Sunday, 29 June 2008


It's not my failure to complete any of my planned tasks that has sparked depression. Like many people, I seem to be suffering mild depression because of the ... er ... depression.

I don't know if this is officially an economic depression or recession or downturn. I note that shares have dropped dramatically in value over the past fortnight and that prices have risen.

Shareholding is an odd system by which people gamble on the profits of companies in which they need have no interest as either worker or consumer. A company may pay its workers well and gain their enthusiastic loyalty while pleasing all its customers with well-made, cherished goods. It may even produce a small, steady return for investors. But once it's launched on the stock exchange, it's not valued by these simple standards. It has to keep increasing profits and put on a good show for shareholders. Its so-called value will depend on rumours and the way in which shares are sold among people who have no interest in the company's employees or the people who buy its products. The rules of the stock exchange seem much the same as the rules of the bookmaker - but there's a big difference. The stock exchange is less honest about the gamble involved. It has the facade of respectability but is more dangerous than the bookie. Its effects can be felt by people who never gamble but simply do their job the best of their ability. At its best, the stock market allows people with no direct interest in the business of a company to determine its direction. Usually their decisions are based solely on the company's ability to produce dividends and the value of the shares, which isn't necessarily related to the company's dividends.

When I think of it like this, it's hard to care much when the value of shares falls. But indirectly we are all share owners. Companies on which we depend - banks, insurance firms, business, pension funds - own shares and the crazy gamble in the stock market affects us all.

We're being affected by many economic factors. Producers and manufacturers are putting up their prices. The west is used to controlling prices. The big supermarkets are used to paying low for goods and competing with one another - although some have admitted occasionally getting together to fix some higher prices, which is illegal. At the same time, supermarkets pose as the friends of the poor, which usually means ignoring the welfare of overseas workers or animals in order to sell cheap food, clothes, etc. When they strike this pose, it's work taking a look at their profits. In 2006-7, Tesco's pre-tax profits were more than £2.5 billion. (I can't find more recent figures.) Supermarkets do rather better for directors and shareholders than for the poor.

Meanwhile, like most people, I have to decide how to live through this depression. Luckily I don't like shopping (except for stationery and in good bookshops) and have never believed in retail therapy. I'm lucky that my nearest shop is a small Co-op - when I have to shop, I like small shops, market stalls and co-operatively owned stores. The Co-op is a consumer co-op while Waitrose - part of the John Lewis partnership - is owned by its workers. I'll continue to shop through the organic box scheme I use, which delivers weekly and saves me the trouble of thinking much about shopping. The prices look high, but the quality if good and I'm saved the temptation of impulse buys in supermarkets. To my surprise, I find I'm saving money by using the box scheme as I'm managing purchases more sensibly and wasting far less.

I've the advantage of having been poor in the past. I've shopped at jumble sales - perhaps they'll make a come-back now - and devised cheap, nutritious recipes. I can mend and darn clothes if I must, though I don't like doing it. I know it's possible to have a good day out in free museums and galleries with a pack of sandwiches for lunch. And for the moment I have a good income, even if it feels over-stretched and repairs to the house are beyond me.

I haven't enjoyed watching the extravagance of the past few years. I understand and share people's love of travel and their enjoyment of eating out - but for many people these have become an expected part of life rather than a delightful luxury or special treat. Cheap flights are damaging the planet. Perhaps I'm a puritan - it worries me that people shop for things they neither need nor want, that they go to films and shows they don't expect to enjoy, that they have grown used to the deference of waiters. I grew up thinking that luxury meant ice cream or cake for tea or a seat or standing place in the theatre gallery.

The recent rush to luxury was fuelled by Britain's dangerous shift from a manufacturing and agricultural economy to a service economy in which workers sell luxury goods and services to one another. This makes Britain particularly vulnerable to economic depression. Expensive luxuries are the first things people will give up. Nail bars, restaurants and coffee shops are vulnerable. The situation is made worse by the way debt has been marketed as a solution to all ills. Our luxury economy has been funded by people living way beyond their means.

I recently answered a question on the best advice my mother gave me. She told me it was worth missing a meal to buy a theatre ticket because I'd forget the missed meal and live for ages off the pleasure of the show. She was right. I'll be finding real pleasures to see me through this depression - if it ever ends. I'll be up in the gods when I can afford it, seeing concerts and plays. I'll be visiting free galleries and museums and really looking - taking all the pleasure I can from a visit. I'll try to find time to cycle and walk in parks and by the river and look at the scenes. And I'll probably continue fencing once a week. It's cheaper than most people think. So long as my kit holds out, it works out at less than £2.50 per session. I reckon I can afford that.

1 comment:

Anonymous said...

Zurich it is!
The power of the financial markets scares me, especially the endlessly complicated financial derivatives that computers have now made possible. I'd like to say I have nothing to do with it (despite living in Bank, so to speak) but of course even as a public sector employee one's job depends on the economy doing well.