Saturday, 24 January 2009

Who has gained in the recession?

According to the Telegraph, the following have gained from the recession:

1. Homeowners on tracker mortgages: The lucky people on tracker mortgages have seen their monthly repayments shrink as the Bank of England has hacked down interest rates to try and prevent out-and-out Armageddon in the economy. A 0.5pc point cut in interest rates would make a difference of £468 a year to a customer on a typical £150,000 mortgage.

2. Wetherspoons: The no-frills pub chain renowned for its cheap drinks has come into its own since the downturn really hit home in the autumn. Like-for-like sales increased 2.6pc in the quarter to Jan 18 and 6.4pc in the final two weeks, accelerating from a 1.5pc rise in the first quarter. More upmarket rivals have reporetd falling sales and profits across the board.

3. People making money from others' distress: There was a time everyone wanted to work in the City. But now the good times have moved on from the Square Mile and instead insolvency specialists, P45 processors and pawnbrokers are enjoying a boom.

4. Big beasts: The Prime Minister got one thing right: the recession has been "no time for a novice."

Gordon Brown managed to reverse plummeting poll-ratings as the banks headed towards collapse in the autumn. Liberal Democrat Treasury spokesman Vince Cable has also had a "good recession", after forecasting sometime ago our national taste for debt would end in tears. And former Chancellor and Conservative heavyweight Kenneth Clarke is back on the front benches as shadow business secretary to take on that other blast from the past, Lord Mandelson.

5. Soothsayers: The so-called unforseen events of the last few months have been a good time for people who did, in fact, forsee them. Monetary Policy Commitee member David Blanchflower had been calling for rate cuts for months before the banking crisis caused the Bank of England to decide that inflation was perhaps not the major worry.

6. Comfort food: Healthy eating campaigns and the move to organic, sustainable and free-range food seem to have been early casualties of the consumer spending downturn. Comfort foods are making a comeback: Britain's 9,500 fish and ships are laying claim to be the nation's favourite recession food after sustaining 3pc growth in sales and footfall – the first annual increase in five years. And takeaway pizza maker Domino's reported an 8.6pc rise in sales over the Christmas period.

7. Movies: UK box office takings rose 5 per cent to a record £949 million last year. The popularity of Mamma Mia!, which generated a record £69 million in ticket sales in the UK, was attributed to its escapist quality, transporting audiences from recession Britain to a Greek island alive with sound of Abba.

8. Public sector employees: Those in the state's pay have had their grievances for the last few years, with wage rises below inflation while private sector pay, especially in the City, shot off the scale. But now the government is the only employer still hiring. Two of the country's largest recruitment consultants, Hays and Michael Page, identified the most fruitful ares for job-seekers as social housing, health, education and finance roles in local government.

9. Shoppers: If you still have money to spend, there are certainly bargains to be had. Retailers are offering huge discounts on everything from clothes to homewares to cars to try and shift stock. With inflation coming down, falling mortage costs for some (see above) and falling energy costs, those who remain in work are expected to have more disposable income this year.

10. Software makers: When one door closes another opens... Companies may be cutting back on IT spending but UK firm Autonomy produces software which can search and store corporate emails - as required by new regulations brought in after bank collapses.

Homework for Economics students:

Who ELSE has gained from the recession - and why?

Post the answer(s) in your blogs...

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