'Banks make average £139 a year on each current account'

The OFT today disclosed that banks make £139 a year on each current account and said they remained poor value for customers.

The OFT said retail banks needed 'significant changes' to tackle 'longstanding competition concerns and a lack of focus on customers' needs'. 

 

 

The Office of Fair Trading (OFT) said that while overdraft charges had fallen – saving customers £928m between 2007 and 2011 – they remained too complex. The report also found that consumers rarely switched accounts and there were still too few new entrants offering accounts.

However, campaigners and consumer groups called the report "depressing" and criticised the OFT's failure to refer the issue to the Competition Commission for immediate action.

"Comparing the costs of current accounts continues to be challenging and ... people lack confidence in the switching process," the OFT found in its latest look at the market.

"Overall, a combination of a lack of competition, low levels of innovation and customer apathy in the face of unclear costs and a lack of diversity in the choices of current accounts available mean that this market is not working well for consumers or the wider economy."

The review also found that the industry made £139 a year on each current account in 2011, with £60 of that figure made on "net credit interest income" and £29 from unauthorised overdraft fees. The total was less than the £152 per account made in 2006.

The OFT said "significant changes" were needed to tackle "long-standing competition concerns and a lack of focus on customers' needs".
It made some new recommendations but said it had chosen not to refer the sector to the Competition Commission for further investigation, although it will revisit the issue in two years.
Martin Lewis, founder of MoneySavingExpert.com, which has campaigned for a more competitive current account market, said it was a "depressing read".
"It's just review after review after review," he said. "The OFT wimped out four years ago and to hear this now is just depressing."

^{Martin Lewis outside the Supreme Court in 2010}
Clive Maxwell, the OFT's chief executive, said: "Personal current accounts are critical to the efficient functioning of the economy. Despite some improvements, this market is still not serving consumers as well as it should."
The regulator noted that text alerts were helping consumers avoid unauthorised charges, but it wants banks and building societies to do more to promote this service.
There has also been encouraging feedback on the use of annual account summaries, which detail what people have paid for their service and provide scenarios so that customers know what they will pay if they exceed agreed limits. The OFT said they would be of greater value if consumers had more consistent access to them.
Regarding current account switching, the OFT said it would ask the Payments Council to look into the costs of enabling customers to transfer their bank account number.
The OFT hopes competition will improve with the sale of branches from both Lloyds Banking Group and Royal Bank of Scotland, while a new £750m automated account switching service is due to be launched in September.
^{How unpaid item charges (UPIC) or late payment fees have fallen. Source: OFT}
Which?, the consumers' association, has campaigned for reform of the industry. It today berated the regulator for failing to refer the issue to the Competition Commission.
Richard Lloyd, executive director, said: "This is the latest damning verdict on how badly people are still being let down by the banking industry. Everyone – consumers, the Government, leading bankers and now the OFT – seems to agree that big change is needed in banking, and that much greater competition on the high street is urgently needed to make the banks work for customers, not bankers.
"So it's disappointing to see current account providers avoid immediate action by the competition authorities, but the banks are not off the hook. If the reforms under way do not quickly make a real difference to consumers, the whole of retail banking must be referred to the Competition Commission without any further delay."
The relationship between banks and their customers dramatically deteriorated from 2006 onwards as customers refused to accept soaring bank charges. Unauthorised overdraft fees and late payment charges of nearly £40 were imposed on customers.
Millions attempted to reclaim these excessive charges, which prompted the OFT to set up a market study in 2007, with the issue culminating in a Supreme Court battle in 2010. But the court found in favour of the industry. However, banks felt pressured enough to reduce the level of charges (see the chart above).
The Government set up the Independent Banking Commission to recommend how to create a "more resilient, stable and competitive banking sector". It came after multi-billion-pound taxpayer bailouts of Royal Bank of Scotland and Lloyds Banking Group during the financial crisis. A draft Financial Services Bill on banking reform was published in October.
However, the Government was criticised for permitting a delay until 2019 for the restructuring of banks – ring-fencing risky investment banking from high street operations. The report, led by Sir John Vickers, also recommended the sale of branches by Lloyds and easier account switching.
Mr Lloyd added: "The need for further action by the competition authorities seems inevitable while the Government's plans for reform fail to adequately address the unhealthy dominance of the biggest banks, barriers remain to new providers thriving in the market and the industry refuses to make switching banks easier by introducing portable account numbers.
"The measures proposed today by the OFT are a step forward but, by themselves, will not do what's required to transform customer service and stop banks offering poor value products that are impossible to compare."
Anthony Browne, the chief executive of the British Bankers' Association, said: "We welcome the OFT's decision not to refer this issue to the Competition Commission and will continue to work with them to make further improvements for customers and the wider economy."

 

Apple eclipsed by Exxon Mobil as most valuable company

Apple Inc.

Last Updated at 25 Jan 2013, 21:00 GMT *Chart shows local time

price	change	%
439.88	- -10.62	- -2.36

Apple has lost its crown as the world's most valuable publicly traded company after its shares continued to fall.

Oil company Exxon Mobil has regained the top slot after Apple shares fell 2.4%, following a 12% drop on Thursday.
Apple, which posted disappointing iPhone sales figures on Wednesday, has seen its shares fall 37% since their record high last September.
Exxon became number one in 2005, traded places with Apple during 2011, and had been number two since early 2012.
At the close on Wall Street, Apple had a market value of $413bn (£261bn), against Exxon's of $418bn.
The tech giant has been hit by fears over its future growth, despite record profits.
Although the firm said on Wednesday that it had sold more iPhones (47.8 million) and iPads (22.9 million) in the final three months of last year than in any previous quarter, investors and analysts had expected yet more.
On Thursday, about $50bn was wiped off Apple's value after the biggest daily drop in the firm's stock in four years.
Apple is also facing fierce competition from rivals like Samsung, which accounted for one in four of all mobile phones shipped worldwide last year, according to Strategy Analytics.
Apple's share price rose sharply following a revival under Steve Jobs, who died in 2011, which came about first in computers and then the iPod music player, and was then followed by the iPhone and iPad.
Apple's shares were worth as little as $3.19 in 1997 when it faced the possibility of bankruptcy, and reached a record $702.1 on 19 September.

