Ep. 134 – In discussion with Gerard Lyons
Described by The Times as ‘one of the leading analysts of the global economy‘, Gerard is a leading international economist with thirty years experience in the City and in the global and public policy debate. Last year he was considered as a contender for the role of Governor of the Bank of England. He focuses on being right, not on being part of the consensus. Gerard is able to bring to life complex issues and make them relevant to his audience in an interesting and easy to understand way, and has spoken to audiences across the globe.
In this deeply interesting episode, we discuss a range of his insights on issues including:
- The Three G’s (Grass Roots / Green / GeoPolitics)
- Perspiration and Inspiration
- Decentralisation of Growth
- Disruption and Dynamism
- Three Arrows Approach
Episode audio & transcript
Connect with Speakers Associates
Sean Pillot de Chenecey (00:06): Hello this podcast is care of Speakers Associates, the global speaker bureau representing a select group of the business world’s finest thinkers and thought leaders founded in 1999. Today Speakers Associates operate out of nine offices across seven countries covering the UK, Europe and Middle East. I’m Sean Pillot de Chenecey author of The Post-Truth Business and Influencers & Revolutionaries, which are being followed by The New Abnormal. In this series, I interview a range of fascinating individuals, proudly represented by the bureau. These change agents and industry experts give an update on their specialist areas of knowledge, and also on their motivations and viewpoints regarding the future of business.
Sean Pillot de Chenecey (01:00): So today I’m really pleased to be interviewing an absolute extraordinary individual, Dr. Gerard Lyons, the chief economic strategist and author speaker, and forecaster. Gerard is a leading international economist with 30 years experience in the city and in the global and public policy debate last year, he was considered as a contender for the role of governor of the bank of England. He focuses on being right, not on being part of the consensus. He’s able to bring to life complex issues and make them relevant to his audience in an interesting and easy to understand way described by the times as one of the leading analysts of the global economy, Gerard is always at the forefront of the economic and policy debate. He’s visited 84 countries on business and spoken to audiences around the globe. He’s testifying to committees of the us Senate and Congress spoken at the great hall of the people in Beijing.
Sean Pillot de Chenecey (01:54): And during the pandemic has testified to the UK treasury select committee, following his cutting edge, work on the economics of the crisis and how to exit from lockdowns during the vaccine gap, he’s been credited with great foresight, having made a number of correct non-consensus calls on the economic outlook. In addition to his economic expertise, Gerard has held senior business roles with leading international banks with a PhD from the university of London. He spent a quarter of a century in the city where his views were always sought by global investors. He then held a high profile public sector role for four years as economic advisor to Boris Johnson. When he was mayor of London now Gerard who has a portfolio of roles as shareholder and strategist with a cutting edge FinTech wealth management firm, net wealth. He’s on the board of the bank of China. UK is a senior fellow, one of the UK’s leading think tank policy exchange. And since its inception, he’s been on the advisory board of the environmental group, the Grantham Institute on climate change and the environment at the LSE and Imperial college. Wow. So Gerard Lyons, how are you?
Gerard Lyons (03:04): I’m very well, thank you. I hope you’re keeping well also
Sean Pillot de Chenecey (03:07): I grateful. Thanks, Gerard. With all the often fairly horrendous economic news around us, and I’ve got a lot of it spread of my desk, as we speak, looking back to a speech that you made last month at the recovery summit, organized by speakers associates, where I think they had just under 10,000 people from around the world, viewing and or listening in you gave a superb speech. It has to be said the, just the first sentence of which, or the first few words of which I’ll read, which is that the economic future is far brighter than you realize how pleased I am to hear those words. Gerard so please explain.
Gerard Lyons (03:43): Yes. well, I think it’s right to be positive about the longer term outlook being saying that at the same time, I think it’s vitally important to stress that there’s considerable uncertainty about the immediate near term outlook as we come outta this crisis, therefore one needs to be realistic about the near term challenges. We’ve been hit by a considerable shock. We are still in this vaccine gap phase. And unfortunately that means that some important sectors of the economy would not be able to return to normal until a vaccine is in place. And until people are able and feel confident about being able to go out as they did beforehand. So some key sectors of the economy would not be able to return to normal. And of course, it’s only when we have that vaccine that we can suddenly start to become completely relaxed about the longer term aspects of this virus.
