An excellent blogpost on the UK failure to drive 'exports-led recovery': http://blogs.telegraph.co.uk/finance/jeremywarner/100024274/the-killing-of-britains-economic-salvation-an-export-led-recovery/
And it has a handy chart:
What's telling about the chart? Recall that every country in Europe is angling to get that 'exports-led recovery' going, including Ireland. which raises two questions
And it has a handy chart:
What's telling about the chart? Recall that every country in Europe is angling to get that 'exports-led recovery' going, including Ireland. which raises two questions
- As commonly asked: who will be importing all these exports from Europe? Traditional answer is: China or Asia, but the problem is - save for some luxury goods, China and Asia can manufacture all that Europe can export.
- What about Ireland? Well, see the chart above: apparently, our exports-led recovery is more robust than just two countries in the sample: the UK and Denmark.
Oh, and a note: Japan has been having an 'exports-led recovery' at record rates, and it is still nowhere near any real recovery.
The strange dynamics between a sov country and a currency union is very important to understand.
ReplyDeleteThe UK if it were to manufacture stuff again needs French scale fiscal or better yet pure fiat investment in Nuclear and or coal as now it simply does not have the capacity.
However In the present UK public debt would crowd out private debt.
Why ?
The UK is getting a short term oil surplus from austerity Euroland.
Any aul asset production looks good until.........
This private asset creation is not very useful in the long run because of the general rapid depreciation and non productivity of these capital investments.
I.e. would you want another Sizewell B PWR which would have a 50 year lifetime of production or a Ford transit (now imported) with a 10 year lifetime of fuel burn