Will Spin save us, or kill us?

The UK economy contracted 2.4% in the first quarter of 2009, a decline not exceeded in 51 years, according to the latest official data.

The decline was more severe than the earlier estimate of a 1.9% fall, and worse than analyst expectations.  The Office for National Statistics (ONS) blamed the sharp revision primarily on weaker output in the construction and manufacturing sectors and highlighted the dire state of economy.  New data on the service sector also showed the sharpest quarterly decline in output on record, and whilst the UK consumer has often been said to be surprisingly resilient in this recession, today we learned that consumer spending in the first quarter suffered the sharpest fall in decades.

Are they telling us something we don't know, I don't think so ... has anything significant actually changed, I don't think so ... hence it will continue to get much worse, ... but will Spin 'help us', or 'kill us' (e.g. delay addressing the real problems and causing an even bigger crisis in a year or two?)  .... take a look around, and have a guess, noting house asset price inflation is mainly about 'spinning' a feeling of confidence so people will go borrow/spend again ...

Confidence ... what Confidence?

In her blog on Friday Stephanie Flanders focused on the Global Property Market whilst discussing 'confidence' and potential 'green shoots' of recovery ... but is housing the right thing to be focusing on when looking at 'Confidence'?  Personally I think not, and worse still I believe it focuses us on the wrong things ... take a look at the comments I added (post  25) to her blog below:

"Confidence/Speculation in housing does not improve trade deficits or borrowing levels, it just makes more money for speculators/banks, more misery and indebtedness for young people (and future generations), and a even less competitive economy ... 

The green shoots of recovery we need to see are in innovation, exports and jobs, not in how much banks/speculators think they'll be able to profit from loans given to hard-working UK people just to get a roof over their head. People are being taken for a ride again ... by a corrupt form of 'spin' focused on 'feeding' everyone's 'self interest' and 'greed' (and supported by a plethora of TV property programmes too)! 

Contrary to popular belief, 'confidence' does not really derive from the price of a house, but from security/opportunity in ones job and the robustness/strength of the overall economy (i.e. trade and exports). 

Some people need to take a reality check ... and realize that many old people's houses are already being taken back and sold to pay for their old age care - this is the only plan (and a hidden one at that!) that the Government have to cover the demographic changes now starting to occur and all the pensions black holes that exist (nb the entirely unfunded Civil Service Pensions liability too)! 

A very sad state of affairs, and it's a disgrace that many people in 'Power' know this already, but because most of them apply Poweromics*, they do not listen and don't care! A few do - but they have not been listened either - take a listen to Frank Field's interview below**

Young, hard-working people and future generations have been failed badly by us all ... responsibility clearly lies with Government (applying Poweromics*) ... but we are all responsible for doing nothing about it either (Ignoromics***). 

We should not be surprised if they do not tolerate what has been done, and make choices of their own, either by withdrawing their labour/support and/or moving to countries who have a taken a more responsible path (which some have, and in the EU too ... which means young hard-working people can move there without restriction)!

For the sake of future generations, can we stop this downward spiral now and only use the word 'confidence' when we're referring to jobs and trade/exports please ... so we can focus on improving the right things, not the wrong things ...

David Clift, a Future 500 Leader

* Poweromics = People using position and power for their own personal gain, based on poor moral values, self interest and greed. Take a look at http://poweromics.blogspot.com for more information/examples of Poweromics.

** http://news.bbc.co.uk/panorama/hi/front_page/newsid_7955000/7955859.stm - "I predict a riot" - Frank field

*** Ignoromics = People are either effectively ignorant of the situation (e.g. the overall environment) or not prepared to take responsibility to make sure it changes for the better."