Our "ear to the ground" John Kennedy a leading figure in the capital's black cab community concludes that London has its own dynamic to prevent it going into a recession.

By John Kennedy

Which way will the pendulum swing recession or slow down, well if you happen to be in London over these next few week's just pop over to Harrod's and have a look at Petrodollars in action.

From Phantom Rolls Royce's, Maybach's, Range Rover's and the odd Mercedes manoeuvring around the rear entrance of this world famous store you would think London's economy was booming.

Well London's economy has slowed down but not to the extent that some journalists and commentators have been saying. Only last week I heard a well known business editor talk of the coming gloom with strikes by civil servants, inflation rising, interest rates remaining on hold and house prices falling. People our creating sensational stories to grab a headline by trying to compare now with the late 1980's, this is 2008 and the conditions are very different. In fact it is this type of direct comparison with past history that got a lot of bank's in trouble.

But let's look at the economy from a different perspective. The bank's that lost heavily by writing down large amounts of money are the same institutions that have been busy repairing balance sheets by re capitalising via rights issues, selling assets or equity stakes. The thousands of job losses predicted have not materialised just yet and hopefully they won't, inflation is rising and food prices too but is anybody honestly starving here in the UK ?

Unemployment still remains historically low and whilst people have jobs the vast majority will manage to survive higher fuel and food prices.

The Government is reported to be looking at increased borrowing, this may well be seen by some as a failure of fiscal policy, however if this action keep's the economy ticking over and staves off a recession what will the opinion poll's say about the Prime Minister Gordon Brown and his Chancellor this time next year, remember a week is a very long time in Politics.
I said this before but we can help by not putting up prices, by taking the hit now we can help to curb inflation, so wage restraint is required by us in the workforce, bosses and business leaders can help by curbing bonuses and pay rises, in fact they need to set an example and take a lead.

Tough times ahead but I am confident London will lead the way with foreign investment via petrodollars, a stronger banking community after the repairs made to balance sheet's and a Government that understands now is not the time to raise taxes. If we the workforce play our part better times will appear upon the economic horizon.