Scary map for euro leavers
THE better news from the International Monetary Fund is that it believes the British economy, despite all the headwinds from across the channel, is actually doing a little better than its peers and should grow in 2012 by 0.8pc (an upward revision of 0.2pc) and next year by 2pc.
It also believes that if all else fails Britain’s scope for further ‘unconventional’ measures – a posh name for printing money – still exists.
In particular it believes such credit easing needs to be aimed at bringing more finance to small and medium-sized businesses.
A more worrying development here at the spring meetings of the IMF and World Bank is the willingness of leading players, including the Fund’s chief economist Olivier Blanchard, to openly discuss what might happen were a euroland member to do an Argentina by leaving.
Blanchard says there is no ‘plan B’ for dealing with such an eventuality but went on to suggest that the so- called firewall, George felt the need to include such a gloomy scenario in a World Economic Outlook report, which upgraded forecasts for the global economy in 2012, is not entirely clear.
But the Fund was caught out by the build-up of toxic US mortgage debt and the impact that made on the global financial system. It does not want that to happen again.
As in the case of Argentina, which defaulted and devalued in early 2001-02, freedom from the constraints of being part of a currency bloc (in Argentina’s case the dollar) brought with it a new start.
If the IMF is to be believed in the euroland case it could be disastrous, creating a period of depression which would make the 1930s look like a children’s tea party.
Marking time
TURNING Marks & Spencer’s performance around, against a background of squeezed household income, was never going to be easy.
Nevertheless, Marc Bolland is doing some things right.
The improvement in food which began when Sir Stuart Rose was in charge continues and remains the star of the show. The real challenge for Bolland is maintaining market share in clothing amid price competition.
The overall fall of 0.7pc in general merchandise in the last quarter is disappointing but not disastrous.
The failure to deliver vibrant overseas growth, despite the effort being made, is also worrying. But there is a decade of catch-up for Bolland.
As for online, it is starting to pay its way and needs to be speeded up if it is to keep the likes of Amazon and Asos at bay.
There is a distance to go before Britain’s favourite retailer restores its premier league status.
Millionaire tax
STOPPING the rich from avoiding taxes is as much a priority for Barack Obama’s White House as it is for George Osborne with his ‘moral repugnance’ of such behaviour.
But Obama’s effort to turn policy into action through a so called ‘Buffett rule’ – which forces people earning more than $1m a year to pay at least 30pc in taxes – has fallen at the first fence. Democrats in the Senate were unable to muster the 60 votes necessary to keep the bill alive.
Right-wing Tories eat your heart out.