Around the web the conflict goes on between optimists and pessimists about the economic and financial future. There are a lot of people in between, those who naturally prefer compromise and those who veer from greed to fear and back again. There are more omens and portents to be found than at your average ancient Roman Bacchanalia.
The difficulty that all of them have and notably those who by the accidents of family, fortune or politics in charge of things is that that they do not want to have anything uncomfortable to happen. What they want is for things to be kept steady and as well as that to have continuing improvements that do not cause any inconvenience.
The critical problem is that a state might have either a controlled economy, one way or another, or a market economy where the sum of individual decisions directs the flow and the future. The serious issue in the controlled one is who makes the decisions and how good they are. In our highly complicated and fast moving global world virtually all such decisions will be based on past and likely flawed data and political pressure that make significant errors almost certain.
In the market model, then the sum of decisions will depend on a variety of changing circumstance, too often unpredictable and then subject to interventions either of fate, geophysics or the actions of either greedy men or gormless politicians or both in tandem. In any case as markets are intended to reflect reality and the essential nature of the present, they will vary, often greatly over time.
In the controlling case you will get change up and down and in various ways that people do not like and they will expect this to be prevented or cured at all costs. It is the costs that are the trouble because these are rarely calculated accurately and usually badly underestimated. It is a world where nobody loses or can lose and where promises to that effect are made by people wholly unable to deliver them.
In the market case this will go whither it will and that has to be up and down according to the flows of money, goods, incomes, savings, investments and the rest. The market has to be volatile to do its job properly of responding to changes and new developments. This will mean that there will be losers as well as winners. There will be those who get it right and those who get it wrong. Worse in popular estimation and mass politics are those who are just plain unlucky.
Once there were no supermarkets. One of the first in the UK to bring this change about was Wilfred Proudfoot of Scarborough, whose obituary has appeared in the Press this week. When elected to Parliament in 1959 as a Conservative, in his maiden speech he forecast a revolution in shopping that would close 50,000 grocers shops in a decade.
Now we rely on supermarkets to feed the nation and are critically dependent on their supply chains and pricing policies. The markets have became controllers and the controllers have become the markets. So now we have a great many markets that do not function properly. Among them are the financial markets, the stock markets, the property market, the food markets, the commodity markets, the energy markets to name but a few.
Thinking of the potential consequences of our wish to avoid volatility, change and ups and downs it make one come over quite faint. The old fashioned way of dealing with this was to send for the smelling salts, or as it was known in the age before supermarkets, Sal Volatile.