Tuesday, June 10, 2003

Will this be ready in forty five minutes as well?

The super soaraway Financial Times claims that the "Euro could add £100bn to Britain's GDP".

Sounds good, that's 9% of GDP but unfortunately "the effect would take a long time - perhaps two or three decades - to show through completely." So we won't actually see the effect, we'll just have to believe them.

We also have this little killer "the lowest figure is a gain of just 0.5 of a percentage point of GDP, worth a mere £5bn a year." So there is a factor of eighteen between the highest and lowest estimates. And we are supposed to take these figures seriously?

It is also likely that some negative forecasts were ignored in compiling this report. After all conversion costs, the loss of trade outside the Euro-zone and inappropriate interest rates can do tremendous damage to an economy (ask anyone who lost their home in 1992).

However we must also be told where the reports were gleaned from the internet, how old they are and whether any Iraqi exiles had a hand in drafting them.


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