The Sun blames Brown for coming economic recession

That Blair supporting rag, the Sun, has launched an attack today on Gordon Brown for his mis-handling of the economy predicting massive unemployment, business failures, house repossessions on a huge scale and a house price crash etc etc. While all the economic info is basically correct and we are facing a recession I can't help suspecting that this article was cooked up in league with that malodorous piece of shite Alastair Campbell and/or slimy Peter Mandelsson in order to spike Browns guns in the forthcoming leadership challenge :
The SUN 11th May
It's the Brown stuff Gord
Boxed in? ... Gordon Brown faces a shaky economy
By IAN KING Business Editor
CHANCELLOR Gordon Brown was the hero of Labour's General Election campaign.
Prime Minister Tony Blair's gushing praise credited him with creating eight years of unbroken economic growth.
But the dark clouds are gathering - and they point to stormy times ahead.
High Street sales in April were down by almost five per cent on the same period in 2004 - the biggest year-on-year fall since records began a decade ago.
Unemployment is also rising. In December, January and February, 29,000 people lost their jobs, lifting the jobless total to 1.43million.
Since then, MG Rover has gone bust, putting another 6,000 people on the dole and potentially hitting 15,000 people working for suppliers to the car-maker.
Telecoms equipment maker Marconi last week announced plans to lay off 800 staff, while computer giant IBM said it was axing 13,000 jobs in Europe - many of which will be in Britain.
And yesterday it emerged another 1,000 jobs are to go at Abbey National.
But unemployment is not the only sign that the UK economy is souring.
House repossessions are at their highest level for ten years with 25,900 orders going through the courts in January, February and March - 25 per cent up on this time last year and the highest since 1995.
On Friday, there was more bad news. We already knew that, as a nation, we Brits owe a staggering £1TRILLION in mortgage borrowing, credit cards, bank overdrafts and so on.
This is now coming home to roost. In the first three months of this year, 13,229 people declared themselves insolvent - the highest figure since records began in the 1960s.
Consumers, worried about their debts, have been hit with FIVE interest-rate rises since November 2003, rocketing council tax bills and National Insurance hikes.
Now they are seeing household bills soar - with inflation at its highest level since May 1998 due to increases in the cost of food, petrol and air fares.
Utility bills are also climbing, following a surge in oil prices.
The result of all this, unsurprisingly, has been a collapse in household spending - and the High Street is screaming in agony.
But it will get worse as council tax re-banding pushes up bills for millions.
Hundreds of thousands of homeowners who locked into cheap mortgages two years ago when interest rates were at all-time lows will see those deals unwind, ramping up mortgage bills. That means shops will suffer further, particularly if unemployment continues to grow.
James Carrick, economist at City stockbroker ABN Amro, believes we could see one in 20 stores close in the next three years, "resulting in 150,000 shop-workers losing their jobs".
In all, he reckons total unemployment will rise by HALF A MILLION by 2008.
And there are other reasons why dole queues are set to lengthen.
Profits are being squeezed as businesses are forced to pour more cash into their pension schemes, partly to make up the £5billion the Chancellor has plundered from every year since 1997.
Companies are also reeling from the NI hike as well as from rises in local business rates, higher payroll costs from the minimum wage plus higher heating, lighting and transport bills after oil-price growth.
Tesco chief executive Sir Terry Leahy recently complained: "Like a tide, the level of taxes seems to be forever rising. The water is now above our waist."
With the UK economy growing less rapidly than Mr Brown predicted, he will rake in less from income tax, NI, VAT and corporation tax than he expected. And that means he will have less to spend.
Mr Brown has saturated business with higher taxes already, so personal taxes will probably have to go up instead.
Pensions loom large as another threat while one more imponderable is the housing market.
Stuart Thomson, of broker Charles Stanley Sutherlands, claims: "Property prices are more than 30 per cent over-valued relative to their long-term trend."
The whole situation amounts to a nasty headache for Mr Brown in the coming months.
And if the housing market cracks, it will feel more like a stroke.
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Reply to
crowleyalastair
Too much Sun can give anyone a nasty headache but that's nothing to what western society as a whole is in for, imv.
G8 at Gleneagles is the next piece in the ongoing farce turned black comedy.
l
Reply to
leðurblaka

