This week I spent a couple of days in London, I got on to an empty train, witnessed an desolate Waterloo concourse at 8:15 and walked over a deserted Waterloo Bridge and admired the London skyline, bereft of the usual forest of cranes.
I then met with a number of PE firms (all brimming with cash) who are chomping at the bit to invest a large sum in a brilliant business services business which is booming.
The juxtaposition was striking. It got me wondering where are we going. We at Polestar are really busy with great companies that are resilient and thriving. Yet a large proportion of the economy is totally stalled.
Pessimistic “Chicken Licken” views about the economy are in danger of holding back the UK’s post-lockdown economic recovery, according to Bank of England economist Andy Haldane.
“Encouraging news about the present needs not to be drowned out by fears for the future,” he said in a speech.
He compared negative forecasters to the children’s storybook character who feared the sky would fall. “Now is not the time for the economics of Chicken Licken,” he said.
“My concern at present is that good news on the economy is being crowded out by fears about the future,” he added.
“Collective anxiety is as contagious, and could be as damaging to our well-being, as this terrible disease.”
I share Andy Haldane’s concerns. Yes we have the four horsemen of the apocalypse – Covid, unemployment, trade wars and Brexit but he is quick to point that we should not overlook the economy’s quicker-than-expected recovery from lockdown.
“The economy has already recovered just under 90% of its earlier losses. Having fallen precipitously by 20% in the second quarter, we expect UK GDP to have risen by a vertiginous 20% in the third quarter – by some margin its largest-ever rise.
This rebound is driving great business and great deals. So don’t believe all you read on the click-bait on your smart phone, or dare I suggest on the front pages as something so old fashioned as an actual newspaper
“Encouraging news about the present needs not to be drowned out by fears for the future,”