On Tuesday Denmark became the latest economy to leave us trailing in its wake as they came out of recession in the third quarter. Yet it ought to come as no surprise. Over the past 10 years Britain became reliant on financial services activity, property speculation and consumer spending to fuel its £1.3trillion economy.

So it seems that while export-dependent countries like Denmark are growing by a growth rebound around the world, Britain is being held back ‘the big hangover from the credit boom. The Bank of England surely can’t keep rates at 0.5 per cent forever, and the Treasury will have to start hiking taxes and slashing public spending to address its £178bn deficit.

ING economist James Knightley said ‘I think its going to be a very slow, drawn-out recovery.’ To read more on this story go to dailymail.co.uk.

It is no secret that we are now in a full-blown recession but there are many analysts and experts who have mixed views about how long we will be in one. Some say 12 months others say 1 to 2 years, while others say 2 years plus.

The UK Chancellor says we will be out of a recession by the end of the year, but many disagree and say that we have not seen the worst yet. This sort of thing is so hard to guess, but we all have our own views on this.

There are glimmers of hope in the UK, as the housing market has started to see signs of a recovery and mortgage lenders have seen an increase in mortgage applications. Please give us your views below and vote.

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The Bank of England (BoE) is likely to cut the interest rate to their lowest level on record this week. It’s widely expected the BoE with cut the rate by at least 0.5 percent to 1.5 percent.

The Central bank’s Monetary Policy Committee on Thursday ends it’s two day meeting and will announce the cut, some analysts are predicting as much as 1 percent being cut from the interest rate.

It’s also expected that Britain will see another interest rate cut in February, taking the base interest rate below1 percent, this is a huge sign that interest rate will stay low for a long time as the Bank of England tries to soften the blow of the recession.

With house prices continuing to fall, and consumer confidence worsening day by day is unlikely interest rate cuts will lift the UK out of the recession, with the Government suggesting more tax cuts in March and the possibility of going down the route Japan took a decade ago by boosting money supply, but this is said to be a long way off before Britain resorts to those measures.

Source: Reuters

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According to Oxford Economics forecasting company Britain were better off than Italy, France, Japan, Germany and the United States when wealth per capita was measured in dollars in 2007.

With the Recession taking its first bite of the British Economy in 2008, Britain fell in fourth place behind America, Germany and France but it’s predicted that during 2009 we will also be worse off than Italian households.

But with pound falling against the euro sharply there is worse still to come as families living in Britain are faced with the biggest economic contraction of any developed economy. The pound is now worth almost 1 euro, falling sharply in two months when you could get 1.3 Euros to your pound. The Sterling has also fallen hard against the dollar with the pound trading at less than $1.50, earlier this year you would get $2 for your £1.

Reports out last week from the Centre for Economics and Business Research, predict that the UK economy will shrink by 2.9 percent during 2009 making an altogether gloomy outlook for Britain’s economy.

Source: Telegraph

After the Automaker bailout for Ford Motor Co (NYSE:F), General Motor (NYSE:GM) and Chrysler LLC was passed by the House of Representatives it’s looking unlikely that the Senate will pass the bailout after supporters face an uphill struggle on Thursday.

The plan is to provide loans to the value of $15 billion to stop the possible collapse of the carmakers. The House of Representatives passed the bill with 237-170 in favor of the bailout, however they needed a further 60 votes in favor to bypass the Senate.

The collapse of any or all three of the car makers is feared will crucify the US economy and that the bailout is needed desperately as the US sink deeper into recession. With unemployment rising to unforeseen levels and GM Motors, Ford Motor Co or Chrysler LLC collapsed it would result in hundreds of thousands more job losses and an industry collapse.

Source: Guardian

Poland’s deputy Finance Minister, Elzbieta Suchocka-Roguska, said that after November the deficit will reach 15 billion zlotys due to accelerating expenditure in a meeting with Reuters on Monday. In 2008 the Polish government expects a deficit of 22.9 billion zlotys according to their full-year plan targets.

Over the weekend the Polish government set up an anti-crisis package for the value of 91.3 billion zlotys ($31.40 billion) and the Prime Minister said they have cut the economic growth forecast for 2009 from 4.8 percent to 3.7 percent.

