UK Set for Unprecedented Economic Growth in Third Quarter

The UK is set for record-breaking economic growth in third quarter, but some economists are fearing that the strong initial rebound may quickly lose momentum.

Economic Recession in the UK

The UK is officially in a recession for the first time in 11 years. Following the coronavirus pandemic, the UK economy has suffered its biggest slump between April and June. The UK economy shrank 20.4% compared with the first three months of the year. This was due to a plunge in household spending as shops and restaurants were ordered to close, as well as reduced factory and construction output. Earlier in August, Chancellor Rishi Sunak reported that the government was ‘grappling with something that is unprecedented’ and that it was a ‘very difficult and uncertain time’ for the economy.

Economic Upturn as Coronavirus Measures Ease – but will it last?

The Office of National Statistics (ONS) reported that the economy bounced back in June as the government restrictions on shops and movement started to ease. Jonathan Athow, deputy national statistician for economic statistics said that despite the sudden growth in June, the gross domestic product (GDP) of the UK still remains a sixth below its level in February.

New data has suggested that the UK economy may experience an unprecedented economic growth in the third quarter. Household spending and consumer spending – including leisure – during the first two weeks of August have already exceeded the same period one year earlier. This growth is the first that has occurred in the UK economy since the coronavirus lockdown was introduced in March.

However, economists are weary of this initial spike in consumer spending. The predicted GDP for September 2020 is set to rise by 14.3 per cent, reversing 55 per cent of the 20.4 per cent drop in output in three months to June 30.

Companies making redundancies in the UK

COVID-19’s impact

Companies across all sectors have been struggling this year as COVID-19 has struck the world’s economy. Businesses everywhere have had it tough but the retail and aviation sectors are the ones being hit the hardest. With social distancing measures and the lockdown limiting the amount of productivity in the workforce, production and service has been difficult to carry out. The huge consequence of all of this for the economy has been a decrease in cash generation, and unfortunately some things are done in response to try and repair the damage.

The main repercussion of the pandemic has resulted in thousands of people in Britain losing their jobs. A large number of companies have announced plans to reduce the size of their workforce. Many firms across the UK have fallen into administration this year, while others are balancing on the fence – many being held up by the government’s job retention scheme.

List of companies cutting workers:

Next

The Next store chain is planning to make redundancies at its head office. The group was forced to close all its stores when lockdown was imposed and lost revenues for the year. The potential amount of money being lost totalled up to around £1 billion.

Airbus

Airbus is to cut 1,700 jobs n the UK as part of global restructure due to reduced production levels. Chief Executive Guillaume Faury warned the company was planning to have a large drop in jetliner output due to the upcoming large cut to the work force.

John Lewis

The retail giant is looking to close more of its stores, make redundancies and remove all of its bonuses. The new chairman reportedly sent a letter to the staff, warning them of potential closures as well as cuts to jobs.

It is said that the letter included implications for some Partners’ jobs which involve companies like Waitrose. It is not known yet how many roles could be affected by recent events.

Personal Finance Podcasts You Should Be Listening To

As media inches closer and closer into the digital age, podcasts are king. They are free, entertaining and an excellent source of information from people with experience and wit. It is important to become financially literate to make sure you can keep your personal finances in order. Here is a list of some entertaining and informative podcasts that are perfect for anyone who is interested in personal finance.

Bigger Pockets Money

Bigger Pockets Money is a podcast that is hosted by Scott Trench and Mindy Jensen. The podcast is a captivating guide to investing with a real focus on properties and real estate. The podcast offers practical advice from financial experts and personal insights from the investing experiences of the hosts themselves. Bigger Pockets Money is a fantastic resource for those who are looking to grow their wealth through real estate investing.

HerMoney with Jean Chatzky

Jean Chatzky’s personal finance podcast allows for a candid conversation about money, specifically related to women. It is extremely important for women to be financially literate so that they can have control of their money, their earnings and their investments – this podcast gives women access to the information they need to boost their personal finance skills. Jean Chatzky is a relatable and informative host, and this podcast is a must-listen for all women!

Millennial to Millionaire

The host of this financial podcast is Paris Grant. He brings a unique voice to the personal finance of the millennial generation. Building wealth is important for the future generations and podcasts are a great way for young people to learn about handling personal finances and growing wealth. Paris Grant offers great practical financial advice and gives idea on ways to build wealth over time by starting early on this personal finance podcast.

Bank of England: Coronavirus V-Shaped Recovery Likely

Despite bleak early forecasts, the Bank of England has announced that a V-shaped economic recovery is seeming increasingly likely. Chief economist, at the Bank of England, Andy Haldane has announced that the British economy is recovering faster than expected. However, with warnings of higher inflation and the threat of unemployment, this recovery could be jeopardised. Official figures published earlier this week showed that the British economy shrunk by 2.2% at the beginning of this year. This represents the sharpest economic downturn since the 1970s. According to those figures, the UK economy was set for the deepest recession in history. Further, with the dwindling of economic activity by 20% in April, the first month of full lockdown, a deep slump was expected. However, earlier this week, during a webinar, Haldane noted: “There is a debate about which letter of the alphabet will best describe the path of the economy, with some scepticism about the V-shaped scenario path in the Bank’s May monetary policy report. It is early days, but my reading of the evidence is so far, so V.” As the rest of the world emerges from lockdown, financial markets have witnessed one of the strongest quarters on record.