Gerard Lyons (04:43): So I think in being optimistic, it at the same time, I’m recognizing that one needs to be realistic about the near term challenges by in terms of looking ahead, I think there are reasons to be positive. And in coming to the answer, let me ask what will change as a result of this crisis, but also for a business, one needs to also ask what will not change and what will still remain the same too often, we have looked the fact that some of the key underlying drivers that were were there before this crisis will still be there afterwards. And that the recovery summit, I was saying, the things that will change are best thought of by the three GS grassroots green geopolitics grassroots. This crisis has made many people and many businesses rethink, rethink and refocus refocus on what’s important from the bottom up important in terms of how they do their business.
Gerard Lyons (05:48): What’s good for their staff and also what’s necessary for their clients. This will be seen in a macroeconomic perspective by some firms taking more of their production back home, whether it’s to America, to Britain or to continent to Europe. So grassroots also seen in terms of how critical workers have come more to the fore in terms of public policy thinking, then there’s green. The green agenda, I think, has always been vitally important. And thankfully in recent years, we’ve had an increased focus on environmental change and climate change and what we should do about it. I think this vaccine gap phase has reinforced the lessons from the crisis that nature and the green agenda should be important considerations in the future. And I think that will become an more important issue. And then there’s geopolitics, even though on a day to day basis, we want to know what it means for us, what it means for not only our jobs, but also if we’re running a business, what it means for whether we’re going to get the revenues in.
Gerard Lyons (07:00): One also needs to look at the world from a big picture and the geopolitics are important. And I think that will become a vitally key issue in terms of the geopolitical tensions between America and China, and also how Western Europe, including Britain fits in. So grassroots green and geopolitics are the changes, but some vitally important features will not change perspiration and inspiration. And the shift in the balance of power, perspiration and inspiration were themes before the crisis. Perspiration is where are the markets? Where are the population changes, demographics, young markets in Africa, young populations across south Asia, young population in big parts of the UK and in America, older generations also vitally important in terms of spending power. So the demographics in terms of perspiration and inspiration, the technological change, and this has become an exciting aspect, but also a worrying feature for some people because artificial intelligence, robotics, technological change are important for all areas of our life.
Gerard Lyons (08:16): And for some people it adds to concerns about near term job prospects. But the last few months have brought technological advances more to the front of business agenda. And then the other aspect that will not change is the shift in the balance of power towards the, into Pacific, from India in the west to America in the east. And how will that impact economies and businesses in Western Europe, including the UK. So I think when one adds it all up, one needs to be realistic about the near term challenges, but at the same time, I think there are reasons to be positive about the longer term outlook and about the future and which every economy one looks at and this matters for whatever business you are running the outlook depends on the interaction between the economic fundamentals, policy and confidence.
Sean Pillot de Chenecey (09:09): Mm. How interesting frankly. And does that also link into certainly to me it appears that it does, and, and I know we’ve spoken before when, when I’ve interviewed you in the past, which was equally fascinating, but that point, remember you talking about one of your bestselling books, a consolation of economics, how we will all benefit from the new world order on linking to that I know also the at the recovery summit, you and I watched this only, again a couple of days ago on YouTube, the discussion you had with Professor Muhammad Yunus and there you spoke about and it’d be great if you could speak about this more now you talked about the shift from the G seven to G 20 over the last few years now becoming more acute and being a shift actually to G2. So again, I know you mentioned, you just alluded to precisely that, but perhaps you could just unpack that a bit more in terms of things like you mentioned things like, you know, a need to avoid protectionism.
