There seems a delicate balancing act that most of Europe is playing with that sees the human impact of the coronavirus fight with the financial cost to economies. Given the widespread increase with infection rates in key EU economies (Germany, France and Spain), it appears that health and economic prosperity do not go hand in hand.
Having reduced the death toll significantly, it is now the turn of the UK economy for some medicine.
Nothing in the dictionary quite describes the recent path and present status of our economy, probably because we have encountered nothing quite like it ever before. We need a new word.
There has been much talk of “recession” after the second-quarter GDP numbers were published this month. But since third-quarter output will almost certainly improve on the disastrous second quarter (the UK was pretty much closed after all), soon they will be asserting that we came out of recession in July. That sounds ludicrously premature.
“Recovery” is too complacent a term to describe the current state of play, when so many employers are considering plans to lay off staff in the coming months. “Downturn” or “slowdown” are inadequate to describe the economic paralysis that has so jolted people’s lives. On the other hand, it is way too early to label it a “depression” when such things are measured in years. “Slump” probably comes closest but has a despairing air about it and gives no indication that there are many things that are already improving from the low point of the pandemic.
Until a vaccine is found, we will struggle to have both health and a booming economy. We can’t have both……it’s one or the other. Perhaps the best word to describe our current position is “conundrum”……it's the ultimate political conundrum as there is suffering either way.
My very personal journey to solve my own mid-life crisis ‘conundrum’ moves at pace. And when I say “at pace”, I mean about as quick as any limping middle-aged man dressed head to toe in ill-fitting lycra ‘Just Do It’ clobber. Just Do It? It’s more like ‘Just About Done It……Just’.
I actually found myself on a website considering buying fluorescent active (limping) wear. FLUORESCENT! Clearly, nothing says “definitely 100% not having a mid-life crisis” than a middle aged man out running whilst looking like Mr Motivator to knock 20 years off his age. And when I say “consider”, the day-glo items made it into my online basket. I was two clicks away from purchase. That’s how close it got. Two clicks.
In a fit of panic I returned to the medical journal of those in the know (Wikipedia) and their definition of a midlife crisis:
The phenomenon of 45 to 55 year olds having a psychological crisis brought about by events that highlight a person's growing age, inevitable mortality and possibly lack of accomplishments in life.
With pen and paper at hand, I scribbled with enthusiasm (normally reserved for my daughter writing to Santa) to confirm my significant accomplishments during August.
* I learnt that Christmas sweets are currently on sale in Tesco. It’s August.
* I learnt that a flock of crows is known as a ‘murder’.
* I concluded that it is impossible for 80% of adults (admittedly it was a small sample) to visit any supermarket without tearing off their mask like they’ve just pulled off the Hatton Garden heist within 3 feet of the shop exit. Interestingly, there is then a high correlation of these adults hanging their mask on their rear view mirror like a germ infested Christmas tree car freshener. Stop it.
* I managed to get out a box of porridge from the cupboard without the need to spend 2 hours with a yard brush, dustpan and two hoovers.
* I considered the economic realities of Postman Pat’s vast array of vehicles and concluded that it wasn’t financially viable to use a helicopter for post in such a small community. It makes no sense. Financial suicide in fact.
* I managed to successfully negotiate unsubscribing from an email by navigating “Please don’t tick this non tick box to not unsubscribe from these emails by not subscribing to the non tick and tick box if you don’t not wish to not receive any further emails by ticking to unsubscribe.” All successfully negotiated……which means no more thrice daily emails for nasal massagers.
* I had an epiphany when considering golf. Golf isn’t the cheapest pastime and the whole idea of golf is once you get on the course you play it as little as you possibly can……the fewest shots if you will. You actually get prizes for playing it less than anyone else. This is the world’s biggest con.
* KFC have missed a massive marketing trick by not employing ‘Cluck & Collect’ or ‘Chick and Collect’ (yes I did research trademarks within seconds of thinking this).
And finally…….my gift to you all……
* “Aegilops” is the longest word in English with all the letters in alphabetical order.
I am pretty sure that August offered me more accomplishments than this but I’ll rest easy with this list. Lessons learnt, self-improvements made and for another month the mid-life crisis is kept at bay. Just.
The Numbers
The economic and financial fallout from lockdown continues and the numbers released in August serve to confirm what many feared……recession for the first time in 11 years.
The UK economy shrank by 20.4% compared with the first three months of the year……the biggest slump in history. The UK economy is expected to be 9.5% smaller by the end of the year and would mark the worst downturn in a century……but smaller than the Bank of England’s initial estimate of 14%.
