Waiting for attractive pricing or for the old car to wear out.

Suddenly we are all saving more. We've been shopping around for new garden furniture but with no discounts available have decided to wait until the sales - why pay 100% of the retail price now when we'll only be paying 75% in a couple of months time? Have thought of replacing the second car but the best discount offered was 10% - for a cash buyer! Will buy new treads and keep it on the road for another year. Our actions are being replicated by millions of consumers across Europe who are happy to hold onto cash while they try to work out where the next body punch is going to come from - deflation, inflation, quantitative easing, devaluation or goodness knows what else? Government statements seem to be ever more doom ridden - this hardly makes for confident, happy consumers.

Have stuck with Euros through the first quarter. For the life of me cannot see why sterling has remained so strong although willing to agree that things are bad on the continent and set to get dire. There seems to be an Anglo-Saxon view that things are worse in Europe than in the UK. Will believe it when Germany starts to print money. The biggest cloud on the horizon would seem to be the likelihood that German banks will have a big hit from Russian corporate defaults but this local difficulty is likely to be pushed to one side until after the national elections.Until then sterling seems set for further weakness - my biggest fear is that with the government borrowing ever larger sums, borrowing costs would rise, currency levels fall and hey presto inflation in the UK might actually start to grow. Stuck between a recession and higher financing costs corporate and personal balance sheets would be in agony.

China told us it was on track for 8% growth this year. For a day markets rallied , until sager counsel reminded them that utility usage is contracting - hardly a sign that all is well. All this patent fear adds up to huge amounts of cash sitting on the sidelines - at some stage there is going to be the mother of all rallies - but what will trigger it? The arrival of better weather , stability in the banking sector, or signs that installed capacity is falling more rapidly than secular demand?