Afternoon:
10°c
The fireworks are over, the Christmas decorations going up. In any other year, we'd now be headed into the big buying frenzy. Just 48 shopping days to Christmas left, all days being shopping days now.
Except it's visibly not working this time, interest rate cut or no. If you wander into the stores, there may still be people there but they are behaving quite differently. They have an air of detachment, even disaffection. They pick items up, look them over, check the price, and then put them down. They often head back out of the store empty-handed, their urge to buy defeated by their wish to save money.
That's the West End. The scene at Westfield is different. Westfield is London's colossal new temple to shopping brands and it's certainly wowing the faithful. There's real excitement in the air as the crowds pack in, exhilarated by its scale and the sheer concentration of totemic brands. But are they spending enough to justify the place's lavishness? Even if they are now, will they want or be able to carry on doing so in January, once the credit-card bills have arrived?
One of the unnerving things about Westfield is that it is perhaps not after all a glimpse of the future but already an anachronism, a vision of the way the future used to look when it was conceived, only a few years ago but now an age away. Maybe it's not the first jumbo jet but the last of the Zeppelins.
Maybe after so many years of becoming more and more enslaved to them, we are at last beginning to tire of brands, even ceasing to believe in them. We're all hoping there will be some positive outcomes from the recession, new starts, getting back to essentials. Binning brands would surely be one major benefit.
Not a hope, according to the self-proclaimed "branding guru" Martin Lindstrom. His revolting new book, Buy.ology, is a gleeful account of how neuroscience can now be used to detect just how brands affect the brain. It has been discovered that when test subjects view images associated with strong brands, such as the iPod, their brains register exactly the same pattern of activity as when they view religious images. The emotional engagement is similar, he says, delightedly.
Lindstrom is sure that "our national obsession with buying and consuming is just going to escalate, as marketers become better and better at targeting our subconscious wishes and desires".
So recession may offer no escape from consumerism - just an ever-more-tormented urge to buy and borrow ourselves into feeling better. It's certainly going to feel quite strange going shopping this Christmas. If only it wasn't too late to call the whole thing off. But that's never going to happen. Christmas is, after all, the brand of brands.
Conflict of interest
So far, only two lenders have declared their intentions to pass on to borrowers the full extent of the cut in the Bank of England's base rate, which is now down to three per cent. We shall see how others react today. Right now, some institutions have withdrawn their tracker mortgages, which vary according to the base rate, for new borrowers. And close scrutiny of the small print on these mortgages reveals that if the base rates fall below two per cent, the banks will have no obligation to pass on the savings — which means these mortgage payers would not gain from any further swingeing cuts that may be made in the base rate. In other words, when interest rates rise, the banks win. When they fall, the banks don't lose.
The apparent refusal of the banks to pass the benefits of the rate cuts on to borrowers and credit card debtors is politically damaging. The Bank of England has done its bit but the banks are not doing theirs.
That looks like ingratitude. And the banks cannot take refuge behind the inter-bank lending rate, which is simply based on an average of their lending rates to each other. Many are now in hock to the taxpayer; they should act accordingly.
And celebrating...
Remembrance. This Sunday is Remembrance Sunday; it is moving to see so many people proudly wearing poppies in tribute to the members of the armed services who fought on behalf of all. The conflicts are still going on and our celebration of the brave dead should also include the living.
Reader views (2)
"Growth" is one term that has always confused me. How can we all expect to be green in a growing economy, with accompanying increased sales. The two seem to be opposite poles. Maybe all we need is a politically correct word for recession, a word which sounds bad to everyone. "Greening" of the economy?
- Naomi Sajeri, Manchester, 09/11/2008 06:37
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does anyone remember in the hitchhikers guide to the galaxy the twist that mankind was descended from a crashed ship of hairdressers and estate agents. Perhaps we can send all bankers and in particular "brand specialists" on a ship off this planet.
Regardless of how you spin it - all this Brand nonsense is basically a variant of the Emperors New Clothes - is invidious and buys into our insecurities. May its time be shortly over.
- Jc, se1, 07/11/2008 13:50
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