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The 1989 Mw 6.9 Loma Prieta earthquake is the first major event to occur along the San Andreas fault (SAF) zone in central California since the 1906 M 7.9 San Francisco earthquake. Given the complexity of this event, uncertainty has persisted as to whether this earthquake ruptured the SAF itself or a secondary fault. Recent work on the SAF in the Coachella Valley in southern California has revealed similar complexity, arising from a nonplanar, nonvertical fault geometry, and has led us to reexamine the Loma Prieta event. We have compiled data sets and data analyses in the vicinity of the Loma Prieta earthquake, including the 3D seismic velocity model and aftershock relocations of Lin and Thurber (2012), potential field data collected by the U.S. Geological Survey following the earthquake, and seismic refraction and reflection data from the 1991 profile of Catchings et al. (2004). The velocity model and aftershock relocations of Lin and Thurber (2012) reveal a geometry for the SAF that appears similar to that in the Coachella Valley (although rotated 180°): at Loma Prieta the fault dips steeply near the surface and curves with depth to join the moderately southwest-dipping main rupture below 6 km depth, itself also nonplanar. The SAF is a clear velocity boundary, with higher velocities on the northeast, attributable to Mesozoic accretionary and other rocks, and lower velocities on the southwest, attributable to Cenozoic sedimentary and volcanic rocks of the La Honda block. Rocks of the La Honda block have been offset right-laterally hundreds of kilometers from similar rocks in the southern San Joaquin Valley and vicinity, providing evidence that the curved northeast fault boundary of this block is the plate boundary. Thus, we interpret that the Loma Prieta earthquake occurred on the SAF and not on a secondary fault.

With unemployment having now passed the critical 3 million level there is intense pressure on the Chancellor to adopt a more reflationary stance in the coming Budget. Even within the confines of the present strategy there appears to be some scope for a limited expansion. This review of UK and world economic data will appraise recent economic performance and make predictions about future economic prospects.

The outlook for the Scottish, and indeed British, economy is not encouraging. The figures of industrial output for June record a fall of 1.5%, suggesting that the nascent recovery in output experienced earlier this year is in need of intense incubation. Both domestically and internationally there appears to be little sign of policies designed to assist any such incubation.

Throughout this year economists, industrialists and politicians have been analysing and discussing the economy and making countervailing claims as to whether or not the recession is over. While many industrialists are clearly aware of the factors influencing their own business they are uncertain of the economy wide prospects. Meanwhile politicians couch their economic analysis in language which maximises their own political objectives. Similarly many economists attempt to defend the schools of thought upon which their reputations are staked. The conflicting viewpoints expressed have resulted in widespread confusion about the future prospects of both the Scottish and British economies. However, much of this confusion arises out of a failure to differentiate between the effect the current recession has had on the level of output and on the level of unemployment. It is widely recognised that a strong relationship exists between these variables and that changes in the level of unemployment lag behind changes in the level of output. It is worthwhile examining each of these factors and assessing their likely future movements.

While the world economy has slowed down dramatically, the UK economy seems becalmed. Although industrial production fell in July at least GDP is not declining as it did during 1980 and 1981. However as yet there are no strong indications of a revival in economic activity.

The data analysed in this paper will show that whilst the end of the recession may be approaching, there is no strong evidence of any sustained or substantial recovery. Indeed, as highlighted in the UK section, there is no clear evidence that the mechanisms upon which the government are relying will generate a significant upturn. The UK economy is notoriously unresponsive to price signals, and while one should support governments efforts to increase this sensitivity, historical evidence is at best equivocal on the efficacy of this approach. For example, while the response of manufacturing investment to changes in output is unambiguously positive, the response to changes in the cost of capital is unclear. Indeed the Treasury have been unable to establish a significant relationship between manufacturing investment and capital cost and, in consequence, base their forecasts on the assumption that such a link exists. Further, any positive effects which might stem from a fall in interest rates will be dampened by the considerable spare capacity in the manufacturing sector brought about by the depth of the current recession.

The textiles, leather, clothing and footwear sector (TLCF) encompasses a wide variety of industries producing a heterogeneous collection of products. It is not within the scope of this brief to analyse in detail such a complex mix of industries. Therefore the purpose of this brief is to describe the performance of the sector as a whole, within the context of the Scottish economy and to discuss the observed trends in the main economic variables outlined below. It should be noted that a study of the data available for the TLCF sector reveals numerous inconsistencies and deficiencies.

Present policies seem highly unlikely to return the UK economy to even the dismal growth path of the sixties and early seventies. This conclusion, unwelcome though it is, is made even more so by two additional factors. The first is the government's refusal to call their chosen strategy into question even in the face of an ever deepening recession and of a sustained logical onslaught on its theoretical underpinnings. The second is the absence of a coherent alternative strategy which carries the prospect of anything more than short-term amelioration of present problems. Further analysis of current UK economic conditions is provided, as too is an analysis of the world's economic performance.

