From Times Online
August 27, 2009

in brief:























Business investment slumped by a record annual rate of 18.4 per cent in the second quarter, raising fears that the economic contraction between April and June could have been bigger than initial forecasts.

The amount spent by businesses on a range of investments, from new computers to building works, fell to £29.8 billion in the second quarter of the year, down 10.4 per cent from the first quarter and 18.4 per cent lower than the same period last year, official figures show. This is the biggest quarterly drop since 1985,

The annual decline is the largest since official records began in 1967.

"The massive 10.4 per cent quarterly fall in investment in the second quarter was stunning, much weaker than had been expected and consistent with further retrenchment in the domestic economy," Colin Ellis, European economist

The worse than expected data has led some analysts to speculate whether revised GDP figures, out tomorrow, could show sharper decline than current estimate of a 0.8%.

“Unless there is an upward surprise elsewhere in the breakdown that offsets the diabolical business investment component, we could be looking at a downward revision to -1 per cent or lower,” Alan Clarke, economist at BNP Paribas

There are also fears that the dire investment data could also hamper the country's recovery from recession as it becomes clear that company spending cannot be relied on to boost the economy.

“Manufacturing investment has been a casualty of the global recession as both cashflow and confidence have been hit hard," Lee Hopley, head of economic policy at the Engineering Employers’ Federation. “Such a rapid and significant pullback in investment in modern machinery and equipment presents risks for a durable recovery, especially as investment intentions can be slow to recover following a downturn.”

Full article: http://business.timesonline.co.uk/tol/business/economics/article6812176.ece

Fluff.....

But we exited the recession in June?? surely the April-June figures are statistically different!! Why would the media and TV economists lie? surely their not on the pay roll of the propaganda elite!!

oh well I shall invite the past to tell me all about corruption and lies!
I shall be doing a section on that as well.