Gerard Lyons (10:07): Yes. Well, the G seven is the largest seven industrialized economies and the G seven have met in an annual summit every year, since the early seventies. And it’s become more than an economic group. It’s become a political group, largely led by America at the time of the global financial crisis in 2008, the G 20 replaced the G seven in the sense that the G 20 effectively, but not exactly the 20 biggest economies in the world includes the likes of not just China and India, but other smaller economies, even Argentina is in there, even though their economy is not done so well. So the G 20 displaced the G seven and became a sort of greater fulcrum for sort of addressing the global agenda, but they haven’t done it particularly well, indeed on the Eve of this crisis, this coronavirus crisis, the G 20 met the finance ministers and central bank governors of the G 20 met in Saudi Arabia, but each year the G 20 rotates its presidency.
Gerard Lyons (11:16): So the person, the country in charge moves year after year. And while that sounds good, from a political perspective, it means that the policy focus changes and lots of things fall through the crack. So even though we were about to have a coronavirus crisis and even though the G 20 met the weekend, when Italy announced it was going into full lockdown COVID only merited one sentence in their communicate. You think, goodness, what were they talking about? Yeah. So I think the G 20 has missed the boats slightly, and that needs to change to become more relevant. Instead, what we are seeing is not only under president Trump but I think it’s a reflection that the political system in the states more generally America becoming more concerned about its place in the world. And at the same time, we’re seeing China becoming more important.
Gerard Lyons (12:08): It’s the second biggest economy and it’s becoming more dominant in other areas, the belt road initiative. So the G2 is the more important group, almost in the sense of America versus China. Now there are areas in which China and America are competing on economic grounds, but also there’s errors in which they’re cooperating. But at the same time, it’s not just economics. And if one needed a crisis to bring home to people, it shouldn’t just be about economics. This was the crisis. And when one looks at the G2 clearly has to be more than economic and financial issues. It’s about human rights democracy and the rule of law as well. And these are issues where some countries might have to choose aside. Now, if we’re looking at this from a British or a European perspective, I would argue there’s a need to differentiate between strategic issues and non-strategic issues.
Gerard Lyons (13:12): The strategic issues are important, themes, security, defense, intelligence issues, and then countries might decide to align with the us USA. But when it comes to non-strategic issues where one is setting a good or a service, then one’s looking at the global marketplace and therefore one needs to actually think about the markets that one can sell into in the future, but really in terms of the G2, it’s because there’s a greater angst about those security issues and a greater focus now, quite sensibly on human rights, the rule of law and democratic issues as well. But there’s no doubt that when one looks at it from an economic and financial perspective, the emerging economies led by China are coming more to the fore. And there are lots of issues and opportunities as well as challenges that come outta this for businesses across the globe.
Sean Pillot de Chenecey (14:13): Mm mm-hmm. And I’m sure on exactly that point that you, one of the points you just talking about, I know that certainly let’s say next year at the 2021 world economic forum meeting, which I’m sure you’ll be sort of heavily involved in as usual. I mean, it’s going under the title as you know, that the great reset. I, the other day I was launching a the launch of that, where cloud Schwab, the CEO that was talking about, you know, focus of that being diversity quality and social justice, justice actually links into exactly what you were just saying. But from the point of view of the, the issue, talking about, you know, strategic issues versus non-strategic issues, what about perhaps things that are even above that in terms of, you know, existential issues, which is exactly what you were debating with Professor Muhammad Yunus, when when you, he was talking about for instance being the fact that he was uncomfortable with the term recovery from the, and actually saying, you know, what, you know, along with all the horrendous misery, COVID 19 has actually done us all a favor because it’s put the whole economic machine to sleep.
Sean Pillot de Chenecey (15:19): The question being, should we break it up or not? You know, the, the system was pushing us, us all to disaster in terms of global warming. We had basically two decades left until we were at the end of a rope. We were now the decade of last chance now, from the point of view that the second of your three GS all things green. And I know that, that you know, for many years you’ve been on the advisory board of, you mentioned earlier on the environmental group, the grant them Institute on climate change and the environment. What about that? J just the, the, the stark issue that for instance, activists like extension rebellion were demonstrating about last year and are continuing to do so when it literally, where people are just calling to question the whole machine, as Xena saying, you know do we want to actually wake it up quite frankly or not? If it is potentially leading us all over the cliff,
Gerard Lyons (16:09): Absolutely. The machine needs to be woken up. In fact, in the discussion with professor Eunice given that you mentioned Davos, I was saying that each year when Mon goes to Davos the catch phrases committed to improving the state of the world and that conversation, I was saying sometimes when one turns up in Davos one wonders, whether it would be better to say committed to ensuring that nothing ever changes because the, there is a sort of four or five day gathering where people sound great and good, then they rush off and go back to doing their own thing. Anyway. Now on the climate change agenda, what I find encouraging is that we have seen a significant improvement, not just in recent years, but you could argue over recent decades and it’s often easy to overlook the improvement or the change that has taken place. What do I mean by that?