Just caught up with a great article featuring an interview with Doug Noland. Noland has done extensive research on the current credit bubble and makes me look like an optimist. This interview covers the various aspects of the current problem and some thoughts on how things might play out:
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FoFP
Reply to
M Holmes
mysteriously appeared thru the usenet mist to inform us thus...
Maybe, it's right up their street ...of equal interest is that all of these poor economic indicators were available *during* the election campaign but mainstream media failed to flag them up for fear of causing Blair's little bubble to burst. Truth is that Brown's so-called economic miracle will soon look like a mirage...
Reply to
hummingbird

I've every confidence that Brown will do for the Country what he did for the pensions industry.
FoFP
Reply to
M Holmes

The Sun, however, used to think we should vote Conservative. I must confess it's a paper I don't often read but presumably you think it must have allowed its previously high standards of political and economic reporting to slip in recent years.
Steve
Reply to
Stephen Glynn


It was Ian who inferred by his remark that the Sun was a joke newspaper.
Gaz
Reply to
Gaz

It makes interesting reading if your read past comments that certain people have wrote in the newsgroups quoting this and that report about house price falls and the collapse of the economy. I have read one past post for Dec 2002 which claimed a report that house prices would fall by 30% the following year, well we know the rest. Others from 2000 talk about the soon to burst credit bubble that is about to burst, it didn't happen. In fact one report was by yourself who in Sept 2002 pointed to a report that claimed a world wide rescission was looming, must of passed us by It is a warning that to those who use these reports to shore up their views, I do not see any difference or reason to believe their claims now as their sources seem as accurate as ever
Reply to
Chris.S

It makes interesting reading if your read past comments that certain people have wrote in the newsgroups quoting this and that report about house price falls and the collapse of the economy. I have read one past post for Dec 2002 which claimed a report that house prices would fall by 30% the following year, well we know the rest. Others from 2000 talk about the soon to burst credit bubble that is about to burst, it didn't happen. In fact one report was by yourself who in Sept 2002 pointed to a report that claimed a world wide rescission was looming, must of passed us by It is a warning that to those who use these reports to shore up their views, I do not see any difference or reason to believe their claims now as their sources seem as accurate as ever
Reply to
Chris.S

Not easily though. Check the Bernake paper in 2003 in which the strategy for escaping oncoming deflation was outlined, and then pursued in the US and elsewhere by dropping interest rates to emergency levels.
Yes, we very narrowly escaped a deflationary recession which would have followed the stock bubble bursting. However, I contend still that we escaped it only by storing up a larger credit bubble, which will at some point burst and produce a recession far worse than the one we escaped in 2003.
We'll see. The traditional point for these manipulation to fail is when they attempt to pass leadership from a tired consumer bubble based on debt, to private company investment. It looks to me like the baton pass is now being attempted. Let's see if the runners stumble.
FoFP
Reply to
M Holmes

Where could I find this?
What exactly do you mean emergency levels, I don't recall our interest rates being reduced to emergency levels.
Well I think that is the point, we have. We have seen many reports forecasting house price collapse, recession, and bubble bursts, the only thing that holds constant in these posts is their ability to get it wrong.
Not sure what you mean, could you expand
Reply to
Chris.S

But it is, isn't it? Surely no one takes its voting recommendations any more seriously than they do its coverage of economics?
Steve
Reply to
Stephen Glynn

Well house prices near me have fallen by around 20% in the last six months, and the houses aren't selling.
If that isn't the beginning of a crash, I don't know what is.
Reply to
Jonathan Bryce

They may be falling where you live, there may be reasons aside from housing slump, but the best measure are national stats and they don't show anything what you claim.
Reply to
Chris.S

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