At the macro level this article is very interesting, the Midlands was always seen as the manufacturing hub of the UK and although some doom and gloomers would have us believe that is all behind us the truth is very encouraging indeed. The region apparently exports more TO China than it imports which is pretty impressive. From a personal viewpoint it is very important at a time when I see manufacturing in Australia, my other 'home', being decimated.
http://www.ft.com/cms/s/0/33e70640-0...44feab7de.html

There is no doubt some negative story to 'balance' it though

NO, they arent that bleak, nowhere near in fact. That is of course if you have regained the will to live and are still reading

It's a worldwide trend that the rich are getting richer and the poor are getting poorer. That's at least as true of Britain as for other places.
People's views tend to be tainted by a conception that the changes they see in their own society are somehow not also happening elsewhere too.

In Britain this especially shows up as the so-called North-South divide which is at least as extreme as it ever was, more now than in the past. Basically one needs to go where the things that one finds as the most important are to be found.

The critical point is that unlike going into the financial crisis, the UK government has about doubled its debt to barely sustainable levels, with a huge additional burden of an ever-aging population coming down the tracks, and the banks are now pretty much a spent force, struggling to meet their obligations to the various regulatory authorities in terms of capital requirements.

This latter point means that they are forever fudging their bad debt provisions, rather than taking a good hard look one time to make their accounts somewhere near accurate. Of course there are loads of companies (zombies) that owe a truck-load to those banks and are just stuck struggling to service the debt in some fashion.

Against this back-drop, we are headed towards another boom / bust scenario because the only things that 'sustain' the UK economy are cheap credit which is what Mr Average (pre-crisis retired folk are often NOT Mr Average and have more in pensions than they feel they can possibly spend - that would be nice!) lives off and perceived wealth through equity built from increases in houses prices. House prices which are now stoked - aside from the London phenomenon - by a government scheme which many in the perceived 'know' think is sheer lunacy, unless it ultimately means many more houses being built, which will stabilize the 'beast'.

As for the overall economy, nothing really has changed and the UK has done nothing to improve employee training, the supply of quality home-grown applicants - particularly in technical areas - to meet the needs of employers*, to get rid of needless constricting rules and regulations, to improve innovation in industry, to improve important infrastructure such as international airport access, to enhance investment in critical areas of employment opportunity, so that the UK can compete and even lead in an ever-tougher global marketplace.

This stuff isn't anything new. The UK has been behind on training, innovation and investment for decades which is why the only way to get 'rich' ended up being on the back of cheap credit in an unregulated market through dabbling in real estate in some fashion, particularly post irrational exuberance (post 1996) (I think we might have it again now though) and after the dot-com bubble burst in 2001 after which many were turned off by the stock market and their defined- contribution pensions have since often taking a turn for the worse.

What is more, employers have copped out and turned to relying on cheap mostly imported labour to keep costs low instead of investing in people and their productivity and skill levels. Admittedly, part of the UK's poor productivity of late is down to the labour-hoarding that has taken place as companies did not necessarily let people go when their businesses declined.

Other than that, things are just fine and dandy.

If you have a house paid for, some form of employment or prospects and crime and the stress of social disorder does not touch you in your haven then YOUR circumstances might seem to suggest that things are just fine.

Today, if you are smart, bold, a risk taker, an innovator and have a well-constructed business idea, then there can be huge opportunities for you in today's world, particularly if you can find backers that share your vision. If you spot openings in the job area which seem to present long-term prospects due to emerging demand and have the requisite skills, you should go far but you may have to re-invent yourself more than once. Failing these, you absolutely have to position yourself in a niche career area at the top of today's lists, in for example, accounting, finance, some IT, engineering and technical, some healthcare provision, some leisure, or you will typically end up as part of the herd in terms of rewards for your labours. Some of these require a good degree, as a prerequisite, for starters.

The overall UK economy is pretty-much on a knife edge because of the government debt burden, while the rest of the world also struggles with some of the same issues that plague the UK, particular that aging population, debt (sovereign and personal), zombie banks and zombie businesses that owe to those banks, government short-termism and coalitions that cannot come to terms and do what is needed and the need to export big-time to somebody (can't all do it obviously).

