According to some economists, the problem with a government becoming a major financial stakeholder in banks and previously privatised companies is that a mixed economy invariably sends out mixed messages – depending upon whether you’re buying or selling, presumably.
The recent upbeat theme, according to the ubiquitous market analysts, is that house prices are slowly rising above the rate of inflation which indicates a recovery of a sort. And we were also told that the economy has not shrunk as much as was thought - which is a jolly good thing, isn’t it? Or are we simply reading signs of business resilience into what might just be incompetence on the part of the analysts?
It is not encouraging that the same bunch appeared flummoxed to learn that the Consumer Prices Index (CPI), a key measure of inflation in the UK, had ‘unexpectedly’ remained at 1.8% when the predictions were for a decline to 1.5% in July. Official statements claimed that “the chief downward impact on prices came from food and non-alcoholic drink prices” which suggest that the author doesn’t do the food shopping in their households - or they basically just don’t know from shit.
The less good news earlier in the week came from the Office for National Statistics who told us that more than one in six UK homes which house at least one person of working age does not have anyone in employment. This is the highest rate since 1999 according to the ONS.
On the employment front, Fujitsu workers are seeing their pensions and pay under attack which is another example of a largely unreported scandal of foreign owned firms quietly putting their UK subsidiaries into liquidation resulting in thousands of redundancies and letting the government pick up the tab for abandoned pension schemes. Such battles are not restricted to industry as a report in the Times of a financial institution biting at its own entrails graphically illustrates but they manage to give a first-hand demonstration of just how impotent all the regulation has proved to be in the face of financial reality.
And the situation is no better for the retired with a third in the red on loans and credit cards. Figures also suggest that some 15% of retired people are also still paying off a home loan, with an average debt of £50,100 per household.
The question of whether we should trust or even give credence to the experts and commentators is probably an academic one in several respects. They didn’t see the recession coming, they talked us deeper into it when it arrived and they are now in danger of disappearing up their own analysis to come up with something halfway credible. Sadly they sound a lot like most politicians.
Yet are they any different from those people who encouraged us to invest in a home-owning fantasy by borrowing more than we could earn in a lifetime and then advising us to ‘consolidate’ what we owed into single amount that would rival the debt of a small third-world nation - and then telling us how an obscure bit of legislation could actually help us avoid repayment altogether? Did they cause the recession, or was it us lot?
The sole common point of agreement to be gleaned from the otherwise contradictory indicators is that the UK economy is hugely dependent on the financial and property sectors. When it’s good, it’s very, very good (for the exchequer) but when it’s bad the bastards still receive bonuses. Yet for all the Westminster & Whitehall talk of better regulation, even us nurks can figure out that there is little reason why any government, outgoing or incoming, would want to effectively crack down on this situation – especially one that is now such a significant stakeholder.
It may be the same the whole world over, as the song goes, but the gravy does seem to a bit thicker & richer in our part of the globe - for some.
0 Comments:
Post a Comment