Turning Point by John Francis Kinsella
The arrows on the TV screen were red and densely packed, viciously sweeping northwards over the British Isles as yet another winter storm took hold of the UK and Ireland. O’Connelly thought grimly that it was not only the weather forecast’s storm that threatened those sceptred isles, the Icelandic syndrome seemed to be on the point of engulfing the two countries, for once united in their misfortunes, in the worse economic storm for almost a century.
O’Connelly had landed at Aerfort Bhaile Átha Cliath or simply Dublin airport for most people. The weather was a stark contrast compared to the bright and warm sun of Miami, however the economic climate was the same. Just two days after the festivities of Barack Obama’s inauguration the world was back to reality…crises and more crises.
Ireland was beginning to look like a banana republic with the UK was close on its heels — its economy looking like that of Italy or Greece, countries that in bygone years had been the nub of sneering British jokes.
There was no more doubt as to whether the shit had hit the fan or not making O’Connelly wonder whether he had made a mistake in buying his Dublin pad. After reflection he rationalized he had paid cash for it, easy come easy go. After all it was a nice home and the bricks and mortar were still there, better still the cost of living in Ireland would surely fall and he could even stop over in London on his way back to Paris where he could enjoy his favourite quick lunch in the Harrods’ food hall, now at a somewhat better price.
His San Francisco home had been little affected by the collapse in home prices. Home prices in towns like Bakersfield or LA Orange County had fallen fifty percent, whereas property in the greater San Francisco area, especially in the North East District, had fallen much less. If he had been forced to put his Telegraph Hill apartment up for sale he would have got a lot more than he had paid for it, though he may have had more difficulty in finding a buyer. Conrad Hilton’s words were still true for property: Location, location and location.
The background work for O’Connelly’s new novel showed that the recession in the UK was the eighth since 1945. So what was all the fuss about? In the more distant past, industry had brought employment and prosperity to Britain. It was the miracle of North Sea oil that had saved the country from oblivion under the iron hand of Maggie Thatcher.
Then came financial services a godsend for Tony Blair. But what could save Gordon Brown? Would something turn up? Or would he end up like Dickens’ father on whom Micawber was based? In any case Micawber had got his economics rights: My other piece of advice…. Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
More academic economists explained recessions come and recessions go! This one however looked like it would be more serious: Bank of England rates were the lowest since 1694, the Northern Rock was the first run on a British bank since the nineteenth century and the effective devaluation of the pound sterling was greater than any previous devaluation in the past century, even greater than when Ramsay MacDonald had been forced to abandon the gold standard in 1931, with the pound falling almost twenty five percent against the dollar. This time, and for the first time, the implications were global, on a planetary scale, the result of perhaps the greatest spending spree in all human history.
The middle years of the first decade of the third millennium had been wild, O’Connelly couldn’t call them the Roaring Tens — it didn’t sound right — perhaps Blair’s Cool Britannia years. In any case the period was well summed up by a speaker at a Montreal conference in 2005 as being:
… a duarchy with two principals, Blair and Gordon Brown, which promised to be the most creative relationship in British politics since that between Neville Chamberlain and Stanley Baldwin in the inter-war years. It is akin to the relationship between Asquith and Lloyd George when the former was Prime Minister between 1908 and 1916. As in that earlier relationship, much the more creative force was not the Prime Minister. Many of this government’s most enduring achievements, above all in the management of the economy and in welfare reform, are not Blair’s but Brown’s. Even the creation and consolidation of the New Labour vision owes more to Brown’s thinking than to Blair’s …
Brown’s leadership had brought the UK to the brink of financial disaster, the same Brown who had mocked the Conservatives in 1992, by saying: A weak currency arises from a weak economy, which in turn is the result of a weak Government.
In the meantime, if O’Connelly wanted to look after Jack, it was back to work, books would always sell, maybe fewer, but enough to ensure his now comfortable life would continue. There were also the film rights to tie up for his last best selling book that had been set in Israel and Gaza, a topic that appealed to Hollywood. Whatever happened, when the crunch came, bread and games would be necessary for the mob he thought without the least cynicism.
The hard facts were there, only a year ago his savings and investments were earning six percent interest providing him with a comfortable one hundred and fifty thousand dollars a year. Up to that point he had not thought in euros or dollars, it was swings and roundabouts, and it would probably always be, what mattered was the quantity of either. His income on savings and investments was now down to two percent, a third of what it had been, that was bad news. He would have to rein in his spending like any salaried worker — a brutal tumble for a man who thought he had made it. O’Connelly like so many others suddenly found himself asset rich and low on liquidities.
At present the royalties from his publisher were still flowing in, but they followed the same sales curve as any best selling book; after reaching a peak they were bolstered by earnings from foreign translations. They then dipped, following a long downwards curve until they became a mere trickle.
He had lunched with his publisher David Hertzfeld at his luxurious South Beach home. Hertzfeld was keen to have a good novel on the financial crisis whilst it was still a burning subject; before it became too depressing for the reading public.
But writing took time, it was not glamorous like appearances on talk shows or filmed interviews, it was a solitary work, requiring sustained a daily effort, much research work, which O’Connelly carried out himself. Writing lines, finishing pages and of course the endless revisions and corrections. Swanning around the world certainly gave him ideas, but putting them on paper required serious application and a daily routine.
The news that the Anglo Irish was to be nationalized and forecasts that property could loose eighty percent of its value over the coming decade came as a shock. On reflection O’Connelly realized his Dublin house was paid up in full, and whatever happened to Irish banks and the country’s economy, the house would be still standing there, exactly like it was the day he bought it, and it would be still be there in weeks, months and years unless there was an earthquake.
