Wednesday, July 25, 2012

UK Economy and Excuses

This would actually be funny except for the fact it is ruining millions of lives.

The UK announced second quarter GDP fell for the third quarter in a row. In fact the downturn is slowly increasing (-.4, -.3, -.7). In the middle of the article from describing the downturn is the following...

"The output drop was exacerbated by the one-off effect of the Queen’s diamond jubilee bank holiday, which removed a working day from the quarter. The Office for National Statistics said it was too soon to try to quantify this distortive effect, but most economists had predicted it would knock about 0.5 percentage points from gross domestic product growth."

but here is the same set of excuses from the same period in a previous year...

Finally, the ONS believes that a whole range of one-off factors – including the extra bank holiday for the royal wedding and the disruption to industry's supply chains caused by the Japanese tsunami – depressed activity by around 0.5% in the three months to June. (The Guardian)

While there are certain types of economic output that would be lost due to holidays, it isn't a one time event if it happens every year. The cause of the downturn in the UK is the same austerity that is plaguing the continent.

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