Posted on 25/02/2010 at 16:20 by Gary Wright
The thing I’ve resented most about the Credit Crunch has been how expensive it’s become to go abroad.
But that’s about to change.
As the pound collapsed, amid the various banking scandals which caused our world recession, I watched the value of my holiday pound go the same way.
This was in large part due to our government’s solution to the problem, quantative easing - or printing money as most African dictators would know it. A cheap pound makes our products more saleable abroad, unfortunately we don’t produce much and our one big skill – financial services – is no longer in such great demand.
And weren’t our foreign chums across the Channel happy. Germans, Belgians (sorry about Nigel Farage MEP, by the way) and French quickly realised Angleterre was the place for a bargain.
So they came across here shopping for clothes and shoes (not actually much foodstuff, mind) then and wondered why we weren’t visiting Calais quite so often any more.
Well you wouldn’t, would you? Since Tesco wine’s cheaper over here and I’m not totally comfortable paying eight quid for a bit of cheese made from sheep’s milk.
Anyway, the annual Wright family excursion has been a little squeezed over the past couple of years because of GB Ltd’s financial mess.
Portugal and Mallorca, turned out to be a bit pricey last year and even Turkey – which is not part of the EU, no matter how much they want it – the previous year admitted prices were up and the Brits weren’t spending as much.
No wonder, I can get a fried breakfast cheaper in a transport café here than I could in sunny Marmaris. And that’s not the way it should be.
Because the idea of holiday abroad is that it’s so cheap you can come back home and tell everyone how four of you ate out, drunk gallons of the local beer/grappa/vino, took a taxi home and still had pesetas/dracma/lira left out of £10.
But for the past 18 months we’ve had to scrimp and visiting the Mediterranean hotspots has become a bit of an expense really.
However, those nice Greeks are set to make it all better again.
I love Greece. Holidays there have always been fun, sunny and pretty cheap.
But the country’s in financial trouble. Real financial trouble and the country that has employed another 72,000 people in the public sector to keep unemployment down, is finally having to face up to reality.
France and Germany are pretty cross with Greek Prime Minister George Papandreou since they have pretty much propped up the Euro while our Mediterranean pals (not just the Greeks) enjoy the benefits of stable interest rates and currency exchange.
Merkel and Sarkozy alongside the International Monetary Fund have given George a bit of a kicking, demanded he cut borrowing and cut spending otherwise the country’s internation credit rating will be moved down to the level of Zimbabwe.
The Greeks might not like it, protestors took to the streets yesterday apparently – I bet it didn't happen between 12 and 4pm. (Remember this is a country where about a third of money earned is never subjected to income tax).
The Greek spendathon has highlighted a dangerous weakness in the Euro proving that an interest rate and currency that stretches across borders 2,000 miles apart won’t work unless everyone is sensible.
And that means the Euro will become less attractive, it will fall in value and WE Brits can enjoy cheap holidays again.
Sangria or Retsina all round then on me.
Economics, why do people make it so complicated?
Note: There are of course some so called financial experts who think that Greece's decline could be followed by Britain, if the IMF have a proper look and we don't get our house in order
What? Do they think GB has created thousands of 'non-jobs' in the public sector to keep unemployment low (Five a Day Co-ordiantor anyone?), or that we have borrowed way too much to bail ourselves out of our financial woes?
What do they know? Of course we have an advantage that we are able to print more money (unlike any country with the Euro) and adjust our interest rates and...
OK, take your cheap Mediterranean holiday this year, the second the Euro collapses – we might be right back down there next year.