UK Economy Is Falling

The head of Barclay's bank, John Varley, says he believes housing prices in the UK will continue to fall and will end being 30% lower than at their peak. He also suspects that unemplyment will rise to 7.5%- that would be an additional 700,00 jobs lost. Also, foreign investors in the UK have decreased because of the downward slope the value of the pound is on.

A main distinction between the UK and US is that the EU has strict rules as to the limitations of the government on situations like this. The government is restricted from helping the banks because rules state the government cannot rack up a debt to help boost the economy. Therefore, the only measure the government can do is keep inflation artificially low.