Have we turned a corner or is this a false dawn?

The last few weeks have been quite difficult for me. I have been trying hard to find new clients and have only found people who were clearly worse off than me. I have been looking at the evidence of what is happening really hard but it is difficult to call. There is a noticeable increase in traffic on the roads, almost back to old times. People are going about their business and daily lives with apparent normality.

But my instinct is to think that this normality covers a whole multitude of sins. The number of Pardod (for sale) signs continues to rise (although I am pleased that my friend Alexanders who runs Mobius selling expensive British Vertu mobile phones has opened another shop in the old town) but in general there still appear to be more businesses closing than opening. There are almost NO adverts on the trams and buses. The exceptions are the big mobile phone companies who are having their own battle royal for our ears and fine words. The prices in most shops have dropped agin. Some have put up prices but they don't seem to have customers. I cannot ever remember seeing any people in one or two shops - but still they stay there. One or two have grasped the nettle and have reinvented themselves to a new lower price level quite successfully. The pubs are mainly empty except for those used by tourists. One nightclub I heard about had no one at all one day last week. Heating bills will arrive this month and that means a direct export to pay for energy- well if people can pay that is. In opposition, the National Bank Governor says we have turned a corner.

We are at the point where the international community (IMF, EU, Swedish banks etc) is demanding that 500m Lats are cut from the government budget. Now some of this will stay in circulation but there are bound to be more effects and they cannot be positive. Tax rises cannot stimulate anything, even accountancy firms!

So my instinct is that what we see is the tip of the iceberg. The big bad bit is under the surface, and with lots of sharp edges. What is amazing is the stoical way society continues its daily round. I suppose that after occupation by the Nazis and USSR, this is just another bit of stress to be suffered. It is just a shame that this time the punishment is being meted out by Latvians upon themselves.