Black cab barometer
Thursday night, as I was coming home from work in a cab past 1am, the cab driver told me that there's an old saying in the cab business that when the black cab business sneezes, the City of London catches a cold.
And he told me, that the black cab drivers knew, from May last year, that 2008 was going to be a bad year for their business and the economy, so they had all started to tighten their belts and manage their expenses in preparation for the coming winter.
He works in co-operation with a cab company that serves several bulge bracket investment banks in the City. This time last year, he said, the business from the investment banks accounts for about 76% of his monthly income, this February, the banks only accounted for 11% of his monthly income (and that's not because his income has increased exponentially). In his 20 years of working as a black cab driver, he's kept daily and weekly accounts of his earnings. And he said that this Monday was his lowest-earning Monday in 20 years, and this week was shaping up to be his lowest-earning week in 20 years. It's mever been this bad, and he doesn't think things are going to change for quite some time.
This is a sobering thought for someone in banking who's never been through the bad times. Especially when I'm thinking of buying a place. Confidence seems to be at an all-time low and it looks like it's going to take a long while to recover. And it looks like it's going to be one long, lean winter. I only wish this reality would sink into the consciousness of London home-sellers.
And he told me, that the black cab drivers knew, from May last year, that 2008 was going to be a bad year for their business and the economy, so they had all started to tighten their belts and manage their expenses in preparation for the coming winter.
He works in co-operation with a cab company that serves several bulge bracket investment banks in the City. This time last year, he said, the business from the investment banks accounts for about 76% of his monthly income, this February, the banks only accounted for 11% of his monthly income (and that's not because his income has increased exponentially). In his 20 years of working as a black cab driver, he's kept daily and weekly accounts of his earnings. And he said that this Monday was his lowest-earning Monday in 20 years, and this week was shaping up to be his lowest-earning week in 20 years. It's mever been this bad, and he doesn't think things are going to change for quite some time.
This is a sobering thought for someone in banking who's never been through the bad times. Especially when I'm thinking of buying a place. Confidence seems to be at an all-time low and it looks like it's going to take a long while to recover. And it looks like it's going to be one long, lean winter. I only wish this reality would sink into the consciousness of London home-sellers.
