The party's over

A quick prediction for 2008 that will not warm the cockles of Gordon Brown's heart.

The economy is screwed...

OK, a bit more detail; the economy is well and truly screwed... The pound is about to go into free-fall and so Gordon will want to support it by raising interest rates but that will hit the hard-pressed home buyers who have believed Gordon Brown's "end to boom and bust" rhetoric. Also Gordon has tasked the Bank of England to suppress inflation and even his "preferred" (for which you can read artificially reduced) measure will be going up as inflation enters the economy so the BofE will want to reduce interest rates, but that will suck in more imports and so increase inflation. At earlier points in the economic cycle, Gordon has raised taxes (albeit stealthily) but whilst that was possible in good times without too much protest from the tame media, the media are now less tame and (apart from the ever loyal BBC)increasingly willing to criticise Gordon's government.

It really doesn't look rosy for Gordon, stagflation is on its way and we are in for a very unpleasant four or five years; it could make 1929 look like a mild downturn. Sorry to be the voice of doom but I think it best we face up to reality.