Merv 'More Uncertain Than Ever' Over Economy

Thrugelmir

1echidna wrote: »

I will need to come back to this in the morning. I guess though there is a lot of investment made in the boom that is now standing idle and there would be even more without the gov't borrowing and spending as the recession has biten.

50% of the jobs created in the boom years were in the public sector.

So not wealth productive.

The Big Issue thats going on sale at the moment is who is going to buy all the copies and at what price. So that UK plc can pay its own wage bills and feed itself.

1echidna

I was thinking of investment in car and steel production, for example, standing idle. Civil servants buy cars, washing machines etc so some value in keeping money flowing into that sector in a recession. If we had built a lot more of an industrially productive sector led by exports we would also have been badly hit, arguably more so, like Japan and Germany. Our growth area has been financial services which despite being shot to pieces shows some signs of being resilient. It is a strange world.

Thrugelmir

1echidna wrote: »

I was thinking of investment in car and steel production, for example, standing idle. Civil servants buy cars, washing machines etc so some value in keeping money flowing into that sector in a recession. If we had built a lot more of an industrially productive sector led by exports we would also have been badly hit, arguably more so, like Japan and Germany. Our growth area has been financial services which despite being shot to pieces shows some signs of being resilient. It is a strange world.

The financial services industry is resilient as its not like a factory producing a product. Which closes overnight. Financial services will contract over time. In the main by reduced overseas exposure (ie RBS which is trying to sell its Asian operations currently).

As for washing machines. The last factories in the UK that produced washing machines are going to be moved to Eastern Europe.

Car production at Honda in Swindon is down 50%.

The loss of demand for steel is permanent. So less likely that major manufacturing will invest new capacity into the UK in the future either.

1echidna

Interesting you say that financial service will contract over time. There will be a lot of desperate people trying to find profitable new activities to make sure there is expansion when world recovery comes. Perhaps not much hope for UKplc otherwise

Thrugelmir

1echidna wrote: »

Interesting you say that financial service will contract over time. There will be a lot of desperate people trying to find profitable new activities to make sure there is expansion when world recovery comes. Perhaps not much hope for UKplc otherwise

Contract but not die. Financial services covers a broad spectrum of activities... including insurance etc.

I was referring to fewer high street outlets. As Lloyds has shown with the C&G. Why do you need a seperate office?

Now everything is under Santander how long will all the branches remain open.

Fortunately a lot of English people are entreprenurial and innovative. So new industries will be born in the future.