Vote Seekers Toying with Business | Knutsford Times

Vote Seekers Toying with Business

By on July 6, 2009

As I sit here writing my second expose on global trade, the baby behind me begins to scream louder, my left ear starts to thump like a fat clock, I begin to frantically search for my I Pod only to be informed that it must be turned off.

As problem child’s cries begin to subside the most monstrous of all voices booms over the intercom to tell us what to do in the event of an emergency. I can only hope that if I do end up in a boat adrift the north sea, it wont be with her, and if I do, I hope that both my ear drums are perforated by the screaming baby on the way down.

The Düsseldorf to Manchester flight begins to taxi, I am only 3 hours away from the safety of the home. As we begin to reverse an anxious German women approaches the cabin crew, worryingly my fellow passengers and I on row one look forward. She brandishes a piece of paper . . . then in rather broken English she says ‘Am I on the right flight? This is the flight London Stanstead, Yar?’

The crew go into panic mode and out struts Captain Porn Star, a sort of cross between David Ginola and Bono. The voice of wickedness returns telling everyone to remain seated. The temperature rises in the cabin, as it does for the virgin German traveler who is now as red as a fire engine.

After much of what I can only imagine to be German swear words, the plane doors  finally open, I lean forward to investigate further and there at the bottom of the steps await a whole crew of airport personnel and security guards. Without daring to look back the woman embarrassingly begins to walk the stairs of a thousand stares and boards the lonely bendy bus that drives only her and any of the self esteem she has back to the airport!

Doing what I do and flying where I fly, I tend to see this sort of commotion on a monthly basis. This time I am on the return leg of my sales trip to Germany which happens to be one of our biggest markets. (I will however admit that sometimes I am involved and on the way out I did leave my passport at home, lost my boarding card and got stopped by the police).

On this particular trip to Germany we have visited four companies and every single time without fail the conversation covers the same thing . . . The global recession.

After probing a little deeper into the problems facing our customers we soon discover that one of the major problems for exporters around the globe is tightened regulations and rules laid out by politicians and particularly in America.

In America politicians have increased safety regulations to such an extent that conforming to them is financially impossible for many importers, they simply cannot abide and subsequently pass the responsibility onto the manufacturer. All three of our customers have had to stop supplying the USA completely because of these barriers to trade.

These policies obviously look great to politicians on paper but when you get down to the ground level and try and put theory into practice it just does not work.

Many of you will remember that in 2007 there were several major recalls of toys contaminated with lead paint affecting the worlds most respected brands. Further recalls of toys containing small magnets were then announced, involving millions of toys worldwide. Again, it was the big brands that were affected, such as the Barbie and Polly Pocket product ranges.

The cumulative damage caused by the overreaction to companies failed safety checks in what has been dubbed The Year of the Toxic Toy are subsequently huge.

I also suspect that there is an element of governments trying to boost internal economy. By tightening up on importers the governments naively hope to re start manufacturing from within the country however this will not work. The resources that were once in place are there no more, the skill base disappeared a long time ago, it would take years and years to get the industrial machine moving again and it will only further drain the economy at such an unstable time.

All this in effect causes slow economic recovery simply because the politicians have not properly consulted the industry and therefore they don’t recognize the potential implications of their ill-conceived plans.

So whilst it may sound like all is doom and gloom within global trade there are some opportunities to be found.

The Baltic Dry Index published by London’s Baltic Exchange to quantify the average cost of transporting dry bulk has sunk to its lowest in 24 years.

There has been a staggering 9% decrease in world trade, the worst contraction since World War 2, this is quite a lot especially when you consider 90% of world trade is carried by sea.

So surely it cannot get much worse for world trade, but there are ways in which you can make money in these uncertain times.

If you’re a good product person and like to trade you could take advantage of the free shipping being offered by many companies, the rates are so low that effectively all you pay for is fuel, or if you like the odd gamble why not place a spread bet on the Baltic Dry Index, because from the bottom of the ocean the only way is up.

Good Luck.

About Austen Smart

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