Duncan’s Economic Blog

Investment down 21.8%

Posted in Uncategorized by duncanseconomicblog on September 25, 2009

A timely reminder on the state of investment in the UK comes from the ONS this morning.

Business investment for the second quarter of 2009 is estimated to be 10.2 per cent lower than the previous quarter and 21.8 per cent lower than the same period last year.

I continue to be amazed that collapse in investment is not being debated whilst the size of the deficit is. The real threat to Britain’s economic future is a lack of investment, not increased public debt.

7 Responses

Subscribe to comments with RSS.

  1. dannyboy said, on September 25, 2009 at 9:59 am

    Don’t be amazed. Very few people understand the paradox of thrift.

    Probably 90% of the population will not form any kind of macroeconomic view that takes in more than their personal circumstances. Clearly to these people future taxation is key, because they can see a cost (tax) but are not certain of receiving the benefits of any investment made on their behalf (and who can blame them for that view?).

    Of those that do form a macro view, probably 90% do it via a fallacy of composition and arrive at the wrong conclusions. We can put many tories in this box.

    Of the remaining fraction, probably half understand the economics but would still rather see economic decline rather than an expansion of the state, either on ideological grounds or because a state expansion would threaten their currently dominant position. We can put the rest of the tories in this box.

    It amazes me how many people think deflation is good because it will improve their purchasing power!

    We’re doomed for now. Perhaps towards the end of the tory’s first term the general public will have woken up and understood the terms of this debate better.

  2. Tax Research UK » Investment down 21.8% said, on September 25, 2009 at 12:55 pm

    […] Investment down 21.8% « Duncan’s Economic Blog. A timely reminder on the state of investment in the UK comes from the ONS this morning. […]

  3. Investment down 21.8% | called2account said, on September 25, 2009 at 2:20 pm

    […] Investment down 21.8% « Duncan’s Economic Blog. A timely reminder on the state of investment in the UK comes from the ONS this morning. […]

  4. newmania said, on September 25, 2009 at 3:40 pm

    Lucky old us avoiding the years of misrule Australia suffered ending with balanced books and …well you can imagine the disaster that has overtaken them…
    Yes Investment would be a good idea , pity then we are being run by a Party who will pay pointless Public Sector unionised friends to even if they have to cancel it ,which they are already doing. If you want more investment form the State you have to make cuts. Choices Duncan not just… “Throw money at it”

    I cannot wait for Duncan to suggest there should be a State Bank and it should pick the winners it was a Policy of Sir Oswald Moseley . .. really good idea .

    • duncanseconomicblog said, on September 25, 2009 at 3:47 pm

      I don’t think a policy of state investment needs to be accompanied by cuts. It’s the capital account, obviously borrowing for long term investment is rational.

      I’d like to encourage more private investment too. And a state investment bank is one way to achieve that. On the topic of Mosley, I’d happily recommend his resignation speech of May 1930 to anyone. That doesn’t mean I have to endorse his later (repulsive) politics.

      • Danivon said, on September 27, 2009 at 3:06 pm

        Indeed, I am often surprised by the people who will make assertions about economics, spending etc without understanding the basic difference between capital and revenue.

        I thought newmania was a capitalist. Seems he don’t understand Capital…

  5. […] Investment down 21.8% « Duncan’s Economic Blog duncanseconomicblog.wordpress.com/2009/09/25/investment-down-21-8 – view page – cached Business investment for the second quarter of 2009 is estimated to be 10.2 per cent lower than the previous quarter and 21.8 per cent lower than the same period last year. — From the page […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: