We read in the Times this week:

Severe cost pressures “piling up on businesses” have led the British Chambers of Commerce to downgrade forecasts for economic growth, as companies face a “long and challenging year”.

The lobby group’s quarterly economic forecast is for the economy to grow by 0.9 per cent this year, down from a previous expectation of 1.3 per cent, with the “limited growth” driven largely by increased government spending.

Gross domestic product is then expected to rise to 1.4 per cent in 2026, but that is also slightly lower than the last forecast of 1.5 per cent.

The growth in the nation’s overall wealth is slowing.

The growth in the individuals’ wealth is… well… not growing at all. From October to December last year, GDP per capita fell 0.1%.

It’s not hyperbole to say the country is in decline.

And sadly, while the “fortunes” of the average Englishman, Welshman, Scotsman, or Northern Irishman (or Ulsterman, take your pick) have faltered, we can’t even blame it on a global decline.

As the following chart shows, while the French have suffered alongside the British, American GDP per capita has soared.

Source: World Bank

As you can see from the chart, it’s true the US has been ahead in GDP per capita for most of the past 65 years.

But while the UK and France have stagnated since the 2008 financial meltdown, the US economy and its people’s wealth have continued higher.

That’s no real surprise. Although the US has become more regulated and somewhat less free-spirited than it was in the past, it’s still leaps and bounds ahead of the UK and France… and the rest of Europe.

For Britain and Europe to have fallen so far behind is a clear indication that both are going in the wrong direction: politically, socially, and economically.

The question now is whether there is any way back for Britain. It’s a topic we’ll continue to explore in these pages.

Links to last week’s essays below.

Hope you’re having a great weekend.

Cheers,

Kris Sayce
Publisher, Southbank Investment Research

What you missed this week…

Anatomy of a crash, part 1

Stock market crashes, although rare, are a fact of investing life. They may be different in their specific causes, but they do share similar characteristics. Let’s take a look at a few and see if there are any indications whether another may be imminent. Read more here…

Anatomy of a crash, part 2

In part 1, we took a look at a handful of historical stock market crashes, their similarities and differences. Today, we turn our attention to the present. Let’s begin with the economic context. As we know, much of the world is mired in economic stagnation. That’s certainly the case here in the UK and across the Channel in continental Europe. Read more here…

Inflation: the good, the bad and the ugly

You might have noticed that prices in the shops are still going up, if less rapidly than a couple of years back. But up is still up, unlike most salaries but very much like taxes. Speaking of taxes, which can be of benefit to narrow groups such as government employees, QUANGOs and the like, inflation can be of benefit too. Read more here…

Move over DOGE, here comes CORGI

By now you have almost certainly heard of Elon Musk’s DOGE (Department of Government Efficiency) initiative to uncover, audit and root out waste across most US Executive Branch departments. Hardly a day goes by without another announcement of some new source of waste or even outright fraud. Read more here…

Did Apple just kill Qualcomm with a paragraph?

Last week over at AI Collision we looked at some of the elder statesmen of the world’s tech scene – Dell, IBM, HP (both of them) and Intel. Of note was how Dell has managed to adjust and adapt to the changing landscape of tech. HP, through its split, has at least kept relevant (for one half of it at least). IBM has become more of a quantum opportunity than AI (albeit that does still mean AI). And then Intel. Read more here…