Welcome to 2009!
I'll put some thoughtful commentary here next week about the outlook for the year, but here's an interesting idea spotted in the Telegraph the other day.
The Post Office approached children to design their literature for their financial services products, and their answers are brilliant.
Asked to explain 'inflation', seven year old Sophie says:
"I get £1 pocket money
every Saturday to go swimming but because of inflation the cost of my
swimming lesson may go up. Next week, I may not be able to go swimming with
my pocket money. I hope Gordon Brown sorts the credit crunch out."
Good explanation Sophie.
But what's 'a credit crunch'?
Yes, Chantal (who's eleven by the way):
"A credit crunch is when banks stop lending money to each other so they
can't give money to us. If our parents stopped giving money to each
other to spend then we wouldn't get any pocket money either."
Well done Chantal. Excellent answer.
Now then, a credit crunch can lead to a 'recession'.
What's one of those?
Let's ask nine-year old Christian:
"All the businesses in
the UK are not lending to each so there are not many jobs and people don't
have much money to spend. My mum is a lawyer and she gives my dad money sometimes to take me
swimming. She doesn't give my dad money any more so I can't go swimming so
There could be a lesson in there somewhere, as what they're really saying is that we can't get swimming again without some cash.