The R-word

The throng saying we’re entering a recession has been joined by its most significant member so far.  Mervyn King deployed the R-word in a speech to Leeds businessmen last night, and the markets have reacted accordingly.  Sterling collapsed against the dollar – hitting a five-year low of $1.6203 earlier.  Whilst the FTSE share index has looked wobbly since opening.  All of which fuels the idea that no amount of Mandelsonian manoeuvring – or no amount of public cash – can prevent the poor state of the economy being the story of the next few weeks, months, years.  The question that remains is whether Brown & Co. will capitalise because of it.  Or whether it will sink them.