UK prime minister Tony Blair is facing the biggest test of his
political career as he tries to persuade the British public to
support military action against Iraq in alliance with the US. But
his government is not just dealing with a major foreign policy
problem. The UK economy is also under scrutiny.
In all of the Anglo-Saxon economies - the US, the UK, Australia
and New Zealand - there are huge consumer debt bubbles. But the UK
has the biggest. It might deflate slowly or burst suddenly.
As UK house prices rocket by more than 25% a year, the government,
the Bank of England and most analysts continue to deny that there
is a debt bubble. Debt is not at danger levels, and the consumer is
still spending because incomes and property values are rising and
unemployment is at historical lows.
Irrational optimism?
Are the optimists right? They admit that house...
