Britannia Radio

BBC ONLINE
=Ireland unveils emergency budget
The Irish Republic has unveiled its second budget in six months to  
deal with its sharply contracting economy
++economy was likely to contract by 8% in 2009, more than a recent  
forecast of 6.75% and significantly higher than the 3% contraction  
experienced in 2008.
++consumer prices would drop by almost 4% this year.
++will remove toxic assets from banks
++Tax rates - up to ?17500 -2%;  to ?50,000 4% ?300,000+  9%
++ cigarettes +25%
++no change on alcohol or petrol
[Somewhat modest, I would suggest -cs]

===================

This is fighting talk for it undoes a central part of the G20 
agreement. The world is now split between the ECB with its history of 
belated response and the US-UK approach which has been more panic-led.

Since extreme inflation is almost inescapable this is a very nasty 
turn of events this afternoon.

Is it now  'Bye-bye recession'  being followed by "Hello Depression"

xxxxxxxxx cs
=============================
TELEGRAPH 7.4.09
ECB attacks G20 plan to boost IMF drawing rights to pump cash into 
global economy
The European Central Bank has issued a blistering attack on G20 plans 
to use the International Monetary Fund to pump liquidity into the 
word economy, calling it "pure cash creation" outside the normal 
mechanisms of control.

By Ambrose Evans-Pritchard

"This is helicopter money for the globe," said Jürgen Stark, the 
ECB's chief economist and Germany's member on the bank's executive 
board.
"There hasn't been a study to see whether the world needs additional 
liquidity. In the old days one would take a long time to to explore 
such a thing," he told the German business newspaper Handelsblatt.

The paper cited an "unidentified" central banker protesting that the 
G20 had rammed through radical changes that could do "irreparable 
damage" to the global financial system "What is happening with the 
IMF is scandalous. They are going to lay waste to everything in this 
crisis as a result of political horse-trading," he said.

Markets have been in confusion over the implications of the G20 deal 
last week instructing the IMF to issue $250bn (£170bn) in Special 
Drawing Rights, a hybrid instrument that lets governments around the 
world take out an overdraft but also contains the seeds of a global 
currency in is own right.

The summit communique stated clearly that the purpose of the 
activating the Fund's SDR powers was to "inject $250bn into the world 
economy and increase global liquidity". This is separate from the 
move to tripple the IMF's fire-fighting fund to $750bn.

If used to create liquidity, the plan turns the Fund into a proto-
central bank for the world, running an expansionary monetary policy 
over the heads of existing central banks. It appears that G20 
delegations from Germany and other EU states may have signed the 
agreement in the rush last Thursday without studying the exact 
details.  [All together now . . . "ALWAYS READ THE SMALL PRINT"  - 
especially when Gordon Brown's around! -cs]

The use of SDRs on this scale poses a immediate threat to the ECB, 
which is worried about a resurgence of inflation once recovery 
begins. It has pursued a more restrictive "steady-as-you-go" policy 
than the Anglo-Saxons, Swiss, and Japanese.

Dennis Snower, head of the IWF Institute in Kiel, said the scheme not 
only risks inflation down the road but also incubates future crises 
as badly-run countries are able to put off their day of reckoning. 
"If the international community does not take steps against this, the 
future bill for this stimulus could prove expensive," he said.

The dispute between the ECB's hawks and policy-makers in the rest of 
the world stems from a deep disagreement about the nature of this 
crisis. The IMF fears that the globe is in the grip of self-feeding 
spiral akin to the events of the early 1930s. It has warned of 
widespread civil unrest and even wars if this process is allowed to 
unfold.

Berkeley professor Barry Eichengreen, a leading expert on the Great 
Depression, said yesterday that global industrial output has been 
declining at an even steeper rate over the last nine months than in 
the early phase of the 1930s. World trade has fallen much faster this 
time.
"It's a Depression alright," he said.

==================
ECONOMIC  'Shorts'   7.4.09

TELEGRAPH
=Royal Bank of Scotland cuts 9,000 jobs, half in the UK
News of the job cuts came as the taxpayer's stake in the bank 
officially increased from 58pc to 70.3pc after investors shunned its 
share offering.
=Water suppliers to raise bills and cut investment
UK water suppliers are planning to raise customer bills more than 
originally thought and spend less on improving infrastructur
=Dow slides 2pc as Wall Street succumbs to nerves
The Dow Jones fell more than 2pc in early trading amid nervousness 
over financial institutions and the start of the first-quarter 
earnings seas
FINANCIAL TIMES
=New UK car sales plunge in March
Registrations in Britain drop by 30.5% year on year, suggesting the 
UK market has not yet hit bottom and renewing calls for the 'cash-for-
bangers' vehicle scrapping scheme

TIMES
=UK manufacturing falls 13.8% in February
Annual drop in manufacturing was the highest in almost three decades 
as recession hit economy
=BA showdown looms over pay cut fears
The airline has proposed a shake-up of employee pay and conditions as 
it seeks to reduce its in-flight budget by £82 million

BBC ONLINE
=Ireland unveils emergency budget
The Irish Republic has unveiled its second budget in six months to 
deal with its sharply contracting economy
++economy was likely to contract by 8% in 2009, more than a recent 
forecast of 6.75% and significantly higher than the 3% contraction 
experienced in 2008.
++consumer prices would drop by almost 4% this year.
++will remove toxic assets from banks
++Tax rates - up to ?17500 -2%;  to ?50,000 4% ?300,000+  9%
++ cigarettes +25%
++no change on alcohol or petrol
[Somewhat modest, I would suggest -cs]