John Linton
There has to be a better way to start the day than to read the financial press - this being a typical example in the SMH:
"AMP Capital Investors' head of investment strategy, Shane Oliver, said - The further fall in US share markets on Friday night and futures trading in Australian shares indicates the Australian share market will fall another 90 to 100 points or so … which will take it below its January 22 panic low of 5186 on the ASX 200."
I suppose if you don't own shares such statements may not really have much impact (I don't own shares) but the clear implications that people who do own shares (including the massive corporate investors such as your and my superannuation funds) are now worth less money and therefore have less money to spend are fairly obvious.
So I read through the rest of the SMH business section and the AFR with pretty much the same consequences as on Saturday - all I read was doom and gloom and endless sets of statistics trying to pin point exactly when things were last this bad.
It's impossible, at least for me at this time of my life, to constantly be confronted with uniformly bad economic news and still retain some sensible level of 'optimism' in making daily decisions. Each day that I read these constant streams of pessimism makes it harder and harder to sensibly plan for any future beyond the next few months because there appears to be every chance that there will be problems in the future that are going to much harder to deal with than the ones that are already difficult to deal with today.
Earlier this morning I took a call from someone I've known for a very long time who I hadn't heard from since mid last year when he was very 'gung ho' on how well his business was going and we had a pleasant hour over really good single malt in one of those club like CBD bars while he talked persuasively about how we could mutually profit from an investment he was about to make. It was a depressing conversation and really sad to hear the desperation coming through the phone as he got very close to begging me for financial assistance to help him salvage something of his life time's savings all of which had been ploughed in to his business including several re-mortgages of his home and other property.
He sounded a lot like I must have done some 15 years ago when I was confronted with an Australian 'business downturn' and faced the same disastrous personal financial and business consequences of my actions, or more exactly, my inactions.
I couldn't/wouldn't assist in the ways he needed help with and when the conversation ended I put the phone down with a very shaky hand.
As you get older in business you, inevitably, know more and more people in more senior positions in various Australian and other companies around the world. So while to some people who read about this or that company's demise and the affect that has on the owners/directors of those businesses with that mixture of 'they got what they deserved' and 'serves those bastards right' attitudes so carefully generated by the popular press and the trashy free to air TV stations I find myself, through personal experience and phone calls such as today, with very different views.
There is little doubt that every human being does silly things, or things that if they'd given more thought they wouldn't have done, and this applies to every aspect of all of our lives - except of course for those saintly beings who never did anything they regretted ever. I suppose the chances of any single individual doing any single silly thing isn't going to cause much of a problem even for the silly decision maker themselves under most circumstances.
However a 'business down turn' or recession or worse - a depression is caused by one or more significant underlying assumptions affecting many, many people's decisions changing that in turn causes many marginally correct, or maybe just marginally incorrect decisions turning in to major incorrect decisions that, because they are in some ways linked to other people's marginally incorrect decisions bring about consequences that have terrible effects on all sorts of people who are in some ways, often unknown to themselves, linked to some other person's marginally incorrect decision.
I can't help feeling that we may be about to be involved in such times and maybe the duration of the events and the consequences of those events we are all about to be 'touched' by are going to affect us far more adversely than the previous two, most recent, 'business down turns'.
Not a good way to feel at the start of the business week.
Sorry for sharing.