Bloody Hell, Harry! as Ron Weasley would say to Harry Potter.
UK GDP has contracted 2.4%, the fastest rate for more than half a century, for an aggregate fall of activity of 4.9% compared with Q1 2008, itself the largest on record.
Still, Gordy and Mandy to the rescue, as they will not cut public spending in a recession, even one of their own making. The OECD and others think that maybe they should think about it a bit harder.
In the least surprising development since the Garden of Eden, foreigners are shunning the UK's debt. Which is a bit of a self-fulfilling cycle. Because as the interest rates that are paid on bonds are raised, to make them more attractive to investors, then the price of the existing bonds goes down. (If that sounds daft, it's because you don't understand net present value.)
So, if you think that the bonds are going to go down in value, you won't buy them. So, the government gets a kind of debt strike by foreign investors. It's dangerous waters, and the bond holders who drive this spiral are called the bond vigilantes.
Going to be an interesting ride in the UK for the next couple of years.
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