Last month the chief executive of a British high street retailer presented a strategy paper to his board. Its conclusion was stark: “We are in for a prolonged period of very sluggish growth.”

This was not another shopowner complaining about the weather. Nor was it another battered executive grumbling about the overweening power of Tesco. Nor was it a kneejerk reaction on the high street to the recent helter-skelter in the City. And, to be sure, this was not an hysterical alarum call giving warning of consumer meltdown.

Instead, it was a sober caution. The document, and the statistical slides that accompanied the presentation, offered a considered assessment of the economic trends bearing down on the shopkeepers of Britain. The five key points are worth repeating here:

— The slowdown in the growth of consumer credit. This, he told his board, “is perhaps the most inevitable and most worrying of all our national statistics”. Consumer credit has grown faster than earnings every year since 1995. In the past two years, it has slumped back in line with income growth. This means a whole stream of revenue growth for retailers that is being switched off.

— The levelling off of employment. Immigration and part-time work has swollen the labour force, bringing employment rates to a 20-year high. Roughly 3.5 million jobs have been created in the past ten years. But employment growth has flattened out markedly in the past year. Retailers cannot expect an expanding customer base to continue to swell revenues.

— Potential fall in property prices. “All logic suggests that house prices must fall.” House prices are seven times household incomes. Mortgages fixed at low rates between 2000 and 2003 are coming due for renewal, but this time at higher rates. The buy-to-let boom is bound to be challenged as investors find they cannot afford the risk if they don’t feel they are guaranteed significant growth in the value of the property.

“The sharper the correction, the harder it will hit the consumer . . . and the higher it climbs, the harder the fall.”

— Inflation. Interest rates were raised too late, he told them, and commodity prices have risen and, as a result, there may be a further threat of inflation. As consumer spending slows, “retailers . . . look to their margins [We being a good example!]” And, in turn, there is a potential for . . .

— Higher interest rates. This possibility, he now says, may have abated as a result of the recent turmoil in the credit markets, but in the longer term the inflationary pressures are there.

One retailer’s caution need not cast a pall over the high street. The very latest figures show that after a gradual decline, there has been a recent pickup in consumer credit: consumers borrowed £1.1 billion in bank loans, overdrafts and on credit cards in July, the highest figure since last November. The housing market remains robust and the buy-to-let business continues unabated. Corporate earnings are buoyant. The prospect of a series of rate rises has receded. And, by comparison with the misery being felt in the malls of America, the heartburn on the British high street is not serious.

But this memo will resonate from the high street to Downing Street. The uncertain outlook for the economy must, surely, weigh on the mind of Gordon Brown, as he considers the possibility of a snap election in October. What is clear is that that while the financial world has been roiled in recent weeks by a sudden halt in liquidity, longer term trends are presenting challenges of their own in the real economy.

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