Fed Intervention For Dummies - What A Record $3 Trillion In Fed Assets Gets You

At the heart of it, visualizing the record $3 Trillion Dollar Federal Reserve balance-sheet is practically impossible. However, in two simple charts we can easily visualize what impact that gargantuan amount of printed cash has had on the 'real' economy and the 'real' market via Bernanke's magic wealth-effect. Presented with nothing to add...
The Market vs The Jobs...


and the real wealth effect...


(h/t @Not_Jim_Cramer)

Brando's Message For Geithner

dailybail.com/home/brandos-message-for-geithner.html …

WATCH - Geithner Says Goodbye At White House

Daniel Hannan: The Bailouts Were An Epic Crime

Daniel Hannan: The Bailouts Were An Epic Crime

Daniel Hannan MEP gives his opposing opinion to the motion of "The House would Occupy Wall Street".
Facebook @ http://fb.me/theoxfordunion
Twitter @ http://www.twitter.com/OxfordUnion
Oxford Union Website @ http://www.oxford-union.org/
Daniel Hannan opens by saying that the bailouts were a crime that will one day be seen as a generational offence. He highlights that he, along with 3 other elected politicians, was the only one opposed to the bailouts along with 87% of the British Public. It's wrong to clobber the little guy in order to reward the corporates.
He says that he is opposed because the occupy Wall Street crowd were occupying the wrong place. He says there is a world of difference between being pro business and pro market.
He challenges 3 propositions; The Idea that we are living through a failure of capitalism, the banking collapse was caused by a lack of regulation and the idea that we're in this financial mess because of our greed.
Filmed on Thursday 22nd November 2012
MOTION: THIS HOUSE WOULD OCCUPY WALL STREET
ABOUT DANIEL HANNAN:
MEP
ABOUT THE OXFORD UNION SOCIETY:
The Union is the world's most prestigious debating society, with an unparalleled reputation for bringing international guests and speakers to Oxford. It has been established for 189 years, aiming to promote debate and discussion not just in Oxford University, but across the globe.

Bloomberg: Is Inflation the Legacy of the Federal Reserve?

Inflation is the Fed's 100 year legacy.
Behold the chart that, in a more just and sane world, would force Bernanke and Krugman to retire and drive the Fed out of business.  Consumer prices are now 30 times higher than when the Fed was created in 1913.

Here's the truth:

• CHART: The Real Inflation Rate Is 10%...

• Economist: The Official CPI Is A Joke...

Former NYC Prosecutor Busted for Felony Marijuana Sales

By Thomas H Clarke
The Daily Chronic
January 25, 2013
A former Manhattan prosecutor was indicted on felony charges Tuesday after being accused of selling about $200 worth of marijuana to an undercover cop last year.
David Leung, 44, was arrested in September after allegedly selling about $200 of marijuana to an undercover detective, and had almost 8 ounces of pot in his car at the time of his arrest. It is believed that Leung was selling high grade marijuana through a delivery service at the time of his bust in the East Village.
Leung had worked at the Manhattan District Attorney’s office from 1993 to 2004, and was indicted in Manhattan Criminal Court, where he worked for much of his career as a prosecutor.
Leung remains free without bail until his arraignment on Feb. 19.

Goldman Sachs boss defends aborted plan to dodge tax on bonuses as being like shrewd house-selling

Lloyd Blankfein said he stood by the idea of delaying bonuses until the 50p top rate of tax had been cut to 45p

After public backlash bank dropped the plan earlier this month

Bank of England boss Sir Mervyn King condemned City's culture of greed

Goldman Sachs boss Lloyd Blankfein defended the idea of delaying bankers bonus payouts to avoid paying tax

The head of Goldman Sachs has defended an aborted plan to avoid millions of pounds in tax on bankers’ bonuses, comparing it to shrewd house-selling.
Lloyd Blankfein risked a fresh public backlash by saying he stood by the move to delay huge payouts until after the top rate of tax was cut from 50p to 45p.
The chief executive of the investment bank claimed opposition to the idea amounted to ‘criminalising every right-thinking person who organises his or her affairs in a sensible way’.
Two weeks ago Goldman Sachs was forced to abandon its plan to delay paying out bonuses to help bankers avoid the 50p tax rate.
Bank of England boss Sir Mervyn King branded the idea 'depressing' and accused bankers of mis-judging public anger at the damage caused by the financial crash.
The investment bank had considered waiting to award equity bonuses deferred from previous years, due to pay out this month, until after April 6.
It would have meant tax on the payouts would have been paid at the 45p rate instead of the 50p rate for high earners.
But at the eleventh how the bank's Comp Committee pulled the plug on the plan.

Unrepentant, Mr Blankfein insisted people should not be subjected to opprobrium for responding to incentives in the tax system.

A plan by Goldman Sachs to delay the payouts of deferred bonuses until after April 6 was dropped two weeks ago

‘We don't go out of our way to put our businesses in the most expensive jurisdictions. Do we go out of our way to put them in the least expensive? No, we think of quality, we think of standard of life, being able to attract and recruit,’ he told BBC Radio 4.
‘If all of a sudden, in addition to the rules that generate certainty for people, the signposts become so amorphous and so loose and so subject to second-guessing, you're making everything uncertain and it's very hard to organise your affairs in a sensible way.

Bank of England chief Sir Mervyn King said bankers had to realise they 'can't just exist on their own'

‘I'm not saying that you are exculpated from any pressure merely because you meet the rule of law - we've never said that, we don't live that life.
‘But I would say are you going to hold people up to public opprobrium because a house they could have sold in January instead they sell in May because there was a profit to be made on that house because the selling price was higher than the purchase price?
‘If you do that, you are going to criminalise every right-thinking person who organises his or her affairs in a sensible way.
‘We are a public entity, we live on the goodwill of the public, and so we adapted to what we perceived as criticism. We stand by our original idea and we stand by the revision of our plans.’
When news of the plan to delay bonuses first emerged, outgoing Bank of England government Sir Mervyn launched a devastating attack on attitudes in the City.
He accused the super-rich of thinking it was 'exciting' to use a loophole which could cost the taxpayer millions.
'I find it a bit depressing that people who earn so much seem to think it's even more exciting to kind of adjust the timing of it to get the benefit of a lower tax rate which they will benefit from in the long run to a very great extent,' he told the Treasury Select Committee.
Sir Mervyn, who will stand down as Bank of England Governor in June, said City firms had to consider the reputational damage the move would cause.
'I think it would be rather clumsy and rather lacking in care and attention to how other people might react and , in the long run, financial institutions, like all large institutions do depend on good will from the rest of society, they can’t just exist on their own.'

