Britannia Radio

On a day that the Bank of England suffered a rare humiliation as it 
failed to sell the gilts ('bonds') on issue causing a fall on the 
stock exchange  and on the day after Brown was humiliated in 
Strasbourg by two stinging attacks from British MEPs AND only a few 
MEPs turning up to hear him , it becomes more and more clear that 
Brown is not gaining support abroad but losing it!

In addition Mervyn King went straight to Buckingham Palace from the 
parliamentary committee for an audience with The Queen.  Even the 
Times is speculating as to whether or not HMQ knew in advance and had 
approved what Mr King said.

We live in very strange times and I've just started on Brown's NY 
speech and will see if it's worth recycling!!!

XXXXXXXXX  CS
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TELEGRAPH 25.3.09
King correct to warn Labour against more public spending splurges
Inflation is not back - more's the pity.

By Damian Reece

If Tuesday's bizarre outcome on the cost of living was sustainable it 
might, just might, reveal that the economy was stronger than we 
thought and demand had not completely evaporated but was still 
capable of applying some upward pressure to prices.

However, RPI at zero and CPI at 3.2pc reveal as much about flawed 
statistical measures as any change in how the economy is behaving. 
The inflation figures were strong only in the same way that a fish 
thrashing in the bottom of a boat can be surprisingly energetic, but 
not something that lasts.

The main reason RPI did not fall into negative territory (or 
deflation) and that CPI was still more than a full percentage point 
above the target 2pc level, was the weakness of sterling. We face the 
far more gloomy outcome of a shrinking economy with falling wages 
cursed by rising prices fuelled by escalating import costs. The 
reason for our weak currency? The disastrous state of the UK's public 
finances and the £118bn plus Alistair Darling will have to borrow in 
the next financial year.

A falling pound ought to be good news for exports but even our 
foreign earners won't be enough to help us out given how quickly 
unemployment is rising.

Falling housing and energy costs are welcome and will help matters. 
Being cheery, the best outcome will be only a short period of 
deflation which will be reversed as the economy picks up. I'm sorry 
if this sounds like wishful thinking but it's the best I've got. 
Mervyn King, Governor of the Bank of England, is a bit more upbeat, 
suggesting the benefit of recent interest rate cuts and its 
quantitative easing programme are still to come.

Whether you believe him or not on this point, King was right on 
Tuesday to warn the Government over further public spending splurges. 
Given the long term damage Labour has helped cause to the economy, 
and sterling, we really can't take much more punishment.
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ECONOMIC  'Shorts'   24.3.09

TELEGRAPH
=Brown seeking to win over US bankers with his 'vision'
Gordon Brown is seeking to win over leading US bankers to his vision 
for reforming the global economy during a visit to the country. [today]
=HSBC to cut 1,200 UK jobs
HSBC is planning to cut as many 1,200 jobs from its British 
operations as it looks to reduce its annual cost base in the midst of 
the global financial downturn.
=Legal & General halves dividend
Insurer halves final dividend payment to shareholders after reporting 
a full-year loss and warns of futher job cuts.
=Wages fall in private sector for first time, but rise for public 
sector workers
Wages in the private sector have fallen for the first time since 
official records began eight years ago, with workers paid nearly £16 
less a week than a year ago.
The average weekly wage for a private sector worker fell by 3.4pc in 
January to £448, compared with a year before when it was £463.80.
This is the first annual fall since the Office for National 
Statistics started collecting this data in 2001

FINANCIAL TIMES
=UK retail sales worsen in March
The pain on the British high street worsened in March, as retailers 
reported further falls in sales and said they did not expect any 
improvement next month, according a survey by the CBI employers group