Give us some good news

A few readers have said, can we hear some good news occasionally?

Yes, of course. I told you about an excellent play recently. Last night I watched the English bowlers and fielders show some real commitment, skill and hunger to win a game of cricket. The played brilliantly, bottling up the West Indies batsmen and letting us live in hope that they might have won the match. In between overs and during the ads I could turn to watch Liverpool playing as if they were on fire. They swept aside Real Madrid as if they were a second division team.

Recessions do end. During them around 90% of economic activity usually survives. Most people keep a job. If you work for the public sector or depend on a public sector pension, you can be assured the government will “do what it takes” to carry on paying.

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16 Comments

  1. Posted March 11, 2009 at 8:20 am | Permalink

    Mr Redwood gives us a common sense interpretation of what is happening each day. The really good news is that the valuable Mr Redwood can apparently do without sleep! How else could he post his blogs so early in the morning and pack so much else in to the day as well? My advice to Mr Redwood – keep doing what you do, for as long as possible and perhaps, one day, Mr Cameron will take notice.

  2. Posted March 11, 2009 at 9:24 am | Permalink

    John: many of your posts have a sub-text involving the ineffectiveness of the present form of government. I hope you will devote some time to this on your blog. Here are some issues:

    1. Why do the Conservatives need an extra 6% of votes to gain power and why are there such large disparities in constituency sizes?

    2. Why do we give special voting rights to citizens of the Republic of Ireland, Cyprus and Malta when they are not reciprocated?

    3. Why do we need so many MPs and Peers compared to the US? This is especially odd given that huge amounts of legislation come to us from our masters in Brussels and we can’t change it.

    4. When are we going to resolve the West Lothian Question and the inordinate power of the Scottish Raj?

    5. When will the House of Lords become fully reformed?

    6. Why are so many important issues not properly debated in Cabinet?

    7. Why are trillions of tax pounds spent and money printed without proper debate in the House of Commons?

    8. Why does the Prime Minister posture the role of de facto President and World Leader with negligible parliamentary control? We are supposed to be a parliamentary democracy with the Government accountable to the people through Parliament. Where is the accountability?

    I could go on. The constitution is broken and the Conservatives should set out their proposals for mending it.

    Reply: will do – have done some of this in the past but maybe a restatement is necessary

  3. Posted March 11, 2009 at 9:38 am | Permalink

    Also on the up side from voter research and comments here in Essex this week:

    1.We’re talking with others about our problems.

    2.We’re making use of the things we have in our cupboards and wardrobes.

    3.We’re spending more time at home as a family.

    4.Many ‘fat cats’ have lost much more wealth than we have.

    5.We have found out how useless this government is which makes us feel less guilty and inadequate!

    And we feel confident in adding after last night and JR’s blog this morning that an English team will win again become Euro champs and we have an outside chance of regaining the Ashes (although look out for newcomers Hughes, North and Johnson!)

    OUR cup is definitely half FULL again…

  4. Posted March 11, 2009 at 10:10 am | Permalink

    Given the news about money supply.
    Continuing with the Good news Blog theme.
    If you are in employment, or have enough savings spare, which now earn you next to nothing.
    Clearly now could be the time to go out and buy some big ticket items, before they go up in price, especially if they are imported.

    Construction is on the floor, so now could be the time for all of those home improvements to be completed at more competitive rates than has been the case for years before the raw material costs filter through.

    Not suggesting people borrow unwisely, but it is a good news opportunity for SOME.

  5. Posted March 11, 2009 at 10:15 am | Permalink

    1914 was a lovely summer, and The Season was doing terribly well. There was a lot to look forward to, and the cricket was splendid. In the Cup Final, Burnley had beaten Liverpool by a single goal at the Crystal Palace, in the presence of the King, lately returned from his Indian travels and the Grand Durbar. For those will more modern tastes there could be either the Ballet Russe or all the new Jazz music. Things were really going rather well.

  6. Posted March 11, 2009 at 11:07 am | Permalink

    The really important question: What do you think of the new referral system?

  7. Posted March 11, 2009 at 11:25 am | Permalink

    Good news here in Bangkok. Taxation is about 30% (supertax). The two ladies in my family have bought 5 dresses for just a few pounds. tonight we are eating out at a Lebanese restaurant. We travelled home from the Malls with a witty Chinese taxi driver who asked me about the relationship with Holland and USA in the 18th century (I think). We decided not to take the Sky Train.
    My son is flying to Manchester to put Reynaldo into an ad for the Far East and tomorrow we go to a lovely beach by Thai train (from the Central Station).
    Oh – and I had fun buying Thai silks in a Mall that would put even Dubai to shame. That was after some good sketching in a coffee shop for an hour or so.

  8. Posted March 11, 2009 at 11:46 am | Permalink

    I wonder if eventually we will be able to just photocopy our money and spend that?

