Is it really Monday since I last posted? What on earth have I been doing?
Two posts on the New England Australia blog since Monday. The first, Belshaw’s World: Seven deadly sins of performance measurement, simply brings my Express columns up to date. The second, Random thoughts for a Thursday, is as the name says.
It is very hard just at present to keep any sane perspective on economic developments because of the nature of the commentary.
Assume, as we economists say, that there had not been a global financial crisis.
It is clear that the Australian economy had entered a downturn before September last year. In the absence of the global downturn and with a recession of the current scale, we would be worrying whether or not it might be as bad as 1991. So far we are well short of that, although in worst case we could see 1991 again.
My point? Simply this. By referencing everything back to the global downturn we are losing sight of the local, twisting our perspective.
In responding to the G20 summit, a Sydney newspaper carried the headline Australian Government declares war on risk.
At one level, this has to one of the silliest headlines of all time. How can you have a war on risk? At a second level, it actually captures some of the more crazy elements in current thinking and responses.
If, as some argue, the current global downturn is the outcome of sustained over-consumption in some countries matched by over-saving in others, then the downturn will not end until the imbalances correct themselves.
There are some issues here that I want to write about in more detail, but I will do that on Management Perspectives. For the moment, my point is that we cannot control the world, only our responses to it.