Global economics is cruel to real people

THE financial news in the UK, and in much of the world, is full of doom and gloom based on stock market movements. At its worst, there are predictions of another financial meltdown, to match the one in 2008 and the media is happily trotting out old pictures of the fall of Lehman Brothers, complete with ex Masters of the Universe carrying cardboard boxes.

The central role is played by the Shanghai Index and the deep losses it has suffered since April. This is taken by Western commentators as a comment on the state of China's economy, which has driven global growth since the dark days of 2008. Current "losses" of share value are estimated at 40-45 per cent in four months. China's overall economic growth stands at only 7 per cent.

I hope you are reading this with an open mind. Seven per cent growth? If only ... Western economies almost went belly up after 2008 and the prospect of a meltdown of the entire banking system was preying on people's minds. Negative economic growth (why do economists try to dress up recession with the word "growth"?) was the norm. Meltdown was averted by the traditional lowering of interest rates to a rate so close to zero we savers could not tell the difference. And there they stay - seven years and counting. If that was not enough cheap money, the UK, the US and, belatedly the EU, came up with the whizzo strategy of printing free money and shovelling it into bankrupt banks. Just in case they were accused of following Zimbabwe's economic strategy, this was given the grand title of "quantitative easing".