The Economy - PW overview

It's interesting to note that reviewing the news media in the last couple of weeks (and I'm obviously talking broadly about the UK based media, although I suspect this pattern is also beginning to show through in the United States as well)you can begin to see stories about 'green shoots' emerging within the economy.

Although it seems that this has been one of, if not the longest recession on record we don't really seem to have hit the deep slumps of 'Depression' - this may be because the world economies intervened in their various banking sectors in time - there are positive signs emerging.

Firstly the consumer confidence indicators are starting to pick up in the run up to Christmas and the housing market, which dropped then stabilized relatively quickly now seems to be driving some value again. Anecdotally I would comment that it has been a while coming but I'm now seeing removals vans regularly parked up outside houses on a Friday morning (the traditional 'moving day' within the UK) - this is a sight that almost disappeared in my area when the credit crunch bit - but this morning on the route of a five mile drive I saw three such vans.

It seems to me though that there are three main drag factors to the economy : -

1)Strikes - in the UK we have a series of national postal strikes as well as numerous local council and public sector disputes - two large ones in my own county alone. Possibily the bad feeling within these workforces is caused by employers taking the opportunity to use the recession as a pretext to imposet harsher conditions or pay. I mean my council tax went up (again) this year by more than inflation - so why can't the workers have a decent pay increase ???

2)Length of recession - although the recession in both the UK and US is now I believe 'officially' over - it has proven to the longest on record - from a confidence point of view it takes a while for economy and public perception to improve.

3)Patchy recovery by sector - as ever, industry and manufacturing are always likely to suffer during recession. They struggle anyway in light of massively cheap labour and cost bases overseas and anything which buggers up their finally balanced cost and output factors like a recession affects this kind of business disproportionately.
In addition this time round a number of financial services and service sector businesses have been adversley affected too although it remains to be seen how quickly they recover as we move forward.

It seems that again the retail sector will be expected to drive the recovery forward into 2010.

What is the Prestige Whisky take on this ?

Well we launched the business at the height of the recession and were in the fortunate position to have ready access to the capital required without having to leverage our finances too hard. Trade has already exceeded our initial expectations and moving towards X-Mas 2009 we're confident that our proposition works and works well and that for 2010 we can drive forward to some of our business plan targets early.

So here's to a bumper 2010 for everyone and hopefully the recovery will persist.