Download - Risks of a Double Dip Recession
Risks of a Double-Dip Recession for the UK economy
Mervyn King predicts choppy times aheadWe are facing a difficult time ahead with a slow and prolonged adjustment to the consequences of the banking and financial crisis
Mervyn King, May 2011
Growth is slowing down
Growth slower, prices higher and unemployment rising – not good
What could cause a double-dip?Retail slump as
real incomes fall
Weak export markets hit UK
Falling business confidence
Fresh recession in housing
Squeeze on public sector jobs
Consumer confidence on the wane
Many people expect unemployment to rise in the next year
And there are fewer jobs available for those out of work
Retail sales have sagged
Real disposable income is falling
Savers continue to be hit hard by negative real interest rates
Business investment dipping again
The UK mortgage market remains subdued
Few new houses are being built and many lost jobs in building trades
Even with inflation > 4%, interest rates set to stay low
The squeeze on state spending is coming in over the next 3 years
A rising tax burden will cut disposable incomes and domestic demand
Can the UK’s export industries provide a kick-start to a faltering economy?
Growth for a selection of EU countries
Stimulating demand and jobsBoosting the money
supply for the banking system
Taking advantage of lower currency
Measures to boost house-building
Encouraging innovation &
enterprise
Banking reforms to boost lending to
businesses
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