The current economic situation is extremely depressed and recent events suggest that, without significant increases in economic activity, the political and social fabric of this country may be several strained. However, as argued in the UK section, the prospects for recovery are bleak and reliance on a purely financial strategy to restore growth is in itself inadequate. The source of real economic growth lies in the ability of labour, capital and enterprise to come together in a manner conducive to increased productivity over time. It is therefore worthwhile examining these factors of production to determine the effect of current policies upon them.

In the second quarter of 1981 the index of industrial production for the United Kingdom was 8% below its level for the corresponding period in 1980. This notwithstanding, there do appear to be signs that the bottom of the output trough may now have been reached. This brief section will seek to understand the latest UK and world economic data to determine current economic conditions and forecasts future trends.

The Scottish economy is taking the first tentative steps towards a recovery in industrial output. Indices of production have slowly started to edge upwards and the results of the April 1982 CBI Industrial Trends Survey show a growth in business confidence. While unemployment will continue to rise, those in work will be faced with less short-time working and increased opportunities for overtime. The prospects for significant long-term growth with a concomitant reduction in unemployment is, however, dependent on a number of factors both domestic and international.

The immediate economic prospects remain unfavourable particularly with regard to the level of unemployment. In the UK the number unemployed in January 1982 stands at a record 3,071,000. While the Scottish figure does not yet equal the figure of 407,000 recorded in January 1933, the present total of 346,547 represents a post-war high. Coupled with these figures is the rapid growth in the long-term unemployed ie those unemployed for more than a year. An examination of recent statistics from the Department of Employment shows that in the United Kingdom between October 1980 and October 1981, this category increased in number from 401 thousand to 785 thousand, an increase of nearly 961. In addition the Manpower Services Commission has recently lent its weight to the view that the true level of unemployment is around four million. As data show, even on very optimistic assumptions about the nature of unemployment and prospects for the labour market (see Employment and Unemployment Section), it is unlikely that unemployment will fall to historically acceptable levels.

The causes of the present recession are generally misunderstood. While it is undoubtedly the case that the growth of the world economy has been reduced, this has, as yet, had little effect on the UK. Exports have been surprisingly buoyant, benefiting perhaps from orders obtained when the pound was at a much lower level. Detailed forecasts, as well as additional analyses of the latest Scottish economic data, is provided to better understand Scotland's current economic predicament.

The purpose of this Brief is to describe some of the main features of housing in Scotland as well as the implementation of housing policies. This is important as the state of housing in Scotland has long been recognised as a major determinant of the high levels of net migration, poor job mobility and of urban blight. After describing the Scottish housing stock, the final sections discuss trends in government expenditure, changes in house prices and the current debate over the sale of public authority housing.

This section of the Commentary provides an overview of the latest world and UK economic data. Clearly, the foundation for recovery in 1982 is a fragile one, for the prospects for the main expenditure aggregates are not promising: world trade is not expected to grow significantly and could even decline if the pressures for protectionism (arising mainly from high domestic unemployment) are translated into action. Real consumer expenditure is likely to remain relatively static since the growth rate of nominal disposable income is moving towards that of price inflation in most industrialised countries, and is even falling behind in some. High interest rates and company balance sheets still reeling from the effects of recession continue to depress investment prospects, and the continuing concern of governments with the size of public sector deficits makes any significant increase in autonomous (as opposed to 'automatic' counter-cyclical) public expenditure improbable. These factors, coupled with their generally consistently over-optimistic forecasts for 1982 made a year ago, have made most forecasters much more cautious in predicting the extent of recovery later in 1982, and some are even suggesting that this recovery may not be sustained far into 1983. 1

The October 1979 issue of this Commentary (Volume 5 No 2) included an article which described the outline structure of a Medium Term Model of Scotland, designed to be used for forecasts or projections of the economy for periods beyond the established 6-12 months of the Institute's short-term forecasting model. Since late 1979, work has concentrated on the precise formulation of the model, data collection, the estimation of the parameters of the model, and tests of its accuracy. In the latter part of 1981, the model was used to generate projections (or conditional forecasts) of the Scottish economy in 1984. Details of the construction and testing of the model, and of the 1984 projections are to be published shortly. This article contains a synopsis of that report, emphasising in particular the results of the 1984 projections. For reasons of length, and of the orientation of this Commentary towards empirical and policy issues, description and evaluation of the estimation and testing of the model is limited; attention is concentrated on the results of the projections. Readers interested in the structure and estimation of the model are referred to the forthcoming report.

The Scottish fishing industry is divided into two main sectors: catching and processing. The brief explores the latest economic data of this important industrial sector and provides an analysis of the influence of fishery policy on economic growth.