16 Aug 2011, 7:40pm
economy reflections


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  • End of recession for companies, Depression for the people?

    It struck me once again as I was in Canary Wharf for a meeting, just how different the City of London is from anywhere else I’ve been in the UK.

    Canary Wharf Tube Station in London's nouveau-riche financial district

    Where the rest of the UK is mired in recession and the jobs outlook is going from dire to desperate, the animal spirits in the financial district seem to be even more on the up than they were last time. Which is pretty remarkable given the near death experience of last week on the stock markets. I even got out at London Bridge and walked through the original City of London where the old money lives just to make use that this wasn’t a Docklands thing.

    Tower Bridge. A gratuitous quick blast of the tourist thang, just for the heck of it

    Well, I couldn’t resist the tourist shot, though I should know better as an ex-Londoner. However, looking back south from London Bridge I spotted The Shard

    The Shard going up south of the river

    and as I entered Bank and St Mary’s Axe, home of the Gherkin’s monument to the essential masculinity of finance I get to see a shedload more cranes.

    How you get to clean the windows of the Gherkin - looks like the hard way

    How you get to clean the windows of the Gherkin - looks like it's the hard way

    It isn’t quite like watching the skyline of Berlin from the Intercontinental Hotel looking over what used to be East Berlin in the early to mid 1990s, but construction is doing very well in London, and that’s not counting the Olympics work.

    Construction galore in front of the Nat West tower


    and of course the serious looking guys on their mobiles

    guys on mobiles - 1

    guys on mobiles - 1

    guys on mobiles - 2

    guys on mobiles - 2

    and a quick proprietorial hello to one of my new purchases, with that wonderful juxtaposition of the olde worlde and the new reflected in the glass.

    Aviva HQ

    Aviva HQ in the City of London

    Ok, so it’s not like I’m Warren Buffett and my vast shareholding in AV. probably bought a stack of pens but there we go 😉

    The overall feeling I got in the City of London is that things are going well. This is a small bubble – even on the train as I was leaving it’s easy to see that other parts of London have boarded up shops which can’t all be due to the recent rioting, and as I returned to Ipswich I saw the signs of severe economic distress all around – boarded up shops, abruptly stopped construction works from 2007 and the like.

    There’s a split happening, where FTSE 100 companies seem to be doing okay just as the Great British Public is losing their jobs, and being exposed to serious inflation, rising fuel and travel costs to which there seems little end. Hence the title – firms seem to be doing okay despite the consumer heading towards ever-increasing straitened times, I’d go as far as saying running towards Depression times of multi-year decreasing economic experiences.

    The contrast between all that construction in the City, the sharp suits and pencil skirts, the purposeful mobile-phone working on the one hand and the slack-jawed chavs hanging around listlessly in the High Street in Ipswich was striking. I don’t normally see the town centre on a workday, and Ipswich isn’t particularly disadvantaged as a town. It doesn’t feel like the prognosis is good for many UK citizens on the economic and the jobs front…

    A very useful insight, Ermine.

    We all live in our own smallish bubbles so it’s always interesting to hear other people’s observations.


    […] and get into gold and the Swissie I suppose. Unlike the more cheerful among us, I expect a depression for the Great British Public, though not necessarily for companies, who seem to be increasingly decoupling themselves from the […]

    These pictures do bring back memories of my own. And my experience of London vs. rest of UK is just the way you write. Saville Row was a different beast when compared with the towns on the M4 corridor, say. The old joke about Richard Whittington was funny back then:

    However, under present circumstances with the riots in recent memory, it definitely looks worrying enough for anyone.

    This reminds me of the comment I made in my own post in response to you. The GINI index for UK is also going up I see…

    What might be the mid-term implications of this, you think? Perhaps, @Salis Grano can be of some help here too šŸ˜‰

    […] is still a long way to go to reach the low-water mark IMO, and Britain will be a much poorer place before that is reached. However, though I’ve taken the piss out of GS in this piece, […]


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