Unemployment has increased by 700,000 since the start of pandemic. August saw the biggest increase in a month for a decade. I fear the worst is still to come.
Can you imagine what these figures would have been without the Government throwing cash at the economy since March? No surprise that UK Government debt has risen above £2 trillion for the first time amid heavy spending to support the economy amid the coronavirus pandemic.
Spending on measures such as the furlough scheme means the debt figure now equals the value of everything the UK produces in a year (100% of GDP). Total debt hit £2.004 trillion, which is £228 billion more than this time last year. Economists have warned the situation will worsen before improving. Eye-watering stuff.
Whilst the above figures are important, they are very much backward facing and tell us how bad things were. For a better picture of the ‘current’, there are two key measures of interest:
Firstly, ‘inflation’……which jumped to above 1%. This was brought about by the easing of lockdown measures and more money being spent in the UK economy (boosted by rising petrol and clothing prices). Retail sales are now 3% higher than February, which also supports the positive inflation figure.
Secondly, the ‘purchasing managers index’……it hit 60.3, which is a 7 year high. The index is an economic indicator that surveys purchasing managers at businesses that make up a given sector (it is very much forward facing). Any reading above 50 indicates that the economy is growing, so the figures suggest business activity across the economy is recovering sharply after hitting its floor in April.
The key thing for the UK economy is the undoing of the furlough scheme over the next few months. According to the Office for Budget Responsibility, up to 20% of people on furlough could be made redundant, which would take the unemployment rate close to 12% per cent before the end of the year. The Bank of England is forecasting an unemployment rate of 7.5%. The Government’s Autumn Budget is going to have to be very creative to address this. Very.
The key US stockmarket (S&P 500) hit its highest ever level – 3,431. The speed of the rebound has been especially surprising, given the US struggle to contain the coronavirus and the impact to the economy. However, the sheer volume of stimulus thrown in by the US Government and Federal Reserve has clearly created an appetite and demand for risk.
The latest rise has also been good for Tesla and its founder, Elon Musk. His fortune has grown by $57 billion this year, the second-biggest increase after Jeff Bezos (Amazon founder). Clearly not a bad year for everyone.
The Comedy (The Trump Award)
As I have said previously, the key to The Trump being……well…..err……The Trump is his ability to always be on stage and consistently hit us with idiocy. Even if he takes some downtime, he’ll still pop up on twitter with a load of stupid nonsensical rubbish. It’s admirable stuff.
And there in lies the problem with some of his rivals over previous months for The Trump Award……politicians, key figures, the leaders amongst us……all think that August is the mid-show interval. To be consistently classed as stupid, you need to keep showing it. Don’t let us forget.
The stupid have continued to walk amongst us during August……they just need to remember to show it more often.
Recognition #1: Matt Hancock
Despite taking some downtime this month, this is the third month in a row that our favourite carpet showroom middle manager appears. Fair play.
Clearly what we need at the moment is for the Government to spend valuable resources concocting a different measure of how many deaths there have been due to the coronavirus. Matt Hancock successfully persuaded Westminster to change the calculation and……the death toll has now reduced by 5,000. Who’d have thought it.
This means that the UK goes from having the worst CV-19 death toll in Europe to now still having the worst CV-19 death toll in Europe.
Pointless? Yes. Stupid? Yes. Idiocy? Yes. Well played Mr Hancock.
Trump Lunacy Rating: 8.5 / 10
Recognition #2: Gavin Williamson
Gavin Williamson is an inspiration to us all. Only last May he was sacked as Defence Secretary for a major national security leak. Yet here he is, barely 15 months later, making an absolute dogs dinner of A-Level results with absolutely no hint of a sacking or resignation!
It is not as though this was a complex unforeseen problem……we took a 4 month run up to this.
When Gavin Williamson defended the downgrading of results he said that “increasing A-level grades will mean a whole generation could end up promoted beyond their abilities”. How very ironic.
Trump Lunacy Rating: 7.5 / 10
Recognition #3: Priti Patel
The largest recession in the G7, the highest excess death rate in Europe, A-Levels in meltdown, unemployment rocketing, catastrophic Brexit imminent (no evidence for this other than the past 9 months of Boris et al) and……Priti Patel takes to twitter to pick a fight with an ice cream maker (Ben & Jerry). It’s madness.
In short, Priti Patel said that the Government “must consider changing laws to deter migrants from crossing the Channel illegally”.
