In the days when I used to get paid for writing stuff like this, one of my favourite beefs was the plethora of "unofficial" economic statistics in the UK economy. There are loads of them in both retailing (BRC survey, CBI survey, "footfall" surveys and so on) and in housing (Rightmove, Nationwide, Halifax, Land Registry). Most of these are used by the body that sponsors them as a basis for special pleading, usually for lower interest rates. The media duly play along. This is annoying enough at the best of times, but in current circumstances, where the economy is wobbly to put it mildly, it can be downright dangerous.
I was put in mind of this again by today's economic releases. After all the doom-mongering of the past few months, including all the unofficial data, ONS reported that retail sales in October fell by a mind-boggling....0.1%! They were 1.4% HIGHER than in the same month of 2007. In the same month mortgage approvals rose 7%. They're still more than 40% lower than they were a year ago, but still, it could be the first sign of a return to normality in the market. Why, it was even reported that an apartment in Birmingham changed hands for more than a million pounds for the first time. (The reporter noted that it had "commanding views over the West Midlands, as if that was a selling point).
The BBC radio reporter from whom I first heard this news was quick to downplay it, noting that retailers were still planning to launch their Christmas sales well before the holiday season. Indeed, Marks and Spencer has been holding an unprecedented 20% off sale this very day. So at lunchtime a BBC News reporter found himself in a shopping mall in Swindon (which, for all I know, you may be able to see from the £1 million flat in Birmingham). It looked pretty busy, but he was quick to aver that it had been quiet up until now. He then interviewed a group of ladies of a certain age who were on a spree. They agreed that they had been lured out by the M&S sale. So far so good. But when asked if that would be the end of their shopping for the season, they were shocked at the very thought. "Certainly not", said one of them, "there's only five weeks to go now, so we have to keep at it". When asked specifically if they were altering their spending plans in light of the credit crunch, they were unanimous that they were not. It looked to me like another attempt at doom-mongering well and truly foiled.
There are dire warnings that unemployment could reach 7% by the time the economy bottoms out. That's awful, but look at it this way: that would mean that 93% of people were still working. The last thing we need in the short term is to put the wind up that 93% to such a degree that they stop spending. For now, it seems as if the retailers have been so convinced by their own cockamamie surveys that they've panicked into price cuts that they could have avoided. Good news for the consumer at an expensive time of year, but brace yourself for surveys in January reporting that sales would have been so much lower but for these price cuts. If all these folks would just shut the f**k up and wait for the official data, and if the media would stop reporting these special pleadings as hard facts, it just might be a whole lot easier to avoid a severe recession.
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