Thursday, March 18, 2010
The Global Economy -Yuppies, Whoopies, Poppies and Ninjas
Over the past 30 years the global economy has been governed by consumption - so it is said - rather than production. During this time the media has produced abbreviated names for groups of persons associated with the way they lived and their typical consumption - or lack of it. The importance of these groups has changed over time and in doing so signalled new phases in a 30 years history of the global economy.
Phase 1: The Yuppies and the Demand-Led Economy
In the 1980s the black-suited, keen-eyed, well-degreed, sore-nosed and suitably deodorised 26 year old lawyer of either sex was generally known as a Yuppie - a Young Upwardly-mobile Professional Person
The Yuppies were at the cornerstone of the social revolution of that decade. Assumed to have risen from anywhere by virtue of merit he/she was going places by virtue of no-nonsense attitude, drive and will. They had money, even though their parents may have been shopkeepers or other self-employed. They began to vote Conservative in the UK and middle-of-the-road liberal on the continent of Europe. Their no-nonsense and self-made-person-attitude, their high spending and demand for luxury was the bedrock of the sweeping changes made by the Thatcher-Reagan coalition in the Anglo-Saxon world
Some Yuppies restrained their power of reproduction in a desperate attempt to cling to their two-seater cars and their no-baby-sitter-necessary social gatherings and retain their status as Dinkies - Dual Income no Kids. The taxes and money from these groups helped refurbish the Keynesian demand-driven economy but via the private, rather than the public sector. It was they who answered to all the surveys that they 'had never had it so good', who promoted tourist investment in exotic places, who employed, at outrageous prices, installers of kitchens and plastic windows, and established the market for luxury sports cars and leather sofas.
But it is not often realised that while the Yuppies captured the cult status there were some older beneficiaries of the 1980s boom - some even parents of Yuppies - who were quietly accumulating appreciating property, secondary residences and stashing money abroad. As the Yuppies morphed into balding over-mortgaged men or mid-life crisis women their role as movers and shakers of the global economy was over.
Phase 2: The Whoopie Factor in Global Finance
It was the turn of the ossified Yuppies. First known as the "greys" because they were in early retirement from 58 years old but it soon was clear that these were not your ordinary zimmer-framed, full-set greys. This variety dyed their hair, pulled out their savings and emerged as - Who(o)pies - Wealthy Healthy Older Persons. A suitable name with the extra 'o' because in English "to make whoopee" is to"celebrate noisily, often indulging in drinking an engaging in uproarious festivities". No one really noticed them until they started to emerge in their droves, yachting timorously around the coasts of the Mediterranean, deck-chairing on Wednesdays, spending their black and grey money in Cyprus, inviting friends to their renovated secondary residences, complaining about the concierge, squeezing into designer jeans and wondering how to clean trainer shoes
But the Whoopies have a greater global dimension which neither the Dinkies nor the Yuppies ever had. They had spare cash to invest derived either from the bubble in their past life, or from downsizing from an over-priced three bedroom to a smaller but luxury flat. But their investment tastes suited their biological beings. They sought exclusively high return, short term, no-risk ventures. High return because they want to spend it now, no risk because they can't earn any more and short term ... well they are, by definition, approaching the time when kicking the bucket is around the corner. They turned Keynes aphorism that "in the long-term we are dead" upside down because, in the case of the Whoopies, it is the short term in which they would be dead.
They have, with this biologically induced short-termism, helped unbalance the world economy by panic withdrawals from high-risk, short-term investments and by refusing to lend for long-term mortgages. Surging their money in and out of countries like Thailand contributed to the Asian financial crash of the late 1990s. Their lack of long-term investment squeezed the mortgage market and encouraged short term lending for longer term projects.
At the end of the 20th century the Whoopies presence began to weaken. The squeeze on pensions, declining interest rates and increasing investments risks meant their conversations became laced with words and phrases as "fairness", "double cross" and "having worked for all this".
The Whoopies place in the world was under threat.
Phase 3: The Poppies and Ninjas Strike Back
It was not only the economic backwash from the actions of Whoopies but oppositional social events also started to occur. Whoopie excesses perhaps prompted the formation of a new bloc - Poorer Older Pension Persons - the Poppies. Poor pensioners began to resent every cent spent on conspicuous consumption despite a massive media attempt to get them to admire high-spending, so-called celebrities. They tend to see anything mainstream as suspect and so vote for populist outliers as they did for Le Pen in France in 2006, for the "No" vote against Europe and very soon for any political adventurer who declares an opposition to the hyped-up wealth images in the hands of young professionals and old retirees.
And the Poppies may not be alone. In the late 2000s another group with similar attitudes emerged. The sub-prime mortgage crisis in the USA and elsewhere gave birth to the Ninjas - the No Income, No Job, or Assets people. They were given unsound mortgages by desperate ageing Yuppies when the Whoopies refused to do so. The Ninjas brought down the banks in the USA and elsewhere where their worthless debt had been spread - or rather allowed the banks into the golden pig trough of taxpayer's money. Ninjas are increasingly not to be messed with. Their habits, attitudes and life-style, freed as they are from a 50 year old mould of social restraints, are constantly requiring new controlling legislation and when they are ethnically or religiously mobilized they become the current obsession of politics.
And so now behind the tranquillity of the silver-haired, bonus-taking Whoopie and the envious but supportive ex-Yuppie reading the "How to Spend It" supplement from the Financial Times lurks the worrying shadow of a new force in the world of abbreviations - a Ninja-Poppie alliance.
WHO(O)Pie = Wealthy Healthy Older Person
YUPPie = Young Upwardly Mobile Professional Person
DINKies = Dual Income No Kids persons
POPPie = Poorer Older Pension Person
NIJA's = No Income No Job or Assets persons
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