Ben & Jerry voiced their concerns that she should show "humanity", that "people cannot be illegal" and “the real crisis is the lack of humanity for people fleeing war, climate change and torture”.
Her response called on her vast education, decade of political experience and current senior political position (Secretary of State)……she said that Ben & Jerry’s ice cream was “overpriced junk food”.
All this coming from someone who you would imagine held some empathy given that her parents emigrated to the UK in the 1960’s.
Wow. Simply wow.
Trump Lunacy Rating: 9 / 10
Recognition #4: BoJo
The personality, courage and leadership qualities of humans is magnified in times of trouble. Nicola Sturgeon hasn’t got everything right but day in and day out she has been bold, accountable, honest and consistent and she has earned the admiration of many. She is a leader.
Now imagine another ‘leader’ taking his fifth holiday in the last 12 months during a national crisis in which he had a baby with his secretary (as his wife had cancer treatment), having oversaw the largest death toll in Europe and for most of August was nowhere to be seen. Nowhere.
And then pictures at the end of the month emerged of him in a posh tent in Scotland. Control the virus. Stay in a yurt. Save lives.
Just a few days away from millions of children returning to school when the concerns of parents, teachers and students needed leadership and reassurance that sending children back to school will be safe. Instead we were told that face coverings were not needed in schools in England (unlike they were in Scotland) because BoJo said we were “following the science”. Yet 48 hours later the science miraculously appeared and now face coverings are needed. Reassured? Far from it.
Just an idea……perhaps BoJo could prevent yet more embarrassing u-turns by ringing up Nicola Sturgeon first and asking her what she's planning to do. Absolutely amateurish.
Trump Lunacy Rating: 8 / 10
The Winner
Perhaps his easiest win to date as the competition was just not up to the standards required. This month’s Trump Award for commitment to lunacy was a shoe-in……The Trump.
Over more than two centuries the US has stirred a very wide range of feelings in the rest of the world: love and hatred, fear and hope, envy and contempt, awe and anger. But there is one emotion that has never been directed towards the US until now: pity. Perhaps November’s Presidential Election will change that? Perhaps.
August saw The Trump’s sixth former aid (Steve Bannon) facing criminal charges - after ex-Trump campaign chairman Paul Manafort, veteran political operator Roger Stone, ex-Trump lawyer Michael Cohen, ex-deputy campaign manager Rick Gates and ex-National Security Adviser Michael Flynn. I would guess that a certain ‘Farage’ is a little twitchy currently.
With The Trump shouting for years about wanting Hilary Clinton jailed for previous behaviour, it makes you wonder why he didn’t just hire her.
The Trump hasn’t disappointed this month……there are some absolutely classic threads. But for The Trump, this is just the standard performance for somebody of his idiocy.
Firstly, there was an interview on HBO where he was questioned on the high amount of deaths the US has had due to CV-19. You would be forgiven for thinking it was a comedy sketch, such is The Trump’s performance. My 6 year old daughter would have put up a better performance. It’s classic idiocy and four minutes of your life you won’t regret. Enjoy.
https://www.youtube.com/watch?v=NmrEfQG6pIg
Secondly, the US Government is proposing to change law and redefine the definition of a showerhead to allow increased water flow…..following complaints from The Trump about his hair routine…..
"So showerheads - you take a shower, the water doesn't come out. You want to wash your hands, the water doesn't come out. So what do you do? You just stand there longer or you take a longer shower? Because my hair - I don't know about you, but it has to be perfect. Perfect."
So very Donald!
Thirdly, The Trump is trying to manipulate the US elections and then blaming others for rigging the elections. Classic The Trump.
In short, The Trump doesn’t want to allow votes in the US Presidential Elections to be cast by post……mainly because polls suggest that this will see Joe Biden get a bigger slice of the votes.
The perfect opportunity for The Trump to strangle this……simply don’t give the cash that is needed!
And then to deflect from his manipulation……he took to the stage at the Republican Convention to state “the only way they can take this election away from us is if this is a rigged election”. It’s a classic smoke screen The Trump plays so well.
But then just for sheer stupidity……
Supporters at the convention cheered Mr Trump and chanted "four more years”. The Trump responded by saying “if you really want to drive them crazy, you say 12 more years."
However, the 22nd Amendment to the US Constitution states Presidents are only permitted to serve two terms and a total of eight years in office…….four more years is the absolute maximum. What an idiot.
Trump Lunacy Rating: 10 / 10
And Finally……
“Strive not to be a success, but rather to be of value.”
(Albert Einstein)
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