The recovery is coming: can we relax yet?

Blue skies are coming.

All this month on economia we’ve been taking stock of where we are five years on from the momentous events that followed the collapse of Lehman Brothers. So much significance has been placed on the events of September 2008, that some commentators are happy now to refer to events purely in terms of them being “post-Lehman”, as if the failure of one institution marked some kind of year zero when the financial world changed forever

While the meltdown in global credit markets certainly followed the collapse of Lehman Brothers, there is plenty of dissention as to whether it was the  trigger for recession it has been portrayed as. Andrew Smithers in his latest book The Road to Recovery (reviewed in the October issue of economia) draws on a wide range of sources to argue strongly against what he calls “the myth of Lehmans”. His argument is that the global economy was in plenty of trouble (and recession had already kicked in) by September 2008. Others still don’t dispute that the collapse of Lehmans was significant but point out that it was significant insofar as the reaction to it from governments around the word led directly to a worsening of the depth of recession.

The argument here is that the painful experience since 2008 was caused by authorities and governments not allowing enough banks to collapse. While the shock would have been much worse in the short term, the recovery would have been sharper and would have taken hold sooner. The banking sector would have emerged with stronger and healthier banks (even if there were fewer of them), and would have been in a better place to help business recover.

National governments might also have been better placed to rebuild economies had they not been propping up failed banks.

But to some extent this is the old story. Five years on from these calamitous events, we are beginning to see the early signs of recovery. There have been various indicators and research reports produced to show that a lasting recovery is taking hold. The biggest question marks now remain over the fragile state of the eurozone and the likely fallout of any further problems in one or more of the troubled member economies, and the trickier issue of whether this recovery (however welcome) is the right sort of recovery.

The chancellor, George Osborne, set his stall out on delivering an export-led recovery that would help rebalance the economy and bring a longer-lasting, sustainable recovery. That the current return to health appears to be built on a new housing bubble and domestic debt remains a concern. It’s the economic equivalent of treating heroin addicts with methadone. It is far better for them (and far better for society) than heroin, and is more controlled, but it can hardly count as a full recovery from dependency. There is a place for this treatment, but let’s not pretend (as a triumphalist chancellor is likely to try and do at his party conference next week) that he has the economy back to anything like a sustainable position.

However, when that real recovery does arrive it will be fuelled by the sort of high-growth businesses that are the drivers of any economy. And on this front there are some interesting insights from a new piece of research from private equity firm ECI Partners. The top line from the report, which is based on a detailed questioning of almost 700 leaders in high-growth firms, is that they are far more confident this year than they have been for the past few years. The vast majority claim to be planning to fund expansion and growth of over 10% in the coming year and most are very confident that they will be easily able to access finance should they need to (this has been a consistent challenge to growth in recent surveys).

While there is a more upbeat tone to the responses from those based in London, and those working in the technology sector, the vast bulk of respondents regardless of sector or location feel that things are moving in the right direction.

Even if the storm clouds had been building since 2007, the storm of recession broke in 2008. Five years on we are beginning to see the first signs of blue skies above. While it is incumbent on everyone to take a hard look at the events of five years ago and make sure we learn the appropriate lessons in areas from audit to corporate governance, from our banking culture to financial regulation, for the time being it is also important to enjoy some good news for once.

This story first appeared on economia.


Photograph: Getty Images

Richard Cree is the Editor of Economia.

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The players make their mistakes on the pitch – I make mine on the page

I find that if I watch three live games in a weekend, which often happens, I have totally forgotten the first two by the time the third comes up.

I was a bit humiliated and ashamed and mortified last week because of letters in this magazine about one of my recent columns. Wait till I see the Correspondence editor: there must be loads of nice letters, yet he or she goes and prints not just one, but two picking me up on my mistakes. By the left.

But mainly, my reaction was to laugh. Typical, huh, I’ve gone through life spelling things wrong, with dates dodgy, facts fictional – will I ever learn?

John Lennon did not use a watch. He maintained that he had people on the staff who would tell the time. I don’t wear a watch, either, but for different reasons. I want to get my wrists brown and I hate carrying anything.

By the same milk token, I don’t worry about my spelling. Like Lennon, I expect others to clear up after me. Surely the subs should have spotted it was a typo, that it is 64 years since 1951, not 54 as I wrote? What do they do all day? The other mistake was about replays in the League Cup: too boring to repeat, you would only yawn.

I usually try to get the spelling right the first time I use a word, then bash on, letting it come out any old way, intending to correct it later. Is it Middlesbrough or Middlesborough? Who cares? I’ll check later. Then I forget.

I was so pleased when Patrick Vieira left Arsenal. I found those ten seasons a nightmare, whenever I realised his surname was lumbering into vieiw (I mean “view”). Why couldn’t I memorise it? Mental laziness. The same reason that I don’t know the phone numbers of any of my children, or the correct spelling of my grandchildren’s names, Amarisse and Siena. I have to ask my wife how many Ss and how many Ns. She knows everything. The birthday of every member of the royal family? Go on, ask her.

I might be lazy on piddling stuff such as spelling but I like to think my old brain is still agile. I have three books on the go which are hellishly complicated. I have the frameworks straight in my head but I don’t want to cram anything else in.

It can be a bit embarrassing when writing about football, though. Since sport was invented, fans have been making lists, trotting out facts, showing off their information. As a boy, I was a whizz on the grounds of all 92 League clubs, knew the nicknames of all the clubs. It’s what you did. Comics like Adventure produced pretty colour charts full of such facts. I don’t remember sitting down and learning it all. It just went in, because I wanted it to go in.

Today, the world of football is even madder on stats than it ever was. I blame computers and clever graduates who get taken on by the back pages with nothing else to do but create stats. And TV, with its obsession with possession, as if it meant anything.

I find that if I watch three live games in a weekend, which often happens, I have totally forgotten the first two by the time the third comes up. Not just the score but who was playing. When Wayne Rooney or whoever is breaking records, or not, my eyes go glazed, refusing to take in the figures. When I read that Newcastle are again winless in their first seven League games now, I start turning the pages. If I get asked who won the Cup in 1923, my immediate answer is HowthefeckdoIknow. Hold on, I do know that. It was the first Cup final at Wembley, won by Bolton Wanderers. I remember that, having been there. I don’t know the dates of any other Cup final winners. England’s World Cup win? That was 1966 and I really was there.

I love football history (I’ve written three books about it) but it’s the players and the history of the clubs, the boots and strips, development in the laws, that’s what I enjoy knowing. Spellings and dates – hmm, I do always have to think. Did the Football League begin in 1888 or 1885? If I pause for half a second, I can work it out. Professional football came in first, which must have been 1885, so the Football League came later. Thus the answer is 1888. Bingo. Got it.

But more often than not, I guess, or leave it out. So, sorry about those mistakes. And if you’ve spotted any today, do keep it to yourself. 

Hunter Davies is a journalist, broadcaster and profilic author perhaps best known for writing about the Beatles. He is an ardent Tottenham fan and writes a regular column on football for the New Statesman.

This article first appeared in the 01 October 2015 issue of the New Statesman, The Tory tide