2010 should be the year when the world finally pulls out of recession and all the major economies register some serious positive growth.  The expected house price increases may bring a rise in interest rates or perhaps a bit of inflation but overall we should all end up much better off by this time next year.

Have a great weekend, its back to work on Monday

If you like twitter then today is a New Years Day #followfriday so make the most of it, that won’t happen again for a few years.

During the global credit crunch we are all used to prices going up so its nice to have some good news from the New York Insurance Regulators. The New York State Insurance Department has issued a document ordering insurers to explain any request to raise rates as they feel that auto insurance price increases are not currently justified. Super insurer Geico has already withdrawn two requests to increase rates on 2 of its key products and “significantly reduced” its proposed increase to its 3rd product which deals with high risk drivers.

The New York State Insurance Department has acted because driver behaviour has changed due to record gas prices. Drivers are making less non-essential trips and car pooling on grocery and shopping trips. This means there are less cars on the road therefore accidents are less likely to occur. Insurance companies seem to agree with this view as they have seen big decreases in their losses. In fact, in May 2008 Americans drove 9.6 billion miles less than in May 2007, the third largest drop in 66 years!

If this continues then motorists in other states can look forward to a reduced auto insurance quote from your insurer.

In times of financial turmoil you need to save as much as possible. The best way to get cheap van insurance is to use a comparison service such as Quotezone to get you the best rate on your van insurance renewal. Comparing prices using an online search service will typically save you £200 – not bad for five minutes work!

The Bank of England must strike a careful balance between the threat of recession and the problems brought on by high rates of inflation such as strike action.

If you are struggling with large bills, compare car insurance quotes now at Quotezone to save upto £200 on your car insurance.

Land Rover officials stated that they expected the downturn based on the problems in the economy and a growing number of customers opting for greener cars as consumers turn their back on “gas guzzlers.” Another statement released by the manufacturer said that trading in May 2007 had been “a very strong month” and this worsened the 2008 Q2 figures.

The Bank of England base rate remained unchanged today at 5.0% which will not ease the pressure on the automotive market. Its likely that some of the smaller car insurers will disappear or be taken over by larger rivals.

Get your cheap car insurance deals while you still can!

It appears that the current problems are causing people to be creative when it comes to cutting costs. Many families are now getting rid of extra cars which means that there are less drivers needing car insurance.

There is also extra pressure on home insurance providers. Its much harder for first time buyers to get mortgages to buy their first property which has slowed down the entire chain. In fact, would-be first time buyers are making a conscious decision to stay in rented accomodation until the money markets improve and borrowing becomes easier. Renters only need contents insurance so the insurers are missing out on the extra revenue from buildings insurance which will cause losses later this year.

One way to control your personal insurance costs is to use a price comparison service offered by sites like Quotezone. You could save up to £200 on your annual car insurance renewal.

Mr King gives the view that increasing rates will not help the current situation and puts forward a case for cutting rates or at least leaving them stable for another few months to allow inflationary shocks to work their way naturally out of the statistical range. It is the Bank of England’s view that the inflationary pressures are short term and the problems will only last between 9 and 15 months before the CPI rate returns to an acceptable level.

Given the facts put forward in the letter I expect the Bank not to raise the base rate and I believe we will see a rate cut in either July or August to combat spiralling costs.

One cost you can control is your car insurance renewal premium. Using Quotezone, you can compare car insurance prices from top UK providers such as Norwich Union, The AA, MoreTh>n, Kwik Fit and Endsleigh.

There has been some speculation that the Monetary Policy Committee would do all it could to maintain the rate at less than the 3% threshold but there is no evidence of this within the letter. In fact, Mervyn King gives a good account of the state of the UK economy and explains that the increase in inflation is unforseen and unavoidable, a direct result of the increasing price of fuel, food, gas and electric. As such, he believes that the Bank must act to stabilise the increase in inflation whilst safeguarding against any possible slow down in the economy. There is even a clear indication that interest rate cuts may be necessary, even though this is the opposite course of action usually taken to reduce inflationary pressure.

In one section the Governer states:

“We have seen in the past how the need to reduce inflation from persistently high levels has prolonged periods of subdued economic growth. ”

This is a clear indication to the Chancellor to rate cuts instead of increases and is hinted at again in the letter.

“I expect, therefore, that this will be the first of a sequence of open letters over the next year or so.”

Meryvn King looks to be taking a very sensible long term view on for the UK economy and hinting at rate cuts in order to stabilise inflation over the course of twelve to fifteen months.

While costs are increasing by the day, renewing your car insurance need not be another financial fiasco. Compare car insurance prices online with Quotezone and save yourself up to £100 on your renewal premium!

The situation is not being helped by the fuel blockades which have the effect of  increasing demand and further escalating the price at the pump.  The continued pressure will only worsen the economic conditions as the small amount of disposable income that is left is being used up on the cost of living.  Over time we may even see people change their jobs to a work place more local to them as commuters and van drivers are hit hardest by the rises.

Its important to save money where ever you can to combat this situation so shop around for your van insurance and get price comparisons from Quotezone to lower the cost of your insurance.

About 300 vans, trucks and lorries forced road closures in the capital today sending a clear message to the Prime Minister Gordon Brown. People are just fed up with “Rip Off Britain” and the record price rises are contributing to inflationary problems which, in turn, has a detrimental effect on our economy as a whole.

Its possible that sky high fuel prices will force the closure of many hard pressed courier and transport based businesses which may lead to unemployment and further economic misery.

The British economy seems to be suffering “Stagflation” as one commentator called it. Basically, when the cost of fuel rises, eveything else increases in price too. This is an inflationary pressure and the correct way to combat this is to increase interest rates. The problem is that we are currently suffering the “credit crunch” and any increase in interest rates will only worsen the problem. We are stuck with our current circumstances until either inflation declines or the credit crunch’s impact is reduced.

I expect the next Bank of England rates decision (due 5th June 2008) to be a no change as this is the only available course of action at the moment. Rise, fall or stick, we’ll know the outcome next week.