From April to June, Wall Street has displayed a dramatic turnaround, aided by emergency financial support provided by the federal government. Since the start of April, the S&P 500 index has risen by almost 20%, demonstrating the largest quarterly increase since 1998. During that same period, the FTSE 100 has resurged by almost 10%, surpassing the peak of 2010, when the market was recovering from the 2008 financial crisis. The Bank of England’s chief economist added that the economic recovery is largely down to consumer spending, which returned faster and stronger than forecasts had predicted. However, with unemployment skyrocketing, the fate of the recovery remains uncertain.

Trafford Centre Owners Intu on the Brink

As the owners of Trafford Centre, and other shopping centres across the UK, Intu are on the brink of administration, we take a closer look at the company.

Intu Property Plc are a British real estate investment trust largely focussed on shopping centre management. As such, the company owns or part owns seventeen sites across the UK, with one shopping centre located in Spain. Previously, the company was known by a number of names, including Liberty International Plc and Capital Shopping Centres Group Plc.

Founded in 1980, Intu started life as life assurance investment company. In 1992, a merger with Capital & Counties, a shopping centre development company, changed Intu’s track.

The Trafford Centre was developed and owned by The Peel Group. It first opened its doors in 1998 and was, at the time, the biggest shopping centre in the United Kingdom. The construction of the Trafford Centre cost a total of £600 million and took almost thirty months to complete.

Intu purchased and took control of the Trafford Centre in 2011. At the time, the property was valued at £1.65 billion.

Located right off the M60 motorway, it is believed that the Trafford Centre is within a forty-five-minute drive to ten per cent of the United Kingdom’s population. Thus, it is visited by around thirty-five million people each year.

Many aspects of the Trafford Centre’s design pay homage to its location. The food court is designed in the form of a steam ship, which is a nod to the Manchester Ship Canal, located a stone’s throw away from the centre.

Designed by The Peel Group, the Trafford Centre is covered in ornate luxury. From 45,000 square metres of marble and granite flooring, to the £5 million main dome, which is said to be bigger than the dome at St. Paul’s Cathedral.

Stock Market crash: Why to invest in UK shares now

At the start of the week, the FTSE 100 index was falling quite considerably. Thankfully, it recovered after a few days and as a result it went up 5.2% from May. If the trend continues, this will be the second straight month of index gains, making it one of the best times to invest in UK shares.

Best time to buy

Equity markets are not at insane heights at this moment. This means that investors should be looking to bank in on certain stocks and hope to make a profit. The markets are not plunging either, which can seem like a risky, if not categorically dangerous, time to invest too. Stock markets are somewhere between the two extremes right now. This indicates that there is room for the FTSE 100 to definitely grow.

In other words, an investor can be confident that the money put into stock markets right now will grow There are plenty of FTSE 100 stocks that make good purchases at this time. For example, cyclical stocks took quite a hit during crash, but now it is looking to be full of potential.

Best UK shares to buy

The UK has plenty stocks, such as Persimmon, which are looking to be very profitable. Real estate places are looking to bounce back from these crashes as their stock forecasts are looking impressive with the relaxing of social distancing rules. PSN has also bounced back from the lows it touched during the crash. Analysts’ stock price forecasts are encouraging, as is its past performance. Other FTSE 100 UK real estate shares are worth considering as well.

Stocks in growing industries, for instance, those of technology-driven companies are very promising. If there was any doubt about the potential of these UK shares, the lockdown has completely removed them. There has been a shift in the industries since the COVID-19 outbreak and a lot of technology has been accelerated due to these forced circumstances.

The Bank of England and a Possible Coronavirus Recession

As the UK economy starts back up, the Bank of England still remains fearful of a possible coronavirus recession. Despite recent positive signs, such as the reduction of the UK’s coronavirus alert level, officials’ hopes remain muted. Following the Bank of England’s injection of £200 billion into the economy, last week it announced a further £100 billion injection. Analysts are warning that these two cash injections surpass all historical precedents and indicate fears of a looming recession. Yet, despite these warnings, the Bank’s chief economist Andy Haldane commented, “the recovery in demand and output was occurring sooner and materially faster than had been expected at the time of the previous MPC meeting.” Thus, we may actually be doing better than was originally expected, now that a semblance of normality is finally returning to the economy.

While financial and monetary concerns may be showing signs of positivity, one thing’s for sure and that’s the dramatic rise of unemployment. Andrew Bailey, the Governor of the Bank of England, has warned that we stand before “the steepest trajectory in the rise of unemployment.” Alongside this, the easing of lockdown restrictions will take time to reap fruit. After months in lockdown and with fears of a second wave of infections, businesses will take some time to return to full swing. That period of the unknown is one in which the sharp rise in unemployment is expected. This paints a worrying picture, possibly for a long time to come.

