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Category: Outlook & Reviews

“Not again…”

It’ s not a very worthy thought, I’m afraid, but I must admit it was my first reaction on seeing the terrible pictures from Beirut on August 4th. The explosion that ripped through the centre of the historic and much troubled Mediterranean city was captured from many different smartphone cameras, and watching the expanding vapour cloud from the supersonic shockwave, and witnessing the sheer size of the explosion, it seemed immediately evident to me that it had to be a high explosive responsible, not the fireworks that could be glimpsed sparkling beforehand in the smoke from the burning warehouse. The rising cloud of orange-brown nitrogen dioxide that followed the blast was the clincher – it looked like it was ammonium nitrate yet again.

Damned lies and statistics

“T here are,” Mark Twain once remarked, “three kinds of lies: lies, damned lies, and statistics.” It’s certainly difficult to know what to make of economic statistics and indicators at the moment, in the world turned upside down that the Covid-19 pandemic has delivered. Here in the UK, we are told that April and May saw the national economy contract by 25%, the largest fall in 300 years of the Bank of England’s economic record keeping, and the situation is very similar across much of the developed world. But how real is that figure? After all, we were all sent home in March, to ‘lock down’ and prevent the spread of the virus, and we are only now starting to move back towards some semblance of normality. Some of us, fortunately or not, have still been able to work from home, but for much of the economy, especially for much of the service sector; tourism, travel, restaurants and hotels, theatres and cinemas – there has been zero activity. Remove half of the largest sector of the economy for three months and surely a 25% fall in output is exactly what you’d expect? But is that real, or just a number? Has that activity gone for good, or, now that we are emerging, blinking into the sunlight again, can we switch the economy back on again as easily as we switched it off?