  9. Posted March 11, 2009 at 1:43 pm | Permalink

    John, if you want some good news that is not being publicised at all, look at the Baltic Dry Index.

    http://www.investmenttools.com/futures/bdi_baltic_dry_index.htm

    (I’m assuming that you know what this is.) After its spectacular collapse last year, heralding the severity of the downturn, it has since recovered sharply, to roughly the level extant in late 2005/early 2006. So was global trade dead in the water back then – I think not! It is still on a steeply upward trend. Why is nobody writing that world trade is apparently showing the fabled ‘green shoots’ of recovery?

    The tragic farce of QE which is being forced through by the Treasury and BoE is far too much if a recovery in global trade is indeed already occurring. Triple digit inflation in this country is the most likely outcome. Poor Messrs. Cameron and Osborne, because they are the ones who will have to snub it out, and that will be much more painful than anything seen to date in this crisis.

    • Posted March 12, 2009 at 2:04 pm | Permalink

      Just for those who dont know the importance of this index is summed upo here:

      “I suggest you watch an index that will tell you when the world economies are starting to perk up and when trade conditions are really starting to ease. It’s called the Baltic Dry Index.Essentially the Baltic Dry tracks the average daily price for shipping dry bulk like coal, iron ore, wheat and soybeans. There are three things that make it such a good leading indicator. One, the index looks at raw materials, so it captures activity at the very beginning of the production process. Two, it looks at ocean shipping, so it reveals what’s happening to international trade — the critical driver of global growth. And, three, the shipping business depends heavily on credit, so the Baltic Dry indicates whether credit is tight or loose.”

      Link:

      http://www.economicpolicyjournal.com/

      Go to the post headed “The Baltic Dry Index at Five Month High”.

      This points to fool hardiness of QE: it assumes that monetary authorities have the knowledge they need to be able to pinpoint the crucical points at which they should pull this £75bn back. They don’t and yet the incumbent authorities can always argue the toss to justify their decision. And when they are wrong they just stand around in a circle blaming each other (change leader if necesssary).

      Say “bye-bye” deflation (if it was ever really a threat) and “Hello” double digit stag-flation and maybe even Mugabe style Hyperinflation. If you have savings in sterling switch it quick for commodites or metals (gold/silver) cos the pound will buy you bugger all in the next couple of years. Even if the IMF sells off its gold reserves and the gold price falls that will be temporary as more and more investors switch to gold as a safe haven against inflation (not just here – rest of Europe and the USA).

      At least Gordon/Mandy are in power to help us all get thru this. It wouldn’t even have happened if they had been in power for the last 12 years would it …..

  10. Posted March 11, 2009 at 2:18 pm | Permalink

    I’ve just lost a job that I was hating. I get to see the kids when they come home from school and I can make a start on the pile of jobs that need doing round the house. The house is paid for and there’s
    money to keep us going for a while.
    … and baking your own bread is very satisfying!

  11. Posted March 12, 2009 at 1:07 pm | Permalink

    You will all be cheared to know that in Local Government at least it is business as normal. Yes Local Govt Officers (LGO’s) WILL get their annual pay award for 2008/09 (backdated to April 2008). The pay award has been set at 2.75%. The Employers originally offered 2.45%, the Unions objected, ACAS was bought in and the latter body has now decided that an extra .3% should be awarded – hence the final 2.75%.

    I have only two further points to make on this:

    (1) LGO’s should obviously be awarded a further amount so they can have interest paid to them on their pay ward for the backdated element. That would only be fair.

    (2) This is good news for the economy and its self evidently the right thing to do. It will increase aggregate demand in the economy and so boost production and help get us thru this recession providing real help to real people who have been let down by selfish bastard bankers who, in the court of public opinion, should burned on a pit and their wimmin folk and daughters raped, pillaged and whipped. If this Pay Award doesn’t do his then of-course thats because the pay award wasn’t big enough, wasn’t done in time and … errr …. welll …. its Thatcher’s fault because … errr … something else.

    Did anyone hear Brown on You and Yours the other day taking questions from the audience (Iain Dale has the link)? His denial of the role of interest rate policy as conducted by the BoE over the last 12 years in causing this crisis is quite staggering. I really do tire of this govt.

  12. Posted March 13, 2009 at 12:09 am | Permalink

    The really good news I heard this week is that the David Cameron’s Conservatives are 12 points ahead of Labour

    • Posted March 13, 2009 at 11:54 am | Permalink

      Personally I don’t read too much into that. I don’t think its that big a lead given that this is mid term and what has happened in the economy.

      Hence I still expect Labour to win the next election. Unfortunately.

  13. Posted March 13, 2009 at 6:40 pm | Permalink

    Not an Economist – Another 5 years of Gordon Brown and his gang! The very thought makes me depressed again. My family and I will emigrate.

  14. Posted March 16, 2009 at 2:27 pm | Permalink

    Thanks John that did give me a slight lift – JR for President I say or at least the cabinet

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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