[Closed] Coronanomics

I reference Thatcher only to paint a picture of what the forthcoming landscape could look like, and to me it looks like it could be the 80's on steroids.

Having grown up in the south then moving up North in 1986 I got to see the both sides of Thatchers Britain. In the South I had seen things steadily improve throughout the 80's whereas I could see the North had been laid to waste.

Our current incumbents have gone so far from even Thatcher's most distorted dreams that I'd have to agree with you, the link has become irrelevant. However, they might succeed in mirroring Thatcherism by achieving in the South what she only managed to achieve in the North.

Not sure how we can help people prepare for what's down the line, thus the limbo land I referred to. I'm sure self denial plays a role but in times like these the only ones who can plan for such an uncertain future are those with assets to spare. For everyone else its going to be a scrap.

And yet everyone still carries on as if it’s no big deal. Bizarre.

Out of curiosity, what do you want them to do other than just carrying on?

I'm well aware that the industry I work in is going to be in a very bad way in the coming months/years, as are lots of others - but there's sweet hee-haw I can do about that so... yea. I'll just keep carrying on.

To think, half a page back there I was going to reply expressing my interest in Anita’s vegan haggis samosas.

Highly recommended btw. One of a number of caterers that have changed their business model locally from weddings etc to home delivery.

I’m well aware that the industry I work in is going to be in a very bad way in the coming months/years, as are lots of others – but there’s sweet hee-haw I can do about that so… yea. I’ll just keep carrying on.

Mainly events industry in this household, nothing really is expected to happen, that’ll be worth happening until late next year, although that does mean the work up to those events start 12 months out at least.  I won’t go full Doom Fapper and say the industry won’t survive and won’t come back but the landscape will look very different and it’s likely (when it does reliably become safe again) that there’ll be quite a few new businesses running those events staffed by people from organisers that didn’t make it through the shit show.

Im pretty much planning for unemployment and a significant decline in living standards. I’ll still keep “carrying on” mind you, don’t have any choice when doing 3 people’s jobs.

Personally I'm finding the working from home great and certainly not rush to go back. Now get up at 730 instead of 550, no hour each way commute and associated costs. Didn't go to the pub much anyway, now get to ride my bike at 530 in the evenings. Apart from the constant worry of catching the long version of covid, and concern for my pregnant wife, it's really not been that bad.

My work which was previously a bit anti home working had now said we're not going back till march next year. Currently trying to buy a house but since lockdown every other person is now after what we have been after - bit of land in the country.

Clearly I'm in a rather privialged position and a lot of people are ****ed by the situation. However the solution to this for me isnt to force me back into my car and office, but rather to move to a social democratic model and raise taxes significantly. I already in the lucky position that i pay a lot of tax, but I'd happily pay more to sort out our broken brexity society.

I'm another that follows this thread without commenting much. But I did in the early days on the big CV thread, and I wondered then and still do actually, about whether we have the balance right. Even with the measures taken, and the generally excellent way they have been followed (it's the exceptions that make the front pages, not the millions who behaved) we've seen ca 50K deaths. Every one a tragedy, and a family devastated by it, but 50K is actually not a lot. It's about a month of 'normal'

Yet we know that if we have a cold winter, thousands die because of fuel poverty and cold / damp homes. We know that lower income / no income leads to lower diet leads to lower health leads to death. We know that loss of work leads to mental health issues/stress leads to suicide increases. We count deaths of CV, but how many will die 'because of' rather than 'of' CV in the years to come.

I thought that as a concept herd immunity made sense, at least early on, because I think the long term effects risk being far worse than the short term. I saw how the pandemic developed and also learned more about HI and now i'm not sure, but we cannot live in lockdown for ever. So I am back at work for some days. I am using shops and cafes, and I have eaten out. It's small and a risk which I mitigate as best I can with masks and hand washing and the rest.

I don't know where the balance is.....but I'm sure glad it's not up to me. I wish it wasn't up to the clown circus either, mind. But i agree, we face a catastrophe that'll make the banking crisis and the 80's look like a picnic.

May I present another possible future as an alternative to Tory hell?

Given the number of zombie companies and redundancies waiting in the wings, across all sectors (not just industry/the North/Wales as in Thatcher's time) a lot of people will be in a very bad way financially. And when that happens across the country to enough people they will want change. I think when the shit hits the fan economically and the idiots no longer have Brexit to cling to Boris and his Tories will have nothing. Labour will sweep in looking like proper government, and they'll have no choice but to reform. The number of people needing help will mean something big and radical will have to be done, they'll step up, and the UK will emerge better.