Donald Tusk, the Prime Minister of Poland that the government is still determined to put Poland in the euro zone despite the economic slowdown.

The Polish government will talk about the amendment to the budget on Tuesday. The government had also announced that it would be boosting corporate lending by raising 1 billion in capital on the fully nationalized bank BGK bank.

Source: Guardian

Its official Japan is now in recession, according to government figures the Japanese economy contracted in the third quarter by 0.4 percent following the second quarter decline.

Japan the world’s second biggest economy declined months after large companies announced warnings regarding their profits falling and their stocks tumbling.

Since the beginning of 2008 Japanese stocks have fallen by 42 percent, with the Yen strengthening and the demand for export goods weakening.

Economists predict that Japans downwards slope into recession will continue as global growth slows, Japan could see its recession as bad as the Japanese recession from 1997 to 1998 according to analylists.

Source: Telegraph

After last week’s official announcement by both the governor of the Bank of England, Mervyn and Prime Minister, Gordon Brown, Britain is heading into a recession with the added statistics that were published on Friday showing that we have a shrinking economy. We now need to know how to survive the recession.

It will come as a shock for many people under forty to feel affluent one moment and then broke the next, due to the fact that many were too young to have serious careers at the end of the 1980’s when the last bubble burst.

Here is a ten ways you can try to improve your stability as we head toward recession.

One, protect your income with a income protection plan, because the government will only pay 13 weeks after you are made reduntant, and will only pay the interest on loans up to £175,000.

Two, make sure you are paying the lowest rate on your credit cards and if possible transfer your balance to a credit card offering interest free for a longer period of time.

Three, Look at your mortgage and see if you have a better deal, if your fixed rate is coming to a end it may be worth looking at a Tracker rate as its speculated we will receive several more interest rate cuts this year.

Four, protect your savings as the bank of England base rate drops so will the interest you earn on your saving, if you can lock into a high interest saving plan this could be advisable.

Five, take control of your pension, if you are younger than 50 the recent stock volatility will not affect you as much as there are plenty of years left for your pension to recover if it is an investment-linked pension.

Six, fix your retirement income, it may be time to buy an annuity.

Seven, keep a close eye on your final salary pension, if you have a government underwritten pension or strong employer then you do not need to worry.

Eight, shake up your portfolio, with interest rates dropping it may be time to re-look at your investments.

Nine, cut the cost of essential insurance, make sure you are getting the best deal on your car insurance and home insurance; tell your insurer to better the deal.

Last but not least, ten, boost your income, take in a lodger or take on a part time job to supplement your income.

Source: Telegraph

According to Emmanuel Roman co-chief executive officer at GLG Partners Inc., 30 percent of hedge funds could go globally. Roman said that many hedge funds would either go bust or decide that the poor profits were not worth the effort according to several tabloid reports.

New York University Professor Nouriel Roubini also said that hundred of hedge funds will fail and it’s possible that policy makers will have to shut financial markets for a week or more as the crisis continues to force investors to dump assets.

In July 2006 Roubini predicted that America would enter an economic recession, and he also predicted just February this year that there would be a financial meltdown that would be to catastrophic for the central banks to prevent and that it would lead to bankruptcy in large banks.

The hedge fund industry has seen its worse year in two decades, with September being hit the hardest with the biggest monthly fall in a decade.

Roubini also added that things will get a lot worse before they get better talking of the financial crisis that is in Europe and the US and now emerging markets.

Source: Bloomberg

In the three months to September Britain’s economy shrunk by 0.5 percent this is the first decline in 16 years according to official GDP figures. Evidence now shows that Britain is now in the first stage of recession, this being the first time since the early 1990’s.

The housing crash and credit crunch has taken control of Britain’s Economy ending the longest unbroken growth run since 1955. With the national income falling by 0.5 percent making this drop the sharpest since the end of the 1990s.

In the previous 3 months to September the economy was at a standstill with zero growth, but September saw the first decline in the economy.

The fall in GDP was worse than ever expected and sent the pound crashing to a new five year low of $1.5616 against the dollar, London stock market has already took a huge battering as the FTSE 100 index fell 258.86 points or 6.3 percent to 3,828.97.

Source: timesonline