IT’S amazing how short term our memories are.
The economic boom of the last few years was just that, a boom. Why then is it human nature to kid ourselves that it’s the norm?
Just as we build an extra lane on the motorway, so it becomes congested. Pay us more money and bonus us for big profits and we spend and borrow money as if the days of boom and bust have gone forever. (Granted, those of you in Britain were told by your now Prime Minister that this was the case.)
Cast your mind back only a year and even then, news reports still talked about the rates of growth being “disappointing” if they were lower than the previous year’s. But the previous year was the most spectacular in recent economic history?!
But such is human nature. Gordon Brown told the British people he was prudent. He also told them as recently as March 2007 "…we will never return to the old boom and bust."
In March of this year, Chile’s leader, Michelle Bachelet, reasoned that Chile was in good economic shape "because of our decision during the good times to save some of the money for the bad times."
This is good old-fashioned common sense of course, but it seems that we do let both our optimism and our pessimism run away with us. Just as the economy will eventually recover, so it was plain that the good times couldn’t last forever.
One consequence of the boom years has been a rise in base salaries for many in the shipping industry, brokers and superintendents alike. They are now much higher in real terms than they were at the beginning of the decade.
Some employers may worry that with fixed costs that much higher than in the past, they will struggle to cope. The good news though – compare the salaries of many brokers and superintendents with those of many other professions outside of shipping and it seems not unreasonable to suggest that at least the vast majority should nowadays be able to live on their base salaries.
It wasn’t always the case. When Spinnaker was set up in 1997, nearly all shipping folk complained, and with some justification, of being the poor relation.
Those who have over-borrowed and are reliant on their bonus might reluctantly think they have more in common with Gordon Brown than Michelle Bachelet. They’re still unlikely to vote for him though!