It's the world economy, stupid?

 It's not all stopped or paused for ninety days but good god almighty what a week we've all been through with the suited baby with all the vocabulary of  six year old minus the fluency crashing the markets, removing stability by the hour.

The whole business of ever increasing tariffs between China and the United States currently over 104% and 84% respectively with neither side prepared back of and agree to look into the issues around dumping things such as steel at below cost and barriers to trade through diplomatic means.

It is like watching to kids in the park threatening and counter threatening each other as the atmosphere gets uglier and uglier as one by one we all leave the park losing out.

It never really works.

In so far far as elsewhere goes, the pause is to be welcomed but even the 10% we were due to pay still would of adversely affected UK Exports and from the Jobs not least here in the Midlands with the Car and Pottery industries.

The 25% on things from the EU and the threat of retaliatory actions would impact us as we still trade a fair bit with the EU as much as post Brexit the volume has dropped by at least a third and the basis for the figures seems...muddled.

One can only hope this breather is used constructively to set up proper talks to explore with independent trade exports how these disagreements can be resolved with less damaging measures. 

Governance  by chaos???

Sort of sorted - craziness revisited

As I type this out it is raining heavily and so we'll kick off the first edition of the month  a bit where we were.

Money, your friend and mine started getting into a bit of a mess last week probably because firstly there was nothing to show how the mini budget was costed, the Office of Budget Responsibility seemed somehow to of been ignored although it plays a part in presenting the budget and there also appeared a disconnect between the Bank of England, a super important player and the Treasury.

The latter HAD to but back Bonds to shore up the value of the Pound because the lack of any of the things that might give you the feeling this mini budget had been fully thought through and costed up to and including a report by OBR just were not there.

Making up for lost time with the loss of ten days to mourning can be understood - having a change of Prime Minister with the cabinet changes  at the same time as the death of one Monarch and the appointment of another was exceptional - but this mini budget was extremely important and while having sorted out the messy idea of borrowing while eliminating the upper income tax rate which at least is doing the job of restoring the pounds value, nontheless some 65million was spent before the simple step of just dropping that ill thought out idea was made on Monday and it still leaves interest rates and by extension Mortgage interest rates historically higher for people.

While I have personally felt interest rates needed to rise as in some fifteen or more years the well-being of savers had been neglected - interest rates of a quarter of one percent were frankly a nonsense - the manner this has been reversed has damage confidence in how the economy is been handled just at the point we needed it with all the other issues we face.

I just hope more thought and planning is put into the autumn financial statement in November as this has been damaging episode.

Craziness at the end of the Month

 It has been a turbulent week not least on the financial markets with the unprecedented reaction to the Mini Budget last Friday that appears to of spooked them with impact -we hope only temporary-on the exchange rates and mortgage product availability.

Whether or not actually in power Keir Starmer's Labour Party announced economic plans that include a chunk of what government is doing minus the scrapping of the upper level income taxes levels but adding a commitment to gather up and nationalize the energy companies that you might well think would add to borrowing to buy the companies and compensate share holders would be any better received by the markets is an interesting question.

I'm inclined to think not but hey, the current plan with them is about making political hay (from the government's problems) while the sun shines.

The problem with stagflation is being a combination of inflation and a stagnant economy the cure for any one makes the other worse so policy tends to be "chicken and egg", stimulate the economy, try to control energy costs, borrowing where needed or slash spending, increase interest rates and risk unemployment rising significantly with all the associated spending on unemployment benefits, training schemes and so on.

 

The onset of the fall reminds me what I miss still from Marmalade who died several years back, that curiosity and poise.

After the heavy rain here earlier on the week the woods were rather like this.

Return to our offices? No chance!

As I'm writing this faced with a big deluge of rain that meant going out after lunch just wasn't going to be happening a couple of days before publication one recurring story is around people who it has to be said were working in offices before all the Covid restrictions came in March.

Back then as you might well recall we were told to Stay Home and only to work if we can from home and a lot of people and organizations adapted to do just that from banks to people doing engineering drawings using phone and computer to work and keep in touch.

 As you can see in this picture of Canary Wharf in London taken during the rush hour, there's not many people actually in the offices coming of the transport networks to the business districts although the numbers vary from occupation to occupation.

In some respects the UK has been a bit behind the curve when it comes to working from home compared with other countries  such as Canada and the States but it appears Covid give it a mighty big jolt in little over five months.

It isn't that people aren't working although some are not such as those in hospitality and entertainment where health measures needed to control the virus effectively prevent them from working at all it's that actually business and workers have found this is working for them with potentially lower office costs and far less time commuting on overcrowded trains and buses.

You might think "What's the problem"?

This homeworking is effecting the viability of businesses within those business districts such as the sandwich bars, coffee houses and dry cleaners with their daily takings well down on normal and that has lead to some such as the C.B.I. to push for a return to working from offices.

Personally having been there and done it frankly if I could work from home just calling in to meet with my supervisor and a few colleagues and any face to face training a couple of days per month to be frank I just would because it's a waste of my time having spent two hours twenty on a good day travelling and sometimes longer otherwise.

Another set of issues is about social distance and its impact starting the shocking fact that at least a third of staff can't be socially distanced in offices even masked so some would have to be accommodated elsewhere.

Then there's public transportation where capacity is down to less than 40% of normal due to social distancing so capacity is impacted during the rush hour making it hard to get people in and having more people come in using private cars to get around that only adds to road congestion and pollution.

In Charles Dicken's day you had to work in an office as a clerk with oil light, quill and ink surrounded by people as there was no other way of sharing information and generally getting things done.

Those businesses in the business district came into being where they did to serve those needs but today it is just so unnecessary so we might as well accept it as indeed a number of big companies have and just move with the times.

That's why despite the rally cry of "go back to your offices" from the CBI and the Business Minister I rather suspect we're not. Time has moved on.