IMF GDP forecasts don't look good

The IMF has made it's latest guess forecast for GDP in 2009 and 2010.

Bottom of the list is Gordon Brown's indebted UK at -2.8% worse than Italy at -2.1%. But it's OK the IMF forecast 2010 GDP will be growing again at 0.2% beating Italy who are forecast to still be contracting at -0.1%.

Interestingly Germany at -2.5% and +0.1% is not forecast to be that much better.

Personally I think the IMF makes it up as they go along. I don't think anyone with a say knows the extent of the lies told in the UK mortgage market, which will have a huge effect on individuals ability to spend their way out of the recession.

Now that lenders have tightened up lending criteria including checking incomes (at last) the scale of the mess is evident.

Just to prove my point I had an inquiry this morning from someone who has a £200,000 interest only mortgage and earns £25,000 a year.

How did a lender make the decision to lend him 8 times his income with no means of repaying the mortgage at the end of the mortgage term. This is not a one off, this is the normal situation at the first time buyer end of the market.

I would say our economy would still be contracting in 2010, with only minimal growth in 2011.