[Re: Britain: a case study in low-growth economic mediocrity, Friday]
Historically, inflation has followed an economic recovery – but not this time. British manufacturing (secondary sector) may be helped by a lower pound, but our economy now operates more in the tertiary sector. The real concern is not the manufacturing industry, but the fact that higher inflation will widen inequality. The lower and middle income classes will be hit disproprtionately hard by the combination of falling real wages and rising food and fuel prices. The best policy would be to amend the fiscal stance and drop taxes, and impose regulation to stimulate a supply side revolution.
[Re: We need a consumer revolution to deliver lower utility prices, Monday]
Renewables are more than solar panels and windmills. It’s about efficient energy transmission, battery capacity and longevity, along with the encouragement of technology development outside solar and wind. I’ve never been too optimistic about the prospects for solar in this climate, but its costs do continue to plummet (now 100 times cheaper per watt than 30 years ago). Meanwhile, the efficiency of gas and coal fired plants has barely moved over the last 25 years. Shale gas has a bright future and is a cleaner alternative to coal. And energy self sufficiency should always be encouraged.
BEST OF TWITTER
Cyprus to contract 3.5 per cent this year; Italy by 1 per cent. But President Barroso wants you to believe the “crisis is over”.
Barclays says cash accounts will lose value by 1.5 per cent a year; government bonds by 2 per cent. Inflation is a tax on savers.
NHS spending up 18 per cent in real terms since 2006, even though GDP isn’t higher. With such misalloction, why expect growth?
The Eurozone will not return to growth until 2014. Spain, France to miss debt goals as Eurozone stays in recession.
Readers of City A.M.