Guess what. The recession might have (almost) ended in the summer after all.

The ONS said this morning that construction output rose by 2% in the third quarter of this year. Why does this matter? It matters because in calculating what had happened to the whole economy in those three months, our official statistical body had reckoned that construction output had fallen, by 1.1%.

Other things equal, that would mean that the 0.4% decline in GDP announced in October, which has already been revised up to 0.3%, would be revised up again on 22 December - to a decline of just 0.1%.

Statistically speaking, a decline of 0.1% is really no decline at all. It's also not far off what many independent economists were expecting when that first estimate came out on 23 October - and caused such a shock.

Does this mean the "sceptics" are right and the ONS was wrong? Well, hardly. Until we see the third version of the GDP figures in a few weeks' time, we don't even know whether the numbers will be revised upwards that far.

But those who doubted the first set of numbers will feel that history is moving their way.

It's always possible that there will be other "new news" about the third quarter that pushes the figures the other way - but there's no sign of anything yet, and looking at the figures to be released between now and 22 December, it looks fairly unlikely. (Theoretically, both the index of production and retail sales numbers for November could include revisions of previous months which affect GDP, but there's no reason to think they will.)

Yet, even if the economy did flatten out from August onwards, there is little sign that it is storming ahead. Quite the reverse.

The news we have had so far of the start of the fourth quarter has not been that great: the CIPS/Markit surveys for manufacturing and services both came in lower than expected in November.

True, the data still point to some modest growth in output in the last three months of the year. The Treasury will be especially gutted if the economy fails to expand now: if there were going to be any measurable impact of the temporary cut in VAT, you would have expected to see it in these three months, as consumers buy now before prices go back up.

It will be a happy Christmas for the government if the GDP figures do get revised up in a few weeks' time. But as 1,700 soon-to-be ex-steel workers in Teesside can attest, it's not time to celebrate just yet.

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Any Conservatives listening to Ben Bernanke's confirmation hearing in the US Senate will have enjoyed what he has just said about Gordon Brown's tripartite system of financial regulation.

Though the Obama administration would like to beef up the Federal Reserve's regulatory powers, some powerful Senators want to strip the Fed of its power to monitor and supervise US financial institutions. Bernanke, predictably enough, would rather they didn't.

If you want to see why it's dangerous to take that kind of authority away from the central bank, he said, you only need to look at the experience of the UK:

"[O]ver the past few years the government of Britain removed from the Bank of England most of its supervisory authorities. When the crisis hit - for example when the Northern Rock bank came under stress - the Bank of England was completely in the dark and unable to deal effectively with what turned out to be a destructive run and a major problem for the British economy.

So currently the trend in UK and elsewhere is quite the opposite of taking away those authorities - it is to give the central bank the authority and information it needs to know what's going on in the banking system... for financial stability maintenance I think it's very very important for the Fed to have that kind of information and insight into the banking system"

Mervyn King will not take kindly to the idea that he was ever "completely in the dark" - about anything. He might also point out that the Fed didn't do such a great job handling Lehman Brothers. But you get the point.

The senator questioning Bernanke noted that more than half of the G20 economies do not give supervisory authority to their central bank, and some of them had come through the crisis rather better than the US. He also said he thought the fault of the British system had been the FSA's "light-touch" regulation and the lack of more comprehensive deposit insurance (apparently, some US senators take a keen interest in Britain's travails).

Nonetheless, it's striking to hear the world's most important central banker citing the UK as an example of what not to do. Time was when the UK tripartite system of financial regulation was a role model for the world. Not any more.

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Ken Clarke has warned his senior Conservative colleagues not to sound "too adventurous" on the subject of spending cuts before the election. This we have courtesy of The Times, which has a recording of his remarks to a private meeting of MPs on Tuesday night.

Clarke is worth listening to - he's got more experience in government than most of the rest of the Tory front bench, put together. He will go down as one of the better chancellors of recent times, though he was not in the job very long.

However, in this case he's preaching to the converted. George Osborne and his team weren't planning to tell us much more about their spending plans this side of polling day.

That's why they keep reminding us how "brave" Osborne's speech at the party conference was: on the courageous front, that's pretty much all we're going to get. Talk of a hung parliament will have hardened their view.

As we saw earlier in the week, the prospect of an uncertain election result is also concentrating minds in the markets.

On balance, I felt the reaction to Morgan Stanley's warnings about the UK earlier this week was rather overdone. I and others have long said that investors and rating agencies would hate the prospect of a hung parliament.

When you talk to ratings agency folk, they always say the strength of Britain's executive is one of our great assets. We may make a mess of things, but when it comes to it, a British PM would always be able to get the difficult things done. They don't want him to be making repeated visits to the Queen.

We know that a hung parliament wouldn't necessarily be a disaster. On budget matters, you might think foreign investors have little to fear from Vince Cable or Nick Clegg.

Still, the UK has a 12% of GDP deficit and a general election coming up. In these circumstances, it would be strange if the likes of Morgan Stanley were not alerting their clients to the risk of stormy weather in the market for gilts. The research note was highlighting possible "surprises" for 2010. That is clearly one of them, and it wouldn't really be so surprising.

Note the excruciating irony in all this for the Tories. Yes, "adventurous" talk of spending cuts may hurt their lead in the polls. But that very decline in popularity also makes the case for dramatic action on public borrowing that much easier to make.

Senior Conservatives can't be seen to be talking Britain down or fuelling panic in the markets - you'll note they were quite careful not to make hay, publicly, with the Morgan Stanley remarks.

But talk of losing triple-A status - or a run on the pound - makes the Conservative argument better than any number of speeches by Cameron or the shadow chancellor. Pity - that won't be much comfort to any of them if they wake up after polling day with no overall control.

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