Green Diamond

Howard Davies is the kind of smart Adair Turner gets presented as by people who rub themselves against the latter in the hope some of his apparent credibility rubs off. Both were/are also FSA chairmen, but only Howard’s recent writing is worth much reading. This includes an essay last month on why the moves to reform the financial system are running into the sand, which matters given the rationale for reform was to prevent a reoccurrence of the kind of thing that has already put millions of people on the dole.

This and the increasingly aggressive push by the banking industry to be left the fuck alone provide the context for today’s announcements about two bankers getting new jobs. The one that got all the headlines, commentary, analysis, pish spoken, etc., involved Barclay’s bank, which will be headed up next year by a very, very rich bloke as opposed to the current very rich bloke. The one that was actually significant though was the announcement that the chairman of HSBC will become a government trade minister in January next year. Not that the attention paid to the former in any way obscured the latter or that there was any coincidence involved in the timing of the announcements. No chance.

Regardless of that its nice to know that as the government is considering reregulating banking and even has a nice commission considering breaking banks up the chairman of a bank that recently threatened to leave Britain if this was to occur will be in government. It leaves you feeling all warm and moist knowing they’re in the tent pissing out, not pissing in. Or perhaps it’s simply taking the piss.

Speaking of which, arse. No idea how to add a graph showing how the % of long-term unemployed has risen from c.1 in 4 to c.1 in 3.

Also piss is all this BBC malarky about the spending cuts/review given what was going to happen was already apparent before the election during which it was allowed to fall between the cracks in favour of the usual personality wankfest. Presumably the temptation to do vox pop/speak your brains specials has just got too damn much. The other point of course is that the spending cuts will be over a number of years and not really kick in until 2011 - i.e. the BBC will get bored with it a day or two after the spending review is announced on October 20th (having already nagged ministers every morning on Radio 4 in the run up to the announcement) and the human misery they actually cause will no longer be headlines when the misery actually starts getting caused (by then my guess is they'll be wanking on about the coalition breaking up in between over-reacting to some disease that might just wipe out Western civilization).

P.S. read an intersting article today (8th), which mentioned Barclays told Downing street in advance about the very, very, very, very rich man's impending appointment, exactly the kind of info that would enable those so motivated to make sure the other appointment was announced at the same time and buried as a result.

Graphtastic

Woo hoo a graph! A shit looking one to be sure, but still it tells a story even if it’s not one with an especially happy ending.

The background here is that unemployment rose sharply throughout 2008 before stabilising at the beginning of 2009 where it has largely remained since. Positively, the employment rate has recently ticked up signalling the worst of the credit crunch is behind us, which is all fine and rather dandy until you look at the actual composition of the unemployed population in a shit graph like the one what I’ve done here. There what you see is that while the unemployment rate may have plateaued, within this long-term unemployment (defined as greater than 12 months), has continued to increase relative to the total. To put it another way from 2008 Q2 to 2010 Q2 the number of people unemployed for over 2 years increased by 63% while the number unemployed for 12 months plus increase by 104% which is an even more fucking horrendous number.

To quote an Office for National Statistics review of employment statistics long-term unemployment is more likely among older men, those with fewer qualifications and the disabled. A different way of putting this is that the growing number of poor sods signing on for the 53rd or more time this fortnight have endured and are enduring an increasingly nightmare uphill struggle when it comes to getting a job. Sure, things are getting better, but why exactly would an employer take on an unskilled, disabled, middle-aged bod who hasn’t got out of bed before 8am for 2 years when there’s some able-bodied graduate just come to the end of a temporary contract and desperate for beer tokens knocking at his door? The answer is he won’t and we’ll see a permanent (over the medium-term i.e. 5 years) increase in the number of long-term unemployed.

At a high falutin economic policy level, the resultant increase in “structural unemployment” will probably see the NAIRU revised upwards in due course and nuanced references to why unemployment in excess of say 6% can be compatible with supply-side constraints and in no way a reason not raise interest rates. It’ll also see some Daily Mail led splenetics about dole scroungers and benefit fraud being trotted out every time government benefit spending figures get published.

Alternatively, given the human misery involved, I’d like to see the next few Office for National Statistics labour market statistics bulletins printed out and publically rammed down the throats of the few dozen or so vile British financial cunts who contributed to and profited from the credit crunch; it’s not as if it wouldn’t be a piece of piss to start naming names, especially given ignorance is rarely an acceptable excuse.