In Apocalypse Now, when Marlon Brandon asks 'Are my methods unsound?' Martin Sheen replies rather haltingly, "I don't see any method at all"
Lots of workers are getting their monthly pay packets today. Most of the retail and hospitality industry are on monthly pay. Monthly LOW pay at that. Often single and without children so the last minute fudge fix isn't coming to rescue them from what many will experience for the first time.
A tax increase. A shrinking of wages for people who in no way consider themselves rich.
Many of these young people will be first time voters. First time voters who parties are desperate to court, for the same reason the banks like student accounts. Free railcard today for you, bank account for thirty years for me. Vote for me today and set that precedent.
So why on earth, on almost polling day, would you remind them all, as they queue up to dispute their wages with their managers, that the government has taken a bit from them.
Is this the great strategy that was being talked of not so long ago?
The form V5c [ the car tax reminder to the non bureaucratic] has been being sent out to every car owner who needs a new licence with the incorrect fee. This has happened for March and April and for anyone wanting a new licence in May.
The fee is some £5.00 - £ 10.00 higher than the printed one. So each person re-taxing their vehicle is reminded some 6 weeks AFTER the budget that taxes were put up. Doubly hurting as it wasn't widely reported that EXISTING car duty had risen, when the talk was all about an increased tax on new cars.
Most people relicence their car on.. yes that's right, the 1st of the month. What's the reminder car owners are going to have as they enter the polling booth.. I have less money / I pay more tax. Is any of this this a winning political strategy?
hmm .. I don't see ... Any method.. .. at all.
Wednesday, 30 April 2008
Tuesday, 29 April 2008
Customer defections have increased by some 38% between 2005 -2007.
The Retail Bulletin points to; not being recognised as a valuable customer, unhelpful staff, and ineffective call centres as major reasons for customers leaving a favorite.
However another really useful indicator of Churn rates is Price. There is a downward migration in retail as budgets are squeezed and a lot more families will be discovering Primark and Morrison's. The rising share prices of the discounters will be in contrast to the shrinking disposable income of consumers.
2008 will almost certainly see an increase in this movement to the budget brands and possibly the first cracks in Tesco’s domination of the grocery market as customers really don’t have the cash to spare on anything that is non essential and move lower down the food chain, as it were. Shopping basket switching is actually a very successful way of saving money, unlike utility or transportation ’choice’
The other upside is a lot less television programs being made about buying or rearing “happy poultry”
We may well all become too poor for guilt.
Monday, 28 April 2008
"... if he was really brave, he could say that the recent fall in the value of the pound and the impending drop in house prices are entirely welcome developments that will assist in the long overdue rebalancing of the economy. The productive side of the economy has suffered grievously from an over-valued exchange rate, which is why the trade deficit is so high. Rising house prices have encouraged over-consumption and resulted in a massive inter-generational transfer of wealth from young people to their parents."
There’s a flaw in this, Mr Elliott and it appears in your first five words ...
Sunday, 27 April 2008
Friday, 25 April 2008
Thursday, 24 April 2008
It never rains but it pours; This news today that banks can b investigated for overdraft charges is yet another headache.
Wednesday, 23 April 2008
This report suggests that commercial consumers of fuel are already feeling the pinch from the strike at Grangemouth. With industry on this scale a single closure can always cause huge problems down the supply chain.
Tuesday, 22 April 2008
When it comes to global commodity crises, real or imagined, until quite recently talk has been of energy, water and high-value metals: and it has been easy to take ones eye off the meat-ball, so to say. Hands up – food prices didn’t get a mention in our predictions for 2008: but it’s food that is the first true global commodity flashpoint of the new century.
In retrospect, how obvious this is and how parochial have been the concerns over energy and metals - the rich man’s ‘necessities’. But meagre incomes are spent predominantly on food, with pitifully little room for manoeuvre. We can take a tenfold rise in oil prices (since 1998!) more or less in our stride, and even become blasé about commodity prices (we may even have invested in them …) They cannot easily take a doubling in the price of wheat and rice.
Of course commodity prices are interlinked, and this we did foresee: that the lunacy which is EC biofuels policy would soon unravel. Biofuels for power generation may be primarily woodchips and chickenshit (and diseased carcasses): but biofuels for transportation compete directly and brutally with food production and rainforests. As we noted here last month, the grand EU enviro-energy plan entails that more than half the renewables we are ‘legally bound’ to use will come from biofuels.
It’s an ill wind … and some very powerful (and greedy) lobbies are limbering up for a big, big payday. The French and US farmers, the GM crop manufacturers: all will strangely find high prices insufficient motivation, and will demand ever more protection, promotion and subsidy for their ‘help’ in solving the food crisis.
A rethink by the EC on biofuels would be a start – we’ll return to this in future - but there are only rumblings at present. Heaven help those on a dollar or two per day.
Monday, 21 April 2008
Sunday, 20 April 2008
Hoping that CU is enjoying his weekend, here are a few articles that have caught my eye this weekend. Avoiding the obvious deluge of RBS stuff initially, we start with . . . a food’n’drink theme.
First, one you won’t want to read – trust me on this - John Prescott reveals his battle with bulimia (sic – or is that sick ?) in the Telegraph. No link – you’ll have to search it out for yourselves!
The Observer reckons that speculators are fuelling a bubble in global food costs. This is rubbish: as with oil and other commodities, it is fundamentals that drive price increases on that scale. We’ll be looking at this again at C@W in days to come.
Remember private equity ? The largest deal so far this year has been agreed: just a tenth of the size of the largest deal at this time last year – the Inde reports on how PE is conducting business in 2008.
