aristoph

Global airline traffic down 2.9% in Sept. First drop since 2003. Freight down 7.7%. (That is the really interesting number and mirrors a collapse in the shipping market that gives a true indication of the speed of the global downturn.) That is despite significant capacity cuts (planned and forced) across the industry. IATA sayes the industry will now lose even more than its forecast $5.2bn this year.

aristoph

That is quite possibly the case if you are involved in manufacturing - a collapsing pound will make you one of the winners for the next few years so enjoy it. Unfortunately for the wider economy manufacturing accounts for <20% UK GDP, whereas service industries account for >70%. And much of that is supported by consumption financed by debt and now that rug has been pulled out from under our feet. The effects of this recession will be most severe in the South, not the North, amongst professional service-oriented businesses, not manufacturing.

pfd

Given that anywhere North of Watford lives on the Public Sector (see http://www.bbc.co.uk/blogs/thereport...c_spendin.html)
then the North is going to get it in the neck when the South hasn't got the money to support them any more. Every time one of those "fat cat" bankers on £100k a year (let alone a million) loses their job, thats 2 public sector jobs worth of tax out of the window.

DYKWIA

And of course, 100% of that tax goes to the soap dodgers north of Watford. Not on things like the 2012 Olympics...

Cheersm
Rick

Earthman

I've noticed the same over here in Ireland.Restaurants are fairly full even on week nights aswell for example.
What people forget is that unlike the 1980's,there are actually record numbers of people EMPLOYED and in a job now.
For instance in the Republic in the last 15 years iirc the work force employed has doubled.
An unemployment rate of 6% or even 10% won't be making much of a dent in that compared to what used happen in the 80's.

People due to sentiment probably are spending less but that means they are saving more and thats money they will release eventually.

I am concerned at the credit squeeze on businesses though.Thats what governments should be concentrating on and of course on sentiment.

The media are no help in this whatsoever with their drive for paper selling headlines or viewer catching sound byte journalism.

Dr Dave

What did you expect when you southerners shut down our coalmines, shipyards and steelworks? Please allow me to be the first to thank you for your generous charity since you did - I am sitting at my computer in an office on an old colliery site in County Durham bowing and scraping in appreciation...

KenJohn

There can be a whole different take on this.

Does the introduction of the LCY-JFK route mean that it replaces one of the LHR/LGW - JFK 747s/777s? Thinking about the number of slots that BA has at JFK given the continous traffic issues.

If BA replaced a 747s/777s with a much smaller A318 (business class only) from LCY
1) BA would keep a higher proportion of full fare CW fares and the capacity of CW seats
2) reduce the number of discounted/restricted/award seats in all classes
3) reduce the surplus unoccupied Y seats on a 747s/777s if pax did cut back leisure flying

Strategy for BA would still be good in a downturn scenario as it would keep the profitable capacity (CW), recduce any surplus capacity but increasing loads on the remaining LHR/LGW-JFK routes. More importantly, it more difficult for the many FT who fly on discounted CW or BA Miles.

You would loose some capacity on F seats up the load factors on the remaining seats.

I suspect BA will still introduce the service for a trial period and judge the demand. BA can always pull the service later like it has with MAN-JFK.

ajax

Well I think that's the core of the matter.

Being realistic in journalism is one thing; needlessly stoking panic is quite another.

Unfortunately, there is a huge grey area in between, and most journalistic enterprises fall squarely in that grey area (if not a bit towards the panic-stoking side of it).

The cynic in me says that this "global market downturn" is the best thing to happen to the BBC since 9/11. It's something which one of my friends refers to as the Great British Misery Fetish.

The brilliant Lucy Kellaway (of the FT) wrote a very insightful article the other day about cliches used by the media in this crisis; she referred to the interview of a 102-year-old man who was working on Wall Street during the crash of 1929. He pointedly said that the troubles today are nowhere near what they were back then.

It's up to us to live our lives as normally as we can.

bernardd

The rapid rise in both the service and public sectors ought to have been giving rise for huge concern for some time.

If we look back over centuries the amount of our waking hours required to put food on the table, or clothes on our backs, has plummeted through mechanisation. In the last century the amount of hours we have to work to buy a car or travel from London to Edinburg or New York has fallen drastically, as has the effort it takes us to extract fossil fuels from the earth. At the same time we've taken huge strides in medicine and pharmaceuticals that keep the population healthier and productive for longer.

Much of that is down to industrialization and mechanization and it's the true reflection of wealth. Yes it's true that somes services contribute to this, for example software, but trading land/houses amongst ourselves for ever inflating prices does not. Equally we do not increase productivity through unstable amounts of gearing / leverage, be it corporate or personal, though the "advisers" and "Bankers" remorselessly skim wealth from every transaction.

Having struggled trying to fund businesses in the UK, I got sick and tired of hearing Bankers and/or other investment managers sneering at hard to predict returns from genuinely new ways of doing things, versus "safe" returns from financial manipulation and real estate. In the end it's a big part of what drove me to live and work abroad.

FWIW UK PLC also seems to be sticking its head in the sand over the dwindling North Sea oil and gas reserves. The country has had it fairly easy for the last 30 years in comparison to, say, Germany which has had to export to pay for its energy imports.

I really hope the UK takes this opportunity to strip away the froth and noise of the fictitious paper wealth it's been "generating" over the last couple of decades and look again at the fundamentals. It doesn't need to go back to smokestack manufacturing, but it does need to educate and reward more technologists, whatever their field of interest, and steer the emphasis back towards genuine productivity improvement. Without increasing real wealth creation it's hard to see how the country is going to pay the bills in the medium term.

Sadly Broon and Darlings comments on Public sector borrowings do not give me a lot of confidence they have the faintest clue where to start.

FlyerTalker46423

Radioman

Well I hope we can help make up some of the downturn. Spent a small fortune last week on shipping.

Radioman

Hi aristoph,

Well this is something that we have looked at and we will make full use of to our advantage. Even tonight I sent an email off to a few of our USA customers offering them some equipment at great prices. Its a great time for them to order and it will certainly keep the money rolling in.

With any luck we will have our new in car cctv units ready and ship even more out to the USA.

Then again, still taking some really good UK orders. I think that businesses have to really look at what they are doing and make the most of it.

regards
J

Radioman

Hi Earthman,

We have one medium size customer and one very large customer in Dublin. They are still doing well. They are changing the focus of some of the ways they do things and making sure they keep the customers happy.

Hope to be back in Dublin early December. I love staying at the CP Dublin Airport. Nice hotel.

Pity I cant really earn TPs on the route now, but dont get me started on that one....the boys in the south will jump on me again.....

Lucifer UK

Not to mention that, unlike the Norwegians, we spent the lot as well!

Globaliser

This effect of a weaker pound is one of the reasons why I believe that the combined Brown/Darling/King "recession is nigh" roadshow that has done such a good job of collapsing the pound may well have been coordinated and deliberate.

There are some service industries on which this will have a similar effect. I have in mind, for example, legal services provided by London to commercial clients all over the world regardless of where the commerce is actually taking place.