You go to a conference on Web 2.0, and come back with a firmer grasp than you’ve ever had of economics and the current credit crunch. Very strange but true. I popped along to the Association of Online Publisher’s annual conference yesterday and there was the usual parade of start ups and thinkers on how the internet was changing the world. Then halfway through the afternoon, who breezes in but the chief economist of one of our leading banks - I can’t name him as the session was under Chatham House rules but can confirm that his firm is still currently solvent. Expecting a pretty dry 40 minutes ahead of us we were rendered bolt upright by a man that could probably hold his own on the stand-up circuit, such were the number and quality of one-liners that he delivered during a very entertaining presentation. He had us in the palm of his hand trotting through a brief history of our current economic cycle and how this relates to our current banking crisis.
Have been under a barrage of Old Testament-like tales of woe and impending doom about our global financial systems it was refreshing to be confronted by a lucid account of UK plc in the last decade and a half. In a nutshell he pointed to the “sound fundamentals” that our economy has had since 1992 in respect of low interest rates and inflation. This has led sustained growth - 63 quarters of it no less - but akin to the British Rail excuse it’s been “the wrong sort of growth”. Two thirds of our GDP is via the consumer and he and she has maintained this until now largely through debt. Here comes the scary bit - the consumer has a collective debt of
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on Oct 2nd, 2008 at 6:52 pm
I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog.
Tim Ramsey
on Oct 2nd, 2008 at 7:58 pm
[...] Read the rest of this great post here [...]
on Oct 2nd, 2008 at 8:07 pm
[...] Phil Clark wrote an interesting post today onHere’s a quick excerptExpecting a pretty dry 40 minutes ahead of us we were rendered bolt upright by a man that could probably hold his own on the stand-up circuit, such were the number and quality of bone/b-bliners/b that he delivered during a very entertaining b…/b [...]
on Oct 3rd, 2008 at 1:41 am
We seem to witnessing the end of neo-liberal capitalism and we have a chance to kick-start sustainable development, problem is we havn’t quite imagined what lies beyond the consumer economy, we need to be asking this question at every sustainability event we go to!
on Oct 3rd, 2008 at 7:24 am
“Does the whole edifice have to collapse?”
This is a good analogy with the construction/property industry, Phil.ie: Is it better to refurbish what exists, or raze and rebuild? The latter may be more painful (more impacts) but may be more efficient/sustainable over the long term.
on Oct 3rd, 2008 at 3:30 pm
Morgan - report of that death may be exaggerated. Don’t be surprised if it twitches again. I completely agree that the question of what we replace it with is completely up in the air. We’re back to karl Marx territory - knowing what the problem is, but not having an earthly what the solution is.
Andrew - I was hoping that there was an analogy there. I’m not so sure wholesale demolition is the way forward. Doesn’t that roughly equal a 40-50 year carbon payback?
on Oct 3rd, 2008 at 5:31 pm
I agree: it’s clear “they” are desperate for it to twitch again - there’s a difference between bailing-out and jumping overboard.
on Oct 6th, 2008 at 2:31 pm
go on Phil - tell us who the economist was :).
Alex