I noted this in the Guardian this morning:
Figures from the Office for National Statistics show debit and credit card transactions fell by 5% over the week to 17 June, while retail footfall declined for the third week in a row at the tail end of a springtime boom after Covid-19 restrictions were relaxed.
Three thoughts.
First, is the post Covid boom already over? It might be. I have long suggested that after a treat or two people would return to caution. Historically that is the pattern and I see no reason why it should be different this time.
Second, do many people have more sense than the government and are locking themselves down even if (or perhaps because) the government refuses to do so?
Third, coupled with known supply chain problems, the end of furlough and labour shortages, is there an economic down turn coming? Could it be that after all the spend the libertarians will achieve what they always wanted, which was economic devastation to clear our what they call zombie firms but which the rest of us call employers?
There can be no certain answer to these questions, of course. But as I have always suggested, the reopening will be much harder than the lockdown. What we know for certain is that we have a government that does not understand that.
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There’s a partial answer to your second point further down the ONS analysis on economic activity – the one that mentioned the 5% reduction in CHAPS payments. It says:
“In the week to Monday 21 June 2021, the seven-day average estimate of UK seated diners was at 128% of its level in the equivalent week of 2019, an increase of 9 percentage points from the previous week ”
That’s not enough cash action to offset the CHAPS reduction, but it indicates some more people are restraining their behaviours and some others are going out and having more fun. A two tier or stratified response to the restrictions methinks. The economy is complicated.
Of course
But again, once celebrations are over that will not last
And I am not alone in going nowhere near indoorcdining, I am sure
I share your concerns.
Anybody that thinks they know how this plays out is deluding themselves. The “booster-ish” approach of the Government and others (BoE etc.) seems odd. Either
(a) they really believe their own BS
(b) they share your concerns, too – but don’t want to “talk down” our prospects
(c) they share your concerns, too – but don’t care.
Options (a) and (c) are worrying…. option (b) might be understandable if the Government had any credibility – but they don’t.
Company debt is still high particularly a problem for small firms who took out government covid loans last year. Also, consumer credit card and personal loan debts are still high so debt repayment will be a restraint on spending in all economic sectors.
Agreed
This screams something at me that HM Opposition could capitalise on but keep failing to do so.
This is a society dominated by fear. Never mind getting back to normal.
The elites get their Wombling treat and a legal temporary, if lethal ‘opening’ to their Caribbean yachts and love islands and whatever summer fetes and boating songs they have always relied upon to Lord it over the lower classes on their way to the glorious 12th.
Last night’s celebrations post football screaming and sing songing and hugging over a return of a round plaything by a crotchety neighbour – will translate in 3-5 days in the next stage of this rocket ship to the highest pile of bodies.
As it was a Tuesday we are ‘lucky’ it was slightly muted.
Saturday will see the boosters fired to set course to a MoonShot that Duminic ‘Dr Death’ Spaffings had planned for us.
For the moment, let’s enjoy the schadenfreude of the Germans, as they along with the rest of the EU watch the grunting ingerlaaaanders trying to travel through passport and customs as if there would be no change after BrexShit! I expect genuine businesses in tourist spots have been properly looked after with their versions of furlough.
These that happily operated on cash and double books – mostly Brit owned and run – probably are the only ones desperate to encourage a plague carriers to flock to their little corners of England in the EU.
From The Road to Wigan Pier
And the peculiar evil is this, that the less money you have, the less inclined you feel to spend it on wholesome food. A millionaire may enjoy breakfasting off orange juice and Ryvita biscuits; an unemployed man doesn’t. Here the tendency of which I spoke at the end of the last chapter comes into play. When you are unemployed, which is to say when you are underfed, harassed, bored, and miserable, you don’t want to eat dull wholesome food. You want something a little bit ‘tasty’. There is always some cheaply pleasant thing to tempt you.”
It seems to me it sums the situation up rather well, eat out because you can for the first time in a year and its not that expensive but hold back on the big items that involve commitment
[…] As I noted this morning, there are already signs that the spending boom is fading. […]
“ Second, do many people have more sense than the government and are locking themselves down even if (or perhaps because) the government refuses to do so?”
We’ll be returning home to Edinburgh from Australia in three weeks (possibly the stupidest thing I have ever done), and expect to be having everything delivered and only going out for walks/drives/bike rides, until cases (covid+flu) drop a lot, which could easily be Spring 2022. So not so much spending.