Is the coronavirus recession as bad as it looks?

This is Money Podcast

This is Money

Business News, Business, Investing, News

4.1 • 650 Ratings

🗓️ 15 August 2020

⏱️ 44 minutes

🔗️ Recording | iTunes | RSS

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Summary

We are in the worst recession in living memory for the UK with GDP plummeting by 22.1 per cent in the first six months of 2020.

But strange as it may sound, does that matter?

We knew things would be terrible as the coronavirus lockdown pressed the pause button on the economy and people’s lives.

Shops were shut, businesses were shuttered, everyone who could worked from home, almost 10million people were furloughed, international travel was halted, property sales were frozen and children didn’t go to school for four months.

If you’d have predicted that was what 2020 would bring last New Year’s Eve, nobody would have believed you and they might even have called for help.

So, it should come as no surprise that the ONS released figures this week showing that this year’s astonishing actions crashed the economy – although the fact that the UK suffered more than any other major economy other than Spain is a cause for concern.

The question is, what next?

On this week’s podcast, Simon Lambert and Georgie Frost dig into the GDP figures to find out why the UK was hit so hard, whether we can read anything into the ONS’s figures and what to watch out for to identify if the economy is recovering better or worse than expected.

Also on this week’s show, they discuss how amid all that carnage some households are getting their finances on track, how to buy a property in pandemic if you are an aspiring first-time buyer and how to keep your pension on track.

And finally, the Government in its wisdom has decided to push on with getting Brexit fully done - even if it means no trade deal by the end of the year – and that will mean imported cars get more expensive. But fear not, new car buyers, because we’ve got the best British-built options instead – from a Nissan Juke shopping cart, to a gorgeous McLaren and the wonderfully bonkers Ariel Atom.

Transcript

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0:00.0	Welcome to This Is Money Podcast, brought to you in partnership with Charles Stanley Direct, the award-winning investment platform, trusted by over 40,000 clients' investment involves risk.
0:10.4	I'm Georgie Frost, and alongside me today is editor Simon Lambert.
0:14.0	And, Kel's surprise, we are officially in recession.
0:18.0	But what does it mean for us?
0:19.9	And is it all gloom and doom, as the figures would suggest?
0:22.9	Well, it's not all gloom and doom, as it seems lockdown has turned Britain into something of a
0:28.0	nation of accidental savers, with more of us paying down our debts. Also today, green shoots as well
0:34.1	of recovery in the property market, but how long will it last and will first-time
0:38.6	buyers be the winners or the losers in all of this? Last week tips to keep your retirement
0:43.4	plans on track as young people particularly stop putting money into their pensions due to coronavirus
0:48.7	and with Brexit on the horizon, we take a look at the best of British cars. And don't forget, himself
0:55.1	to date with all the latest breaking money news, just go to this ismoney.com.uk or download the
1:00.3	app. But first, we're officially in recession. It was confirmed this week by the ONS in what
1:05.9	Simon has said managed to be both important and perhaps the most meaningless piece of news this year.
1:13.0	Let's be honest, shutting down businesses and telling everyone to stay at home was never going to
1:16.5	be good for the economy. The 20.4% decline in GDP from April to June was the worst quarterly
1:23.1	drop on record. But what does it really actually mean for you and I? And are there any positives,
1:31.3	any green shoots, anything in those pretty horrendous figures that can make us feel a little
1:39.1	bit better? Simon, what does being in technical recession actually mean, by the way, economics 101?
1:47.8	It means that you've had two consecutive quarters of what is wonderfully termed negative growth.
1:56.6	Negative growth is basically going backwards.
2:00.5	It's a contraction in the economy.
	...

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