The Perfect storm is continuing to build, the government austerity plan, reducing the public sector, cutting benefits (now appears to cost more than they save) and increasing tax to individuals and the private austerity confirmed in an ICM poll with two-thirds of Britons think the economy is getting worse and most are cutting back drastically on their spending to make ends meet in the face of rising food, fuel and energy prices.
The findings follow a string of retail failures in recent months as shoppers cut back on non-essentials while Britain’s economic recovery remains sluggish
Official data showed that Britain’s economy grew by just 0.5 percent in the first three months of 2010, a muted bounce from Q4’s dismal 0.5 percent contraction.
Figures also showed the biggest fall in households’ disposable income in more than 30years the Office for National Statistics said that in the year to the end of March, real incomes - adjusted for inflation - fell 2.7%, a fall not seen since 1977 with higher taxes, domestic bills and inflation are all eating away at consumers' spending power.
Let us be clear, the CONDEM government has made and continue to make false claims about the British economy, the previous government NEVER left the country bankrupt, only Canada had a lower sovereign debt % of GDP, but this dangerous talk has frightened consumers, this led to a collapse in consumer confidence predates and predicts the collapse in consumer spending that is now devastating the high street: the value of goods sold in the high street fell by 1.4 per cent in May, which isn't surprising, given that real disposable income fell 0.8 per cent in Q1 2011, after a fall of 0.9 per cent in the previous quarter.
Now the CONDEM government has done little to tackle the financial sector, the sovereign date crisis in southern Europe could well be the tipping point that will be the shock to send our economy into recession, if Greece or Portugal defaults on their loans and with the banks inter connected through Europe and beyond, the final ingredient in the perfect storm, reminiscent of the Great Depression.