WATCH: Obama Calls Geithner 'One Of The Best Ever'

http://bcove.me/gws251o0


'Tim will go down as one of the finest Bailout Secretaries in our nation's history.'
UPDATE - Washington Post - Geithner Said F*ck The Banks!...
---
Meanwhile, Geithner tells Politico today he doesn't want Bernanke's job:

Geithner is returning to New York to be with his family and said he has no immediate plans beyond relaxing and traveling with his wife.  Geithner firmly ruled out ever serving as chairman of the Federal Reserve, something that has been mentioned by people close to the outgoing secretary as a possibility down the road.

“Not a chance.  I have great respect for the institution, but that will be someone else's privilege.”

---
Full press conference:
Obama says goodbye to Geithner, introduces Jack Lew.

Photo by William Banzai7...
You see that jackass cleaner peeking through the window?

The Untouchables.MP4

Scene from The Untouchables.
Notice Lanny Breuer's hostility to criticism at the 22-second mark.  Details below.
---
Bye Bye Lanny... (Wash Po)
"Lanny A. Breuer is leaving the Justice Department after leading the agency’s efforts to clamp down on public corruption and financial fraud at the nation’s largest banks."
Darrell Issa: Breuer’s Resignation 'Is Long Overdue'... (Wash Po)
House Oversight Committee Chairman Darrell Issa issued a sort of good riddance on Thursday to Lanny Breuer.  “Breuer was at heart of several critical failures in Operation Fast and Furious,” Issa said. “He knew about reckless tactics, failed to take seriously allegations that they were continuing, and only owned up to his failures once they were publicly exposed.”
The Long Goodbye Of Lanny Breuer... (Legal Times Blog)
In the Frontline piece, Kevin Perkins, associate deputy director of the FBI, said he and Breuer have argued "back and forth" over whether certain cases should have moved forward as criminal prosecutions. Perkins said he was at times frustrated and disappointed. But he said he accepted, as a "professional," the final decision.
Frontline Gets Its Man: Lanny Breuer Is Done At DOJ... (Must Read)
Breuer/Holder failed to investigate fully.

FRONTLINE: We spoke to a couple of sources from within the Criminal Division, and they reported that when it came to Wall Street, there were no investigations going on. There were no subpoenas, no document reviews, no wiretaps.

LANNY BREUER: Well, I don't know who you spoke with because we have looked hard at the very types of matters that you're talking about.

Breuer/Holder failed to reach out to key whistle blowers.

FRONTLINE: Another criticism that has been thrown at you is that you've not done enough to go looking for the whistle-blowers that are out there. We have been able to contact a number of people who were inside the banks, doing due diligence work as contractors, who all told us that they were never contacted by the Justice Department.

BREUER: I can't talk in general about nondescript, anonymous whistle-blowers. But here's what I can tell you. Whenever I personally have been in any public setting, I've invited whistle-blowers to come forward.

Breuer/Holder worried more about the fragility of the banks than cleaning up corruption on Wall Street.

FRONTLINE: You gave a speech before the New York Bar Association. You talked about your use of nonprosecution and deferred prosecution agreements. And in that speech, you made a reference to "losing sleep at night over worrying about what a lawsuit might result in at a large financial institution." Is that really the job of a prosecutor, to worry about anything other than simply pursuing justice?

BREUER: I think I and prosecutors around the country, being responsible, should speak to regulators, should speak to experts, because if I bring a case against institution A, and as a result of bringing that case there's some huge economic effect, it affects the economy so that employees who had nothing to do with the wrongdoing of the company... If it creates a ripple effect so that suddenly counterparties and other financial institutions or other companies that had nothing to do with this are affected badly, it's a factor we need to know and understand.

---
Lanny Breuer in his own words:
Bloomberg interviews Breuer.
Watch the whole interview, but pay particular attention at the 2:30 mark.  Breuer is shocked by the question and admits "we don't know anything about that letter" before changing the subject.  His answer is completely ridiculous on so many painful levels (prosecutors are supposed to investigate for chrissakes), but again this is what happens when you have criminal defense attorneys from Covington & Burling running DOJ.
No word on whether Breuer gave his famous pep talk to HSBC execs on avoiding prison.

"We are frequently on the receiving end of presentations from defense counsel, CEOs, and economists who argue that the collateral consequences of an indictment would be devastating for their client.  In my conference room, over the years, I have heard sober predictions that a company or bank might fail if we indict, that innocent employees could lose their jobs, that entire industries may be affected, and even that global markets will feel the effects.  Sometimes – though, let me stress, not always – these presentations are compelling."

Read the full speech...

More Than 50 San Francisco Restaurants Accused Of Scamming Customers & Employees By Pocketing Health Care Surcharge

(Consumerist)

For more than four years, dozens of restaurants in San Francisco have been tacking on surcharges to diners’ bills, claiming that the money was to go toward health care costs. But it turns out that millions of those dollars were just going into restaurant owners’ pockets. The San Francisco Chronicle reports that starting in 2008, some owners decided that, rather than raise their menu prices to cover city-mandated health care costs, they would just add a surcharge to customers’ invoices. In some cases the surcharge was a flat amount, in others it was a percentage of the total bill. Regardless, this money was to be used for health care for employees.
But per the city’s Office of Labor Standards Enforcement, that just wasn’t happening. It tells the Chronicle that in 2011 alone, $14 million was collected via these surcharges, yet only around one-third of that ever went to health care.
“It was pocketed back to the restaurateur,” said San Francisco Supervisor David Campos, who says that some restaurant employees were actually denied health care when they shouldn’t have been.
The City Attorney is expected to announce an amnesty program today that would forgive violators if they fess up to the skim and pay back some of that money to employees.
“Requiring these people to pay restitution is a compromise,” Assemblyman Tom Ammiano tells the Chronicle. “If it was up to me, I’d throw them in jail.”
One pizzeria has already settled with the city for failing to provide health care benefits to 115 employees between 2009 and 2011. Those employees will receive a total of $205,000 in reimbursement from the owners, who will also pay a $15,000 penalty to the city.

