I’ve just read the best article yet only article worth reading on the current recession.
I’m no macro-economist, so I’ve found it hard to follow some of the more technical melodramatic discussions so beloved by the media. How did this global economic tsunami downturn come about? An over-inflated property market? A housing crisis? Banks too eager to lend? Stock market greed and irresponsibility? Premiership footballer wages? Or – my opinion for what it’s worth – is it part of a natural cycle?
I couldn’t give a stuff. I’m not sure it really matters. The point is – What do we do about it?
So far I’ve heard two different pieces of advice. The first comes from an academic economist, socialist, and politician. So it’s suspect to start with. Name? Gordon ‘Golden’ Brown. Occupation? Unelected British Prime Minister. Advice? Spend more money than we have. Chances of success? Nil point!
Like I said at the start, I’m no academic economist. So you’ll forgive me if I scratch my head a this one. But isn’t it bad to get into debt? Isn’t is irresponsible to spend what you don’t have? Doesn’t this come under the heading of patently idiotic short-term thinking?
Again, my opinion – for what it’s worth, blah, blah – is that there must be a barkingly obvious connection unless you’re as think as champ direct correlation between micro-economics (how individuals and their families run their finances) and macro-economics (how nations and governments make a mess of run theirs). In fact, this correlation is a cornerstone of modern economic theory, which says that the macro is/should be build on the micro (this is called ‘common sense’ ‘microfoundations’).
So what Gordo is saying is this. Someone up to their eyes in credit card debt has their best hope of recovery by getting their hands on even more plastic to pay it off. No wonder the mood is gloomy. If reasoning so stupid as this is the best we’ve got, then we might as well admit defeat right now. As Monty Python would say – ‘Stop it! You’re being silly!’ And now for something completely different.
Out if this mist rides forth Sir David Tang, Entrepreneur! In an article entitled Optimism is the cure for the downturn, Sir David slays Gordon the Goliath with the sling of positive psychology. ‘Pessimism has an uncanny knack of being self-fulfilling,’ he says. Even – especially? – on a global scale. Supporting small business is key, along with ‘solid business sense based on the fundamentals of supply and demand, with particular reference to the efficiency of the workforce.’ Although the collapses are big, the solution is to ‘think small’ in these ways.
But my favorite quote is this, and with it I’ll end. I promise.
“It is only with a sense of optimism, preferably accompanied by a sense of energy and laughter, that we will be able to pick ourselves up from a broken Humpty Dumpty.”
Politicians and media and other scare merchants – are you listening?
Image credit: fuzzbabble.