The government would love everyone to think it's us and them, family first and everyone else can go hang. It is us and them but it's capital versus labour. People need to learn about workplace and community organisation. Recently in Serco, a section got unionised, won sick pay from day one and a pay rise. I think they've surprised themselves.
Edukator's (?) comment about the Spanish repossessions flagged up how housing (and food, transport and and) is very much part of this issue but the Spanish have more history of battles around housing. Potentially the cladding issues blocks will lead to a mass wipeout of people at the very same time as declining building regs for newbuilds.
We are witnessing an increasing concentration of capital arising from what Gove calls 'creative destruction', wages cut, more zero hours, pensions cut, and flogging off the welfare state where possible. The mortgaged Audi brigade may well be finding themselves renting with no woodburner and a worthless car they can't afford. This is bare-knuckle class struggle and the LP has positioned itself in defence of the establishment so rowing over who said what, who to expel, who to give money to, who is a geriatric Nazi gardener, who to vote for in 4 yrs time, is pretty well irrelevant. We need to be thinking and acting very differently but looking at the voting intentions (and the current LP) it seems there's quite a few who imagine the establishment has their interests at heart. So sad, but some will be fast learners.

Good to hear. Which bit of creative Julian? And where are you based, if you don’t mind me asking?

Interested to know as work-wise as a freelance creative, it’s been a desert out there. There’s nothing. Not just from my own experience but across the board from the people I know. It’s wall-to-wall doom and gloom

Were in manchester, she does copy writing. I know one swallow does not make a summer, and this may be all she gets for years, who knows....

Not a bad piece from the Groaniad:

https://www.theguardian.com/commentisfree/2020/aug/06/covid-jobs-crisis-rishi-sunak-safety-net?CMP=share_btn_tw

I’m doing what I can to mitigate the likely impacts of johnson’s incompetence; what are others doing?

For me this essentially boils down to saving as much money as possible and avoiding unnecessary spending. When all the covid stuff kicked off work started a voluntary hours reduction scheme where you could go to a 4 day week and whilst voluntary they were pretty pushy about how it would help the company. Quite a few colleagues signed up up but I didn't purely on the basis that now is not the time to be voluntarily reducing income, which may sound a little mercenary, but it's the sensible thing to do. I've also started taking a much more proactive approach to brushing up on skills I may need if I find myself looking for a job.

Out of curiosity, what do you want them to do other than just carrying on?

I don't expect anyone to do anything, it was more a comment on the lack of discussion both on here and in the real world about the affects. I admit I may be something of a pessimist on the economic front but when I talk to friends and relatives about this they seem completely oblivious or in outright denial.

I’m doing what I can to mitigate the likely impacts of johnson’s incompetence; what are others doing?

I'm interested in this. What CAN people do?

Some 50% of people in the UK have less than a month's worth of living costs in savings, and 69% of people under 35 have less than £1,000. (When I was 35, that was me, too. I'm now 40 and slightly better off).

So when we're talking about 'savings, investments, pensions', we're only really talking about the top few % of wealthy people in the country. What of the majority? What can they actually do, besides keep working and cross their fingers?

(sources:

https://www.independent.co.uk/news/uk/savings-account-money-finance-banking-isa-building-society-a9223831.html )

I admit I may be something of a pessimist on the economic front but when I talk to friends and relatives about this they seem completely oblivious or in outright denial.

Banks are OK. Plenty of households largely or unaffected financially/job-wise or at least still have 1 earner.

That's because we're still in the early phases. Like I said the impact has been mostly on those who have already lost their jobs and income. The furlough scheme has so far delayed the real impact, but that is now being withdrawn and the redundancies are starting to accumulate. Also those impacted with no help like Binners will be living on savings or other temporary means which will soon start to run out if they haven't already. The bigger picture is the issues around city centre economies, the businesses it supports and underlying commercial and residential asset prices. When they collapse the banks will be hit. They're already reporting massive losses in the billions, and we know what happens from 2008 when the loans they have issued can't be repayed.

The bigger picture is the issues around city centre economies

Banks are OK.

The banks are most certainly not OK. Only last week HSBC put out a warning that they are expecting a huge raft of defaults as businesses fold owing loads in outstanding loans that will never be repaid.

