Nearly half of Britons expect another recession


10:01 am - November 13th 2012

by Sunny Hundal    


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Nearly half of Britons think the UK is on course for another wave of bad economic news.

The poll by ComRes for ITV, out yesterday, found that 47% of Britons expect a triple-dip recession. 32% weren’t sure.

It should be an alarming statistic for the government for two reasons.

First, only 21% of respondents had enough confidence in the government not to expect another recession. Just one in five people.

Secondly, expectations of another recession will likely dampen consumer spending, thereby becoming a self-fulfilling prophecy.

YouGov for the Sunday Times this weekend found that only 10% of people expect their situation to get better, while 50% expect it to get worse.

The ITV poll found other bad news for the government too.

More details from the poll are here.

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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments


I think the idea that predictions of a recession will dampen spending are over stated. According to a McKinsey report cited by Robert Peston in Nov 2011 private debt in the UK was 492% of GDP in 2011. The dampening effect of the interest payments on this level of debt are the thing we should be looking at.

But of course private debt does not feature in the models of mainstream economists and politicians so it is not even considered a factor. Not even when the interest alone amounts to something over 50% of GDP. I don’t get why this is not the big news story.

I don’t just expect another recession. I expect the UK to be stagnant at best for at least another 10 years, but probably longer. Compare our GDP grow curve with Japan’s. Look at what happens when Japan has a debt induced recession in 1990. Stagnation for 15 years. And the UK presently has a much larger proportion of debt than Japan had then. Austerity (if it can be called that when over-all spending is rising) will only prolong the agony.

This is a direct result of deregulation of banks, and allowing them freedom to create as much debt as they wanted to, and to use it in ways that suck money out of the real economy. Free market economics always seems to lead to economic instability and inequality.

Luckily, recessions don’t believe in polls.

3. Chaise Guevara

@ Andreas

“Luckily, recessions don’t believe in polls.”

They might, if people get more paranoid about spending as a result. Self-fulfilling prophecy.

Is it any wonder that there is no confidence in the Government to sort out the economy. The other day we had a proposal to postpone the 3p increase in fuel duty from Labour.

Whether or not you agree with this is not important. What is, is that Robert Halfon (Tory MP who campaigns against increasing fuel duty) voted against the proposal from Labour because there’s a chance Osborne might do it in the Autumn Statement.

That’s right, he voted against something he believes in now in the hope that his side can claim the brownie points in the future. How can you have trust that these people will fix the country when they are more interested in playing politics rather then backing motions they agree with?

I would expect confidence to remain low for as long as the Eurozone crisis remains unresolved. The 19 or 20 summits thus far appear to have been aimed at simply preserving the status quo rather than addressing the underlying causes. There’s little to suggest that this attitude will change.

On a more positive note, we may see increased investment in the US now that the elections have taken place.

Exactly:

“Prof Paul de Grauwe from the London School of Economics (LSE) said austerity measures imposed on the Club Med with no offsetting stimulus by the creditors was creating a contractionary bias to the whole system and and leading to a ‘very dangerous situation’. ”
http://www.telegraph.co.uk/finance/financialcrisis/9681868/1930s-medicine-pushes-Europe-back-into-double-dip-recession.html


Reactions: Twitter, blogs
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