What he found grimly amusing were the resignations of the Anglo Irish Bank’s top management after the revelation that one hundred and eighty million euros in loans had been made to its directors for investment in property funds and other get rich quick schemes. All good stuff for a story once the dust had settled.
Home
O’Connelly had landed at Aerfort Bhaile Átha Cliath or simply Dublin airport for most people. The weather was a stark contrast compared to the bright and warm sun of Miami, however the economic climate was the same. Just two days after the festivities of Barack Obama’s inauguration the world was back to reality…crises and more crises.
Ireland was beginning to look like a banana republic with the UK was close on its heels — its economy looking like that of Italy or Greece, countries that in bygone years had been the nub of sneering British jokes.
There was no more doubt as to whether the shit had hit the fan or not making O’Connelly wonder whether he had made a mistake in buying his Dublin pad. After reflection he rationalized he had paid cash for it, easy come easy go. After all it was a nice home and the bricks and mortar were still there, better still the cost of living in Ireland would surely fall and he could even stop over in London on his way back to Paris where he could enjoy his favourite quick lunch in the Harrods’ food hall, now at a somewhat better price.
His San Francisco home had been little affected by the collapse in home prices. Home prices in towns like Bakersfield or LA Orange County had fallen fifty percent, whereas property in the greater San Francisco area, especially in the North East District, had fallen much less. If he had been forced to put his Telegraph Hill apartment up for sale he would have got a lot more than he had paid for it, though he may have had more difficulty in finding a buyer. Conrad Hilton’s words were still true for property: Location, location and location.
The background work for O’Connelly’s new novel showed that the recession in the UK was the eighth since 1945. So what was all the fuss about? In the more distant past, industry had brought employment and prosperity to Britain. It was the miracle of North Sea oil that had saved the country from oblivion under the iron hand of Maggie Thatcher.
Then came financial services a godsend for Tony Blair. But what could save Gordon Brown? Would something turn up? Or would he end up like Dickens’ father on whom Micawber was based? In any case Micawber had got his economics rights: My other piece of advice…. Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
More academic economists explained recessions come and recessions go! This one however looked like it would be more serious: Bank of England rates were the lowest since 1694, the Northern Rock was the first run on a British bank since the nineteenth century and the effective devaluation of the pound sterling was greater than any previous devaluation in the past century, even greater than when Ramsay MacDonald had been forced to abandon the gold standard in 1931, with the pound falling almost twenty five percent against the dollar. This time, and for the first time, the implications were global, on a planetary scale, the result of perhaps the greatest spending spree in all human history.
The middle years of the first decade of the third millennium had been wild, O’Connelly couldn’t call them the Roaring Tens — it didn’t sound right — perhaps Blair’s Cool Britannia years. In any case the period was well summed up by a speaker at a Montreal conference in 2005 as being:
… a duarchy with two principals, Blair and Gordon Brown, which promised to be the most creative relationship in British politics since that between Neville Chamberlain and Stanley Baldwin in the inter-war years. It is akin to the relationship between Asquith and Lloyd George when the former was Prime Minister between 1908 and 1916. As in that earlier relationship, much the more creative force was not the Prime Minister. Many of this government’s most enduring achievements, above all in the management of the economy and in welfare reform, are not Blair’s but Brown’s. Even the creation and consolidation of the New Labour vision owes more to Brown’s thinking than to Blair’s …
Brown’s leadership had brought the UK to the brink of financial disaster, the same Brown who had mocked the Conservatives in 1992, by saying: A weak currency arises from a weak economy, which in turn is the result of a weak Government.
In the meantime, if O’Connelly wanted to look after Jack, it was back to work, books would always sell, maybe fewer, but enough to ensure his now comfortable life would continue. There were also the film rights to tie up for his last best selling book that had been set in Israel and Gaza, a topic that appealed to Hollywood. Whatever happened, when the crunch came, bread and games would be necessary for the mob he thought without the least cynicism.
The hard facts were there, only a year ago his savings and investments were earning six percent interest providing him with a comfortable one hundred and fifty thousand dollars a year. Up to that point he had not thought in euros or dollars, it was swings and roundabouts, and it would probably always be, what mattered was the quantity of either. His income on savings and investments was now down to two percent, a third of what it had been, that was bad news. He would have to rein in his spending like any salaried worker — a brutal tumble for a man who thought he had made it. O’Connelly like so many others suddenly found himself asset rich and low on liquidities.
At present the royalties from his publisher were still flowing in, but they followed the same sales curve as any best selling book; after reaching a peak they were bolstered by earnings from foreign translations. They then dipped, following a long downwards curve until they became a mere trickle.
He had lunched with his publisher David Hertzfeld at his luxurious South Beach home. Hertzfeld was keen to have a good novel on the financial crisis whilst it was still a burning subject; before it became too depressing for the reading public.
But writing took time, it was not glamorous like appearances on talk shows or filmed interviews, it was a solitary work, requiring sustained a daily effort, much research work, which O’Connelly carried out himself. Writing lines, finishing pages and of course the endless revisions and corrections. Swanning around the world certainly gave him ideas, but putting them on paper required serious application and a daily routine.
The news that the Anglo Irish was to be nationalized and forecasts that property could loose eighty percent of its value over the coming decade came as a shock. On reflection O’Connelly realized his Dublin house was paid up in full, and whatever happened to Irish banks and the country’s economy, the house would be still standing there, exactly like it was the day he bought it, and it would be still be there in weeks, months and years unless there was an earthquake.
What he found grimly amusing were the resignations of the Anglo Irish Bank’s top management after the revelation that one hundred and eighty million euros in loans had been made to its directors for investment in property funds and other get rich quick schemes. All good stuff for a story once the dust had settled.
Home