Tag Archives: recession

Recession Britain, it’s official: but don’t lose hope!

It’s a a hard Friday for the UK: it’s official we are in recession. Probably it’s not exactly news, but all the newspapers have opened today with new even darker predictions for the future.

The BBC.co.uk reports: “The UK is now in recession for the first time since 1991, official government figures have confirmed. … That means that the widely accepted definition of a recession – two consecutive quarters of falling economic growth – has been met”.

The Guardian.co.uk says: “Britain has officially entered recession for the first time since 1991, after the economy shrank at the fastest pace for nearly 30 years in the fourth quarter”.

The Timesonline.co.uk explains: “Britain is in the grip of its sharpest recession for three decades, grim official figures confirmed today. The economy suffered a brutal 1.5 per cent drop in Gross Domestic Product (GDP) during the past three months, shrinking at its fastest quarterly pace since 1980”.

People in London feel the pressure: unemployment is accelerating sharply, with 1.92 million people now out of work, the housing market remains severely depressed and retail sales are weak. There are no ‘green shoots of recovery’, no light at the end of the tunnel. The average recession in the UK since 1955 has lasted for three quarters, but the past two recessions have lasted for five. But people don’t lose the hope and the will to do and work.

The latest news bites

Good afternoon and welcome back. It never rains but it pours:

1. “Recession will hit UK hardest” – says the Guardian.co.uk -, economists predict slowdown will be sharper in Britain than in any other major European countries and Britain will suffer a deeper recession than any other mature EU economy. Consequence? The European Commission’s latest half-yearly forecast predicts UK unemployment will rise from 5.3% in 2007 to 7.1% in 2009 — which would bring the number out of work to about 2.25 million.”

2. “HBOS deal to save Lloyds £1.5bn,” writes BBCNews.com. “Lloyds has said that its acquisition of HBOS would save it at least £1.5bn a year, raising fears of heavy job losses from the merger. Both banks have also unveiled further write-downs on assets ravaged by the credit crunch, with HBOS hardest hit. The banks also detailed plans to raise up to £17bn as part of the government’s bank bail-out plan. Unions said that the banks should think about the human cost of the takeover and avoid compulsory redundancies.”

3. “Ryanair profits fall sharply,” reveals today’s Financial Times. “[Its] profits fell heavily in the first six months under pressure from the doubling of fuel costs, and the group forecast that it would be in loss during the second half of the year… The group, Europe’s largest low cost carrier, had only “limited visibility” of forward bookings, but from October to March would fall by between 15 and 20 per cent leading to losses in the third and fourth quarters.”

4. WorldNews explains, “Gordon Brown hinted at another emergency global interest cut yesterday amid warnings that UK unemployment is set to soar to almost 3million. The Prime Minister promised ‘co-ordinated action’ across the world as pressure grew on the Bank of England to slash the cost of borrowing by as much as 1 per cent this week.” We shall see.

5 news bites for your coffee break

Here is a quick press review selected from the most interesting business news of the day:

  1. Pound Falls to 5 Year Low Against Dollar: the pound slid to the lowest level in more than five years against the dollar after the Bank of England Governor Mervyn King said Britain’s worst banking crisis since World War I is likely to push the economy into a recession – read more on bloomberg.com.
  2. Factory gloom ‘worst since 1980’: the slowdown in the UK economy is now spreading to sectors previously resilient to weaknesses in the banking and housing markets. The crisis is spreading into all sectors of business, affecting unemployment and inflation – read more on BBCNews.co.uk.
  3. Soaring art market returns to earth with a bump: the global financial crisis has finally caught up with the art world. Experts warn that things are likely to get tougher: what’s happened in the financial markets will also damage the art market because liquidity is tighter everywhere – read more on Reuters.co.uk.
  4. European business backed up: during this crisis, resultant cuts in jobs, production and investment, means companies must hunker down hoping to survive what they fear will be a ferocious reversal – read more on Ft.com.
  5. David Beckham will join AC Milan on loan in January: the English football player will move to Italy for few months at the beginnig of 2009, according to Adriano Galliani, the Italian club’s vice-president. Beckham wants to train and play with Milan, and Milan wants him: Beckham’s commercial value means full stadiums and read sponsors. Maybe not all rich men are crying – read more on Thetimesonline.co.ukthe English football player will move to Italy for few months at the beginning of 2009, according to Adriano Galliani, the Italian club’s vice-president. Beckham wants to train and play with Milan, a sentiment reciprocated by the Italians: Beckham’s commercial value means is nothing but good news for club merchandise and ticket sales – read more on Thetimesonline.co.uk