British economic collapse rivals Great Depression!
LONDON, England - July 24, 2009 - Economic output shrank by 5.6% in the 12 months to the middle of the year, according to official figures, which shattered hopes that the recovery has already begun.
The Office for National Statistics said that Britain's gross domestic product (GDP) contracted by 0.8% in the second quarter, following the unprecedented 2.4% fall in the first three months of the year. Economists had expected GDP - the broadest measure of the country's economic performance - to shrink by 0.3%.
According to calculations by Martin Weale of the National Institute for Economic and Social Research, the profile of the current Depression is now almost identical to the decline in Britain's output between 1929 and 1931. The 5.6% contraction over the past year almost matches the 5.8% fall in the year preceding the second quarter of 1931, during which Credit Anstalt in Austria collapsed, triggering a second wave of economic seizure across Europe.
The Depression is far deeper and more severe than those of the early 1980s and 1990s, added Weale.
"Gordon Brown is now competing with Ramsay MacDonald - not a comparison he would much like," he said. "It looks as if we are pretty much tracking the 1930s. The financial crisis has been much bigger [than in the 1930s], the period of boom beforehand was more marked; and so you might think it's thanks to the policies [from the Bank of England and government] that we'll end up with something slightly less bad but along similar lines."
The Office for National Statistics said that Britain's gross domestic product (GDP) contracted by 0.8% in the second quarter, following the unprecedented 2.4% fall in the first three months of the year. Economists had expected GDP - the broadest measure of the country's economic performance - to shrink by 0.3%.
According to calculations by Martin Weale of the National Institute for Economic and Social Research, the profile of the current Depression is now almost identical to the decline in Britain's output between 1929 and 1931. The 5.6% contraction over the past year almost matches the 5.8% fall in the year preceding the second quarter of 1931, during which Credit Anstalt in Austria collapsed, triggering a second wave of economic seizure across Europe.
The Depression is far deeper and more severe than those of the early 1980s and 1990s, added Weale.
"Gordon Brown is now competing with Ramsay MacDonald - not a comparison he would much like," he said. "It looks as if we are pretty much tracking the 1930s. The financial crisis has been much bigger [than in the 1930s], the period of boom beforehand was more marked; and so you might think it's thanks to the policies [from the Bank of England and government] that we'll end up with something slightly less bad but along similar lines."
