After every downturn comes an upturn [BT broadband office]

After every downturn comes an upturn

Posted 21 May 2008 at 8:34AM by Ian Betteridge in Doing business online

There is, it seems, light at the end of the tunnel. According to the US National Association for Business Economics (NABE), the US economy will be recovering from its current downturn before the end of the year. Given that the current worldwide malaise is largely due to knock-on effects of the US credit crunch, this is likely to be good news for us in the not-too-distant future.

But will things really return to the way they were before? The answer, unfortunately, is "probably not". Although banks may start to come out of their shells a little and start lending more freely, the kinds of easy credit which drove much of the consumer economy prior to this year are unlikely to come back for quite a while.

However, there is some good news: the NABE also predicts that the dollar will begin to gain in strength, which means that businesses exporting to the US can breath something of a sigh of relief. While its predictions won't mean too much in the short term, they do at least indicate that the downturn shouldn't turn into a fully-fledged recession.

Tags: bt, bt broadbandoffice, economy

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Comments

1. At May 21, 2008 9:24 AM, Chris Sabin wrote:

The US economy is recovering because the FED is issuing billons of dollars worth of assets, as well as JP Morgan lending over $18 billion to one of the biggest banks in the US. This is giving back the confidence to the investors and with companies reporting profits above expectations and making some wise acquisitions or re-investing their money, they will see the results come the end of the year.

However the likes of platinum, gold, silver etc have skyrocketed in price due to the credit crunch because it was seen as a stable investment considering the price of oil. Speaking of oil it probably will hit $200 a barrel by the end of the year which wont help the downturn but with the ship starting to steady things are looking up.

2. At May 21, 2008 9:39 AM, steve wrote:

So we here that the US will turn the corner by the end of this year, is this not the case that we tend to talk ourselves into problems like this, a positive approach is what is needs (like the indpendenet business development courses my company provides), we must adopt a clear focus on looking what we can do to overcome the problem instead of becoming part of the problem www.activitygroup.co.uk
Steve Descher - MD

3. At May 24, 2008 10:07 AM, Ian Jenkins wrote:

Oh dear economists and their tunnel vision and so highly paid? part of the reason for America's so called "early recovery" is due in the main to the massive reduction in interest rates AND passing same onto cash-strapped Mortgagees. Its well time the myth about high mortgage rates or base rates or both keeping inflation down is squashed once and for all. The facts of the matter are that high interest rates INCREASE inflation and stifle trade. Mortgage rates need slashing here urgently before our downturn morphs into a MASSIVE problem bigger than the last depression with millions homeless!
GET THOSE MORTGAGE INTEREST RATES CUT BY 2% AND DO IT NOW
Ian Jenkins
www.accessentertainment.co.uk

4. At May 27, 2008 8:52 AM, james wrote:

Have just returned from the usa, and for all you people who think the price of oil is going to reach $200 per barrel I have to inform you that this not the opinion of most of the usa finance company's, reason 1 at the moment the usa is awash with oil, it has no more capacity to store anymore, there are attempts to try and put it back in old dried up wells, 2 there is growing rumours that Bush will release 2 billion barrels from the countrys reserves before the next election. oil i suspect is going to have a rough ride in the next few months with a big correction in june/july. rgds jk

5. At May 27, 2008 2:41 PM, 'Razor' Ramone wrote:

The USA has always been awash with Oil. Reason being so they can have the only major supplies when the rest of the world runs dry, then can dictate its price without fear of competition.

The very fact that they are considering releasing some of their reserves into the public domain is evidence in itself of the scope of the problem.

Short-term fixes and overblown spending on unnecessary actions have been the hallmark of this US administration, so I would actually be greatly surprised to hear the their economy was coming out of a downslide before the power changes hands to ones more competent.

6. At May 28, 2008 6:46 PM, Chris Sabin wrote:

It is expected to hit £200 a dollar because Opec (the controllers of all things oil) are not going to increase supply to meet demand which is driving the price up.
The USA of course has plenty of reserves and so does the UK.
You dont just stock what you need. You get extra to make sure that you plenty supplies!

BT broadband office