Rikki and the pandemic.

[Cateran]

The UK chancellor is apparently a disciple of Joseph Schumpeter, the Austrian economist, who thought up the theory of "the gale of creative destruction". This is the notion of economic mutation (much like the Covid bacteria) that continuously revolutionises wealth creation from within, if we view Covid 19 as a storm blowing our economy off course then the analogy is made contemporary with the latest events from Westminster.

But notice the difference. The pandemic is "creative" in that it creates the perfect storm of wealth creation disguised as a necessary evil. We all have to knuckle under and comply, or suffer the consequences. It is for our own good, or for some good, perhaps venture capitalists, like those in the City of London, for which profit comes first. So, cui bono? Who gains from the pandemic? Well, not the millions suffering from breathing difficulties and lung disease, nor the NHS, whose future is in peril.

We should take the latest "dose" of medicine from the Treasury with a warning attached. Perhaps a whiff of cynicism about Rikki and his pals may be appropriate. Whatever he is selling cannot be good nor beneficial for our public safety.

[Troilus]

Hi Cateran.

The gale of economic destruction is not as bad as it sounds. It is to do with the cycle of production. Old technologies and machinery are replaced with new ones. Like hand operated looms being replaced with automated ones.

It is about innovations, entrepreneurs and yes venture capitalists. People who have the ideas, and people who develop the ideas and people who fund it.

I doubt that there are many venture capitalists who are coining it in at the moment.

Of course, there will be those who are investing in various vaccines at the moment, but we do need that investment.

What we are experiencing at the moment is a much simpler form of economics. Quite simply the law of supply and demand.

Because of the pandemic and it’s restrictions on our normal habits, the demand has reduced dramatically in some sectors.

The government is trying to plug that gap, but there is a limit to what they can do in terms of subsidies and support.

Government debt, at this time is estimated at three trillion pounds, with the possible need to borrow more to supply additional funding to the nhs and welfare system.

And of course, we do need to remember that all of this will need to be repaid in the future.

All I know, is that I am glad I am not the one trying to sort all of this out!

[Cateran in reply to Troilus]

This is a very reasoned and perceptive reply Troilus, and I am not being the Thersites in my response to you. I want to pursue the ethical and moral case in this, namely that certain investors benefit for the wrong reasons, even the risk capitalists. They are taking advantage of the pandemic in order to gain an edge and buy when the climate is right for them. I learnt recently that Boots, the chain store pharmacists, are owned and controlled by hedge fund investors, as an example of opportunistic intervention and predatory market forces. Already Boots is reshaping their labour force with redundancies and shop closures, the better to save on costs and profit loss/margins. So there is that double edge sword of state capitalism and interventionist government.