Words About Things

Last September I wrote a post about a survey which showed that 40 percent of Britons felt that they were unable to save money due to the tough economic climate. This statistic was shocking but not unfounded, unemployment was at almost 2.5 million and the recession was hitting hard. At the time 1 in 4 people surveyed had no savings at all which left them in a very precarious state financially. Others had savings already but were unable to increase them despite the looming threat of unemployment.

Although we are now out of the Recession things are recovering very slowly and many are still struggling. Consumer confidence remains low and a ‘double dip’ recession is a strong possibility. Whilst this all seems very negative it’s not all bad news. A survey completed in July shows that we are in a slightly more positive position this year: savings accounts balances at a major high street bank actually increased by £1.4 billion in the first five months of 2010.

Some people are still unable to move money from their current account to a savings account. 62 percent of those asked said that they were saving ‘much less than they should be’ and 22 percent were not currently saving at all. The reduction in personal saving is mirrored by the reduction in consumer spending, both show that lack of consumer confidence is having a negative effect on the economy. The Bank of England will publish their August Inflation Report on Wednesday and it is expected to predict a 2 percent growth in inflation next year. This is much less than previously predicted, the outlook as been revised to to continuing economic problems.

I’m no economist but it seems to me that what we need right now is some good news. A little growth in the economy would lead to increased borrowing and spending. In turn this would lead to more growth and increased job security for those reliant on consumer spending. All it would take is for some positivity to spread and not be destroyed by another wave of bad news. I’m feeling helpful so i’ll get us started: I just found £2.50 in change down the back of the sofa…

The amount of money that can be saved in a tax free ISA was increased on the 6th of October for those aged 50 and over. The rest of us will see our ISA allowance increase at the beginning of the new tax year in April 2010. The new top limit is £10,200 half of which can be cash with the other half being shares:

A cash component: a cash deposit that is similar to any other ordinary savings account, apart from the tax-free status. A TOISA must consist solely of a cash deposit.

A stocks and shares component: the money is invested in ‘qualifying investments’ consisting of any combination of stock market equity investments (with no geographic restriction), public debt securities such as government or corporate bonds, or cash “awaiting investment”. As a consequence, the risk profile of the ISA may be anything from low to high. The investments may also include or consist of property funds or derivatives such as options. This element may be self-invested and managed through a stockbroker, but the majority of investors invest collectively through a collective investment such as a unit trust, OEIC or investment trust.

The limit has risen from £3600 per year cash allowing us to save an extra £1500 tax free. Unfortunately 40% of Britons feel unable to save. Those who can save may not see a great deal of benefit in having their money in a low-interest ISA rather than a standard savings account. Still an ISA is a good way of saving and keeping the dreaded tax man at bay.

Today it was reported that the country is still in the grips of a recession much to the surprise of most. The nation’s economy contracted by 0.4% between July and September which was the sixth consecutive quarter to see a reduction.

As the graph above shows the GDP has reduced by less this quarter but the fact that there was a reduction means that this is the longest recession we have witnessed.

Fashion advertisements are suddenly being dominated by blonde haired blue eyed models. Where once you would see a selection of different looks selling luxury gifts modelling agencies are seeing increased demand for a more traditional look. Quirky, androgynous edgy looking brunette are apparently not what we want to see during a recession.

“Advertisers, they claim, no longer want the quirky faces that have dominated the catwalks, billboards and weekly glossies in recent years. Instead, they’re searching for safe, wholesome-looking girls with flaxen manes who will reassure rather than shock the consumer.”

Carolyn Asome

Some have suggested that blondes are considered more trustworthy and upbeat. A friendly face will sell more handbags because what we need during tough economic times is something dependable and positive. It could also be assumed that stylish rather than fashionable items will sell better as something that is timeless will provide more wear for the price.

“Blondes are a safer bet for clients who want to hedge their bets. Plus when we’re constantly surrounded by bad news, that blonde stereotype is zingy and upbeat.”

Sarah Doukas, Storm.

There are some interesting theories as to why young blonde haired women are considered beautiful. There is nothing new about blondes being considered the embodiment of the feminine ideal according to evolutionary psychologist Dr Lance Workman:

“Men in the northern hemisphere were drawn to physical signs of youthfulness because women have a limited period of fertility. Fair or lighter coloured hair is one of these signs because hair darkens the older you become.”

Not everyone is banking on blondes however, Paul Smith recently showed his Winter 09 RTW collection which featured mostly brunette models. Others are using ‘healthier’ looking models (this is fashion-speak for less skinny) probably as a response to controversy surrounding size 0.  This might also help to sell, to men at least, as apparently Men prefer bigger women during a recession.