Saturday 14 March 2009

Darling may try to contain fiscal deficit

At last, we see the green shoots of sanity pushing through the barren soil of Westminster. Bloomberg reports that Darling might be ready to contain the explosive growth of the UK fiscal deficit. He told reporters at the G20 conference that the government had already plowed "a lot" of money into the economy.

You could say that Alistair; a deficit in excess of 8 percent of GDP does represent a lot of expenditure that has to be covered, sooner or later, by the taxpayer.

Interestingly, Darling's comments come hot on the heels of a recent speech by Kate Barker, a member of the Monetary Policy Committee. She recognized that once the Bank of England's unprecedented monetary expansion starts to feed into the economy, there might be a need to rapidly increase interest rates. "Of course, I recognise that at some point this stimulus may need to be unwound, possibly rapidly, to avoid an overshooting of inflation."

Taken together, it sounds like the Treasury and the Bank of England are waking up to the fact that they might have over-reacted to economic slowdown. They got carried away with red hot language of crisis. They overdid it with the monetary and fiscal stimulus, creating a massive problem of unwinding the historically unprecedented deficit and zero interest rate policy.

The UK economy may end up experiencing a strange paradox. The large deficit and rate cuts were supposed to prevent a recession. However, bringing the deficit under control and re-establishing normal levels of interest rates will require a much tighter policy stance that will actually generate a recession.

We will have a recession later caused by the attempt to prevent a recession today.

7 comments:

Anonymous said...

And we have a recession now.

Anonymous said...

Sanity is in short supply right now.

Anonymous said...

Do you know, I'd happily see Darling stage a putsch against Brown.

Anonymous said...

i.e. after the election...

John Pickworth said...

"... re-establishing normal levels of interest rates will require a much tighter policy stance that will actually generate a recession."

Another recession? Or, indeed, a grossly lengthened continuation of the current one!

This is something I've been trying to explain to folk for months. We simply can't afford these measures. But then they were never about 'doing the right thing', Brown is merely waging the most expensive election campaign in history.

Anonymous said...

I agree: I think Darling should go for it: he is a much nicer guy and I actually have warmed to him. I would prefer him as the Labour leader.

Anonymous said...

成人電影,情色,本土自拍, 寄情築園小遊戲, AV女優,成人電影,情色,本土自拍, A片下載, 日本A片, 麗的色遊戲, 色色網, ,嘟嘟情人色網, 色情網站, 成人網站, 正妹牆, 正妹百人斬, aio,伊莉, 伊莉討論區, 成人遊戲, 成人影城,
ut聊天室, 免費A片, AV女優, 美女視訊, 情色交友, 免費AV, 色情網站, 辣妹視訊, 美女交友, 色情影片 成人影片, 成人網站, A片,H漫, 18成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 愛情公寓, 情色, 舊情人, 情色貼圖, 情色文學, 情色交友, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 色情遊戲, 情色視訊, 情色電影, aio交友愛情館, 色情a片, 一夜情, 辣妹視訊, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊, 視訊美女, 美女視訊, 視訊交友, 視訊聊天, 免費視訊聊天室, 情人視訊網影音視訊聊天室, 視訊交友90739, 成人影片, 成人交友, 本土自拍, 免費A片下載,

美女交友, 嘟嘟成人網, 成人貼圖, 成人電影, A片, 豆豆聊天室, 聊天室, UT聊天室, 尋夢園聊天室, 男同志聊天室, UT男同志聊天室, 聊天室尋夢園, 080聊天室, 080苗栗人聊天室, 6K聊天室, 女同志聊天室, 小高聊天室, 情色論壇, 色情網站, 成人網站, 成人論壇, 免費A片, 上班族聊天室, 成人聊天室, 成人小說, 微風成人區, 色美媚部落格, 成人文章, 成人圖片區, 免費成人影片, 成人論壇, 情色聊天室,


性愛,
成人交友, 嘟嘟成人網, 成人電影, 成人, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 情色, 情色貼圖, 情色文學, 做愛, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲情色視訊, 情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊美女, 視訊交友, 視訊聊天, 免費視訊聊天室, a片下載, aV, av片, A漫, av dvd, av成人網, 聊天室, 成人論壇, 本土自拍, 自拍, A片,成人電影,情色,本土自拍,