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Microbusiness Taking on The Zombies
The dilemma in the UK economy for microbusiness is not helped by banks hiding their bad loan books by propping up "zombie companies". Alex Barrett explains the problem in historical context with the added complications of nationalised banks
Two reports published this week by the British Bankers Association and R3, the UK Insolvency Practioners body, have been carefully analysed to extract the information relevant to microbusiness enterprises with key statistics and comment.
With his usual insight and analytical gaze Barrett takes a wider view than many other commentators and reviews the respected analysis from the University of Tokyo in 2010 in regard to Japan's solutions to their zombie company crisis of the 1990s.
History does not repeat but it rhymes, so they say and the lessons learned in the Japan crisis are not necessarily those that will apply to current circumstances particularly with the dilemma of having partly nationalised banks holding on to extensive bad loan books.
The Chancellor of the Exchequer, George Osborne is faced with an impossible choice, whether to force the banks to face the truth and kick-start the economy with the necessary fallout that will entail or continue the slow salami slicing of public sector spending.
Microbusiness could take advantage of a truly free market but stagnates in the current climate where large "zombie" corporations are supported with effective subsidies from the taxpayer.
Read the full article in the Glass Box Blog http://wickit.co.uk/
Page Updated Last on: Nov 24, 2012