"Momentum is turning against austerity and economic, market and political pressures will ultimately lead to more deficit spending. Here’s why.
AUSTERITY’S TIMING IS OFF
The best time to be fiscally responsible is during the good times. The savings can then be spent during the bad times when the economy needs an extra boost and is actually more sensitive to additional expenditure. Few governments will ever follow this advice, however, as it’s in the nature of politicians to spend the country’s wealth while they are in power, rather than allow the opposition to potentially waste that money next time around.
Running on empty is the norm."
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Chris Darbyshire, Chief Investment Officer, Seven Investment Management