Throw in a mass of personal bankruptcies, and stuff like PCP on cars that peple can't really afford anyway but certainly won't once they lose their jobs. Martin Lewis ran an article about that a couple of years ago where he stated that just outstanding PCP defaults could trigger a crash as the sub-prime mortgages collapse.

Also those impacted with no help like Binners will be living on savings or other temporary means which will soon start to run out if they haven’t alread

Savings are long gone. We've been luckier than most in that we live a very simple lifestyle anyway with not many expensive material trappings, my wife has a decent job and I've been able to do other things, so we've stayed afloat. Just.

I'm now working for a mates business on minimum wage with a few other massively overqualified people who've been made redundant already from well-paid professional roles. A lot of people with nice comfortable middle-class incomes and lifestyles are in for one hell of a rude awakening.

They are going to have to adapt to living on 'minimum wage' as when unemployment goes through the roof, as it's about too (present predictions are 9% of the workforce), for most positions it will simply become 'the wage' for everything and people are going to be fighting tooth and nail for every minimum wage job, in their hundreds.

If you read the stories on Excluded UK the desperate straits some people are in already is tragic. There are 3 million of us who've had no income since March and zero government support. We've just been cut adrift. Collateral damage. There's going to be millions more over the next few months who will be excluded completely, millions more consigned to the misery of Universal Credit. The suicide rate is going to go through the roof

Only last week HSBC put out a warning that they are expecting a huge raft of defaults as businesses fold owing loads in outstanding loans that will never be repaid.

7 Billion?

As Daz said, nothing's happened yet. This is the calm before the storm

Look at how much we had to throw at the banks last time around to stop them folding. Hundreds of billions. And this is going to be way worse than that.

When this hits, 7 billion won't touch the sides

End of Furlough will see the impact really be felt

Even if consumer spending keeps up through the summer, the real worry is how severe any second wave will be.

Hospitality industry is going to struggle hugely, Xmas is a big chunk of their annual profits, there will be no work dos this year, no office parties , opening pubs is risky enough in the summer, but come winter, I really can't see them opening, especially if it's a wet one, when beer gardens can't be used & flu season is upon us.

As ever the middle classes who much more likely to keep WFH will be least impacted, it's already those at the bottom feeling this the worst.

I still believe the office is dead , but that has huge repurcussions for city centres, it could be a boost to local high streets, but government need to guide that, they still seem determined to get people back commuting into city centres & buying lunch in Pret

it could be a boost to local high streets

I really don't see where this boost is. I've been working from home and not once have I popped out to the high street to buy a coffee, a sandwich, a bag of crisps, let alone an after work pint or 3 as I was doing when working in Manc. Instead I go to Morrisons and buy the stuff I need in the weekly shop and make lunch at home. The local craft brewery has gained from the beer deliveries but that's the exception. Unless of course by 'boost to the high street' you mean boost to the big supermarket chains, but I don't think that's what most people think the 'high street' is.

they still seem determined to get people back commuting into city centres & buying lunch in Pret

Worryingly, I think that in itself is indicative of the dearth of imagination at the heart of government. They just seem to be wishing everything back to how it was before.

Despite the pessimism, this is surely an opportunity to address big issues about the way we order our society. They don't even seem to want to acknowledge that as even being a possibility. The present economic model was bust before Covid, it looks even more threadbare now, but we have an ultra-neoliberal government that won't countenance any other approach and is simply sticking its fingers in its ears and shouting LA LA LAAA WE'RE NOT LISTENING

Actually... Doesnt Boris have form for doing literally this?

It certainly doesn't bode well. Say what you like about Gordon Brown, when the banking crisis hit he understood the magnitude of the challange and stepped up to take decisive action

He didn't run off and hide in a fridge

really don’t see where this boost is. I’ve been working from home and not once have I popped out to the high street to buy a coffee, a sandwich, a bag of crisps, let alone an after work pint or 3 as I was doing when working in Manc.

That's my point, unless the government steps up the benefits will be minimal.

We have had a coffee & snack van started coming round locally, they also set up by the local parks, which are rammed, so all the parents can get their caffeine hit

local cafes doing takeaway should be encouraged too

I’ve been working from home and not once have I popped out to the high street to buy a coffee, a sandwich, a bag of crisps, let alone an after work pint or 3 as I was doing when working in Manc

Say what you like about Gordon Brown, when the banking crisis hit he understood the magnitude of the challange and stepped up to take decisive action

You can imagine the meetings going on in Whitehall with sober civil servants trying to explain to the likes of Boris and Raab just what a depression means for the economy and wider society. Back in the 30s FDR understood what it meant, and it resulted in the New Deal which by today's standards would be labelled outright communism. Even then the new deal in itself wasn't enough and it required the second world war and the command economy it created to pull them out of the deflationary downward spiral of the depression. What's happening now is of a similar magnitude, and yet our leaders seem to think getting people buying their lunch in Pret will solve the problem.

what’s stopping you from jumping on your bike and doing any of those things before/after work or at lunch time?

