Last Chance Saloon……?
Thanks to you for reading…..
I was going to start the blog, this week; by telling you that there is now a shortage of jelly beans, following my comments last week, but I don’t know if that is true. What I do know is that there are 700 of you out there, who follow my random thoughts, which leaves me both humbled, and grateful. The vast majority of you access this with the very latest iphone/pad type technology, so we are getting a highly sophisticated audience, every bloggers dream.
Or, you are all students, who are the only people that can afford this kit.
Welcome, also, to our new followers in Canada, one of the few countries in recent history to have been through a debt crisis, from whom we have much to learn. Or at least we would if anyone bothered to consult them.
At better week…..
It has been a rather better week for equity markets; major international businesses, which have been around for generations, are now deemed to be worth at least 10% more than they were on Monday morning. Capitalism, at its best.
Margins of statistical improbability……
Tuesday saw the Autumn Statement, in the UK, a sort of 6 month roundup of where we are. Anyway, not good. We are going to have to borrow another £111 billion, by 2016, before the tide turns. Due to any lack of growth. The OECD and OBR forecasts are downbeat, to say the least, with the economy thought to expand by just 0.9% next year, which is within the margin of statistical improbability. Ask anyone if things are getting better, even by circa 1% and the answer is negative.
Strikes…….having a point but missing the issue!
Well mostly. Wednesday saw the biggest strikes in the UK since whatever. I have to say it made Londona far more bearable place, bar the constant clatter of helicopters; these people have a point, but miss the main issue. So, I doubt we will see a repeat performance, but the shops were happy with sales up by 38% compared to the same day last year.
Unprecedented action which has been seen before……
It also coincided with some Global Central Banks taking” unprecedented” action to pump cash in to the banking system, which had all but seized up. This application of oil to the gearbox is welcome, but given the huge crack in the casing, not likely to have a long term impact, which is what happened on the last few occasions such unprecedented action was taken.
Ten days to save the Euro……?
Meanwhile, an eminent journalist in the FT, on Monday, predicted that there were only 10 days left to save the Euro, followed by some equally eminent chap saying the same thing on Wednesday. In a situation like this, you need lots of eminent people, just not the ones that got you there in the first place. Both cannot be right, obviously, but maybe they are both wrong. Indeed, the latest offering from Germany is some form of “fiscal union”, which sent markets wild today. Quite how this works is unknown, but it pretty much looks like anyone wanting to stay in the currency block will have to abandon their sovereignty, a bitter pill to swallow, but good headlines for The Daily Mail.
Last chance saloon……
We will see how this plays out in the coming week, but there are things that they cannot change, (such as the level of debt), things they can, (such as how to get out of this mess), and they just need the courage and wisdom to make the right choices. I don’t know the odds on the outcome, but this has to be the last chance saloon.
University applications declining……
Whilst others ponder, and plan, some are taking a more certain grip on their destiny. Applications to Scottish Universities, from locals who are entitled to free fees, are down 16% on last year, as market forces kick in with vengeance. The tuition fees might be free, but the cost of living, without income, over four years, is not. As youth unemployment climbs inexorably higher, many more will take this decision, and yet another New Labour dream will collapse in the sand.
Absence of leadership……
It is not all gloom; The American economy seems to be picking up, with record Thanksgiving retail sales, and unemployment numbers the best in two years. All without any political leadership. Imagine!
CDO
2nd December, 2011
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