The UK; a case study on botched COVID-19 stimulus: Pete Wargent

The UK; a case study on botched COVID-19 stimulus: Pete Wargent
The UK; a case study on botched COVID-19 stimulus: Pete Wargent
EXPERT OBSERVER
 
As Australia gets back to business I've been following the UK government's inept handling of the Coronavirus with increasingly wide-eyed incredulity.
 
The cost to date has now been estimated at a mind-boggling £284 billion according to the government's own spending review this week. 
 
If you were wondering what exactly has been achieved by this interplanetary level of spending (so far), then you wouldn't be Robinson Crusoe there.
 
With the Brits expected to announce approval of the rollout of a Biontech/Pfizer jab as early as this coming week then the UK's effective lockdown will likely continue through until the new year, accounting for thousands more blameless small businesses.
 
To add insult to injury the botched and inoperable test-and-trace system has alone cost an absurd £22 billion, single-handedly erasing years of pointless austerity measures.
 
Britain's public sector net debt will soon be well above 100 per cent of GDP and back to the highest level since the post-war years. 
 
Higher taxes will doubtless be back on the agenda soon enough to pay for it all, but this time around capital will likely up and leave. 
 
Just the Brexit debacle to finish off now before the incumbent PM gets ushered out of politics...
 
Money printer go #Brrr...
 
It's remarkable how quickly views have changed in respect of quantitative easing and related stimulus. 
 
Fears of inflationary spirals in the financial crisis aftermath have been replaced the money printers being embraced with joyful abandon. 
 
Grant Williams of RealVision and TTMYGH rustled up this belter of an infographic this week to compare the scale of the Covid-19 stimulus to that of the 2008 financial crisis. 
 
 
With interest rates mired at zero for the foreseeable future capital has been flowing into real estate, stocks, and cryptocurrencies. 
 
Lucky country
 
Numerous medical journal studies are now showing how Vitamin D can play an important role in reducing Covid-19 infection.
 
 
This might go some of the way to explaining Australia's near elimination of the virus, with zero deaths or cases in ICUs or on ventilators for a long time now. 
 
Whatever the reasons, it's looking increasingly likely that Australia has dodged another sizeable bullet and will become a remarkably sought-after destination once its international borders are reopened.
 
Data due to be released this week will show that the Aussie economy began to expand again with output growing by about 3-4 per cent in the third quarter of 2020, with another pumping current account surplus, and housing prices rising by +0.6 per cent in the month of November. 

Pete Wargent

Pete Wargent

Pete Wargent is the co-founder of BuyersBuyers.com.au, offering affordable homebuying assistance to all Australians, and a best-selling author and blogger.

Tags: 
United Kingdom COVID-19

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