With Governments committing billions and trillions (whatever they are) to bailing out toxic banks, many people were of a notion that the worst was over.
In the language of the economists the world is now emerging from a U-shaped recession. Green shoots, world stock markets roaring ahead, everybody feeling better. Spend our way out of recession.
Well, hold up. Over the weekend proof has emerged that all is not rosy in Dubai, the small city-state which is the greatest exemplar of "mine is bigger than yours".
Biggest building in the world, biggest indoor ski-slope, biggest swimming pool, biggest hotel (7 star no less), shopping mall, theme park, airport, and biggest sweet shop for goodness sake.
Now it appears to be on the edge of producing, relatively speaking, the biggest financial crash in the world because of its fragile sovereign debt position.
The ripple effect of Dubai on confidence will affect international lending decisions and interest rates out of all proportion to the actual amounts of money involved.
Hey, Dubai is a long way away with its possible debt default being fairly inconsequential in the context of trillions of worldwide debt. A little sandy dot with a pile of essentially useless real estate bling. Does its hubristic economic collapse matter to me and my business in Ireland?
I think it does and I would advise you to take note and take early action. Now that everybody is getting a bit complacent, Dubai reminds us that recovery is still shaky.
When the downturn started to bite and borrowing was tight, remember how you made cuts in overhead, reduced staff, slashed expenses and focussed on cash flow?
Well, go into your business this week, take another hard look and follow it up with some hard action as before.
Oh, and at a personal level, delay your car change, take a much less expensive holiday, cut all unnecessary expense. Christmas is coming and here is Mr Scrooge already.
Do this and do it now! I have a feeling that in 6 months time you will be thanking me.
Find out more about Will at http://www.willmckee.ie/
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4 comments:
Will,
Do you think Northern Irish companies are only starting to see the filtered process of this recession due to our heavy slant toward the public sector?
Niall
Spot on Niall. But it is coming down the tracks at us. But don't despair. Ther are going to be plenty of opportunities for private companies that are fast on their feet, even in the teeth of public sector cutbacks.
Remember, "It is not the strongest of the species that survives, nor the most intelligent. It is the one most adaptable to change"
You're quite right, GOW, it's not Dubai anymore, it's don't buy!
Do Buy/Don't Buy! Wish I had thought of that. Great!
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