The British economic picture is bleak, according to the latest government figures reported in the Wall Street Journal.

At this point, the Bank of England and the British government are not offering any solutions.

Mortgage lending in July was down more than a quarter from the previous year. The manufacturing sector is close to recession, according to the Confederation of British Industry.

Since the British government is borrowing more than it intended this fiscal year, there is little hope for a stimulus package similar to the Bush administration's. The annual rate of inflation is expected to rise, causing the Bank of England to reconsider cutting back its bank rate.

Public-sector net borrowing reached the equivalent of $35.67 billion — twice the deficit amassed at the same time last year.

Britain has enjoyed more than a decade of economic growth as credit became easy to obtain, consumer spending soared and housing prices rose steadily.

The trend began to reverse at the beginning of the year. Residential property sales have fallen, along with house prices and consumer spending. As in America, food and fuel prices are high.

Other indicators in an industry survey revealed trouble: manufacturers' expectations for future output growth are at minus 13, the lowest since 2001. Credit problems are slowing activity in the housing market.

For Britain, this may be a time to let the market correct itself.

Unfortunately, the picture may grow bleaker until it brightens. On Friday, the Office for National Statistics said that the country's gross domestic product was stagnant in the second quarter, the lowest reading since 1992 when the country was mired in a recession.

And Hector Sants, chief executive of the Financial Services Authority, the financial regulator in Britain, said that British banks need to prepare for another, more serious economic downturn.