Saturday, 19 May 2012

The quotes that don't make the headlines...

Warning that UK 'may never fully recover if Greece exits Euro: Top forecaster says Britain would face long recession'- The Guardian front page headline, May 19 2012

"[Office for Budget Responsibility head Robert] Chote said there were so many uncertainties around what might happen with Greece and the eurozone that trying to produce firm predictions was not "particularly helpful". - The Guardian, May 19 2012

For the avoidance of doubt here are the rest of Chote's quotes in the piece:

"The head of the UK's OBR said the deepening crisis in the eurozone could force him to tear up his forecasts, made only two months ago, that Britain would post modest growth of 0.8% this year.

"The concern is that you end up with an outcome in the eurozone that creates the same sort of structural difficulties in the financial system and in the economy that we saw in the past recession, and that has consequences both for hitting economic activity in the economy, but also its underlying potential," said Chote.

With economic output in the UK still 4% below its peak level when the recession began in early 2008, the prime minister and the governor of the Bank of England, Sir Mervyn King, have expressed concern in recent days about the vulnerability of Britain to the eurozone.

Chote said he was particularly concerned about the possibility that a second deep recession would leave permanent scars. "That means not just that the economy weakens and then strengthens again – it goes into a hole and comes out – but that you go down and you never quite get back up to where you started."

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