Well aside from lockdowns and the risk of catching covid, why would I when I can make lunch at home and open a can of beer at the end of the work day and in the process save a ton of money? Nothing's stopping me from doing it, other than the fact I don't need to, and that is exactly the problem. People are adjusting to a way of life which involves much less frivolous spending, and they like it. If you suck demand out of the economy overnight, then everything collapses, and that's exactly what's happening.

I really don’t see where this boost is. I’ve been working from home and not once have I popped out to the high street to buy a coffee, a sandwich, a bag of crisps, let alone an after work pint or 3 as I was doing when working in Manc. Instead I go to Morrisons and buy the stuff I need in the weekly shop and make lunch at home. The local craft brewery has gained from the beer deliveries but that’s the exception. Unless of course by ‘boost to the high street’ you mean boost to the big supermarket chains, but I don’t think that’s what most people think the ‘high street’ is.

It's doing ok here. I haven't been to the city centre in over 4 months but about twice a week I nip out for a coffee before work to support the local cafes. I now get my meat from a local butcher because I'll be in during the day to take delivery - was chatting to him last week and he said he's doing really well. I use the local takeaways more than I used to, and there's always a queue outside the bakery these days, when previously it was only busy on a Saturday morning. I'm spending less in supermarkets and more in local shops.

I don't think the pubs are doing so well, but overall the street is very lively.

People are adjusting to a way of life which involves much less frivolous spending, and they like it.

I’m spending less in supermarkets and more in local shops.

Maybe. No sure that’s there case where I am tbh! Local bike/surf shops never been so busy. Indie cafes/pubs/takeaways/ice creams vans/chip shops/garden centres etc doing a roaring trade. High st/seafront areas very busy.

I'd imagine seaside towns are doing great business this year. But even so, we do need to remember that we're talking about the middle class economy here. I know people with businesses that have had their best quarter ever: a record shop, a synthesizer shop, an independent clothes shop. But that's because their customers are people with office jobs W-ingFH and no pubs to spend their money in. It's not necessarily indicative of the wider economy. MrsDoris works in the airline industry and is not enormously confident of whether she'll still have a job in 6 - 12 months' time...

I'll say what I like about Gordon Brown. He saw being Prime Minister as an inheritance rather than something you had to go out a fight on the stump for.

But compared to the current lot he looks like Superman.

But even so, we do need to remember that we’re talking about the middle class economy here.

airline industry... yeah, that's toast. Obviously doesn't help those who'll lose their jobs but I think it will do planet Earth a favour in the long run.

High st/seafront areas very busy.

Sounds like your area is benefitting from the staycation boom, rather than a shift from city working? What's going to happen in the winter or when people start travelling abroad again? And yes the online economy is for now doing ok, or better than it was, and from what I've heard there's money to be made in the delivery sector (I heard a rumour of one delivery driver in Manc bringing in 1k per week), but how long will that last when more people start to lose their jobs and savings? We're still in the phase where people have changed their spending habits due to the lockdown rather than lack of funds, but that's going to shift towards the latter, and when it does the change will become permanent.

Sounds like your area is benefitting from the staycation boom, rather than a shift from city working? What’s going to happen in the winter or when people start travelling abroad again?

ouch

Sunday papers biz sections don't paint a rosy picture - nor do any of the many talking heads who've pontificated recently.
I've stayed away from this thread for a few days but...absentee PM; track, trace, test, isolate not working; banks making chunky provisions for bad debts; second spike almost certain; redunders announcements continue; imposed salary and hours reductions becoming more prevalent; BoE claim of rapid recovery is delusional; base rate going -ve is becoming more likely; rhetoric continuing to outstrip action; eat out to help out is now 25% done and it's benefit is questionable.
Look at non-essential retail shops in your area - are their opening hours back to what they were pre-CV19; limits on customer numbers.
Sunak making it clear that support schemes must end.
Possibility of re-imposing closures in the leisure sector.
Increased WFH is here to stay; extent still tbc.
Public transport under pressure.
Commercial property squeeze is on.
Open conflict between LAs and property developers just around the corner
Three weeks until the next stage of removing furlough.
Nothing from johnson about his vision for a post CV19 economy; more of the same bozza?
What about your economic, industrial and manufacturing strategy? Cripes, hadn't thought about that - been a bit busy, don'tcha know?
End of brexit transition and consequent costs will further deepen the gloom.
Was going to have a drink but...my glass is empty.

frankconway
Subscriber

Nothing from johnson about his vision for a post CV19 economy; more of the same bozza?

