If growth\'s the problem, are more ARMs the answer?

BBC : If growth\'s the problem, are more ARMs the answer?

The UK has both a short-term and a long-term growth challenge.

We will know a bit more about the immediate problem later today, when figures are published for UK GDP in the three months to September.

Unless every economist in the UK is as wrong as wrong can be, the stats will not presage a strong recovery - and, at best, they may show that the country stands a chance of avoiding a return to recession.

Which takes us to the longer term question, which is whether there is the remotest prospect that the UK in the coming five to ten years can return to the 3%-a-year growth rate it enjoyed during the putative golden years from 1992-2008.

The problem is that the economic model that achieved the strongest and most consistent growth rate in reliably recorded history - a spending spree by consumers financed by borrowing from the great producing countries like China, Japan and Germany - is kaput.

The great crash of 2007 to 2008 was when it became clear that the UK has to start paying its way in the world, that it's impossible to run current account de ... Continue reading this article at BBC
Source: BBC