Fears of economic meltdown increased yesterday as the biggest fall in house prices was announced sine the dark days of UK Recession in the early 1990s. Is it the biggest indicator yet of economic collapse on the way?
Analysts are writing it off as a ‘correction’. House prices are simply too high, so the time had to come when they would begin to fall. But I suspect this is just PR spin, for the simple fact is, an economy has nothing to do with economics.
I’ve said it before, and I’ll say it again. Ever since the Gold Standard was dropped, economic prosperity has been based on confidence. It can be based on nothing else, as there is nothing but our ability to spend holding an economy up.
Recessions, nowadays, are more likely to be proof of the ‘self-fulfilling prophecy’. If we think it, we make it so.
© Anthony North, April 2008
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