Gerard Lyons (17:09): If we went back 10, 15 years ago, it was center stage the debate that there was this conflict between economic growth and the environment, and in some respects, that was right to say it like that. But what I think has happened both because of personal behavior, consumer attitudes changing, and because, because businesses are more aware of this, we’ve now got to a good situation where it’s not growth versus the environment, but it’s no growth and the environment because there’s more environmentally friendly business practices coming to the fore consumers, not all of them admitted Italy and there’s reasons for this. We can come onto in a second, more consumers are aware of the environmental agenda, and therefore there’s more of an move towards an environmentally friendly business environment. So it’s not a case of growth versus the environment. It’s a case of growth and the environment working together.
Gerard Lyons (18:12): So it’s a long way to go. But with, we’ve seen this in the last couple years here in London, in terms of the financial sector where the aim is for the financial sector to fund more of the green agenda for businesses to be penalized and more risks to be factored in if they’re actually not taken on board the green agenda. So I think this crisis we’ve seen in the last few months with, for instance, say a focus on, let’s just take planes, obviously business travel leisure travel is important, but
Gerard Lyons (19:29): Now I’ve got three children they’re in their twenties, one’s a comedian, one’s a medic. She worked in the COVID hospital and my son’s just started work. So I see different agenda items and different issues when we chat about things. So one of the challenges, and I saw this with I, and sort of Gilbert in London when people work they often, at the end of the month, don’t have much money to spend and accommodation absorbs such huge amount of that followed very quickly by travel before you actually then get into any of these areas of so-called discretionary spending. I think what we need to focus on in the UK, but other countries are in a similar situation, is to actually provide an environment where the cost of housing is far lower. The cost of travel is environmentally friendly, but hopefully cheaper as well. And what we might therefore start to see is an agenda where the grassroots, as I touched them earlier becomes important, but also one can see it from a top down perspective in terms of not everyone needs to come and work say in the capital city there can be more decentralization of growth helped by broadband activity helped by the effect that you might be able to do things now in a more creative way as technology comes more to the for.
Gerard Lyons (20:59): But certainly coming back to your question, Sean, yes, things do need to change at the end of the day. We need to keep the things that work. But at the same time, there clearly is a need, not just on the environmental side, but in terms of sharing that success side to see how we can move ahead and businesses do need to succeed. Businesses still need to sell their products and their services but businesses need to be attuned to the changing consumer environment at home and overseas.
Sean Pillot de Chenecey (21:31): Mm mm. Absolutely. And I think it’s really fascinating how that absolutely. Even like sort mirrors for instance, I mean, other people, I know that you are very familiar with people like sort of Matt Ridley, his latest book, how innovation works. John Eton’s book, green swans in there he talks about, you know, as you said, if Nicholas Taleb’s Black Swans are problems that can take us exponentially towards breakdown, green swans are solutions that take us exponentially towards breakthrough and our success and survival now depends on how we reign in the first and accelerate the second. What about, I mean, some of the points you mentioned just now in terms of one specifically in terms of you’re talking about, you know, sharing in success, being so important, what about the view from the economist recently and, and the, and the way they were, you know, the three points they made really about where it was all going, totally mirroring yourself, where they’re talking about, you know, what are we seeing the big drivers or was it the crisis as they put it, but it will amplify three key trends, one the quicker adoption of new technology.
