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He explained that debts in the UK have not been repaid but reshuffled, with household debts falling slightly but government debts rising.

Peston referred to the Office for Budget Responsibility’s forecast, which predicts household debts are set to rise again. He said this is because of the UK economy's dependence on the housing market.

He said the UK economy is also very dependent on multinationals and companies that come to the country for the "single economic market" but "there is a perfectly plausible long-term case on how companies could prosper, and over time growth would pick up and accelerate".

In Europe, Peston said there is a lack of political and sustainable union between countries, especially Germany and France. He said: "As long as there is that mistrust then the Eurozone will continue to struggle."

About China, Peston explained that as the country is dependent on investment, its rate of lending has not slowed down. He said: "We have never seen a country increase lending at [such a high] rate, especially not a country the size of China, and the penny is beginning to drop for the Chinese government, and unfortunately they are too hooked to stop."

He said China’s lending cannot slowdown gradually if it wants to maintain its growth rate because it will need to see a dramatic rise in consumption – so much so that the citizens will have to shop for 24 hours a day. "I don’t think the Chinese economy is going to fall but we will see a sharp shock soon and it will have foul political impact," he said.