According to the Office of National Statistics (ONS) we are now out of recession, news which has dominated the headlines all day. Personally, I don’t know whether to celebrate or not, as I really can’t believe it went on for 18 months. My, how time flies!
So let’s look at the bare facts. We have been in recession for the longest period since quarterly figures were first recorded in 1955 and we are the last major economy to come out of the world wide recession, but only on the growth of 0.1 percent.
This figure is based upon only half the data so far available, so in theory, when the full data is there, we could actually see more of an increase in growth. Be warned though, we could also see a negative and we are then back in recession.
Many economists I listened to today fear that this could be the case once the full data is available, but my view is more upbeat and I am in positive mode because everyone I speak to in the commercial industry seems to be getting really busy.
A few days ago I made enquiries about further developments to my website but my web support team said that I will have to wait a few weeks because everyone that had put jobs on hold last year are now hitting the ‘Go’ button.
Over the weekend I ordered a new shower door for home and in chatting to the sales department asked how business was doing. They said it really kicked off for them back in November last year and it has been manic since the start of the year.
I have a friend who is high up in Ford who tells me that they can‘t make the Ford Focus quick enough to meet demand.
The other place I decided to enquire was down at my local, The Chapel in Coggeshall, Essex. All in the line of duty, I sampled some bitter and spoke to the landlord who informed me that it was all good, steady business.
We can all be armchair economists but what I would like to see is all the political parties united in getting things moving for the good of the country instead of listening to their predictable sniping at each other. I watched George Osborne and Vince Cable on the BBC today and I could have written their speeches for them. Each one blamed the other party, as well as the government, all point scoring on prime-time TV.
My only concern is that those individuals burdened with debts will not see any benefit from the upturn. Debt levels will stay the same irrespective of the recession, with interest rates probably rising towards the end of the year to combat inflation and one can expect the plastic brigade to put their interest rates up. At the moment the average interest rate for a credit card is only 36 times that of the current base rate! So if we go to 1% we will soon be back to the good old days of a credit card at 36%. Also most households have been squeezed financially and this could take many months, if not years, for this to improve.
My marker for getting out of recession and onto a sound recovery is the three ‘Cs’
Cash, Credit and Confidence. Cash is linked to Credit - get more Credit in the economy and the Cash comes. Then get the consumers gaining Confidence in their job status and they then have the Confidence to buy goods and services and use leisure facilities and away we go!
