The past few days have been very unsettling. The financial markets the world over have taken a nosedive. Fears of a double dip recession have returned and looks like investors and those of us in the financial sector have no where to hide. Of course, the markets are usually a leading indicator and things may turn out to become worse for the "main street" as well.
What is more unsettling however, is the sudden and inexplicable violence in London. I woke up on Sunday to see images of burning buildings and people trashing stores. At first, I thought this was a one-off thing, although pretty scary and not something that you would expect to see in a city like London. When people started calling me, and had sent emails overnight to check I was ok on Tuesday morning, things really hit home. I quickly turned on my computer to see what was going on. Some of the images were horrific to say the least. The sounds of sirens, ambulances and helicopters have continued over the last few days and parts of England do look like war zones.
What struck me the most is that people are not really protesting about anything at all! They are just taking advantage of the situation in a very organised way and looting items like plasma TVs, iPads, shoes, clothes..How were they so organised, they used blackberry messenger, of course! Only in the UK will you find people in £100 trainers robbing shops because they feel that they have been wronged by society..
Who are these people? What do they want? They say they are angry, but what for? For having council housing? for having the chance to get an education? to get unemployment benefits? How about they tried to go to a real poor country and saw what poverty is all about. What it means to have no food, no home and no education. What it means to be living off the streets and have no real prospects.
These riots also brought home the fact that the UK authorities are unable to deal with widespread disturbances like these. They are still debating whether it is actually "legal" to use batons and wondering if the use of water cannons is "appropriate". In fact, on the very first day of rioting, the police simply watched as rioting went on, much preferring to look at CCTV rather than actually trying to stop the events as they unfolded.
Reminds me of the free market regulatory policy that most of the western world has followed. The theory that markets are always right and that the market will correct itself and weed out the outliers is completely wrong and has been proven wrong many times in the past. As for the current sell-off, seems to have been triggered by the US govt downgrade by S&P, but no-one has a put a finger on the real issue - over leveraged consumers and governments. The response of the western world to shore up the economy for the last few years has been to print, print and print more money ergo leading to further increase in government debts! Very few have pointed out that credit fueled culture will need to be reversed and it will be painful.
On the social side, there has been talk about "bad parenting" here and how parents need to keep a tab on their out-of-hand kids. Is that the real issue here? Why did these kids or certain sections of society get out of hand in the first place?
Maybe all this is because the rich and the poor both felt entitled to have things that they could not afford in the first place. The educated used their credit cards, while the un-educated used their knives and the power of the mob.
I almost feel that police and regulators have been too soft here. Increasingly in the west, you get the feeling that Big Brother is watching. Phones are being tapped, emails are monitored, there is CCTV everywhere you go. But where is the Big Brother when you actually need him?
I hope that the fires are put out quickly and the sirens go quiet again. I hope the rampant sell-off in the markets stops and firms start generating business and start hiring again. But the reality is that all measures are stop-gap and temporary and no one has a real long-term solution yet. And so we will go along our business, till we get shocked to the core again..