Sports Calendar

Economics: Things can only get… worse

If there is one economic forecast for next year of which we can be pretty certain, it is that Alistair Darling’s forecasts will be wrong.

In November, the Chancellor predicted the economy would shrink by 1 per cent next year. This already looks hopelessly optimistic, with many economists believing the downturn will be twice as bad and that more than one million jobs will be lost. Hardly any businesses will escape. The early Eighties downturn was focused on manufacturing. In the early Nineties, the pain was felt in services in the South East. This time, there will be nowhere to hide except, perhaps, in the public sector. Jobs will go in manufacturing, the high street, housing and cars, in the City – even in accountancy.

It is not all bad news. Millions of those in jobs will be better off. The Bank of England has cut interest rates from 4.5 to 2 per cent since November, and is likely to cut further next year. Homeowners whose mortgage payments are linked to base rates will see monthly bills tumble. Fuel bills will also fall next year following the slump in the oil price, and the VAT cut has trimmed most other prices.

But the interest rate cuts are bad news for savers, and even those who benefit may not feel like celebrating. Those in jobs will worry about losing them and will be careful with their money. That is going to translate into weak consumer spending and more job losses at retailers. A number of chains have gone under, and more will follow after the sales. Small businesses are particularly vulnerable. Their finances tend to be less secure than big companies, and they will find it hard to borrow. Much will depend on whether the Government can persuade the banks to step up lending.

The trend on the high street is already clear. While the overall picture is gloomy, shops that focus on selling essentials at keen prices will do well. In food, for example, Asda has been winning customers away from the likes of Marks & Spencer. Andy Bond, Asda’s chief executive, believes the effects of the recession will be long-lasting, producing a generation of frugal shoppers focused on low prices and on limiting waste. A new do-it-at-home culture is developing, which will hit some businesses and help others.

The short-term outlook for those sectors worst hit by the downturn is grim. Housing is unlikely to pick up until prices bottom, but most observers are forecasting falls of 15 per cent. No upturn in car sales is in sight either, and manufacturers will struggle to sell into slowing export markets in spite of the fall in sterling. The City faces another dismal year of low or nonexistent bonuses. Bankers will struggle to overcome their pariah status, having shown themselves, in the eyes of many, to be not merely greedy, but also incompetent. One area that could see growth is regulation of banks, which are being blamed for the mess, and other industries. The credit crisis may hurt confidence in free-market capitalism, with pressure to make it fairer. The risk is we strangle business with red tape. But that’s for later. First we need to get through 2009.

David Wighton

Nature: The great outdoors

“Nature is daunting” reads the opening line of Johnson P. Johnson’s The Armchair Naturalist, a short-cut instruction manual for anyone who feels out of their depth in the country. He’s got a point. To city dwellers stepping out of comfort zones, away from the Tube line or the paved streets, the thought of communing with nature, of growing your own food or trampling through wilderness without a personal sat-nav is faintly terrifying. It doesn’t have to be.

A while back, a few of us in our company Heavenly Recordings heard the call of nature and rekindled a childhood love of angling, taking to the banks in weather fair and foul. Shortly afterwards, we started a website, www.caughtbytheriver.net. It was somewhere to talk about fishing, books, records, bodies of water, mountain ranges, whatever – somewhere to slow down and take the time. It was the complete opposite of anything that is perceived as achingly cool, not the sort of thing that anybody would expect trendsetters in the music and media industries to be remotely interested in: an online world where the strictures of fashion had no place. But the site was an eye-opener for us. It took on a life of its own, joining the dots between all sorts of disparate activity that was going on in the UK. Awareness of the natural world seemed to be everywhere, not just in headlines about climate change. It has been inspirational.

For us, Roger Deakin’s Waterlog was a defining, Dylan-goes-electric type of moment. Infused and enthused with a gentle, pastoral anarchy, the book is a journey round the British Isles, although it’s less of a road trip than a breast-stroke. Waterlog, along with The Wild Places by Deakin’s contemporary, Robert Macfarlane, appeals because, above all, it is an adventure story, a subtle V-sign to petty bureaucracy and a love letter to a disappearing Britain.

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