Sean Pillot de Chenecey (22:33): Secondly, a a sort of recasting of supply chains with perhaps firms becoming less profitable, but more resilient with resilience being such a key per point of our time. But this is what I thought was fascinating in terms of linking into the point you just made about sharing. They’re saying one of the real worrying points from the economist point of view, and obviously you think the economists quite often look at these issues from the left is autocracy with big, getting bigger as they put it a further and unwelcome rise in corporate concentration, that word unwelcome. Do you agree with that? That it’s a, we we’re seeing an, an unwelcome rise in corporate concentration, the rise of the oligo copies, as they say,
Gerard Lyons (23:15): Well, there’s a challenge here, both at a global level, but also within countries themselves take net wealth where I’m a shareholder, as well as the strategist. We’re an FinTech company. In some respects, we basically are an online discretionary wealth manager is more exciting than it sounds, but one of the reasons for going into this was that we felt that the industry basically was ripping people off. If you look at the fees in discretionary wealth management, which is basically managing your pension, managing your savings managing your ices technology allows you to actually do this at very low cost while at the same time, having people there to actually provide the service as well is not a case of suddenly it’s a robot, but you can actually have people, who’ve got the expertise using the best technology and to pass those gains on to the consumer.
Gerard Lyons (24:09): And what you, one of the reasons why I was attracted to this was that when I spoke to people in the industry just over four years ago, it was ripe for disruption. There was too many incumbent incumbents who had fat, healthy margins who were charging huge fees to justify a sort of maybe luxury or not. So luxury lifestyles for some of the individuals who worked in it. What we’ve done is pass the gains onto the consumer. So our fees are at a third or to a half of the industry average and our performance over the four years has been up there in the upper quarter. Now, I think this is relevant, cuz it shows my firsthand experience of what you see from the business side. And what you find as a newcomer is there’s lots of hurdles to cross. The challenge is, and it comes back to your question, the incumbents work with the regulators to say, oh, we need to put another regulation here.
Gerard Lyons (25:11): We need to put another regulation there. And before you realize it, whilst it’s important to have those rules and practices and processes in place to protect people, if you push them too far, what you end up doing is you allow the incumbent to become too cozy and you allow the customer to not benefit in the way he, she, or they should be benefiting. So I think we do need to see an environment where new businesses are not constrained by too many rules, too many regulations and indeed too many taxes. One of the challenges outta this crisis is that globally debt levels are now at an all time. High governments have rightly spent money to pull economies back from the brink. As we locked economies down, economies stopped unlocking is allowing countries to bounce back. But the same time at the end of this process, we will see most countries across the globe having higher levels of debt than previously, it would be wrong.
Gerard Lyons (26:21): If the governments, whether it’s Britain, America, or China or wherever decided to tax people. What we really need is to have a pro growth strategy, low inflation, low interest rates and low yields allow the current level of debt to be not a problem, but to be lived with. And then the debt in terms of GDP debt in relation to the size of the economy can be brought down over time. Now, the challenge coming back to your question is that if suddenly governments decide in addition to all the rules and regulations they’re going, they will now hit businesses with higher taxes. Then that makes it even harder for small businesses to make the breakthrough. So we do need to see a more disruptive environment. There’s no harm in bus, big businesses surviving and doing well, but they need to provide the services and the goods that their consumers now and in the future want.
Gerard Lyons (27:25): So I think we do need a more dynamic business environment here in Britain of the bulker businesses, the small businesses, small firms, family run, privately owned, and there needs to be a business friendly environment during the crisis. I did some pieces of work one with professor Paul onroad, he and I independently sat down and we proposed how to unlock the economy. We added behavioral trends from economics to the epidemiological models, the scientific analytical framework of these models. And we put forward a traffic like approach to unlock, which ended up being discussed by the cabinet. They didn’t adopt all the things. Unfortunately we suggested one or two other countries across the globe have though. But the same time I did some work at policy exchange and it was all about some of these issues you’ve talked on is about the policy the timely, the temporary, the targeted policy response to the chancellor, but at the same time, how do you make sure when we come outta this crisis, not only do individuals feel that they can either retain their job or find a new job, but how can we ensure that small businesses, as well as current firms are able to become innovative and dynamic allow the economy to grow.
