Northern Rock and Roll

Wednesday’s post late again this week because I was waiting – no, don’t laugh – for the allegedly imminent decision on nationalising Northern Rock. Which with the inevitability of so many of the Prime Minister’s decisions, hasn’t quite been firmed up yet. The BBC’s take on it is here.

The difficulty to my mind isn’t so much with whether or not it gets nationalised, although the news on Tuesday evening had enough aggrieved and potentially aggrieved shareholders to persuade me someone’s going to suffer. The real problem is that as we saw in the lead-up to what turned out not to be a general election, nobody’s actually making a decision. This doesn’t bode well for the economy overall or business matters in general.

There’s every sign of a recession brewing. In the last week Marks and Spencer and other retailers have posted less than glittering reports of the Christmas period – the usual last-minute surge simply didn’t happen and the money taken was less as a result. On the one hand if this means we’re going to stop living on credit so much that’s probably a good thing. On the other hand, fewer sales mean fewer jobs. It’ll be what the economists call a ‘correction’, which is a euphemism for an extremely painful stage for a lot of people.

This would be easier to bear if the people at the top could actually tell us what’s being done. Yes, we’re going to nationalise Northern Rock or no, we’re not going to do it. Simple as that. My guess is that for the majority the outlook would look infinitely less bleak if only it had a name and a certain direction. Not knowing breeds uncertainty – and if you check my previous posts you’ll realise I believe the whole Northern Rock problem arose from perceived uncertainty rather than actual problems in the first place.

Guy Clapperton is a freelance journalist who specialises in small business issues and has written for the likes of The Guardian, the FT and the Daily Mirror. Guy has written about finance and franchising for SmallBizPod. http://www.guyclapperton.co.uk