Confusion reigns. Trying to spot the prevailing trends in economic activity has proved far harder during the current supposed recovery than ever before. Many projections for business activity have been significantly wide of the mark as different sectors have identified signs of an upturn - or sometimes a downturn - only to see sales moving off in a totally unexpected direction. The result of all this has been fragile confidence and an unwillingness to invest.
The underlying cause has been the sharp shift in the balance of power between the providers of goods and services and their customers. The pull factor - what the customer wants to buy - has vanquished the push factor - what the supplier wants to sell - as the driver of economic activity.
Combine this with unprecedentedly low inflation and the result is a highly unpredictable business environment where economic patterns become increasingly fluky. Consumers are no longer fooled into believing that their real income is growing and are more reluctant to part with their money, just like the commercial customers who at last understand how their business is really doing once inflation is stripped out.
This all makes for a tough world in which to do business, particularly when the variability of demand is accompanied by pressure on margins.
The next few years will show whether suppliers of goods and services can meet this challenge thrown up by the free market. What is worrying are signs that many businesses are declining the challenge and running for cover, away from the market forces which they have espoused for so long and into the arms of interventionism. Straws in the wind are various: take the recent concern - in the City, of all places - that current recruitment packages are getting out of control, and the call by some of the leading investment banks for a gentleman's agreement on poaching and pay rates to prevent steep erosion of their margins. But the protectionist moves go far beyond that. Consider one of the new buzz-words - 'co-opetition'. A hybrid of co-operation and competition, it attempts to set up what Game Theory (as explained by Stuart Crainer in Not Just a Game, p66) describes as win-win situations, in which rivals find ways to ensure that their competition is 'healthy', and to their mutual advantage.
Co-opetition, which embraces concepts like 'strategic alliance', needs to be monitored very carefully. While co-operation is often the way forward within the supply chain, co-operation between competitors is market-rigging by another name.
Wrenching power back from the customer is not an unworthy aim in itself; indeed, the point of thrilling customers is to establish their dependence on you. But those who attempt to wrest this power by denying a free market to their customers, and possibly even to their employees, are retrogressing dangerously.