Taking Stock - October 31, 2011

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If there’s one thing I can wholeheartedly admit not understanding, it’s economics.

I’m not talking about household economics – you know, making sure you don’t have more going out than is coming in.

That’s a concept the Greeks don’t seem to have been particularly familiar with – which is why this week a lot of important people have got together in a bid to sort out their mess, before the nation has a credit rating even Wonga wouldn’t touch.

No, I’m talking about the whole global crisis business, boom and bust and all that malarkey. Greed is good, so Michael Douglas told us in the 1980s. So is growth.

More profit is always the mantra of business, and that’s what I don’t get.

What, and forgive my ignorance here, is wrong with ‘some’ profit. Why is ‘just doing fine’ so frowned upon? I understand that recession is a bad thing, but surely breaking even, or better, is something we could all be happy with.

After all, what has the big push for profits left us average Joes?

Well, there’s sky high utility prices, ever-increasing food bills, and a whole host of other demands on the wallet.

Then there was the great property bubble, inside which every Tom, Dick and Harry was convinced they could make a killing on bricks and mortar.

Of course, it eventually went pop, leaving many who bought houses with the intention of merely living in them stuck in negative equity.

Now, some clever economics type will, I’m sure, tell me, companies have to make bigger profits all the time because of the shareholders, many of who apparently live in hedges, and pay our pensions ( well, not mine, I can’t afford one).

Therefore, I’m assured, it’s a bad thing for anyone with a pension (not me, I’m all right Jack) when the FTSE goes down – an event guaranteed to send the 24-hour news media into a delirious state of joyful panic.

“Confidence is weak,” we’re continually being told.

And I’m not surprised.

It’s very hard to have confidence when there’s somebody on telly jumping up and down predicting economic Armageddon every time somebody sells a share.

“It’s the worst economic crisis in living memory,” we’re told.

Are you sure?

I’d have thought there were more than a few folks around who lived through the Great Depression of the 1930s – where people lived on the brink of starvation, rather than just on the brink of having to cancel their gym membership.

Then again, what do I know? I’ve already admitted to you, nothing at all!