Printing Money and Economic Prosperity

Printing Money and Economic Prosperity

Get far away from USA...its collapse will be messy: Jeff Berwick

Get far away from USA...its collapse will be messy: Jeff Berwick

U.N. to consider validity of China's claim over disputed islands

 

(Reuters) - The United Nations is planning to consider later this year the scientific validity of a claim by China that a group of disputed islands in the East China Sea are part of its territory, although Japan says the world body should not be involved.
Tensions over the uninhabited islands - located near rich fishing grounds and potentially huge oil-and-gas reserves - flared after Japan's government purchased them from a private Japanese owner in September, sparking violent anti-Japanese protests across China and a military standoff.
Taiwan also claims the islands, known as the Diaoyu islands in China, the Senkaku islands in Japan and Tiaoyutai in Taiwan.
In a submission to the U.N. Commission on the Limits of the Continental Shelf, China claims that the continental shelf in the East China Sea is a natural prolongation of China's land territory and that it includes the disputed islands.
Under the U.N. convention, a country can extend its 200-nautical-mile economic zone if it can prove that the continental shelf is a natural extension of its land mass. The U.N. commission assesses the scientific validity of claims, but any disputes have to be resolved between states, not by the commission.
China said the "Diaoyu Dao upfold zone" - the islands - is located between the East China Sea shelf basin and the Okinawa Trough. "The Okinawa Trough is the natural termination of the continental shelf of (the East China Sea)," it said.
China also told the commission that it was still negotiating with other states on the delimitation of the continental shelf.
"Recommendations of the commission with regard to the submission will not prejudice future delimitation of the continental shelf between China and the states concerned," said the executive summary of China's submission published on the commission's website.
'NO DOUBT'
The commission said consideration of China's claim would be included in the provisional agenda of a meeting of the body due to be held in New York from July 15 to August 30.
In a letter to the commission, Japan's U.N. mission argued that China's submission should not be considered.
"There is no doubt that the Senkaku Islands are an inherent part of the territory of Japan in light of historical facts and based upon international law. The Senkaku Islands are under the valid control of Japan," it said.
The islands were put under Japan's control in 1895 and were part of the post-World War Two U.S. military occupation zone from 1945-72. They were then returned to Tokyo by U.S. authorities in a decision China and Taiwan later contested.
China responded to Japan's letter by calling Tokyo's claim to the islands "illegal and invalid."
"Diaoyu Dao and its affiliated islands have been inherent territory of China since ancient times," its U.N. mission said in a letter.
U.S. Secretary of State Hillary Clinton urged China and Japan in September to let "cool heads" prevail in the dispute, but her pleas fell on deaf ears.
After Japan's purchase of the islands, protests in China saw some Japanese businesses looted, Japanese citizens attacked and auto and other Japanese manufacturers reported considerably lower sales in the country.
More recently, Japanese military planes have scrambled numerous times against Chinese planes approaching airspace over the islands. Chinese planes have also been launched to shadow Japanese planes elsewhere over the East China Sea. Patrol vessels from the two countries have also played a tense game of cat-and-mouse in the waters near the disputed islands.
(Reporting by Michelle Nichols; Editing by David Brunnstrom)

Jon Stewart: "AIG Put The 'A' In Asshole"

The Daily Show with Jon Stewart
Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

The Ingrateful Basterds of AIG.
'Don't buy Hank Greenberg's stupid f-ing book.'
Pretty funny Daily Show clip from last week.  Former AIG CEO Hank Greenberg thanks the people who bailed out his company by suing them for $25 billion.

Obama Pledges to Deal With Climate Change

Short clip from yesterday's inauguration speech.  President Obama dedicated more time to climate change than any other specific policy area.

Obama sees a huge threat from climate change but no threat from a $17 trillion national debt.
"We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations.  Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires, and crippling drought, and more powerful storms."
Today at the White House, Jay Carney offered more detail on Obama's plans.
We can only assume the President doesn't see any threat from trillion-dollar annual deficits and the soon-to-be $20 trillion national debt, since neither was mentioned in his wide-ranging speech.  Everything looks great to us, as well.
Let's spend, bitchez!
The national debt has grown by $6 trillion since the Spender-In-Chief took office, and four additional $1 trillion deficits are on the way before Obankster leaves Washington in 2016.  Check the debt clock and decide for yourself.  Is there anything, anything at all, that appears 'under control' to you?
---

Fed’s Holdings of U.S. Gov't Debt Hit Record $1,696,691,000,000; Up 257% Under Obama

Treasury Secretary Tim Geithner and Federal Reserve Chairman Ben Bernanke (AP Photo/Mark Lennihan)

(CNSNews.com) - In data releasedThursday afternoon, the Federal Reserve revealed that its holdings of U.S. government debt had increased to an all-time record of $1,696,691,000,000 as of the close of business on Wednesday.
The Fed's holdings of U.S. government debt have increased by 257 percent since President Barack Obama was first inaugurated on Jan. 20, 2009, and the Fed is currently the single largest holder of U.S. government debt.
As of the end of November, according to the U.S. Treasury, entities in Mainland China owned about $1,170,100,000,000 in U.S. government debt, making China the largest foreign holder of U.S. government debt.
When Obama was inaugurated in 2009, the Fed owned $475.322 billion in U.S. government debt. As of the close of business on Wednesday, Jan. 23, the Fed owned $1.696691 trillion in U.S. government debt, up $1.221369 trillion during Obama's first term.
Since Obama has been president, the publicly held portion of the U.S. government debt (as opposed to the "intragovernmental" deb the government has borrowed from federal trust funds such as the Social Security Trust Fund) has increased by $5,264,245,866,257.40. The $1.221369 in additional U.S. government debt the Fed has purchased during Obama's presidency equals 23 percent of all the new publicly held debt the Treasury has issued during that time.
http://cnsnews.com/news/article/fed-s-holdings-us-govt-debt-hit-rec...

Today, Apple Stock Lost More Than the Market Value of Nike or Starbucks

Apple's stock fell 12 percent today, its worst tumble in four years. Nobody knows if this is the beginning of the end, or a lull between two glorious chapters of market dominance.
What we do know is that Apple lost an eighth of its market cap today, or $52 billion in stock value. That's more than the market cap of some very big, very famous companies (h/t Rebecca Jarvis for the first comparisons) ...

Big picture: This says as much about the monstrous size of Apple (which just "disappointed" with $54 billion in revenue last quarter) as it does about the size of today's sell off.

