By David Mc Williams
I am standing outside Selfridges on Oxford Street watching the world go by. What a world it is! There goes an Arabic woman in half hijab with Gucci sunglasses propped on her covered head, carrying two pairs of designer shoes in her distinctive yellow Selfridges bag. Beside her, four Chinese women are similarly laden down, tourists from everywhere are shopping for everything, while London’s newest ethnic minority, the emigré French middle class, can be heard over everyone.
Is it any wonder that retail sales in Britain bounced strongly in May, with all these people fighting each other in the narrow passage that is Oxford Street?
This zone of London is the ‘ground zero’” of globalisation where goods from everywhere are sold to people from everywhere in a shopping frenzy of everything.
While they carry on obliviously, the frenetic shoppers seem to have no idea what is coming down the road financially or what effect the malignant coincidence of a growth slump in China, a fading recovery in America and Europe’s debt crisis will have on their world.
Let’s deal with China first.
Isn’t it interesting that the only big central bank to slash rates recently in the face of economic crisis has been China?
The ECB is talking about it and will probably introduce another massive bout of easy financing for the banks in the next few weeks, likewise the Federal Reserve. But the Chinese have already acted. Why?