TBF that's for later, right now it'd just be good to have some plans that'd make a post covid economy possible. But this government is working hard for permanent covid.

There’s almost no chance of a post COVID world.

Are you really referring to a time when the virus has declined in severity to a point where we can return to normality?

Brown was no saviour he was a chicken. All that money and he didn't even nationalise them. There wasn't even a hiccough in their inflated salaries and bonuses. You would be very naive to look to the Tories or LP for a solution, they are tied to the system and can only seek to 'save' it, like Brown, at everyone else's expense. Covid is potentially putting the system on the line and they have no answers. Burger vouchers, really?
Many of those new tory voters have never been in unions and their thinking is binary and confused and as in all crises the media shifts to the right so no alternatives will come from there. The BLM protests showed lots of anger and concern but was only a real threat to some inanimate objects and people risking getting coshed and ridden over. Without political focus and organisation for a serious change in the direction of a socialist society all hope is lost. It seems that eg Osbourne has succeeded in persuading people that good government reduces your standard of living, that the nice but limp old reformist Corbyn was Lenin (and Stalin) and that posh people who say things you don't understand must know what they're on about therefore should be in charge. '
Class consciousness' isn't about which label's on your car or whether you wear a tie but understanding that the interests of capital and labour are mutually exclusive, profits come from exploiting the labour of others and the essential characteristic of capitalism is crisis not long term stable growth. The government have shown their true worth by their treatment of their own pay against the health workers' pay, give them a clap and a cupcake. If that's how they treat heroic and super-exploited frontline staff don't imagine for one moment they're going to do anything for you unless, maybe, you own Virgin or Wetherspoons.
There's never been a greater need for people to get informed and organised and prepare to fight back. Look at how brutally those BLM protesters were treated, they ain't going to make concessions without a big organised opposition and that's going to be in the workplace, communities, streets, alt media and I think you'll find Sir Squeaky has already been bought and absorbed into the system, a bit like that poor little angler fish. Gone.

Klunk
Member
ouch

Ouch indeed.

We've a very difficult winter ahead.

a lot of people forget that corporates are actually in the minority

This is true but they make up much of the money in The system so are critical to the economy.

BoE claim of rapid recovery is delusional

Interested in why you say this. Do you think that the BoE don't know what they are talking about, or are they under political pressure?

Ken Clarke has just been on Sky News. It would appear that despite his years as chancellor and decades in parliament that he doesn't know how the public finances work. He said the furlough scheme has 'added another NHS' to the public finances but we haven't 'raised any money to pay for it'. This is the problem. Until people stop worrying about how we're going to pay for things and start worrying about what will happen if we don't start under-writing the economy with printed money then we're f****. Deflation is here and we have a bunch of politicians in charge (and in opposition) who don't understand what it means, let alone the vision or will to take the bold action to correct it.

Clarke knows full well that it's financed by quantitative easing, it's just that 'you're going to have to pay for this' message in one of it's many and varied forms. **** (fill in as appropriate)!

Intrigued by the wording of the BBC on today's economic news...

"employment falls" rather than 'unemployment rises'. The psychology of that feels odd to me.

I agree, because the usual metric is unemployment, so when I saw it I read 'unemployment falls' which would normally be a good headline.

BBC have been careful in their phrasing...

The figures do not include the millions of people who are furloughed, those on zero-hours contracts but not getting shifts, or people on temporary unpaid leave from a job, as they still count as employed.

and

The UK economy has been battered by the coronavirus pandemic, but unemployment has not surged as much as feared because large numbers of firms have furloughed staff.
However, analysts said unemployment was set to worsen in coming months as the scheme wound down, warning of a looming "cliff-edge" and a "lull before the storm".

Another point on the wording. Very imminently the current year 13 are about to recieve their A level results. For the 50% ish that do not go to university, they are about to become classed as unemplyed adults.

At what point do those figures hit the stats?