Britain is more optimistic about Brexit than gloomy forecasts suggest

British Weather

The International Monetary Fund (IMF) is up to its usual tricks. Last week, it predicted a two-year recession in the UK in the event of a no-deal Brexit. Even in the main forecast, involving a mild Brexit, GDP was projected to grow by only 1.2 per cent this year and 1.4 per cent in 2020. […]

The coming explosion in natural debt is a serious risk to the economy

Martin Feldstein of Harvard is an economist who should always be taken seriously. Writing in 1997 about the forthcoming introduction of the euro, for example, he argued that “the adverse economic effects of a single currency on unemployment would outweigh any potential gains from trade flows”. He went on to predict that the euro was […]

Is Britain on the edge of recession? History is an unreliable guide

Concerns are growing about a marked slowdown in the UK economy. The Lloyds Bank purchasing managers’ index, for example, fell to 52.1 in April, its lowest point since 2013. The initial estimate for GDP, total output, in the first quarter of this year shows an increase of just 0.4 per cent on the final quarter of 2015. […]

China is drowning in private sector debt: there’s no telling how this one will end

The eyes of the financial and economics worlds are now fixed on China, with focus predominantly on Chinese stock markets and the country’s GDP figures.  A fascinating perspective was provided last week in the leafy borough of Kingston upon Thames.  The university has recruited the Australian Steve Keen as head of its economics department, and it […]

Capitalism is stable and resilient

The financial crisis did succeed in creating one dynamic new industry.  Since the late 2000s, there has been a massive upsurge in op-ed pieces, books and even artistic performances offering a critique of capitalism. A founder member of the Monty Python team, Terry Jones, is the latest to get in on the act with his […]

How Bad Has It Been? 2008-2013 in Historical Perspective

The end of a year is a good time to take stock. For the first time since 2007, prospects for the UK for the forthcoming year look unequivocally good. But looking back, just how bad have the last few years been across the developed world as a whole? And how do they compare with previous […]

A Tale of Two Recessions: Grounds for Optimism

The economic news at the moment is mixed, and the impact of the 2007-2009 financial crash is far from over. But looking back into the past may give us something to feel cheerful about. There have only been two global financial crises in the past century, that of the early 1930s and the most recent […]

Expansionary fiscal contraction

To many people, this phrase is an oxymoron. How can fiscal contraction be expansionary? But the evidence suggests that this is exactly what has been happening in the United States. In terms of national output, GDP, the trough of the trough of the recession was reached in the second quarter of 2009 (2009Q2). We have […]