British capitalism is in big
trouble.  The official annual inflation
rate has hit 3.3%, its highest level for 16 years. The governor of the Bank of England, Mervyn
King, has been forced to send a letter to the Chancellor of Exchequer, Alastair
Darling, to explain why the Bank has been unable to keep inflation from rising
at more than 2%, which is the target set by the government for the Bank.

Bradford and Bingley are the latest bank to catch a cold in
the present financial crisis. They’ve declared a loss of £8m for the first four
months of 2008. This compares with £108m profits they made in the same period
last year. The main reason for the losses is because they’ve had to
write down £89m of their assets. ‘Write down’ is banker-speak for the fact that
they realise they can whistle for their money.

There’s an old saying that, ‘When the USA sneezes, we all catch
cold.’ Alistair Darling and Gordon Brown know that the USA is already
in recession. They know that the financial crisis is causing the
hatches to be battened down all over the world. But, they say, Britain
is immune. They’ve even commissioned a Treasury report to try to prove
it. Don’t believe them. The chill winds of economic crisis are
coming our way. The parallels between the US, which is already in the
mire, and the UK are stark.