"Stock markets in the Gulf states plunged on the week's opener Sunday as panic from the fallout of the global economic crisis continued to dampen investor sentiment.
The slump came despite the approval by leaders of the G20 nations of an action plan on Saturday to restore global growth and prevent future financial upheaval while promising new spending plans and a set of reforms."
Still, for all the talk of action and history-making change, some experts said the outcome was disappointing.
“This is plain-vanilla stuff they could have agreed on without holding a meeting,” said Simon Johnson, an economist at the Massachusetts Institute of Technology and a former chief economist of the International Monetary Fund. “What’s new, except that this is the G-20 instead of the G-7?”
'Dynamic provisioning' (BBC)
"Spain's system has attracted a lot of interest.
In effect, it requires banks to build up a financial cushion in the good years which can help them absorb losses in the bad times when increasing numbers of borrowers fail to repay.
The basic principle is not exactly financial rocket science, although the name it has - dynamic provisioning - makes sound as though it is."
------------------------------------------------"The Prime Minister, who is attending the G20 Summit of the world’s leading economic powers, is keen to present himself as the central figure in international efforts to deal with the credit crunch.
"Although he refused to put a figure on the size of the handout – which is likely to be delivered in tax credits or winter fuel payments – he acknowledged ‘a general view was emerging’ that the Government should plough up to two per cent of economic output into measures to combat the slump.
That would mean spending up to £30billion.."But these efforts have been driven by tensions. At home, the Treasury has counselled caution about ramping up borrowing to pay for a spending boom, while abroad the summit has revealed governments are reluctant to respond to Mr Brown’s call to co-ordinate his tax cuts.
Some Tories claimed last night that the handouts could mean higher taxes for middle-class families later on."
"The Shadow Chancellor’s warning of dangers to the pound came as sterling remained under intense pressure on currency markets.
The pound yesterday slipped to a 13-year low against a basket of other currencies. The dollar rate fell to below $1.48 and the euro rate to €1.17, a record low, capping its biggest weekly fall against the single currency."
"The Bank of England yesterday warned there is a 20 per cent chance the UK could spiral into deflation in 2010. Deflation is the inverse of inflation, and is seen as one of the worst economic diseases a country can catch.It involves a massive squeeze on lending, which leads to sustained falls in prices on the High Street.The costs of food, clothing, cars, electronic goods, and services plummet as companies are forced to repeatedly slash prices. This can drive thousands of firms out of business and send unemployment to stratospheric levels.For those with large debts, the consequences are disastrous. During inflation, debts become easier to service over time as the value of money is eroded.But with deflation the opposite happens, resulting in rocketing debt defaults and more trouble for the banking sector.This last struck the U.S. and European economies during the Great Depression of the 1930s."
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The economic benefits from record levels of immigration to Britain are 'small and close to zero', the Lords was told today.(Daily Mail)
Vicky Redwood, from Capital Economics, said today's figures were only the 'tip of the iceberg' because the labour market lags behind the economy by several months.
'We have not seen the full effect of the recent slowdown in the economy, let alone the full force of the recession,' she said.
'Much worse is to come - we expect unemployment to peak in 2010 at around 3.3 million.'
"Ahead of Wednesday’s unemployment figures, the Cross Party Group on Balanced Migration has published new research which shows that last year thousands of jobs went to economic migrants from outside the European Union – and not a single one of those jobs had to be advertised in the UK first. The Co-Chairmen of the Cross Party Group have written to the Home Secretary, asking her to ensure that all UK jobs are properly advertised in the UK, and to suspend Tier One of the new Points Based System, under which migrant workers are able to come to the UK without any job to go to."
......."Nowhere was this tendency greater than in Britain during what is now dubbed “the age of irresponsibility”. Gordon Brown, chancellor of the exchequer throughout the period, even claimed he had “abolished boom and bust”. The result was not just a disastrous failure to curb growing levels of personal debt in the UK, which had reached the highest level recorded in any large economy by last year. It also meant the Labour government ran the highest budget deficit of any leading western country. It is little wonder that last week the International Monetary Fund joined the European Commission in predicting that Britain would suffer a deeper recession than any of our competitors.
So our response must be both international and domestic."
"Thanks to the wisdom of Gordon Brown, the UK has endured a decade of grossly irresponsible fiscal policy. This is the start of a period of zero-credibility in terms of monetary policy too.
We are kidding ourselves to say "inflation is dead". Fiscal policy and now monetary policy are wildly expansionary. Across the Western world, multi-billion dollar bail-outs are being funded by issuing debt and printing money - which will generate a new wave of inflation, making it even harder to escape the slump.
Suddenly, a consensus has sprung from nowhere that the Western world faces "deflation" - a situation where prices fall. Deflation is dangerous. Debts rise in real terms and price signals stop working."
"However, today's poll underlines the dangers of going to the country next year, giving the Tories a comfortable lead on 43 per cent, against 30 for Labour and 18 per cent for the Liberal Democrats.
If repeated in a general election, the figures would give the Conservatives an 80-seat majority in the House of Commons, the Sunday Telegraph said.
In another boost for Mr Cameron, he was rated the British leader best-placed to build a new relationship with US president-elect Barack Obama, beating Mr Brown by 40 per cent to 35 per cent."
He told an audience at Cass Business School in London on Thursday that the Brown administration is set to throw overboard its entire economic strategy."
"The British economy is facing one of its gravest crises, and Gordon Brown's economic framework has been shown up as a sham. It worked well during the good times, but imploded when put to the test."
"Brown has used three tricks to ensure his survival. First, he has turned to the oldest and cheapest gambit in the political lexicon: he has blamed Johnny Foreigner"
"The Prime Minister's second tactic is deception.
In a stroke that must have brought a gasp of admiration even from his notoriously untruthful predecessor Tony Blair, the Prime Minister now denies that he ever claimed to bring an end of 'boom and bust'.
He insists that he only meant 'Tory boom and bust'.
But it is his third response to the economic collapse that is truly remarkable.
Having abandoned his supposedly immutable economic framework (in April 2002 Gordon Brown declared that 'at all times - now and in the future - we will never compromise our commitment to meet our fiscal rules and disciplines'), he has replaced it with the exact opposite.
Instead of tight controls on borrowing, the Prime Minister and the Chancellor this week made clear that the Government will respond to the downturn with unlimited Government spending."
Brown debts are a 'ball and chain' on Britain, says IFSA report by the influential Institute for Fiscal Studies claimed Government finances are in a far worse state than the Prime Minister admits.
It said the budget deficit is more than four times as high as under the Tories in the early 1990s."
