David Cameron's response to world economic meltdown? A round robin

British Prime Minister has set firmly into the international debate - and anyway, your focus should be closer to home

It was just a breath of air in fall 2008 in Washington this weekend. Ben Bernanke's efforts to calm financial markets with Twist The operation failed spectacularly, sending the Dow Jones falls more than 600 points in 48 hours, Greece the last round of austerity measures was met with a shrug shoulder, and banks became the center of fears about the next phase of the credit crisis.

response in Britain this new alarming turn of events? David Cameron, visited Ottawa, and organized a round-robin letter to Nicolas Sarkozy, President of G-20.

British officials tried valiantly to describe the initiative, supported by Canada, Indonesia and Australia, as a seminal diplomatic realignment. Rather than remain neck and neck with his former allies of the United States and the Eurozone, London ran a new ginger group to remind the rest of the G-20 of their responsibilities.

without the signature of China, the United States or Europe, however, and South Africans to dropouts last minute citing logistical difficulties (perhaps his pen had run out), the net effect was simply to highlight the divisions between the nations of the G-20, and locate Britain firmly in the global debate.

While we listened to our international partners, even if - they are not - the primary responsibility of the house of Cameron. Unemployment rose from 80,000 in the three months to July, more than 2.5 million, and the IMF should remain at these levels until at least late 2012. Many analysts expect to get much worse.

George Osborne has done a lot of support from the IMF, Christine Lagarde, the head of its austerity program. But Lagarde said this weekend that countries with strong "entrenched" plans to restore its public finances could lead to "adapt to the short-term growth." "There is a dilemma is a matter of time," said

Chancellor is quite right that, as Gordon Brown said at the beginning of the credit crisis 1.0, no country can be immune to global developments, but global nature of the crisis must not allow bureaucrats Osborne ignore bullies euro liability or dysfunctional U.S. political system.

The risk is that, as the first shot, the UK, with its heavily indebted households and applauded banks, is particularly vulnerable.

• Throughout the growing crisis of this summer, Osborne repeated the mantra that has been invoked since the election: Britain is a haven of peace, its austerity measures that we taken in economic danger, and adhering to spending plans sacred no matter what. Speaking to reporters in Washington on Friday, reiterated his position, saying. "I very clearly that we have a plan, we follow the plan It is a plan which means that the discussion does not address market pressures on the United Kingdom. "
• But the market's reaction to the austerity unstable in the euro area has shown that both investors hate wasteful governments, which are also terrified of stagnation.
• The crisis of confidence gnaw on world markets and is returned to slower growth. Last week, the CBI survey of manufacturing industry, which is intended to be a leader awaited rebalancing of the economy, showed empty order books, the weakening of export markets and accumulation of surplus property. Although rebel leaders in the euro area are able to overcome their differences, and the reserves of his constituents - and to avoid blowing away the single currency, it will be too late to avert a sharp slowdown, perhaps even a recession in Europe, remains by far our largest trading partner. Meanwhile, Bernanke desperate measures, and market response, highlight the fragility of the U.S. economy has also become.

Osborne can trust the Bank of England to come to the rescue, and it became clear last week that the monetary policy committee is close to signing for a new round of quantitative easing. In Washington, said his approach was to be "fiscally conservative" Bank could be "financially active".

Dhaval Joshi But in research ACB has recently argued, while EQ can increase GDP - 1.5%, according to Bank analysis - seems to have mainly by higher prices assets and profits for the benefit of the rich, but erode the purchasing power of low-wage workers, who face higher inflation with little hope of making an offer to their salaries. In other words, even if the economy continues to fall into recession, the QE2 will not address the social costs of the slowdown is coming.

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