Another year another British winner of the F1 World Championship – amazing considering the talent there is in the sport already & the global pool of drivers competing just to enter it. And can you think of a more exciting year of F1? I can’t. Just amazing – teams & drivers pushing themselves to an extraordinary degree. Of course that’s the point of F1 but it just seems to have been on a higher plain this year.
A claim to fame of mine (and now braggable) is having met Button very briefly at a drivers party in Barcelona where I ‘humourously’ asked him to stop copying my beard – he was very patient and polite despite my weak sense of humour and I was left with an impression of a genuinely very nice guy. If anything perhaps a little too nice to win the most competetive motor-sport championship in the world. He seems to have worked a lot harder and looked more focused & confident this year. Despite being a bit edgy in the second half of the season he clearly deserves this and having it under his belt should make him less nervy in future seasons.
Button and Hamilton now both know they’ve got what it takes to be the best. Pity Hamilton hasn’t quite had the machine to be right up there with Button this year but he does seem to have worked his way to regular podium positions despite this so next year will be another interesting one.
Now to Ross Brawn – what a legend. He’s the Mourinho of motor-sport. An extraordinary leader and strategist who seems able get the very best out of his team and to place his cars with razor sharp accuracy ahead of the competition after every pit stop. And all that under extraordinary financial pressure. To win F1 in the first season of team ownership and after having to make so many redundancies is truly incredible. I look forward to his book.
The newest member, Adam Posen, of the Bank of England’s (BoE) Monetary Policy Committee (MPC) has come out in favour of increasing the banks £175bn easing program. Growth in the economy next year is likely to be weak (c1%) even with it next year (after a c4.5% drop this year) and with inflation being much less of a risk these days it would seem silly not to keep the policy running.
Moreover when the money is created banks lever it up to about 4.5x the initial money injected so it will make a big difference to liquidity. However while households and businesses are paying down their debts the reverse is true. So unless enough money is injected to offset this and the increased capital requirements we will suffer falling credit & investment … and GDP growth and the tax take would be greatly reduced potentially to the point where would could fall back into a deep recession.
London Stands Alone
A recent Knight Frank forecast demonstrates very clearly the North/South divide where House Price Inflation (HPI) is concerned and London’s unique strength. The forecast for London is to rise by 38% by 2014 while nationally the figure stands at just 19%. I’m sure you can draw your own conclusions as to where the best place for investment property is.
Shrink the Big Banks
Adam Posen was interviewed in The Sunday Times and suggested breaking up Britain’s biggest banks, particularly those owned by the government. I agree – big corporations tend to be able to manipulate markets because of their size. They also tend to use excess regulation to defend their monopolies (small business can’t afford to keep up with the lobbying & paperwork) which also moves against economic flexibility and will hold back market recovery.
Research into the reasons for divergence into the two main measures of unemployment have brought some good news. The two measures are the claimant count which shows 1.5m unemployed & the Labour Force Survey which now shows 2.5m. At least 250k of the LBS figures relate to full time students looking for part-time work. A substantial further number relate to 16-17 year olds in full time education looking for part-time/Saturday work. The monthly increases in the claimant count is also trending down from almost 100k per month to just over 20k last month. There is even a faint possibility that unemployment has started falling.
This is a remarkable result for the UK where a 5.6% drop in GDP has led to only a 1.6% increase in unemployment as compared with the US where a drop of less than 4% in GDP has resulted in an increase of 5% or more in unemployment. This is most likely to be as a result of the flexibility in our labour market – workers have typically accepted pay freezes and cuts in working hours. Additionally nearly £5bn has been invested in training and help to get the unemployed back to work.
Future cuts in public sector employment won’t help but they’re unlikely to make it as bad as many are forcasting.
In other news
Weird but wonderful, The Sunday Times:
– The bottom line. A student who flashed his buttocks at a parting train is lucky to be alive after his trousers became caught in a carriage door. The 22-year-old man had been thrown off the train in Lauenbruck, Germany, for travelling without a ticket. In response, he pushed his naked backside against the train window. He was dragged for 200 yards until a passenger pulled the emergency brake. Services were disrupted for an hour. The student, who suffered minor injuries, has been charged with interference in rail transport and insulting staff. A police spokesman said: “He has advised others not to try the same thing.”
– The scales of justice. A man who beat his former girlfriend, then stabbed her pet fish, leaving it impaled in her flat, has been sentenced to two years’ probation and psychological testing. Donald Earl Fite III of Portland, Oregan, told police: “If she can’t have me, then she can’t have the fish.” A judge turned down a request from the woman, Sarah Harris, for financial restitution. She wants the money to pay for a memorial tattoo of the fish.
– Bunny Boilers. Rabbits culled from parks in Stockholm, the Swedish capital, are being used as an innovative biofuel. The rabbits are frozen and later burnt at a bioenergy plant to provide heat for the Varmland area of Sweden. A large number of tame rabbits, abandoned by their owners, live in the city’s parks. In autumn, pest controllers shoot the creatures – 6,000 last year – as they peek out of their holes.
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