The UKs recovery from recession has been slow, in fact the economic recovery since the crash of 2008 is the slowest since 1921, as reported in the Guardian. It’s no wonder things seem so hard looking at the below chart.
The ONS blamed the weather for a low rate of growth: “The strongest evidence was that it reduced retail output in January and March 2013 but boosted demand for electricity and gas in February and March, which increased output in the energy supply industries.”GDP was 0.4% higher in Q1 2013 than in Q3 2011 and therefore has been broadly flat over the last 18 months.”
I think there’s more than the weather at work.
A recession is defined as two or more consecutive quarters of economic decline, the UK has just missed its third recession in four years. Is austerity really working? No it’s not, the UK government needs a different approach and quick but it has nothing to offer.
If this is the worst recovery since 1930 then that should be reflected in the stock market performance and you guessed correctly. It doesn’t.
The stock market has appreciated over 85% since its lows of 2009 but if the economy has just missed its third recession in four years, how is this possible? Quantative Easing is looking like a likely culprit, excess fiat is being pumped into the banks and inflating the stock market to give the appearance of a healthy economy. I’ve discussed that the financial markets are fixed here and here but rather than dwell on fixed markets, have a QE giggle with Mr John Clarke.