Wise Money doesn't feel any better off
The Chancellor duly delivered his pre-Budget Statement to an enthralled world and largely produced what had been anticipated.
The known factors are worrying enough, the unknown components of the cure will keep economists employed for years to come, pontificating the why's and the wherefore's.
An interesting quote within an article in the Times this morning attributed to JK Galbraith; there are 2 types of economists, those who don't know what will happen and those who don't know they don't know'. Over the next few months/ years, there will be plenty of the latter.
Anyway, both Sterling and the Stock Market ended higher; more on a weaker $ and on relief over the Citicorp rescue than a passion for all things UK related but was not well received by the Gilt market which in turn pushed up the price of hedging against losses on labour government bonds (CDS's on gilts).
In other words, the UK as an investment was perceived to be less secure at the end of the day than it had been at opening.
Yesterday saw the November German IFO index of the business climate dive off once more to a cyclical low of 85.8 the record low was back in October 1982 at 76.7. This however marks the starting point for a lurch lower in statistics from both Germany and the Eurozone.
Today's 3rd Qtr German GDP release will undoubtedly be the portent for sharply lower 4th Qtr figures to come. From this we can see that the latest news is decidedly not good. The economy is spiralling downward towards zero with the pace of price increases following the same road.
This is a good scenario for bonds but bad for everything else. We have 3rd Qtr GDP for the US, this afternoon and the same for the UK tomorrow. A great chance for a comparison of the 3 economies.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
The known factors are worrying enough, the unknown components of the cure will keep economists employed for years to come, pontificating the why's and the wherefore's.
An interesting quote within an article in the Times this morning attributed to JK Galbraith; there are 2 types of economists, those who don't know what will happen and those who don't know they don't know'. Over the next few months/ years, there will be plenty of the latter.
Anyway, both Sterling and the Stock Market ended higher; more on a weaker $ and on relief over the Citicorp rescue than a passion for all things UK related but was not well received by the Gilt market which in turn pushed up the price of hedging against losses on labour government bonds (CDS's on gilts).
In other words, the UK as an investment was perceived to be less secure at the end of the day than it had been at opening.
Yesterday saw the November German IFO index of the business climate dive off once more to a cyclical low of 85.8 the record low was back in October 1982 at 76.7. This however marks the starting point for a lurch lower in statistics from both Germany and the Eurozone.
Today's 3rd Qtr German GDP release will undoubtedly be the portent for sharply lower 4th Qtr figures to come. From this we can see that the latest news is decidedly not good. The economy is spiralling downward towards zero with the pace of price increases following the same road.
This is a good scenario for bonds but bad for everything else. We have 3rd Qtr GDP for the US, this afternoon and the same for the UK tomorrow. A great chance for a comparison of the 3 economies.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
Labels: credit crunch, UK interest rates, UK recession, wise money
posted by Dr Search- Principal Consultant at the Search Clinic @ 12:01 PM
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