Gerard Lyons (28:41): So it is about bringing things from the policy side to make them relevant for individuals and for firms themselves. So we do need to see a more dynamic business environment, certainly in Britain, but in many other countries as well.
Sean Pillot de Chenecey (28:55): Mm mm wow. Fascinating. Can I just ask on that last point, you just, you alluded to there the world of think tanks I’m gonna spend a lot of my time sort of floating around different think tanks and we’re certainly policy exchange. You obviously, of the right are and very much a, a leading think tank, but how do you just see you say the dynamism or not in the world of think tank. So if you’re looking everywhere from the left and the, the RSAs and the demos and the, I PPRS, et cetera, to the right, to the, the world of sort of, you know, center for social justice and policy exchange, I know ran corporation res public Adam Smith Institute. It seems that sort of policy so that sorry, think tanks go in and outta fashion. So, I mean the moment policy exchange are very much over the moment. Why is, why aren’t they, so, so over the moment, do you think, why have they got to pre say the such a high profile?
Gerard Lyons (29:53): Yeah. Why I’ve been involved in different think tanks over time? Gosh, Sy attach. I did some work with them. I think it was on pensions of years ago than CSJ in terms of UK productivity. So I’ve worked with think tanks from the left to the right, in terms of policy exchange. I joined them at the beginning of this crisis and we focused on what are the key policy issues. Mm-Hmm
Sean Pillot de Chenecey (31:06): Mm-Hmm okay. And then just to move on to another point and that is, and I sort of almost apologize for using a sort of a terrible word, but that we’d all rather hope to had perhaps quietly gone away Brexit you wrote a, you know, really interesting book a couple years ago, clean Brexit, why leaving the EU still makes sense. So perhaps just talk a bit about where you see us now and where the whole Brexit thing is.
Gerard Lyons (31:33): Yeah, well
Sean Pillot de Chenecey (31:35):
Gerard Lyons (31:37): That’s that’s right. It people probably feel, they would prefer to have talked about Brexit than viruses earlier this year, but it’s been good that Brexit has not dominated our thinking. Because as we’ve seen, there’s more important issues in terms of life and death through this virus, but in terms of making a success of Brexit, the UK needs to get three things, right. One is its future relationship with the EU and that’s where the dominant political and sort of media focus has been. But the other two issues are vitally important and that’s the domestic agenda. And also the UK’s position with the rest of the world. Now, in terms of the relationship with the EU, while politics clearly comes to the fore, I think it makes sense. And in all likelihood will be the case that the UK and the EU would agree to trade deal, because economically it makes sense for both sides to do that.
Gerard Lyons (32:39): The EU itself is driven very much by a political process. Tensions came very much to the four early, during this virus pandemic Italy, not happy with how they were being treated. It seemed, but I tend to think that they’ll, they will patch up these differences and move ahead. So one wants to see the EU succeed and one wants to see the UK succeed. So that bilateral relationship is key, but the domestic agenda, the UK is very imbalanced economy. The imbalance is a London versus the rest, urban, rural coastal inland all versus young homeowners versus renters. There are many things the UK should have done when it was in the EU that it didn’t do should have been doing this regardless of our EU membership. Now the UK is leaving the EU. I think the importance of addressing those issues comes very much to the four.
Gerard Lyons (33:39): As I say, they should have been doing those anyway. But the Le agenda is encapsulates this and then our position with the rest of the world, UK is a UN security member nation UN permanent five. I, I was asked about this on radio four today program yesterday, actually in terms of the UK China relationship. And the lady asked me, will China listen? And I said, well yes, in terms of depends like most issues, how you put your case forward, but the UK is a permanent member of the security council. It’s the fifth or sixth biggest economy in the world is a major military power. And also in terms of that question, yes, they, China in its next stage of development wants to move up the value curve. And the UK after America is the biggest service sector economy in the globe.
