Intergenerational scam

So here's the scam, mum and dad go out on a spending spree for 40 years using debt, tax breaks and inflation to build their personal wealth and lock it up mostly in property and pension savings.

Then they retire and leave the debt burden and it's servicing to their kids and grandkids.

No wonder the economy is sinking - we've broken the covenant with our children, we should be picking up the debt bill - not them.

A one off tax on all those with capital assets of c. £1M and more, would pay down the national debt at a stroke and with it the servicing costs, with no cuts or direct/ indirect income tax rises required.

Then the youngsters could get on with rebuilding Britain's economy- untroubled by their patrents' debts.

Let's hope the government get honest, exposes the scam and sorts it out.

Economy goes slow

It seems the economy has decided to go slow - everywhere you look the consumer is holding back and cutting back.

But the UK economy relies for two thirds of it's output on Mr & Mrs Consumer well, consuming!

So what's to be done, how does the Coalition persuade us all to get out and spend?

Well, as the Irish joke goes, to get to where you want to go - I wouldn't start from here.

It's all down to confidence and trust, as every Interim Manager knows well, without those two ingredients you can't make anything happen. Mr & Mrs Consumer need to have confidence in their futures and to trust the Coalition to set policies that make Britain a place where enterprise and opportunity can thrive.

Trouble is - politicians - despite their posturing - have very little power to do these thing in the very interconnected and interdependent world of the 21st century. They rely on the kindness of stangers around the world to keep Britain going because of it's huge debts.

Will they have the capacity to bring about the paradigm shifts in thinking required to solve UK's problems, we'll have to wait and see - but so far it doesn't look promising.

Perhaps they should move over and let a cohort of Interim Managers take over who are skilled in using paradigm shifts in thinking, in order to solve the complex problems they meet every day!

When will the penny drop.

Capitalism relies on creative destruction to survive.

It must destroy inefficient organisations so that new ones can flourish, yet right now the central bankers and their government sponsors seem determined not to let inefficient banks, inefficient governments, or even inefficient states go down.

No they must be saved from their mistakes, they must be saved at all costs and hey- it's not our money they are being rescued with, it's our children's and grandchildren's.

So now we don't really live in a capitalist society or economy anymore - but one which is 'protected' from reality by ooodles of cash which we don't actually have.

Yet - next to global heating (which will wipe out man), western nations' biggest problem is debt.

Adding more debt is so foolish - yet the man in the street does nothing to stop his elected representatives as they pay down debts with more debt.

When will the penny drop !!

Will they deliver or do they need professional Interims?

Will the coalition government have the bottle to push through their proposed savings ?

Will they really cut PFI deals which would cost everyone ££ millions over the next 25 years?

Will they upset so many groups that they get hounded out of office?

Will we really see a million public sector workers on the dole?

Well, they've set out their plans in broad terms and the detail will follow in October, but as every Interim Manager knows, you then have to deliver...no if's or but's, otherwise you are toast.

Consultants do the analysis and set out the plans (the easy bit), but Interim Managers deliver.

Interims everywhere will be watching Dave and Nick with interest in the autumn, to see if they can make the transition from consultants to Interim Managers!

Realism not optimism like Interim Managers

So - the economy is recovering, really?

It will take years for the adjustment to lower living standards for all in the West as we level up with the East.

Asset prices have much further to fall, 50%+ and real incomes likewise.

So let's get realistic like Interim Managers and accept lower pay rates and adjust our lifestyles accordingly.

Emergency budget good news for Interim Managers

Yes- at last the IR35 issues are to be dumped, which will be good news for many Interim Managers operating through their own companies...AND......best of all, the public sector is to reduce it's costs WITHOUT REDUCING FRONTLINE SERVICES.

They'll need the advice of Interim managers to do this - it's a core skill for them, so standby for lots of enquiries from public organisations.

The moment of truth

So - Gordon decides to go on the day Europe decides to adopt his policies - what an irony.

Gordon Brown's legacy will be that he was the man who persuaded the world to pile debt on debt and then spread it around. Following the 2008 banking crisis, it was G B that convinced the central banks to pump more debt into the system which was already choked with it.

Now 18 months later when that new pile of debt is spilling over into ailing sovereign balance sheets in some countries - the EU central bank (or it's proxy) has decided to pump more debt into the system to cover not just the ailing countries - but those yet to catch the malaise.

Previously cautious and prudent bankers following the Austrian school of economics have abandoned their principles over the last weekend and signed up to debt profligacy joining Britain and America in the race to penury.

As Gordon leaves the stage - it will be the job of those that follow to balance the books, unless we invent a new form of economics where folk live off ever increasing debt forever...now there's a thought!

Why bother going to work - just relax and borrow some more to buy the bread and circuses.