The housing market
‘Negative equity is a threat to 3 million homes’
was the headline in a recent edition of the Daily
Mail newspaper. But Labour politicians do not
believe that that there will be another recession.
However, official statistics disagree.
In parliament, Liberal Democrat, Vince Cable,
warned that a 10% fall in house prices would
leave 3 million households with negative equity.
Government Minister Angela Eagle was quick to
disagree. But house prices have fallen for the last
five months and economists warn that this trend
is likely to continue.
The economy
The chancellor, Alistair Darling, insists the UK
economy will still grow this year. The Bank of
England is under pressure to cut interest rates.
It’s unclear what will happen in the US, but
Ben Bernanke warned that the world’s largest
economy could shrink in the first half of 2008.
Further bad news
Oil is still selling at over $100 a barrel which
suggests that petrol prices will stay at their
current level of about a pound a litre.
Food inflation is rising. The cost of milk, bread
and sugar has been going up for many months.
The latest food to come under pressure is rice
– the UN has warned that 36 countries could run
short of essential food stocks.
The week the crisis hit home
Level 1
Elementary
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The week the crisis hit home
Level 1
Elementary
Comprehension check
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