Readers Question: Between markets and concerted central banks intervention, e.g in currency and shares, which forces are likely to prevail? Market forces can be very strong in influencing the value of currency or shares (or bond yields). Governments and Central Banks can try and influence the value of the currency and bond yields. In certain …
Readers Question: what is the difference between saving and investment? Saving Saving involves income that is not consumed. Typically surplus income is saved in a bank account. But, it could be saved as cash (cash under the bed e.t.c) The Savings Ratio is the % of income that is saved. In recent years the UK …
How to judge George Osborne’s and David Cameron’s economic record since May 2010? They inherited an economy recovering from a deep recession, high unemployment and large budget deficit. It was a difficult economic circumstance, but at the same time you might expect a strong economic recovery as there was much unused capacity and potential for …
In 2015, the German current account surplus surged to 8.5% of GDP. A record level and a surplus which has implications for the Eurozone and global economy. Source: Bundesbank The surplus is primarily due to the surplus on trade in goods. Though in recent years, there has also been a surplus in primary income. This …
In recent years, major companies have seen a significant rise in cash reserves. These are profits which are not reinvested or distributed to shareholders but effectively saved. The largest cash reserves are found amongst major US IT companies, such as Apple, Microsoft and Google. These cash reserves have significant implications for economic welfare and income …
At the 1992 General election, the Conservative Party won a stunning electoral victory – despite being in the middle of a self-imposed recession. Many point to this as an example of how the press can influence national debate and influence elections. The 1991/92 recession was a classic example of a boom and bust. It wasn’t …
Will the UK’s decision to leave the EU cause recession? Factors which could cause Brexit recession Loss of confidence. Many foreign investors may be deterred from investing in the UK because of uncertainties that they may have higher costs for accessing the Single Market. This decline in investment could lead to fall in aggregate demand. …
Source ONS | NTV A possible unit 4 A Level question this summer could be: Discuss the impact of a fall in public sector investment on the UK economy? The graph shows a fall in public sector investment from 3.5% of GDP in 2008 to 1.5% in 2011. This means cuts of approximately £30bn a …