We live in an ‘Alice in Wongaland’ economy, apparently
Someone has coined an awful phrase for the UK economy, and you can bet that every newspaper in the land is going to run with it. Yes, we live in an 'Alice in Wongaland' economy now, where the government’s Help to Buy scheme is creating another housing bubble, and recent retail growth is unsustainable – based on the availability of short term loans.
That’s according to Ann Pettifor, from Prime Economics – who was reacting to figures from the Office of National Statistics that show a spike of growth in the retail sector in July.
She said: "I think it's artificial and can't be sustained. People's incomes are falling in real terms, and have done so for five years. Now there's been this sudden, ‘go on let's just go’ because everyone says its in recovery. At a fundamental level it's quite dangerous because household debt is still 153 per cent of GDP. There's nothing seriously underpinning this recovery, and that's why it's Alice in Wongaland, the confidence fairy is out there.’
Aside from wanting to punch her for saying ‘confidence fairy’ (there are no fairies in Alice in Wonderland, Ann, just big mental rabbits) she does have a point. According to retailers, the growth in the retail sector in July - which was the fastest for 2 years - was down to the good weather and the feel good factor of the Royal Baby, rather than any real long term growth.
Oh well, time to break open the bottle that says 'Drink Me.'