It is amusing to watch economists toss around ridiculous terms like "technical recession" to justify their poor forecasts. The entire eurozone is now in recession and the UK was sure to follow because so much of its trade is with the eurozone. This was easy to predict, yet few did.
AFTER the winter gloom that enveloped the British economy last year, with GDP dropping in the final quarter, there have been brighter signs of late. Business spirits are rising and the latest monthly figures for the public finances were better than expected. The immediate threat from the euro crisis has become less existential. But even if Britain does dodge a double-dip recession the bigger issue, both for hard-hit households and a government struggling to contain public borrowing and debt, is just how fast the economy can grow in the aftermath of the financial crisis.
For the past four years, fighting a global economic crisis has been the U.S. Treasury Secretary’s top priority. Though the U.S. economy seems to be entering a period of recovery, President Obama’s Treasury Secretary nominee, Jacob “Jack” Lew, would still face enormous challenges in office.
The Treasury will try to maintain a cautious posture on Wednesday, but start to put the political squeeze on the shadow Treasury team by claiming its dire predictions of mass unemployment have been proved untrue.
The shadow chancellor, Ed Balls, in the US for talks with the Obama administration, has already prepared the ground for the change of economic gear by highlighting the continued squeeze on living standards.