The Financiers are Nervous
If you are a senior in the financial world you have two primary obligations – to tell the truth and to avoid causing panic. Sometimes combining the two is impossible. Investors – you and I – are emotional people first and rational people second. If we ‘own’ some money, we make the decisions about how it is invested and spent, even if we get high level and expensive advice. If you are a writer, a reporter, a commentator, a doctor, a tutor, a mentor, you have the same obligations of truth and calm. It can be impossible to fulfil them both at the same time.
Inciting panic is what some sections of the press and other media live off. Social media aficionados also try to disrupt by distorting the truth, though exactly what satisfaction it gives them is unclear. I suppose we all like our feelings gingered up a little as a relief from a sometimes rather staid and plodding world. But does such a steady world still exist?
Even so, when the horses get nervous there is usually a thief in the stable.
The Financiers are nervous now. They purport it to be the possibility of a looming recession. For a world expecting to grow as its criterion for happiness, recession seems like a disaster. It will certainly be uncomfortable if it happens. Personally, I think the world would become a happier place if it slowed down a little and thought about why it was doing what it is, rather than just ploughing on with it.
Progress, that god of modernity, thinks otherwise.
Are the Financiers really frightened of recession or of something worse? I think they are frightened of bankruptcy – not of their own businesses, though that would be bad enough. I think the real fear is that the world has over-borrowed so much that it is going to face a massive bankruptcy which destroys money as we know it, reduces many to starvation and recreates the situation of primitive living experienced thousands of years ago.
Unlikely? They will certainly tell you that. Do they believe it? I notice a convergence of four things that together give ‘reason for concern’.
First, the spread of views by social media. When what was being spread was news, even fake news, it was subject to shrinkage. All news is. Yesterday’s news suffers the same problem as yesterday’s bread. It is stale. The short life of news is probably President Zelenskyy’s biggest problem. News doesn’t demand action, except for those involved in it.
Views, on the other hand, are more durable and demand everything from despair to riot. Social media are now in the ‘views’ phase. That implies action. The average wealth holder’s options are limited – go liquid or stay banked and invested. The recent bank collapses were relatively small but undoubtedly significant. Credit Suisse is said to be a ‘one-off’. But the customers are nervous. Not most of them yet. Just those who know the world debt situation. Are even the most respectable of reporting news systems being quietly asked to play down the level of world indebtedness? I ask because I don’t know. But I watch the price of gold.
Second, the Fed and central banks are openly agonising over tighter control, with its possible economic decline consequences, and letting inflation persist to rob the poor of life. They don’t know which way to go because the mass of people have never been so informed – and ill-informed – about the world’s money. A run on the world’s financial resources would lead to chaos it is not necessary to describe.
Third, the widespread knowledge of what top people earn is emotionally charging those less well paid, to protest. They have been taught that more money means more happiness. They see top salaries at ridiculous levels and assume that those who earn them are ridiculously happy. Actually, they are ridiculously worried. But unlearning ‘more means better’ takes time.
Finally, social media will not remain in the ’views phase’ for long. They are already moving into the political phase where they will effectively begin to replace voting. The dangers of pop-government are already clear. When everyone votes hourly on the price of ice-cream, things will have reached a pretty pass.
Maybe it’s not only the Financiers who are nervous.
Are you nervous, too?
Are you nervous or phlegmatic about it? We don’t do surveys but we’d love to know.
firstname.lastname@example.org looks anxiously, even nervously, for your comments
17 April 2023