Give the emperor a real set of clothes

Article Abstract:

Touche Ross' Christopher Morris estimates that there will be 25,000 business failures by the end of 1990, which would surpass the previous record of 21,000 set in 1984. Morris and many other economic and financial analysts blame the business failures on bad management, but the short-term nature of the economic boom between 1983 and 1987 indicates that the boom years were the result of sophisticated financial engineering, deregulation, and privatization, and were not the result of the creation of underlying worth. Companies met the pressure for higher returns by diluting their capital bases, which has left them ill prepared to cope with a downturn in the economy. The government must commit itself to a long-term strategy to boost consumer confidence, and lenders must reestablish traditional financing relationships.

Management, Business failures, Touche Ross and Co., Morris, Christopher

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No 'easy fix' for the construction industry

Article Abstract:

The UK construction industry enjoyed eight years of steady growth between 1981 and 1989 in which output increased to 34.7 billion pounds sterling from 25.3 billion pounds at 1985 prices. The construction industry is suffering a downturn due to the decline in the private housing market since 1988, and the likelihood of a decline in the private commercial sector have dashed hopes for an early recovery. There is doubt over the continued vitality of the public, non-housing sector as there is sentiment to reduce public and local spending. Coupled with a world recession and jitters over the Persian Gulf Crisis, indictors signal that the construction industry is in for a severe downturn for the medium term.

Construction industry, Housing

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