Remember last year when the government bailed out the banks.  At the time, Gordon Brown pronounced that the size of the bailout was necessary to avoid the government repeating the exercise three months later.

Well, here we are three months later, and the Government is again bailing out the banking sector.  The worrying thing, is that I am not actually surprised by this manuever, nor is anyone else I speak to.

Recessions are inevitable.  To say that you can avoid or eliminate recessions is to divorce oneself from economic reality.  The hubris of the current government on this matter, especially that of Gordon Brown, is especially galling now that there is a body of evidence that they were forewarned of the problems were are all now experiencing.

Whilst I do not proclaim to to be an economic expert – is anyone? – recessions may be simply described as a period where we experience negative economic growth .  What makes this one so different is that hasn’t been caused by the usual culprits.  A new culprit has emerged this time: an almost total lack of credit.

Every business, no matter its’ size requires credit to operate.  If there is no credit available, business stagnates.  Contrary to what the government and banking sector say, as someone who works in the small business sector, I have witnessed the simple truth that the banks simply aren’tlending, or if they are, they have cut back their lending levels to minimal levels.  I strongly suspect that a more reasonable degree of lending will not resume until the banks have addressed their own internal liabilities.

The interesting and encouraging aspect at present is that there is work available, and companies are still placing orders.  What has changed is the ability to extract payment.  A substantial number of big companies have increased their payment terms to over 90 days, which for a small business is simply unsupportable.  Increasingly, the only way to extract money out of customers, is to become a major thorn in the side of their Accounts department.  Those who cause the most grief, will probably be paid quicker.

As no-one has yet to invent a working crystal ball, no-one can say for certain what will happen next week, let alone this time next year.  What will make a huge difference in the coming year is confidence.  The higher the level of confidence in the market

As for myself, well like a lot of other people, one of my concerns is whether or not I will actually keep my current job.  Even the most traditionally secure jobs, like those in the public sector, do not appear to be safe in the current climate.  My local county council recently announced 500 job losses.  It would seem that that the only people currently safe are those working in schools.  Like most people, I am a planning to keep my head down, and my fingers crossed.