MPC Member: “We need to talk this up now”

Not my words but the words of one member of the Monetary Policy Committee to a client of mine a few weeks ago. The man in question, Andrew Sentance, is concerned that, despite all the ingredients being in place for economic recovery, we will manage to snatch defeat from the jaws of victory.

And he should be concerned if you look at today’s business pages dominated by the financial crisis (sorry ‘contagion’ must remember to be more hyperbolic) in Ireland.

However, it is noticeable that the negative news bias is increasingly bearing no relation to company and market performance. The FTSE 100 has moved up nearly 1,000 points since July and today’s company results show enormous progress across a swathe of sectors. EasyJet has seen profits triple in the last six months. ITV has seen revenues rise by 16 per cent due to an advertising recovery (yes you read that right, an advertising recovery!). Luxury fashion brand Burberry has reported a 49 per cent rise in first half profits. British Land reported a 4.2 per cent rise in net asset value.

These are all very positive results in sectors, namely luxury goods, air travel, property and advertising which have been, excuse my language, mullered in recent years.

So in my self-appointed role as the guardian of economic optimism, we need to heed Andrew Sentance’s words and start talking this up!