Reality check

kabayiri

My point about Tesco (one example) is that we sometimes imagine here that the world outside the UK is somehow static.

This is illustrated by a belief that 'things will return to normal, how it was before the GFC'.

I think this is an unrealistic viewpoint to take.

China and other developing countries have had ambitious plans for decades now. What's changed is that they now have financial resources behind them to achieve these plans.

The economic landscape has changed, and it will take a long time for the true effect of this to play out.

Loughton_Monkey

kabayiri wrote: »

My point about Tesco (one example) is that we sometimes imagine here that the world outside the UK is somehow static.

This is illustrated by a belief that 'things will return to normal, how it was before the GFC'.

I think this is an unrealistic viewpoint to take.

Surely not many people believe that? A simple glance at GDP figures etc. will show that China, India, S America and others have been outstripping us economically for years. And this was true well before the so-called 'crash', and so even were we to recover to 'how it was' [whatever that means] we will still be dwarfed and out-competed by the other countries who do not carry our economic and social baggage.

kabayiri wrote: »

China and other developing countries have had ambitious plans for decades now. What's changed is that they now have financial resources behind them to achieve these plans.

The economic landscape has changed, and it will take a long time for the true effect of this to play out.

Probably about 500 years. UK has been lost politically and economically for years. Our greatest allies USA are the ones to watch. We have already seen a taste of what's to come with Syria. China & Russia can now put USA in its place. Give it another decade or so and these two will be huge Rottweilers. USA will be a lame poodle, while UK will be the trembling little chiwawa cowering in the corner, eating out of whatever scraps remain in the poodle's bowl.

Europe is irrelevant.

CLAPTON

children grow faster than adults but that doesn't mean that they are bigger than adults

russia's population is in decline and exists only because of oil/gas

china has the most rapidly aging population in the world and will experience it's own problems very soon.


other peoples will catch up with europe just as other european countries have caught up with GB and USA

the world (including GB) has benefited by these developments and will continue to do so

the future is looking good

Loughton_Monkey

CLAPTON wrote: »

children grow faster than adults but that doesn't mean that they are bigger than adults

russia's population is in decline and exists only because of oil/gas

china has the most rapidly aging population in the world and will experience it's own problems very soon.


other peoples will catch up with europe just as other european countries have caught up with GB and USA

the world (including GB) has benefited by these developments and will continue to do so

the future is looking good

I hear what you say, but disagree. The height of a human is constrained by genetics. The collective wealth of individuals is not so constrained.

A declining population is (in my view) a huge bonus, and consistent with the trend for less and less human labour required to create wealth.

China actually did something about their unsustainable population growth. Any ageing 'bulge' is temporary, and in any case is very little to do with their economy. Responsibility for maintaining elders is utterly and firmly the responsibility of family. Surely you don't think they pay state pensions like us do you?

Of course other people catch up with USA/Europe and Others catch up with GB. But not as fast as China. Our wealth as measured by GDP per head ($38K roughly) puts us about 27th in the world. Russia ($14K), China ($6K) and India ($1.5K) are just about off the starting blocks. Anyone who thinks they won't catch up - especially with [probably] half of the world's natural resources - should really think again. Since 1980, China has leapt from 3% of our GPD per capita up to 17%. Some headroom! In the same period, South Korea leapt from 29% to 59%.

It's OK to suggest that we pick up a few scraps from their GDP growth, and I hope we will continue to do so. But we should ask ourselves whether their dependency on us for their growth will increase or diminish? I firmly believe it can only diminish.

TruckerT

Carl31 wrote: »

Interesting spending on food decreased when we had the best summer in ages, the supermarkets were full of barbecue stuff, which appeared to be selling well

It's hard to think of barbecue stuff as food - I would describe it as an alternative to food!

Loughton_Monkey wrote: »

But I suspect there are universal 'laws' behind it all. Just like Newtons 3 main laws, I suspect there are some inviolate economic laws..... I wonder what they are?

I can only think of one - 'there will always be winners and there will always be losers'

dryhat wrote: »

There are no universal laws behind the "economy" because economics is not a science

Astronomy wasn't a science at first, it was simply star-gazing. Economics is at a similarly primitive stage.

TruckerT

Loughton_Monkey

TruckerT wrote: »

It's hard to think of barbecue stuff as food - I would describe it as an alternative to food!

I can only think of one - 'there will always be winners and there will always be losers'

Astronomy wasn't a science at first, it was simply star-gazing. Economics is at a similarly primitive stage.

TruckerT

To be technically correct, your middle point about winners and losers is totally correct, but it is a 'corollary' rather than a 'law'.

But the nub is your third point. On a snooker table, the balls do follow Newton's laws. Given the force of hitting the cue ball, its direction, and degree of 'side' a physicist knows all the mathematics/laws he needs to work out where every ball will go. But it is one hell of a calculation!

If you take an economics problem - equivalent to the snooker ball - I don't believe the laws are totally known or indeed precise. As is patently clear, economists can't even agree whether we have a house price bubble or not, least of all its size.

TruckerT

Loughton_Monkey wrote: »

To be technically correct, your middle point about winners and losers is totally correct, but it is a 'corollary' rather than a 'law'.

But the nub is your third point. On a snooker table, the balls do follow Newton's laws. Given the force of hitting the cue ball, its direction, and degree of 'side' a physicist knows all the mathematics/laws he needs to work out where every ball will go. But it is one hell of a calculation!

If you take an economics problem - equivalent to the snooker ball - I don't believe the laws are totally known or indeed precise. As is patently clear, economists can't even agree whether we have a house price bubble or not, least of all its size.

Many years ago, at the time of the Brixton riots, I said to a social scientist that, as a scientist, she ought to be able to offer a detailed prediction of how the riots would develop, and should be able to state exactly how to deploy the necessary opposing forces.

Needless to say, I slept alone that night.

TruckerT

Loughton_Monkey

TruckerT wrote: »

Many years ago, at the time of the Brixton riots, I said to a social scientist that, as a scientist, she ought to be able to offer a detailed prediction of how the riots would develop, and should be able to state exactly how to deploy the necessary opposing forces.

Needless to say, I slept alone that night.

TruckerT

Sounds to me she was more like an antisocial scientist.

Macca83_2

I don't know if anyone has found the same but coming from a small rural town when the recession first hit I was like 'what's the big deal?' there was no change in my general day to day business. But as it went on I realised that it's only taken that wee bit longer for the recession to hit us and it's gonna end up with us taking a wee bit longer for us to get out of it.

Loughton_Monkey

Macca83 wrote: »

I don't know if anyone has found the same but coming from a small rural town when the recession first hit I was like 'what's the big deal?' there was no change in my general day to day business. But as it went on I realised that it's only taken that wee bit longer for the recession to hit us and it's gonna end up with us taking a wee bit longer for us to get out of it.

Due to the arbitrary but precise way we define "Recession", technically, we can say it ended 4th Quarter 2009. It ended for all of us at the same time.

So for 3½ years we have seen a juddering improvement in economic activity. At which point anyone could say it's "over" defies any logical analysis. 60 million individuals all have their own unique mix of financial attributes and were 'hit' in any number of ways. Similarly all the businesses.

There is no 'magic wand' that is going to eliminate the obscene Government debt overnight. The extent to which someone is in the financial grasp of government (employees, benefits claimants) can expect no panacea that will give them huge rises in the near future. Private sector employees also should know that their employer has to compete against the world and are still sensitive to being thrown out of business if their costs (including wages/taxes) get too high.

It's time to forget the "recession" and accept the key external factors [Inflation, Interest Rates, House Prices, Wages, Benefits] as a 'given' and get on with it.