UK Economy Grows By 0.8%

ONS statistics published today show that Britain's economy grew by 0.8% between July and September of this year, that is the best performance since Q2 2010. The services sector accounted for the majority of the growth, itself growing by 0.7%.

It is encouraging to note that Mark Carney, the Governor of the Bank of England, has said that the Bank will not rush to raise interest rates or withdraw support for banks.

Now if the government could only bring itself to simplify the tax system, and indeed lower taxes, we might be assured that this growth can be maintained!

Greece's Budget Deficit Falls

Apparently, if statistics from eurostat can be believed, Greece's budget deficit for 2012 has been revised down from 10% of GDP to 9%

However, before popping the champagne corks, it should be remembered that debt stands at 156.9% of GDP.

UK Economy Grows By 0.6%

The UK economy grew by 0.6% in the second quarter compared to the first three months of the year, according to the Office for National Statistics (ONS).

George Osborne tweeted the following reaction:

"GDP stats better than forecast.Britain's holding its nerve, we're sticking to our plan, the economy's on the mend.But still a long way to go"

However, as I always caution, when it comes to ONS statistics never trust them. They are always out of date and subject to revision.

In the meantime whilst people crack open a can of lager to celebrate the modest signs of economic recovery in the UK, let us not forget that China frets when growth bumps along at a "mere" 7%!

China's 7% Bottom Line

China's Premier, Li Keqiang, has underpinned global markets by stating that China’s “bottom line” for GDP growth is 7%, and the nation can’t let growth go below that.

Seven percent is not too shabby at all!

I would note that had a similar statement been issued by the ECB, wrt there being a bottom line for growth for the Eurozone (albeit with a bottom line of growth of far less than 7%), no one would have believed it!

Chinese Growth Falls To 7.5%

As expected China's economic growth slowed to 7.5% in the second quarter of the year.

The Chinese statistics bureau said the slowdown was partially due to deliberate efforts for structural reform and that a slower pace of growth was preferable in the long term.

Sheng Laiyun, spokesman for the National Bureau of Statistics, is quoted by the Telegraph:

"Some measures, including the intensified property tightening campaign, new rules to curb misuse of public funds and the exit some previous stimulus policies, will inevitably have some impact on growth in the short term, but they will benefit our economy in the long run."

Were this any other country such a rate of growth would be considered to be excellent.

The reality is that exceptional levels of growth, such as this, cannot continue indefinitely. Given the size of China and its economy, growth in excess of 7% isn't too shabby at all.
 

UK Avoids Triple Dipper

In a small ray of sunshine, the Office for National Statistics (ONS) reports that Britain's economy grew by 0.3% in Q1 of this year; thus the UK has avoided entering its third technical recession by the skin of its teeth.

The 0.3% rate of growth even managed to be larger than the 0.1% predicted by economists.

However, before people break open the Bollinger, it should be remembered that 0.3% is not exactly "stellar" and that China is feeling very sorry for itself having "only" managed to grow by 7.7%!

However, as I always say, never rely on ONS statistics they are out of date and will be revised upwards/downwards in due course.

China's 7.7% Growth Not Too Shabby!

China's GDP grew by 7.7% in Q1 2013, down from 7.9% in Q4 2012.

Were this any other country such a rate of growth would be considered to be excellent.

However, analysts have programmed themselves to expect ever improved levels of growth in China; thus many have been disappointed by the figures.

The reality is that exceptional levels of growth, such as this, cannot continue indefinitely. Given the size of China and its economy, growth in excess of 7% isn't too shabby at all.

The doom sayers need to calm down and take a more measured view.

UK Economy Flatlines

The UK economy shrank by 0.3% in the final three months of last year, and posted zero growth for the year as a whole.

Many now expect the UK to go into a triple dip recession.

ONS Revises Its Figures Yet Again!

On July 25 I wrote the following:

"UK GDP has contracted by 0.7% in the second quarter of 2012, thus bringing the UK into a double dip recession.

However, this figure needs to be taken with a pinch of salt, ONS figures are out of date and are invariably wrong."

In August I wrote the following:

"As predicted, it transpires that the ONS figures were of course wrong. Economia reports that the ONS has revised its figures upwards from -0.7% to -0.5%."

One month on and the hapless and hopeless Office for National Statistics (ONS) have yet again revised their figures upwards, this time to -0.4%.

As I have noted many times before it is extremely unwise to rely on figures provided by the ONS, they are always out of date and invariably wrong; eg in February this year inflation figures spiked partly because the ONS (as per usual) had been erroneously under reporting inflation (clothing) for several years, and the resulting correction caused a spike in inflation.

Instead of the government and the Bank of England relying on and using ONS figures to to try to manage the economy, they may as well rely on reading goat entrails as these would be more accurate, timely and easier to interpret!

ONS Screws Up Again

On July 25 I wrote the following:

"UK GDP has contracted by 0.7% in the second quarter of 2012, thus bringing the UK into a double dip recession.

However, this figure needs to be taken with a pinch of salt, ONS figures are out of date and are invariably wrong."

One month on and, as predicted, it transpires that the ONS figures were of course wrong. Economia reports that the ONS has revised its figures upwards from -0.7% to -0.5%.

As I have noted many times before it is extremely unwise to rely on figures provided by the ONS, they are always out of date and invariably wrong.

Shackled To Debt

Britain (like every other significant national economy) is shackled to debt.

The UK public sector net debt has risen to £1.022 Trillion, that is the equivalent to 66% of GDP and the highest since records began.

Some are questioning how this can happen, given that the politicians have launched an austerity programme designed to cut back on on debt.

The answer is simple.

The "planned" cuts and austerity drive will never cut the actual level of debt, at best the cuts will reduce the rate of increase of debt.

We are destined to be shackled to debt for the rest of our lives!

Greece's Deathmarch Continues

The Foundation for Economic and Industrial Research (IOBE) reports that the Greek economy will continue to shrink (5%) this year, and that unemployment is at 20%.