Can’t entirely ignore the Big Story, so here are a few interesting angles. The Observer reports that
Friday, 18 April 2008
Back in the summer we covered their ‘successful’ out-bidding of Barclays for Dutch bank ABN-Amro, and wondered at the time whether they’d be pleased with what they’d done. Big take-overs can be really clever when done at the bottom of the market (e.g. BP taking Amoco and Arco when oil was $ 10 / barrel - only a decade ago !). But they look pretty crass when they are carried out on the very brink of a massive down-turn, which was clearly on the cards last September, if not a racing certainty.
So – not very popular with existing RBS shareholders, one might imagine. And there’s another group that may not be over the moon: the
PS - get well soon Mr CU !
Thursday, 17 April 2008
This is our 501st post. I don't go for stat porn etc, however, given I was inspired to start a blog one afternoon in August 2006 I am amazed to have kept it going this long - with due credit for assistance to Nick Drew and more recently, Bill Quango.
Wednesday, 16 April 2008
I am pleased to see we have some left-wing, labour voting readers for balance, as this must account for the 9% who said all is well.
The winner by a long way though was no real improvement until 2010, with not a vote for a turnaround this year. Economically, this is bad for us all if it comes to pass as it will mean, higher unemployment and higher costs of living.
Politically, this would eb even worse news for Gordon and Badger; no hope surely of winning and election after what would be 2 full years of economic hardship/decline. No blaming the Tories this time.
A significant vote went for no real improvement until 2012 - with my optimist hat on I think this is pushing the bear a abit far; but time will tell.
Tuesday, 15 April 2008
Back from hols suitably refreshed, and before anger overtakes me at what I'm reading in the papers of the last 10 days, here's something more constructive: a short review of a very good book.
Thus, contra Francis Bacon and hordes of vested interests ever since, science is not a public good but a complex private good. As such it should not be funded by the public purse. Throughout all history (which Kealey surveys magisterially, if erratically) science and more especially technology have thrived when allowed to respond to market forces, and have languished or even declined when insulated from markets, e.g. when subsidised by the state. And although the developments thus stimulated start out as proprietary (and are perhaps intended thus to remain), they rarely fail to enter the public domain shortly thereafter. To the benefit of all.
This book is sustained polemic, albeit from an academic operating mostly to high standards of reasoning. It is stylistically casual: “When [eugenicists] encountered the Hardy-Weinberg Principle, they did not cry ‘falsifier, pants on fire!’, they simply ignored it.” “Male chimps obtain the monkey meat. Now, what do female chimps possess that male chimps might fancy in exchange? Yup, you’ve got it.”
And the editing has been casual too: repetition and typos abound and, more seriously, there are a number of discontinuities and even non-sequiturs in the account. But it is unfailingly entertaining and illuminating: most unusually (for me) I found myself starting back at the beginning again as soon as I had read it through. Buy This Book, as they say: you will be enthralled by Kealey’s bravura and compelling account of one aspect of, err, Capitalism at Work.
Monday, 14 April 2008
The onset of the credit crunch has affected countries all around the world in different ways. The UK is in the process of suffering a mortgage credit crunch which may well cause a house price crash.
As well as this, Spain has the Euro as a currency, which some of our Prime Minister's advisers' are recommending as a solution to our probelms.
It is worth reading an article such as this therefore. It makes for a very sobering tale. Spain suffered an even bigger asset boom than we did due to entering the Euro and immidiately reducing interest rates by 2%.
A crazed government also passed tax laws allowing foreign acquisitions (e.g. BAA) by large companies to avoid tax. the net result was a huge growth in debt and over-investment in reall estate and corporate take-overs.
Where has this taken them now? Well house prices are down 20% and falling, the banks are hiding as much of the debt as they can, but the economy as a whole is in a nasty recession. The Government can try and spend its way out as it has a relatively good debt level in comparison to ours; but overall the prognosis is pretty bad.
You would not want to be holding property in Marbella right now. What makes the situation worse, is that there is no end in sight. interest rates cannot rise, so effectively Germany and others are exporting their inflation to the likes of Spain. Meanwhile a strong Euro hampers Spain's exports just when it needs to re-balance the economy.
If the UK was in the Euro we would be in a very similar position, our house prices would be even more crazy than they are now and economy would be suffering the huge distorotions that are affecting Spain.
Sunday, 13 April 2008
Friday, 11 April 2008
Wednesday, 9 April 2008
Monday, 7 April 2008
Saturday, 5 April 2008
Friday, 4 April 2008
Both ND and myself are going on hols from today. This gives a rather special buzz to that Friday feeling.
Speaking for myself it is a year since I had a proper break so I am very in need of this!
There will still be some posts next week as we can't resist and also our regular contributor, Bill Quango will be overseeing things from his lofty position.
No Sunday round-up likley though as Mrs Slicker highly likley to baulk at the request for a time-out on our first day abroad.....
Thursday, 3 April 2008
Al Italia today is in the news again. The long discussed tie-up with Air France-KLM seems to have finally collapsed. The Chairman has resigned and the Italian government itself suggests administration is in the offing.
'Twas ever thus in the world of national airline carriers. Countries have highly unionised companies with a proud national brand. But this is not enough anymore, unless you are in the US where the government wants to throw $15 billion at you to keep you afloat.
Interestingly if you read this link, the talks failed because the Unions thought they could play at the table, when in fact Al Italia had no chips at all; the airline was less than worthless due to all its debt and loss-making operations.
Also this week we have had the introduction of Open Skies in Europe, allowing in theory much more competition between the domestic EU carriers. This is only going to lead to more Al Italia type collapses and hurt national pride. Even the US can't really support 4 major international carriers and Europe has more like 12.
Much wailing and knashing of teeth from politicians to come on this subject, perhaps even here in the UK...
Wednesday, 2 April 2008