an assault on "living standards" set to run and run...,

telegraph | At the time, I was minded to dismiss the suggestion as unduly alarmist. As the years pass, however, the forecast is if anything beginning to look on the over optimistic side. Indeed, according to a first attempt by the Office for National Statistics this week to measure "national well being", we are already well on the way, with net national income per head falling by 13.2pc in real terms since the start of the crisis in 2008.

Today's third-quarter GDP figures are widely expected to show the UK economy emerging from its double-dip recession – indeed the Prime Minister virtually confirmed it in PMQ's yesterday. Unfortunately, this totemic piece of good news doesn't really reflect the underlying reality, or the degree to which paying for the excesses of the past through tax increases, spending cuts, unemployment and erosion in real wages is eating into living standards. These are suffering much more severely than the raw output data suggest.

This is no doubt what Sir Mervyn King, Governor of the Bank of England, had in mind when he warned this week that the next generation may have to live under the shadow of today's economic correction "for a long time to come".

The Governor is still as reluctant as ever to concede the central bank's own culpability in the crisis – no mention of that in this week's speech - but it is hard to disagree with the thrust of his comments – that though the policy response may have smoothed the adjustment, it can't eradicate it, and it may now have reached the limits of its capacity to do even that.

As regular readers will know, I've been progressively more sceptical over the efficacy or appropriateness of further demand management measures to ease the crisis, so I was heartened to hear Sir Mervyn rule out some of the more exotic suggestions for getting the economy going again.