UK Economy is in a ‘state of crisis’ says ex IMF Exec

Ex-IMF chief economist Simon Johnson, although now no longer in his role at the IMF has a lot of weight behind his name and his words should be heard. He had some worrying things to say in an interview with the BBC.

Talking to the  BBC, Simon Johnson said the UK should be seen in the same category of countries as Greece and Spain, who are facing severe debt problems.

Johnson is quoted as saying:

Now Greece is an an extreme example – there I think you can see that it’s going to get very messy very quickly – but unfortunately the budget situation in these other countries is also weak. And I have to add the UK to this list. Unless you can persuade the markets that you’re really going to bring the budget under control within the foreseeable future and you’re going to have some credible actions – and you’re going to have to do some persuading – you’re going to have big trouble.Simon Johnson

Pressure is mounting on the EU to take action and this will be brought into sharp focus this coming week when the new President of the European Council Herman von Rompuy chairs a special economic summit in Brussels at which the public finances of Greece, Spain and Portugal will be discussed.