Clarkson on: finance
Due to the unique way the BBC is run, I’m writing this several weeks before you actually read it, so I have no idea what state the world’s finances are in. But I bet they’re not pretty. And I bet the problems are very, very far from over. In fact, you are probably looking at your pet goldfish right now, wondering what it would taste like...
It is extraordinary to think that in the last few weeks, Lehman Brothers, AIG, the Bradford & Bingley, Washington Mutual, Northern Rock and Fortis – as well as two banks in Belgium, one in Germany and one in Iceland – have all either gone, or been Communistised.
This, in case you are eight, and you have no idea what I’m talking about, is like waking up one morning to find Toyota, Volkswagen, General Motors, Mercedes and Renault have all been made bankrupt. Which, I’m fairly sure is what will happen next. Along with every other company and person and government in the world.
The problem is simple. For the last few years, most banks have been lending more money than they have. They’ve been living in a never-never land where they could borrow a hundred quid at three per cent interest and lend it on at five. They must have known that one day, the whole pack of cards would come tumbling down, and so it did when some Mexican bloke woke up one morning and thought, “Shit. I can’t afford my mortgage any more.”
The upshot is that today, the surviving banks are extremely reluctant to lend money to anyone. So when a pottery company in Stoke gets into trouble, the management won’t be able to borrow their way round the problem. They’ll go bust. This means their workforce will be made redundant, which means they won’t be able to afford to keep paying their mortgages. Which means their houses will be repossessed by the banks, who will have to sell them off for 50p. Because no one’s buying. And that will make the banks even less likely to lend, and so we find ourselves into an ever-deepening spiral of recession, doom, crime, terror and disharmony. Only James May is likely to survive, with his fire-resistant hair and his cast-iron wardrobe.
For the next few years, you’re going to think a pork chop is the last word in decadence. What’s more, your children will get a lump of coal for Christmas, and they will love it. They will give it a name and play with it, like they used to play with their private parts. Before you had to sell them in exchange for some rice.
This means Sony won’t sell any PlayStations, which means they will have to lay off their workforce, which means the problem will spread to Japan. And China. And India. So, thanks to the bone-idle Mexican who borrowed half a mill to buy a stupid prefab house, the whole world has had it. You’ve already lost your savings. Soon, you will lose your job. Then your house will go, and the only way to survive will be to murder the postman and eat him.
As a result, no one’s going to be buying a new sofa on credit any time soon, partly because there won’t be any credit and partly because there will be no sofa companies. And, of course, if you can’t get a loan to buy two bits of button-backed leather and some fire-attracting foam rubber, you sure as hell won’t be in with much of a chance of getting a loan to buy a new car. Which is why we shall be waving goodbye to Volkswagen, General Motors, Toyota and Renault. Ferrari? I bet they’ve gone already.
"Banks have been lending more money than they have. They must have known one day it would all come tumbling down"
Have you seen 28 Days Later? That film where a plague kills everyone and, strangely, removes all cars from the planet as well. Well that’s what the streets will look like. There will be utter desolation, apart from a few eco hippies running around rejoicing because, at last, they’ve got what they’ve wanted for so long.
Naturally, you imagine that governments won’t allow things to get this bad. Really? Because, as I write, the debt carried by Iceland’s banks is six times higher than the country’s entire GDP. Then there’s Ireland, which has guaranteed every saver’s deposit account, even though a catastrophic failure of the system would leave them with a bill three times higher than the country’s entire annual earnings.
Of course, governments could get round the problem by increasing taxes, but what’s the point when everyone is unemployed so no one’s paying tax anyway? Or they could print money, which will lead to massive inflation. A loaf of bread will cost £8,000 trillion, so the £8,000 savings you took out of the bank in its last few days of solvency and hid under the stairs is not going to be enough to buy even a paper clip, leave alone a VW Polo. It’ll be goodbye Nissan Z car, hello Zimbabwe.
This will cause lots of governments to borrow cash which they won’t be able to repay. So they’ll go bust as well. Which means the army won’t get any money so when civil disobedience begins – and it will, when everyone has eaten all the postmen – there will be no one on hand to sort it out.
Of course, because no one will have any money, no one will be buying any oil which will cause massive pressure in Iraq, which will turn into a blood-bath as all the Middle Eastern states pile in, and the West is unable to stop them, because America’s gone tits up and Sarah Palin’s back in Alaska burning polar bears to stay warm. And remember, this is all because a Mexican man chose to fill his pickup with fuel, rather than pay his bloody mortgage bills.
Meanwhile, all schools will have closed, and the only people to survive in Britain will be those with pigs, sheep and vegetable gardens. And guns, because at night, those without such things will come round and try to steal yours. You may very well have to die defending your cabbages.
The only solution, so far as I can see is to bomb, immediately and extensively, the whole of Mexico. Not only would this be a punishment for their slap-dash accounting, but also it would be a deterrent for those in the future who think, “Nah. I can’t be bothered to pay off my mortgage. I’d rather buy some sweets.” We may have to shoot a few bankers too, to bolster morale.
Of course, it is possible, I’m sure, that by the time you read this, everything has sorted itself out. Inflation is low, Mercedes are recruiting staff to cope with demand for S Classes, the eco hippies are back in their box, writing silly press releases about climate change Armageddon and your kids are getting a quilted Bentley laptop case for Christmas. In which case, I can only apologise and explain that, thanks to the unique way the BBC is run, I wasn’t to know.
N.B. I am indebted to a chap called P. Chislett from Dover, near France, because he has sent me a copy of the Highway Code and a note, saying, “Re your ‘attitude on Top Gear’, I think you should read the enclosed.”
Sadly though, Mr Chislett, I have read it, and it’s full of stupidity and factual inaccuracies. The braking distances, for instance: what did they use as a test car? A Ford Anglia?