The "Undisputed Housing Recovery" Is Unmissable On This New Home Sales Chart

We could bore readers with the just announced New Homes Sales data from the Census Bureau, which put a somewhat largish dent in the "undisputed" housing recovery fairytale taking place in America (perhaps in the Hamptons, and triplexes in Manhattan where the NAR continues to launder Chinese and Russian oligarch money) such as:

• December new homes sales, seasonally adjusted annualized, dropped from an upward revised 398K (was 377K) to 369K on expectations of a 385K print;
• That this was the biggest M/M drop since February 2011;
• That months supply rose from 4.5 to 4.9, the highest since January 2012;
• That on an unadjusted, actual basis, a tiny 26K houses were actually sold in December, compared to 24K last December, of which just 2K in the Northeast;
• That a whopping 1,000 houses were sold in the $750,000 and over category
• That houses for sale rose to 150K, the highest since December of 2011
• That the punditry already spun this as being due to lack of clarity over the Fiscal Cliff and tax hikes, when in reality with expectations of higher taxes, consumers would have spent more money on hard assets in December, but why not regurgitate generic stupidity...

Or we could just show this chart of the non-seasonally adjusted, unannualized New Home Sales in the past decade, and ask: just where is this recovery everyone keeps on talking about?

Source: St Louis Fed

Bank of England ready to set up first G7 yuan swap

Source: G&M
The Bank of England is prepared in principle to become the first G7 central bank to enter into a foreign exchange swap agreement with China, opening the door to another substantial step in moves to liberalize the yuan currency.
The bank’s executive director for banking services, Chris Salmon, told a meeting of senior bankers in London that the move was aimed at underpinning a developing offshore market in yuan trade out of London that Britain is keen to encourage.
It would be the latest in a string of bilateral currency agreements that China has signed in the past three years to promote use of the yuan in trade and investment.
British officials have previously shied away from such a deal because the renminbi (yuan) is not freely exchangeable. But there have been signs that China is moving to open up trading of its currency and Mr. Salmon said the bank was more interested in helping yuan business to flourish.
“The Bank would welcome the development of the offshore RMB market just as it would any other legitimate market innovation, and we would not want to inhibit that outcome inadvertently through gaps in our operational framework,” he told the London Money Market Association’s Executive Committee in the text of his speech provided by the bank.
“To remove any residual uncertainty about our attitude: the Bank is ready in principle to agree a swap line with the PBOC (People’s Bank of China), assuming a mutually agreeable format can be identified.”
European and U.S. officials have been pressing China for years to do more to open up the yuan to market forces, saying its artificial weakness was one of the key imbalances of the global economy.
Beijing is slowly delivering, although it still keeps a tight rein on gains for the currency for fear it will weaken an economy that has been the biggest engine of global growth for a decade.
“This is part of the internationalization of the RMB, this is China moving forward to internationalize its currency,” said David Bloom, head of FX strategy at HSBC.
“They are setting up these lines around the world, it is the beginning of the opening up of the flower of the RMB.”
Britain, always anxious to bolster London’s status as Europe’s biggest financial centre, launched an offshore yuan currency and bond market to great fanfare last year and a swap deal would cement its role as the leading centre in the Group of Seven industrialized nations for offshore yuan trade.
But bankers have been arguing for some time that the bond side would struggle to develop unless British and Chinese authorities took steps to make trading easier.
The need for such measures has become even greater in recent months as potential investors have been discouraged from buying yuan bonds by China’s slowing economic growth and a slump in one-year yuan non-deliverable forwards to price in a depreciation.
“Ultimately, the growth of the market will depend on the success of market participants in matching incipient demand and supply for RMB-denominated products – just as the original euro-dollar market grew by satisfying a latent private sector demand for dollar assets in this time zone,” Mr. Salmon said.
“That said, there is a perception that market confidence would be boosted if the Bank and the PBOC agreed a swap line.”
Issuance of London-listed yuan bonds has been limited to a handful from the likes of oil major BP PLC and banks HSBC Holdings PLC and ANZ.
By comparison, the Hong Kong yuan bond market grew to around 350-billion yuan ($56-billion U.S.) in a little over two years from 2010, according to Thomson Reuters data.
But industry players say foreign exchange trading out of London itself looks far better, with daily turnover levels having risen to up to $900-million, compared with $1.5-billion in Hong Kong.
Figures from global transaction services organization SWIFT also show the U.K. is the leading centre for offshore yuan trade outside Asia and has made far more progress in getting companies to invoice in yuan than the United States, for example.

Families' disposable income slashed by a fifth every month because of debt interest alone

Debt interest payments are swallowing up around a fifth of the disposable income of a typical UK family, despite the amount owed on personal loans being at their lowest level in 14 years.
Households are finding themselves forking out on average £189 in interest payments alone each month on top of capital payments made on their borrowing, a study commissioned by debt charity StepChange has found.
Interest paid on mortgage payments, overdrafts, loans and other types of borrowing such as store or credit cards is taking up 22 per cent of a family's funds left over after capital payments and spending on essentials such as food and transport.

High interest: Households on average are paying out £189 a month in interest on their debts.

Delroy Corinaldi, external affairs director at Stepchange, raised concerns that some families struggling with interest payments who are hit with unexpected costs could be taking out more credit to see them through until payday.
He said: 'With few UK households immune to the effects of the economic downturn, it is crucial that families have the means to buffer themselves from unforeseen expenses, such as a boiler breaking down.

'If they don't have the finances to deal with unexpected bills, they are going to have to rely on credit to cover the cost of them.
'Therefore, the burden of debt interest can often lead to a vicious cycle where people are using credit because so much of their income is being eaten up by debt interest payments each month.'
The British Bankers' Association reported this week that the amount owed on personal loans was at its lowest since 1999, with the level of outstanding non-mortgage consumer borrowing down 1.6 per cent in the 12 months to December, driven by a 7 per cent contraction in personal loan and overdraft lending.
Spending on credit cards however did increase in December.
The amount of interest people are paying on their debts varies by region, with those in areas with the highest house prices paying off the most due to their larger mortgages, according to separate research.
Households in the south east are paying the most, with the study - conducted by The Centre for Economic and Business Research - suggesting they are spending £315 of their disposable income on interest payments.
You would expect that higher wages would assist people in covering these extra payments, but the research found that inflated house prices are not balanced out with better pay to the same extent across south east as they are, say, in London.
Debt interest payments were found to be at their lowest in Wales, at £150, and in Scotland, at £168.

Watchdog probes ICAP over Libor sending shares tumbling

Investors took fright yesterday as the world’s largest currency broker publicly confirmed it is being investigated by the City watchdog over suspicions it rigged interest rates.

