economonkey

(or “Stop talking us into a recession!”)

In recent months I have read, in newspapers and online forums, and heard, from some genuinely interested people and a few incurable optimists, the proposition that the problems in the financial system are somehow due to ’scare-mongering’ in the press. Depending on your bull/bear persona, it’s easy to agree or disagree with this proposition without actually thinking too much about what it means.

So let’s take a step back and consider the fundamentals. First, the mass media obviously influences public opinion. There can be no doubt about that. If it didn’t, it wouldn’t exist; it would have no political role and no advertisers would be interested in paying to be a part of it. Television and newspapers have finely-honed psychological hooks, and although they’re suffering because of the accessibility of more credible information on the Internet, they know how to drag their readers in with a good, emotional (but seemingly rational) headline and story.

As we know from experience, when every newspaper and television channel is exhorting people to buy into the housing pyramid scam (sorry, market) because ‘house prices only go up’, and using fear and greed to push that message home, it has an effect; first on the psychology of the public and then on the market pricing.

I am writing to enquire whether you have any vacancies on your strategic board for someone of my talents. I realise that it is a little unorthodox to apply ‘on spec’ for such a high-ranking position within your organisation, but I believe I have the necessary skills to further increase the profits and assets of Big Bank Plc. In this letter I will attempt to demonstrate my knowledge of the challenges and opportunities in our marketplace.

1) Who are our customers?

I understand that our most lucrative customers are those with the least awareness of financial matters; indeed, the less numerate they are, the better. Rather like the dear old PM, in fact.

If they don’t know the difference between APR and AER, if they fail to read the small print in their credit contracts - not that it matters, as I’m sure I have the necessary legal skills to make such text impenetrable - and if their limited attention is grabbed by an ‘introductory’ rate, then they are exactly the kind of people we need to target.

I think that if we closely follow that other highly successful model of commerce - drug dealing - we won’t go far wrong in attracting and retaining the right customer base.

2) How do we get people to take on more debt?