大象传媒 NEWS | The Reporters

Winter of discontent

Robert Peston
2 Dec 08, 07:56 AM

I dread this time of year - because if you're in my trade, it's an exhausting season of parties hosted by chief executives, ministers, editors, ambassadors, even prelates.

You'll doubtless ask why, as an ungrateful and ungracious bah-humbug Scrooge, do I join the festive throng. Well, they are an excellent place to test the climate of opinion of those with the economic or political power to influence most of our lives.

And right now, the climate is grim - and the forecast is worse.

It won't surprise you that those who run our biggest retailers are utterly fed up.

What does surprise me is that those I've met recently are furious with the government for cutting VAT.

Partly it's the cost and hassle of changing all their prices that irks them.

But mostly it's that they don't believe the 2.5% cut in the VAT rate will increase their sales. I lost count of the number of times I was told that the 拢12.4bn cost to the of the change was "money down the drain".

Woman walks past shop sale sign All they see is an unstoppable trend of consumers spending less - and the big shopkeepers tell me they would have cut their prices, with or without the tax reduction.

They believe that a reduction in income tax or an increase in tax credits for those on lower pay would have been a more effective stimulus.

We'll see.

In my experience, retailers are always grumpy about something. But they are at the frontline of consumer spending, so it would be foolish to ignore them.

Only one group is more miserable than the retailers: the bankers and investment bankers.

The investment banks are as challenged and threatened as the coal mines in the 1980s. Those running them tell me they're planning to make further significant job cuts between now and the end of January. "We've cut so much, we've become anaesthetized to the process" said one.

Another told me that the latest round of redundancies would be pretty indiscriminate: "it's about simply getting the numbers down now" he said.

There is one common theme to the shrinkage at these leading investment banks. They are massively cutting back the businesses that provide services and funds to hedge funds - which has the knock on effect of wreaking havoc on the hedge fund industry.

"We're going to see the closure of well over half of all hedge funds" a banker told me.

Which brings me to the professional investors, who are the most dazed and confused of all those on the party circuit.

"Where oh where do we put our money?" said one.

That's not what you want to hear from someone who manages the pensions and retirement savings of many thousands of us.