Firstly the downgrading of the UK's credit from AAA to AA1 caused very few waves; the reason for this is simple - because the UK controls its own money printing machine. Unlike in France, Italy, Greece, Spain where the downgrading of an individual nation who uses the Euro can force up the interest rate at which it is forced to borrow money if it wants to maintain its expenditure, the Bank of England simply steps in and buys up the debt and in sufficient quantities to artificially lower the interest rate to whatever the Bank of England wants it to be.
What has happened is that the value of £1 has fallen against other currencies, which is making all imports that much more expensive... expect the rate of PRICE INFLATION to continue to increase, I would say that it will go up from its current 8% (using the shadow statistics produced using old government methodologies) to over 10% in the next twelve months. Of course the government is likely to tell you that it remains at 2%.
The Italian elections have ended in the inevitable uncertainty and their interest rate has soared and with German hands on the Euro printer, there is just not much forthcoming.
There has been much talk of an end to austerity, but fundamentally if you do not have any money, then it is impossible to spend it.
Perhaps we will really see some government austerity where it truly matters in the profligate waste that is bureaucracy.
Back on the Island and one of my major election campaign themes is now front and centre... the battle between the JFSC and the finance industry. You may wonder why it was part of my campaign, well someone has to being these matters to the public's attention, to start the public debate and in the time since there have been many voices echoing my opinion.
The finance industry exists to punish the most profligate of bureaucracies by allowing those with the most capital to avoid suffering as a result of the excesses of government. The finance industry requires discretion, which is why both Jersey and Switzerland have lost significant business since they sign the agreement sharing treaties with the EU. Most of the business is moving to Singapore.
The JFSC has adopted a very strange approach to regulating the finance industry, a good analogy would be if the Police were to decide that the best way to prevent disorder were simply to kill all the people. It has a certain logical basis; and would certainly achieve its aims. Another solution which would work would be for all laws to be repealed.
So not content with already losing its market share, the JFSC has decided to speed up the process and bring the inevitable calamity on Jersey all the sooner.
So with the JFSC working to foment economic contraction in terms of the number of pounds generated, with the UK looking to devalue each and every one of those pounds and a States of Jersey still determined to spend our tax like there is the same infinite supply of money that the UK enjoys thanks to its printer, everything seems to be headed towards one inevitable conclusion and at breakneck speed.
The government actually appears to believe its own hype; that the fairy will descend and with a wave of his magic wand and a little bit of fairy dust everything will be back to better than life.
