Excessive Debt is Main Source of Weak Economic Condition World Wide
There is no doubt that UK households are having a hard time making budgets work with the loss of spending power of today’s pound. Inflation has increased and is expected to continue increasing in the months ahead throughout the end of the year. Despite this increase in the level of inflation, the economy remains too weak for an increase in the interest rate, which would help rein in inflation growth. However, even with low interest rates available for remortgages and new home purchases there remains a slack in the housing market and mortgage lending.
Things seem in turmoil and it is exactly that viewpoint that had the chancellor, George Osborne calling on European leaders to show they are facing head on the problems of the economy in the Eurozone. In a speech to the Daily Telegraph’s Festival of Business gathering in Manchester he called for a better international response to the issues being faced by European nations. He remarked, “I will be looking for my European colleagues to send a clear signal that they truly recognize the gravity of the situation and that they are dealing with it.”
He remarked that excessive debt by countries was the main source of the worsening of the economic condition being experienced currently. He stated, “What started as a debt crisis in the banking sector in 2008 has now turned into a wider crisis of sovereign, banking and private sector debt. And Britain cannot blame the rest of the world for these debts, for we were one of the biggest contributors to them.”