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£2.8 trillion lost to credit monster

May 6, 2009 at 1:30 pm

In January, business minister Baroness Vadera drew criticism for insinuating that the British economy was beginning to recuperate. Four months later, as the Bank of England announces yet another month of credit woes, the International Monetary Fund (IMF) warns that global debt could reach a record £2.8 trillion before the first “green shoots” of economic recovery begin to appear.

According to the BBC, the UK economy suffered a slump of almost 2% during the first three months of 2009. The Bank of England has asked consumers to be vigilant over fluctuating credit conditions, but has made no promises to unhappy savers and the ubiquitous unemployed.

John McFall, chair of the UK Treasury committee, described the current economic crisis as an “astonishing mess” and called on financial institutions to make amends with alienated consumers.

Experts predict that the credit-crunch will continue to gobble up money, jobs, and good cheer until 2010. British anglers, foresters, and farmers have shown some resistance to the frosty economic climate, however, with some sectors experiencing growth for the first time in twenty months. Retail services also enjoyed a boost to their profits in early 2009.

In similar news, beleaguered American institution, Citibank, finally quashed rumours of its collapse by reporting a £1 billion profit in the first four months of 2009. Citi, who also own the Egg internet bank, made thousands of people redundant in November 2008. Fellow US banks, JP Morgan Chase and Goldman Sachs also posted a profit.

An interactive Recession Tracker – offering data on unemployment, repossession, and house prices – can be found on the BBC website.

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