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As a result, the eurozone is seriously underperforming.Somehow Europe has to learn to how to do better. That needs a change of mindset among the political leadership. Would the new constitution, if approved, encourage the EU elite to think differently? Surely not. But if it is rejected, then the leaders would have to consider what the voters really want.. Gordon Brown does not like David Blunkett And David Blunkett does not like Gordon Brown That, I'm afraid, is not news. What matters is how the two mesh together as Chancellor and Work and Pensions Secretary Gordon Brown does not like David Blunkett And David Blunkett does not like Gordon Brown That, I'm afraid, is not news.
Shortly, though, Mr Turner will tell us how we might get out of it. The former CBI boss's prescription is likely to involve "soft compulsion" - an oxymoron that will force employers to pay large amounts into pension schemes and then twist their workers' arms to follow suit. It would certainly help the housing market, which needs to be stabilised. Once people are convinced that the trend for the next couple of years will be down, they can look through any current difficulties and plan.The obvious worry is that the Bank is still worrying too much about inflation and not enough about demand. Its guns, so to speak, are still facing in the wrong direction.It has not made a serious mistake on the upward part of the interest rate cycle and there really has not been much of a case for lower rates until now.
But it could make a mistake on the downward part of the cycle by not getting going fast enough.Eurozone should say 'yes' to trade but not to integrationThe background noise is deafening and, consequently, the signals are very hard to interpret. As it does, expect consumer spending to be hit.Consumer confidence? Well people claim to be confident (next graph) both about their own situation and, to a somewhat lesser extent, the economy. But that does not mean (third graph) people are going to rush out and spend big. Indeed, they think it is almost as bad a time for that as they did in the early 1990s.One of the most useful concepts in economics is "revealed preference" - you don't listen to what people say they think or want.