Gerard Lyons (34:27): And therefore there are many things that the UK can export to China in terms of skills, knowledge, experience, as well as the services themselves that will help China in the next stage of development. But I think that’s also relevant in terms of this post Brexit agenda for the UK. As I say, it’s about having a sensible future relationship with the EU with a trade deal. It’s about having the domestic agenda included and focused on the leveling up. And it’s about the UK positioning itself in the changing and growing global economy where the UK very much comes more and more sort of global in many things that it does. So all of these different things are vitally important. In the book, clean Brexit, half of the book we focused on how the UK and the EU can succeed in the future, but the second half of the book focused on the domestic agenda and how, in terms of the domestic agenda, there are many issues that can be addressed.
Speaker 3 (35:32): Mm mm-hmm
Sean Pillot de Chenecey (35:34): Okay. Moving on, what about this that so let’s say so, you know as we all know, the apart from things like the epic recovery summit organized by speakers associates generally speaking, the the, the conference market has been fairly flat over the last month for the last few months for obvious reasons, but it’s now sort of bursting into life again. So when you are asked to give, let’s say you know, both a mixture of, as you’ve done, you know, really fascinating forward looking sort of, you know, macro perspectives on where things are going. What about also some of the more micro day to day bits of advice that you’d be giving, let’s say, I mean, you know, theoretical, let’s say if you are standing up in front of you know, a vast audience, be it online or not from a, from a, from a Proctor and Gamble or a Unilever or whatever, you know, so a multinational so you are faced with, you know, delegates from, you know all parts of the world.
Sean Pillot de Chenecey (36:34): And, you know, to quote, again, someone like this, say the economist who talks about three key things, one being division. So they’re saying this might be a moment of revelation and unification, but parts of countries hardest hit by the disease, generally cities aren’t the parts hit hardest economically, which tend to be, as you were just saying, perhaps rural and post-industrial areas already in, in decline, that’s gonna reinforce a social divide. Meanwhile, from the point of view of tomorrow’s customers, they’re gonna be poorer, nervous, obsessed with social distancing and hygiene, but then from the point of view of PAX, most of specific immediate interest to an audience at the type of event where perhaps you you’ll be speaking in terms of the forthcoming recession or depression or whatever it is business models are broken resilience rather than efficiency is suddenly a priority. So how are you gonna talk about practical bits of advice that you would give in order for businesses to be more resilient?
Gerard Lyons (37:33): Well, thank you for the question. Well, first and foremost, I bring a lot of experience to the table. Not just in terms of building the business at the moment at net wealth in the FinTech world and being on top of the latest developments there, but also I’m on the board of bank of China in the UK. So I have that global financial expertise. I spent 30 years in senior roles in leading financial firms, both in terms of running research departments, but also in terms of running business operations within those banks. And as you mentioned at the very beginning, visiting 84 countries on business. So I have a business research economic and a global perspective, and therefore I can bring all that together. Now I’ve spoken to many boards, talked at many conferences, and thankfully I’m always asked back by the people who’ve heard me before, which is, which is a good say.
Gerard Lyons (38:29): So it’s breaking into those new people. That’s the challenge. I think it’s about getting it right, making it relevant, understanding what the client needs, but also at the same time, challenging people. One needs to look at things from the top down, as well as the bottom up bringing the top down perspective in terms of the global trends, the regional developments, the national and different traits within various countries. What are these issues that are happening now? What do they imply for the future? And also actually looking at things on the bottom up data is important, but one doesn’t need to bring all that data to a presentation. One needs to understand the backdrop. So one needs to have facts. One needs to have figures and one needs to have a sort of focus on what’s going to lie ahead. So I I’ve done it very well over long period of time. And I would expect to be able to remain on top of the agenda and sort of bring that to the clients I’m speaking to in the future.
Sean Pillot de Chenecey (39:36): Mm, fantastic. Okay, Gerard, well, that case, lemme issue last couple of questions and it’s been an absolute, fascinating and deeply interesting conversation. I know you mentioned that just now that the, during the crisis during the pandemic for instance, you work with professor Paul
Gerard Lyons (40:14): I just started my first Gaelic session last night to teach myself well, not teach myself to learn Gaelic. So I spent two and a half hours on the zoom. So I can say JDI, which is hello and Gaelic and JE, which means I am Gerard. And what was the other one, Jess BU LA, which is nice to meet you. So I need to go over to the west coast of Ireland at some stage soon to start soon if anyone else understand it. So but yeah. So there are lots of things. So from a personal perspective as well as trying to keep fit but in terms of economics, I’m working on the book at the moment with my eldest daughter, she’s a comedian as probably touched on the earlier. So we’re writing a book, a combined book about economic and financial issues.