Fears that ICAP may be more heavily involved in the scandal than previously thought sent shares down almost 3.1p to 324p.

So far the spotlight has been on some of Britain’s biggest lenders, including Royal Bank of Scotland, which is bracing itself for a huge fine in the coming weeks.

Libor effect: Fears that ICAP may be more heavily involved in the scandal than previously thought sent shares down almost 3.1p to 324p

But there are growing concerns over the role that middlemen – which help broker deals for investment banks – may have played a part in the conspiracy.

ICAP, founded by former Tory Party treasurer Michael Spencer, has become the first non-bank to confirm it has been linked to the scandal.

Its decision to go public followed a leaked internal memo from the City watchdog confirming it is investigating the broker.

Spencer previously played down the firm’s involvement in the scandal when it emerged last summer.
He said the investigations were not a ‘high concern’ as his company was not ‘front and forward’ in the investigation.

But the internal memo from the Financial Services Authority suggested to analysts and investors that Spencer’s confidence may be misguided.

The watchdog has assigned seven staff to focus on the currency broker.

It is reported to have roughly 50 staff working on the huge probe into Libor, suggesting that ICAP is high on its list of priorities.

The memo, dated from March last year, shows that the watchdog has been investigating a subsidiary of the group.

It suspects the unnamed subsidiary may have broken rules by ‘directly or indirectly inappropriately influencing or attempting to influence submissions used to compile the London Interbank Offered Rate (Libor)’.

Unlike investment banks ICAP does not help to set Libor interest rates – which are used as a benchmark for mortgages and trillions of pounds of investments.

But regulators are concerned that ICAP and rival brokers have colluded with traders at investment banks.

James Hamilton, an analyst at Numis, said: ‘News flow is bad enough without this and until a resolution is found it is hard to see the shares doing anything other than underperform.’

The FSA declined to comment. An ICAP spokesman said: ‘The investigation is confidential, accordingly no further comment will be made at this stage.’

Half of Foreign Investors Threaten to Cut Investments in U.S. Due to Washington Budget Discord

Source: All Gov.

The ongoing stalemate in Washington between Republicans and Democrats to forge long-term budget and deficit-reduction solutions has made international investors leery of American markets.
A new Bloomberg poll of 921 subscribers to Bloomberg Professional service revealed that 47% of global investors surveyed said they are reducing their investments in the U.S. as a direct result of “repeated confrontations between the U.S. Congress and President Obama.”
More than a third of respondents said the nation’s fiscal problems pose the biggest threat to the world economy, while 29% chose Europe’s sovereign debt crisis and 15% named China’s slowing economy.
Investors also indicated that they doubt President Barack Obama and congressional Republicans will agree this year on major changes to federal entitlement programs or to government tax policies.
Nonetheless, the United States still ranked higher than any other country as a place for investment opportunities.

-Noel Brinkerhoff

Barclays bankers including former boss Bob Diamond lose High Court bid to remain anonymous over alleged involvement in Libor-fixing scandal

Former Barclays boss Bob Diamond among those denied anonymity

High Court judge said public confidence in justice could have been damaged

More than 100 names on list released, but not all involved in any impropriety

Former Barclays chief executive Bob Diamond, who was among a number of executives who unsuccessfully attempted to keep their identity secret during hearings in which the rigging of a lending rate was discussed

A judge yesterday named the Barclays bosses who tried to  keep their identities secret in a landmark case linked to the rate-fixing scandal.
Former chief executives Bob Diamond and John Varley, current investment bank boss Rich Ricci and ‘casino banker’ Jerry del Missier were among those trying to keep their involvement in the case under wraps.
But the judge said it would be an ‘affront to the principle of open justice’ to bar the public from knowing the names involved – and demanded that they be published immediately.
The decision to reveal the names heaps further embarrassment on a bank which has been hit by a string of scandals, including the rigging of the Libor rate and the ‘aggressive’ mis-selling of payment protection insurance.
In his written ruling, Mr Justice Flaux said the public had ‘a legitimate interest in learning who in the banking community is alleged to have been implicated in the manipulation of Libor’ and should be given ‘the full picture’.
Barclays became the first lender to be fined last June when it was hit with a £290million penalty by regulators in the UK and the US.
Damning emails showed how traders bragged about rigging interest rates, promising each other bottles of champagne to take part.
Five Barclays staff have been sacked over the scandal, with another eight disciplined.
The  revelations also led to the departure of Mr Diamond and his right-hand man Mr del Missier, both of whom denied knowledge of the conspiracy.
Following the judge’s ruling, 104 names have been published – all of them employees whose emails were handed to the City watchdog as part of its probe into Barclays.
THE SUPER-RICH BANKERS WHO DIDN'T WANT TO BE NAMED

John Mann, a member of the powerful Treasury select committee, said: ‘There is no justification for hiding the names, particularly those at the very top.
'There are still questions to be answered about how far up this went at Barclays.’ 

The revelations came in a preliminary hearing for a case between Barclays and care home operator Guardian, which alleges the bank mis-sold it a so-called ‘interest rate swap’, which was linked to the Libor rate.
A Barclays spokesman said: ‘This started as an alleged mis-selling case which the bank considers has no merit.
'The addition of a claim based on what happened with Libor does not change the bank’s view.
'The fact that someone’s documents were reviewed by the bank during its review of millions of documents does not mean that person was involved in any wrongdoing.’

The list of 104 names

Mr Justice Flaux said more than 100 people had asked to be anonymised - and lawyers released a list yesterday containing 104 names.
The judge said not all those listed were thought to have been involved in any impropriety.
He said more than 20 were on a 'shortlist' of people believed to have been referred to in 'notices in respect of Libor'. The emails of others had been provided to regulators investigating alleged Libor manipulation.
Several firms are airing grievances against Barclays in litigation which Mr Justice Flaux described as a 'test case'.
Bosses at companies which run care homes sued after claiming that Barclays sold financial products without warning that the inter-bank lending rate on which they were based was likely to have been 'undermined' by manipulation.
Barclays disputes the companies' allegations. Bank bosses say they do not believe that 'any aspect of the case has merit'.
Scroll down for list of those who sought anonymity

Mr Diamond resigned as Barclays' chief executive in July 2012 in the wake of the rate-rigging scandal

Mr Justice Flaux said a trial was due to take place in London later this year.
The judge said public confidence in the administration of justice could have been damaged if Barclays' staff involved in the manipulation of Libor had been granted anonymity.
He dismissed the anonymity application earlier this week, after editors at three national newspapers and a news agency raised objections.

