Twin imposters triumph and disaster lurking

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No InstallTaonga: The Island Farm Tags: NULL Show Comments ▼ whatsapp Sunday 5 December 2010 11:07 pm KCS-content center_img So here we are just a few weeks before Christmas and those twin imposters triumph and disaster lurk behind every corner. England lose a brilliant World Cup bid that they could never win, only for the cricket team to comprehensively outplay Australia and take control in the Ashes. On Coronation Street four actors will lose their jobs as their characters are killed in a  huge tram crash but it will drive the ratings and help celebrate 50 years of  Britain’s oldest soap. Last but not least, George Osborne does jigs of delight after the OBR statement and manufacturing data vindicates his polices only for …..?  Well exactly, only for what? WILL AUSTERITY BITE TOO HARD?When  spending restraint digs in next year, will it combine with an even weaker housing market to send consumers and the economy over the edge? Or will the private sector and manufacturing and industry continue to create jobs and keep us going, albeit at a reduced pace? It’s an issue on which the Bank of England’s monetary policy committee, which meets this week, is hopelessly split and is likely to remain so for a while.  The fact is that no one really knows. We can make educated guesses but, a bit like the World Cup, the analysis could be fatally flawed if we’ve made the wrong assumptions.  The England bid team assumed that when a FIFA Executive committee  member shakes hands and says  they’ll give their support, they mean it.  Mervyn King assumes large amounts of spare capacity in the economy and the government’s austerity drive will help weaken growth and keep down cost push inflation. TURKEYS KNOW TO KEEP HEAD INNow turkeys know not to stick their necks out too far at this time of year, but, at the risk of being stuffed, here’s my sixpence worth. We spent 2009 worrying about 2010 and 2010 worrying about 2011.  In that time the UK consumer has been written  off more times than bad debt. Now I admit spare household income should be less next year as wages rise less than inflation and the costs of living – in terms of energy, food and clothing – go up, but I believe global growth will still be fairly buoyant and Britain as an open economy will benefit. MUDDLING ALONG OK FOR INVESTORSTherefore I predict we will muddle through, with the risks on the upside as we find out the effects of austerity are not as bad as feared. And that could be just perfect for investors, with weak enough growth to keep bond yields and interest rates anchored and just enough growth to keep profits at cost efficient businesses chugging along. In fact, stock markets could be well supported by cash rich companies. They will  either increase  merger activity, pay higher dividends or increase share buybacks.  FURTHER PREDICTIONS FOR 2011Oh, and as for my other big assumptions: Europe’s politicians will do whatever it takes to minimise the euro crisis, China will find the right policy mix to keep its economy going at the right pace and the US will deliver growth that’s good enough for company profit but not enough for big job creation.    As I say, it’s only a forecast and if it’s a disaster  I’ll meet it with the triumph of reclaiming my sixpence back from the Christmas Pudding.      Ross Westgate co-hosts Worldwide Exchange daily on CNBC and also anchors Strictly Money — www.cnbc.com     More From Our Partners Brave 7-Year-old Boy Swims an Hour to Rescue His Dad and Little Sistergoodnewsnetwork.orgFlorida woman allegedly crashes children’s birthday party, rapes teennypost.comAstounding Fossil Discovery in California After Man Looks Closelygoodnewsnetwork.orgMark Eaton, former NBA All-Star, dead at 64nypost.comRussell Wilson, AOC among many voicing support for Naomi Osakacbsnews.comPolice Capture Elusive Tiger Poacher After 20 Years of Pursuing the Huntergoodnewsnetwork.orgKiller drone ‘hunted down a human target’ without being told tonypost.comNative American Tribe Gets Back Sacred Island Taken 160 Years Agogoodnewsnetwork.orgA ProPublica investigation has caused outrage in the U.S. this weekvaluewalk.com980-foot skyscraper sways in China, prompting panic and evacuationsnypost.comMatt Gaetz swindled by ‘malicious actors’ in $155K boat sale boondogglenypost.comSidney Crosby, Alex Ovechkin are graying and frayingnypost.comBiden received funds from top Russia lobbyist before Nord Stream 2 giveawaynypost.comInside Ashton Kutcher and Mila Kunis’ not-so-average farmhouse estatenypost.comWhy people are finding dryer sheets in their mailboxesnypost.comI blew off Adam Sandler 22 years ago — and it’s my biggest regretnypost.comSupermodel Anne Vyalitsyna claims income drop, pushes for child supportnypost.comUK teen died on school trip after teachers allegedly refused her pleasnypost.com Twin imposters triumph and disaster lurking Share whatsapplast_img read more