Gerard Lyons (41:11): And what do they mean? Like, why can’t I afford a house? Why are train fairs so expensive? Yeah. And things like that that are very relevant. So lots of things on the agenda at the moment and hopefully a flurry of public speaking requests once people have heard this presentation, but look at the end of the day. I think in terms of the policy debate is also important to sort of keep getting those messages out there because I think here in the UK post a crisis I think too many economists bolted away led it, left it to the epidemiologists, hence the work I did that politics change and with all
Gerard Lyons (42:05): But also at the same time, I, in terms of the current debate on the UK and China, I think vitally important that we bring human rights, democratic issues, rule of law, focus more to our relationship with other countries. It can’t just be on economic and financial issues, but the same time we need to actually still be realistic about the fact that we need to work with countries of different shapes and sizes across the globe. So it’s about making sure that we can actually see the UK continue to do well. And within that environment hopefully the policy agenda will be more focus. I came up with an idea recently that I put forward in a few papers about, we need to have a three arrowed approach to economic policy in the UK. And we need to aim for a bullseye in each first arrow is monetary and financial policy, which is at the remit of the bank of England and how you, we basically ensure that monetary and financial policy allows us to recover.
Gerard Lyons (43:10): And that includes closing the Macmillan gap. No one talks about this. Can you believe it? This was first identified in 1931, how UK banks to not fill the needs of small firms in the UK and last year, the bank of England quietly, it has to be said, acknowledge that this gap is still the 23 billion pound gap. So here we are almost 90 years later and we still haven’t addressed that. So monetary and financial policy and making sure the financial sector serves the need of the domestic community. I’m involved in trying to set up a social bank in the UK. I’m giving some advice on that as well. So that’s a keep that’s the first arrow. The second arrow is fiscal policy. How we come out of a crisis with high debt in a way in which we can see the economy recover. Obviously we need a progressive tax system, but the important thing is that we see debt reduce steadily over time. And the third arrow is the whole supply side agenda. And there it’s all the eyes, as I might have talked about to you before infrastructure innovation, investment incentives in terms of tax and regulation and reducing inequality. So get those three arrows, right? And we don’t need to change all aspects of the system. We need to tweak and make it better and hopefully get a bullseye in those areas. And then the economy and people and businesses will start to succeed.
Sean Pillot de Chenecey (44:56): Fantastic. Well jar, thank you so much. It was absolutely superb. Just so our audience are utterly crystal clear about where to track you down. Where can they find you?
Gerard Lyons (45:09): Yes. well they can email me at email@example.com. So D R G E R A R D L Y O N S@yahoo.com or I have a website drgerardlyons.com and you can read my stuff up there.
Sean Pillot de Chenecey (45:32): Well, superb. Well, it’s been absolutely brilliant. I, I know time is now running short as you are an incredibly busy person. So Dr. Gerard Lyons, the chief economic strategist author renowned speaker and forecaster. Thank you very much.
Gerard Lyons (45:47): Very good. Thank you. It was great to speak to you and thanks for your time and great questions.
Sean Pillot de Chenecey (46:05): Thank you for listening to The Speakers Show podcast. Please leave a rating on iTunes. We’d really appreciate it. And also it’d be great. If you could subscribe to the podcast itself, you’ll find it also on Google podcasts, SoundCloud, or your favorite podcast app. Thank you.
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Sean Pillot de Chenecey
Foresight strategist, author and podcast host Sean Pillot de Chenecey is an inspirational speaker, who’s also consulted for some of the world’s biggest brands.
Sean has a very deep level of knowledge regarding the genuine issues impacting brands from a cultural, social and business perspective.