MR JUSTICE FLAUX'S REASONS FOR HIS DECISION

'The public has a legitimate interest in learning who in the banking community is alleged to have been implicated in the manipulation of Libor,' said Mr Justice Flaux, in his written ruling yesterday.

'In my judgment, for the court to permit individuals who were involved in such manipulation the protection of an anonymity order is not only not necessary for the proper administration of justice, but would be an affront to the principle of open justice and would potentially damage public confidence in the administration of justice.'

The judge added: 'So far as individuals who were not involved in the manipulation and are entirely innocent of any wrongdoing are concerned, the suggestion that they could be prejudiced by being identified seems to me somewhat unreal.'  

He gave detailed reasons for his decision in a written ruling published yesterday.
'The involvement of Barclays in manipulation of Libor is only one part of a much bigger picture concerning the manipulation of Libor by a substantial number of banks,' said the judge.
'There is a legitimate public interest in the true picture in relation to the manipulation of Libor by banks generally, not just Barclays, being brought fully to light.
'In my judgment, fair and accurate media reporting of all aspects of Libor manipulation, including the involvement of employees and ex-employees of Barclays and their identity, is an important aspect of the public obtaining that true picture.'
Mr Justice Flaux said bankers making the anonymity application wanted restrictions imposed in relation to preliminary court hearings. But the judge said full reporting of the case should not be put off.
'The manipulation of Libor by banks, including Barclays, is in the news now,' he added. 'The media... should be able to report the matter fully now, not at the time of a trial in ten months' time.'
Mr Justice Flaux also said the identity of a number of 'key' individuals - including former senior executives Bob Diamond and Jerry del Missier - was already in the public domain.
He said a parliamentary committee report had discussed the dealings Mr Diamond and Mr del Missier had with the Bank of England.
Lord Pannick QC, for the bankers seeking anonymity, had argued that naming his clients in public at preliminary hearings would be unfair.
He said information could be revealed out of context and reports might give the wrong impression about an individual’s involvement. His clients would have no right of reply to information which might emerge and their reputations and job prospects could be unfairly damaged, he added.
'It is simply unfair for names of these individuals to be published by reason of these proceedings, Lord Pannick told the judge.
'Fairness is a reason not to name someone who has not been heard in the proceedings.'
The Times and Telegraph newspaper groups, the Financial Times and the Bloomberg agency raised objections.
Guy Vassall-Adams, for the media groups, said the Libor case was a 'compelling' matter of public concern and the 'sort of stuff' journalists should report. He said courts should treat bankers like they treated everyone else and adhere to the principle of open justice.
And he told the judge that the public would think it a 'joke' if identities could not be revealed.
'They may be grand. They may be wealthy. They may consider themselves above all this. They may even be able to afford Lord Pannick,' said Mr Vassall-Adams.
'But they are just like any other individuals in court proceedings up and down this country.'
He added: 'What this really comes down to is a group of some wealthy individuals saying the court should depart from the normal principles covering civil litigation.'
Barclays last year tried to stop damages claims relating to Libor being brought. But Mr Justice Flaux ruled that firms could air their claims, following a hearing in London in October.

'They may be grand. They may be wealthy. They may consider themselves above all this. They may even be able to afford Lord Pannick, but they are just like any other individuals in court proceedings up and down this country'

- Guy Vassall-Adams, for the media groups

 

Firms had already complained of being mis-sold financial products but wanted to add more claims in the wake of rulings by financial regulation authorities on Libor manipulation.
Barclays objected, saying the new claims relating to Libor did not have 'real prospects' of success and should not be allowed.
The judge ruled against Barclays after hearing legal arguments from both sides. He said he had 'no doubt whatsoever' that the Libor claims passed the 'sufficient argument' threshold and should be aired at a trial.
The judge was told that Barclays was fined after regulators in England and the United States concluded there had been 'misconduct and wrong-doing' in relation to Libor manipulation between 2005 and 2009.
One firm, Guardian Care Homes, said the judge’s decision to allow the Libor claims to proceed was a 'huge milestone'.
The firm, based in Wolverhampton, says it was sold two interest rate swap arrangements worth £70 million between 2007 and 2008 when it sought to refinance loans with Barclays.
Bosses say they should never have been sold the products, which are designed to insure businesses against rising interest rates.

LIST RELEASED BY LAWYERS OF THE 104 WHO SOUGHT ANONYMITY

Mr Justice Flaux said that not all those listed were thought to have been involved in any impropriety. He said more than 20 were on a 'shortlist' of people believed to have been referred to in 'notices in respect of Libor'. The emails of others had been provided to regulators investigating alleged Libor manipulation...

1. Abbot, Angus
2. Anil, Atluri
3. Bagguley, Mike
4. Barnes, Nick
5. Bartosik, Kristofer Kasimir Kristofer
6. Baynes, Kenneth
7. Behiri, Chris
8. Bellemin, Velik
9. Bermingham, Colin
10. Bhattacharyya, Arrak
11. Bommensath, Eric
12. Bond, Tim
13. Brown, Conor
14. Buckley, Aiden
15. Callow, Julian
16. Carter, Sarah Camilla
17. Chamadia, Mayank
18. Chatterton, Simon
19. Chu, Sarah
20. Coleman, Aisling
21. Contogoulas, Stylianos
22. Dai, Ian
23. Darbyshire, Hamish
24. Daulby, Sarah
25. de Vitry, Benoit
26. de Waal, Eldon

27. Dearlove, Mark
28. del Missier, Jerry
29. Desler, Jon Michael
30. DeSouza, Derek
31. Diamond, Bob
32. Dymov, David
33. Egawa, Tomohiko
34. Eng, Jennifer
35. Fowden, Rupert
36. Franco, Stefano
37. Frisbee, Rick
38. Fry, Scott
39. Goudie, Paul
40. Guarnay, Adrien
41. HaIl, John
42. Harimoto, Makoto
43. Harrison, Harry
44. Herbert, Simon
45. Jancic, Aleks
46. Jiang, Joe
47. Johnson, Peter
48. Kai, Shinichiro
49. Kassam, Adil
50. Kerr, Chris
51. Kunimura, Hiroshi
52. Lee, Don
53. Lee, John H