Ultimately, as we stand on the precipice of what was feared to be the worst and farthest-reaching recession in history, we simply do not yet know what the future has in store. Only time will tell what the true impact of the 2020 coronavirus pandemic will be. In the meantime, Boris Johnson’s government bungles from one gaff to another as we remain helpless.

McDonald’s Walk-In Service Reopens for Customers

Among the very first fast food outlets to close at the beginning of the lockdown, McDonald’s has announced it will reopen for walk-in customers. While only eleven McDonald’s service stations will reopen for walk-ins today, and all drive thrus have been reopened, all McDonald’s franchises are set to follow suit by June 24. Although the reopening of walk-ins signals a partial return to normality, customers will not be allowed to dine in at any of the restaurants. The move comes as strict social distancing measures are set to continue, with McDonald’s issuing their own rules for customers to abide by while visiting their premises.

McDonald’s Social Distancing Rules

Under McDonald’s strict social distancing rules, only one member per household will be allowed entry to the walk-in service to collect food. Also, children will be allowed in if necessary, but play areas and digital play screens will be off limits. Furthermore, toilets and lifts will also remain closed. All orders will be capped at £25, as the fast food giant will continue to operate a limited menu. Additionally, McDonald’s will offer customers hand sanitiser to use upon entry, pay using contactless payment methods, follow space markers to ensure social distancing is maintained and follow a one-way system inside their premises.

On the limited reopening of walk-in services, Paul Pomroy, McDonald’s UK chief executive declared, “Following a closed test in London last month, I am pleased to confirm that we will begin reopening for takeaway and click and collect. Starting on Wednesday 17 June, in 11 Roadchef service station locations, we will welcome motorway users back inside our restaurants for the first time since March. We’re taking our time to get this right, reviewing our processes before we gradually roll-out to high streets, towns and city centres from 24 June onwards.”

Formula One Bosses Welcome Silverstone Support from Actor Rod Bond

With the 2020 Formula One season beleaguered by cancellations, bosses have welcomed support for two Silverstone grands prix from actor Rod Bond. An icon of the British film industry, Rod Bond is also a known fan of Formula One. Not only that, the star boosts excellent friendships with Formula One bosses and racing drivers, including British F1 stars Lewis Hamilton, Lando Norris and George Russell. The £50,000 donation from Rod Bond is in support of a rigorous coronavirus testing regimen, stipulated by the UK government, in order for the grands prix to proceed safely. Financial experts have stated that such a move is unprecedented but will go a long way to assuage business concerns, as the UK emerges from lockdown.

Silverstone’s Financial Struggles

The British Grand Prix at Silverstone is one of Formula One’s biggest crowd pullers. Last year, the race attracted the highest attendance of the Formula One season with 140,500 in attendance on race day. Despite this, in recent years, Silverstone has struggled to make a financial mark. Silverstone bosses, from the British Racing Drivers’ Club, had decided in 2017 to pull the plug on the race, amid mounting financial losses. However, in a deal set to cost Formula One $66.3 million, bosses hurtled to save the iconic British Grand Prix. As the first ever race to feature in the Formula One calendar, Silverstone occupies a special place in history, Not only that, but Britain is also home to seven of the ten Formula One teams who participate in the championship.

With costs mounting, extra costs of the strict measures under which the races will be held and the absence of crowds flocking to the races, Rod Bond’s cash injection has been welcome by Formula One bosses with open arms.

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Fraud in finance

Over the past few months, we have been shown more e-commerce and online offerings than ever before. Prior to the COVID-19 outbreak, internet use for various things had already been increasing in trends. Now that people have been forced to stay at home, the market has simply increased in diversity in regard to what we can do online. From online shopping to virtual gym classes, the pandemic has accelerated the move towards a fully digital world.

Unfortunately, this growing digital atmosphere inevitably leads to a rise in cyber-attacks, and more specifically, fraud. Even before the mass lockdown, fraud cases were projected to be on the rise. According to Juniper Research, online payment fraud for businesses in e-commerce, money transfer, banking services and airline ticketing were suspected to lose over $150 billion to online payment fraud between 2020 and 2024.

Digital Identity

A digital identity can be defined as “a body of information about an individual or organisation that exists online.” The reality is that not many understand what makes up a digital identity so how can they protect something they do not understand. People are often mixed up whether it specifically refers to our social media profiles, or our credit score history, or many other platforms.

The confusion means many are also concerned about the level of access a digital identity exposes to potential fraudsters. Once a hacker is able to access our personal details, just how much are they really able to access?

It is clear that protection levels need to be increased alongside the rise of the e-commerce services. The fact that everything is now able to be put within a digital cloud rather than a hard copy makes things a bit worrying. At the end of the day, we will all be responsible for our own digital ‘twins’ so it may end up being a personal choice where you want your details to be when it is placed online.