Gone are those halcyon days when you had a single-digit number of television channels, a limited number of radio stations and games on our computers consisted of ping-pong and an aggressive digestive biscuit called Pac-man.
The term ‘online’ was probably a reference to your mother’s washing hanging out and that strange word ‘internet’ was either something other people used their basic computer for, or where you hoped some shrimps might end up while on a long wet weekend in Cornwall.
So was life better back then? We probably thought so – but a lot of that can be put down to the fact that ignorance is bliss and we did not know how bad things really were. Now we have advanced! We have direct access to more news, views and commentaries than ever before.
So, looking at the wealth of information in front of us, what is the current economic situation for the UK? Our chancellor Rachel Reeves has so far not shown much financial and market acumen. She needs to create more confidence in the UK economy as markets are still wary of another Truss-style amateur fiasco.
Rub of the green
Yes, Reeves has cost the country a great deal – not just in terms of money but very valuable reputation too. If she can focus on the growth areas – especially technology hubs and regional infrastructure – then green shoots will start to appear, but she should back this up with direct tax incentives for corporates and investors. And if she does not act swiftly, any green shoots that do appear risk being mistaken for advanced mould.
The chancellor should also push investment funding and action to the regions and get away from the Treasury’s fixation on centralised control. Despite what we are told, there is no shortage of funds for investment – it is just that the holders need the confidence to trigger action.
And for the rest of the world? The US president’s “big beautiful bill” has already had an impact as US treasuries have been rising in cost. US debt is eye-wateringly expensive and, whatever you may think of the recent departure of Mr Musk, his comments about the asset class were quite right. A key area to watch will be China’s willingness to keep buying those treasuries. China is often the largest holder of US debt and thus a key financier of the US economy.
These two nations may be often at odds with each other but, equally, they cannot do without each other so they both need to keep the party going. If they start to falter, however, this is a key area of risk – especially if growth recedes and the risk of recession rises.
Local corrective
With all of this information in front of us, the latest online headlines can sway our views one way or the other. Trying to have a sensible overview of the global economy is almost impossible. For every success there will be some failure and risk will be jumbled up with opportunities.
Better, then, to look at our own local position. In your own city, town, district or borough, how many new businesses have taken the brave step of starting up? How many new jobs have been created and how much new investment has come in? Not all of these will be success stories, of course, but many will be placing the negatives tales of woe into the correct perspective.
Equally, consider your local stories and weigh those against other areas both domestically and overseas – now we can really start to have a far more constructive view of how we have been developing. And the purpose of this? To create confidence – and encourage people to start investing again.
Co-founder of Seven Investment Management and, more recently, the Regionally Ventures investment service – not to mention a driving force behind Barclays Stockbrokers, Proshare and AIM – Justin Urquhart Stewart is the keynote speaker at Wealthwise’s June Wealth Forum, which takes place at Coworth Park, Ascot on 26 and 27 June. For more information on the event, please click here
“The US and China may be often at odds with each other but, equally, they cannot do without each other.
