Read this BBC report of the Moody’s downgrade of the UK’s credit rating and you would think it was all over, UK PLC is done for…or as the BBC put it …Osborne’s ‘Gamble failed’.
Despite putting in the basic facts from the report the tone adopted by the BBC is downbeat and defeatist with an emphasis on an economy with ‘significant “challenges” ’ …though Moodys itself doesn‘t use the word ‘Significant‘ …..except in the positive sense as it says itself: ‘the UK’s creditworthiness remains extremely high, rated at Aa1, because of the country’s significant credit strengths.’
Read Moody’s actual press release and you will see a much more upbeat analysis of the UK economy…. supporting Osborne’s ‘strong track record of fiscal consolidation and political will.‘
Look at the growth figures from 2010 Q4 up until 2012 Q4 and they paint a different picture to that painted by Balls and the BBC of no growth or even contraction:
The total positive growth for the period is 2.6%.
The total negative growth for the period is -1.2%
The sum total then is a positive growth of 1.4%….slow and low but not ‘failing’ and certainly not ‘contracting’ as the BBC so often state..
Look at the GDP figures since 2006.….they show that even after the deepest recession since the ’30′s we have a GDP above that in 2006:
In 2006 we had a GDP figure (£m) of 353,777
In 2009 Q2 (The height of the recession) GDP was 349,261
In 2012 Q4 GDP was 360,483
Finally there’s the issue of Moody’s own credibility…..
The BBC has always attacked these credit rating agencies but seems happy to take the opportunity to give Osborne a dig.
However I did laugh when I heard this this morning from ‘Wake Up to Money’ (26 mins) from Mickey Clark in relation to the credit rating agencies:
‘They’re not regulated, they have got a lot of vested interests…and they got away scot free over the banking crisis.’
Or was he talking about the Labour Party!