The world markets sit on the edges of their seats waiting for something new and positive to come out of China, the only real engine of the global economy aside from the United States which has recently relied entirely on the Fed to move things forward, as the much-vaunted other BRICs economies struggle to make any sort of impact because of their own issues.

Things may be improving in the UK and that is indeed positive but we are only now approaching 2007 levels in terms of overall GDP, while inflation takes a big and bigger chunk out of Mr Average's wages.

http://www.bbc.co.uk/news/10613201

Neither main party has hinted at anything other than austerity for a good many years yet and the public sector labour cuts - aside from councils - really haven't even started due to the - up to now - weakness of the economy and the huge costs involved in severance packages.

*The education minister is still tinkering with standards - incl exam formats - and universities are still churning out graduates whose qualifications often do not fit with service or industry needs

I see holly has touched on the north-south divide and that together with the huge focus on London activity makes the UK situation even more serious below the national economy level, which is what I'm really talking to.

The north also includes Cornwall and much of South Wales in terms of predicament but then there are extremities only 60 miles or so from London, such as Margate, that are also pretty dire in terms of possibilities.

You make a good point, a point I have made numerous times that the assumption is that all the issues affecting the UK are somehow restricted to the UK. As someone who has lived much of their life in Australia I can tell you the same issues exist there as well and of course most other developed economies.

I haven't quoted your entire post due to length, but I think you've hit on some important points.

So far austerity in the UK has meant gaining more national debt while increasing underemployment and living costs. The debt of the USA is increasing all the time, and we had their recent shutdown which has only kicked the can down the road a few months in terms of their "debt ceiling" and budgetary concerns. I don't think the UK can take another big hit economically for a long time, so I would dread to think what might happen if the US has a proper wobble.

Wait, haven't you frozen to death yet from an inability to pay fuel bills?

I have almost burned the last of the furniture, thankfully it is a very mild autumn. You will of course be accused of being flippant you know I plan on fixing our utilities costs until mid 2017, we will pay slightly more now but it will be cheaper in the long term plus I have almost finished putting the log burner in.

I believe the recent round of huge energy costs are mostly due to be introduced in November - so the increases won't be noticed by most until mid-winter.

The US, as I have said before, is at least having some sort of conversation regarding debt and though the Tea Party crowd may look like a bunch of crack-pots, they are responding to their constituents' gravest concerns, far right though those constituencies are. They are also trying to survive.

The US should get past this congress log-jam, in due course , as the Republicans realise they may never otherwise provide an elected President.

Austerity, IMHO, in the UK, was/is used to create a general hardship and need urgency scenario against which public opinion ultimately adopted a sort of stiff upper lip and caved in to the Government in terms of demanding wage increases and pay and conditions which at one time what have been the minimum acceptable. This has included changes in State pension age and the cost of public sector worker contributions to their pensions. Colonial-style divide and rule.

Of course austerity, self defeating as it is in terms of growth prospects, is music to the ears of those holding the debt, so the rating agencies have kept the AAA ratings there in some fashion and this has critically helped to keep the cost of servicing that debt down .

Also, as we see, (just about) everybody is onboard when it comes to cutting the costs of welfare, though not the NHS, apart from DM abuses, whatever they might cost????

Shared sacrifice, though the bosses don't seem to take part in the sharing.

The USA is definitely in a worse mess than the UK. The debt ceiling keeps getting raised, taxes keep increasing while salaries dont. The unemployment rate for where I am in the US is much higher than where I am moving back to in the UK. Please in the US you spend your life working and doing nothing else. No forced vacation and minimal vacation time with most companies, no paid maternity leave etc. Each country has its issues thats for sure but the US is definitely going to the dogs very quickly and I'm ready to get out before it gets worse.

Yes I would have to agree judging by what American friends tell me. Its bizarre that America seems to put itself up on a pedestal and assumes others look up to it as something to aspire to.

Cool, that means we have a few more months of Chris' posts before he freezes to death.

I have talked with colleagues over there who seem pretty unfazed by the recent economic goings-on on Capitol Hill, and confident that federal and state budgets are sound.

I always liked the eternally optimistic "can do" attitude over there but just recently I wonder if it is detached from the reality of the situation.