The CBI are stating that about this time next year inflation will be around 2%, the bank rate will around 2.5%, and your salary will not have increased by more than 2% (if you are lucky). So the chances are the cost of living will be affordable, your mortgage will be acceptable and you might  have a little less to spend as in 2008. So why all the talk about recession?

BECAUSE if the banks don't start lending money, your company starts losing control of its day to day cashflow needs and then it has to start cutting its overheads to work within whatever cash it can generate independently.

Which means businesses start laying off staff. Which means that if you are employed you will be fine in 2009 and if you are unemployed you will be stuffed.

In 1991 we had high inflation, high interest rates, low salary increases and growing unemployment but at least the banks lent you money.

Without cashflow businesses go bust. When banks stop lending money businesses go bust. And yet the rest of the economic statistics suggest all will be well!

What is the rescue plan for the man in the street Gordon.?

It looks like you've given all the lifebelts to the people who threw us in the water.