54. Lloyd, Ben
55. Lucas, Chris
56. Lundstrom, Jan
57. Luthra, Rahul
58. Masayuki, Ebira
59. Mathew, Jonathan
60. Mitchell, Mike
61. Modhvadia, Vijay
62. Morse, Stephen
63. Murayama, Chiga
64. Murayama, Daisuke
65. Muri, Mats
66. Murray, Kilian
67. Nagai, Hideki
68. Pabon, Alex
69. Pal, Ronti
70. Palombo, Carlo
71. Pan, Xuan
72. Parrie, Hadley
73. Penketh, Steve
74. Perrette, Clement
75. Petrie, David
76. Pike, Ian
77. PoIlak, Michael
78. Porter, John
79. Reich, Ryan
80. Ricci, Rich

81. Ridgway, Jon
82. Ritossa, Ivan
83. Roberts, John
84. Saarbach, Christian
85. Savill, Susie
86. Scammell, John
87. Schwartz, John
88. Shah, Bineet
89. Shinoda, Mark
90. Spence, Peter
91. Stone, Jon
92. Storey, Miles
93. Story, Kevin
94. Taylor, Ryan
95. Thrash, Robert
96. Trebault, Pierre
97. Tsappis, Alex Thomas Henry
98. Turner, Nathaniel Joe
99. Tyce, Nat
100. Varley, John
101. Wikmark, Johan Bo Olaf
102. Yarian, Michael
103. Yeong, John C
104. Zhou, Lin Yi

 

UK set for triple-dip recession after economy slammed into reverse with 0.3% contraction at end of 2012

The UK economy slammed into reverse at the end of last year, raising the unprecedented spectre of a triple-dip recession this year. 

Official estimates today showed that gross domestic product shrank by 0.3 per cent in the final quarter of 2012 - a massive reversal from strong 0.9 per cent growth in the third quarter. The Office for National Statistics said economic output as a whole remained flat in 2012.
Although output in the third quarter was fuelled by one-off factors, the fourth-quarter deterioration was worse than the 0.1 per cent that most economists had expected.

Economic gridlock: Some analysts think the cold snap has cost Britain more than £500million a day in lost output

David Tinsley at BNP Paribas said 'it's clearly a bit larger than the consensus and ourselves were expecting'.

'I would hope that we will get a bounce in the first quarter, but of course the snow does pose a risk to that,' he added. 'So, there is a risk of a triple-dip (recession) in the UK, even if it is for somewhat erratic reasons.'

WHAT IS A TRIPLE DIP AND ARE WE IN ONE?

 If there is a contraction of output in the current quarter (for which figures will not be available until the spring) then the UK economy is officially in recession again.
That follows two recent recessionary periods (April 2008 to June 2009 and Oct 2011 to Jun 2012), without a return to robust growth in between - this is what informally has been labelled a 'triple dip'.
The UK plunged into a double-dip recession last year, contracting for three quarters in a row before bouncing back with growth of 0.9 per cent in the three months to September.
According to the Office for National Statistics, there has not been a triple-dip recession since its records began in 1955, with Britain last suffering such economic gloom in the Great Depression.
But the UK did experience some shaky economic times in the 1970s, when the economy came very close to a triple-dip recession, slipping in and out of negative territory.
But then Britons also faced eye-watering stagflation in the 70s, when negative GDP combined with high inflation.
Economists believe the chances of a triple dip now are high, given that there has been no let up in the pressure on consumers and businesses and the current snow disruption is threatening to cost the economy an estimated £500million a day.

A recession is defined by two consecutive quarters of contraction, so the economy would have to shrink this quarter as well, but that will not be revealed until the spring.

Current economic activity, however, has been hit by the snow, which some analysts think has cost Britain more than £500million a day in lost output.

The figures increase the pressure on Chancellor George Osborne at a time when all three major ratings agencies have the country's prized AAA status on negative outlook.
Sterling fell to a five-month low against the dollar and to its lowest against the euro in over a year after the data was released.
Chris Williamson at Markit said that today's numbers 'have greatly increased the risk of ... a downgrading of the UK's AAA credit rating'.
'(They) pile ever more pressure on the Chancellor to seek ways to revive the economy in the March Budget,' he added.

The IMF chief economist yesterday said that Britain needs to 'make some adjustments' to its austerity measures if the economy is not to stagnate.

Olivier Blanchard Blanchard said George Osborne needs to 'take stock' of his Plan A in the March Budget.

The ONS said the UK had recovered only half of the fall in GDP seen since the start of the 2008 recession, with output still 3.3 per cent lower than its pre-recession level.
The biggest drag on GDP came from the production and manufacturing sector, which saw output fall 1.8 per cent quarter-on-quarter, according to the ONS.
Within this sector, mining and quarrying suffered the biggest drop in activity since official records began, down 10.2 per cent, due mainly to the shutdown of the Buzzard oil field in the North Sea amid extended maintenance work.

Howard Archer at IHS Global Insight said that this one-off factor 'contributed 0.2 percentage point to the GDP contraction'.

He added that, 'There was also undoubtedly some payback in the fourth quarter from the Olympics-lifted GDP spike of 0.9 per cent quarter-on-quarter in the third quarter.

'We believe the economy is essentially flat-lining.'

The powerhouse services sector, which accounts for 77 per cent of the economy, saw activity grind to a halt in the fourth quarter due to the absence of the Olympics boost in the previous three months.

The Office for National Statistics said the economy shrank by 0.3 per cent in the last three months of 2012, which meant there was no growth overall last year

The construction sector delivered a 0.3 per cent rise in output, but economists said even this was a lot lower than surveys had indicated.

Today's figures from the Office for National Statistics represent the initial estimate of fourth-quarter GDP and are subject to revision over subsequent months, and James Knightley at ING warned against reading too much into the data.

'The problem with that is that the quality of this report is so poor. The most accurate thing we can say is that taking this and other reports together, the data is consistent with ongoing stagnation in the UK economy - the year on year GDP growth rate remains at 0.0 per cent, the same as in Q3 2012.

'That said, we are hopeful of a gradual improvement through 2013. Global optimism is improving with the euro zone situation looking less calamitous.

'Furthermore, the general data flow outside of the UK has been looking a little more encouraging and this should help support risk sentiment. Sterling has been softening, which is helping UK competitiveness, while the Bank of England's Funding for Lending Scheme is also helping to improve credit conditions.

'UK employment is also looking good right now and so if these trends can all remain in place there is the platform for the UK economy to start performing more strongly as we progress through the year.'

Up and down: The UK economy has been on a rollercoaster ride for the last two years