Moving The Economy Fast Forward
By Syed Akbar Ali
In banking, we used all the financial and accounting tools to assess a company’s and a business’ viability and credit worthiness.
But there were also some rule of thumb methods and grape vine cross checking that was often more vital than all the fancy financial analyses.
One unconventional method was to make site visits and see what was really going on in the company. An important place to look would be the loading dock, the warehouse and the workers canteen.
At the loading dock you should look for trucks and lorries busily loading and unloading goods. That means there is activity.
At the warehouse you want to see raw materials and components but not too much – meaning they are not overbuying. You also did not want to see too much finished product stockpiled in the warehouse – it means they could not sell their output.
(I once visited a State SEDC factory where their finished goods were stacked up to the sky in the warehouse. Their over influential Company Secretary had set up a side business supplying machinery to the factory. He convinced the Company to expand their capacity, which the company did. He made a pile as a commission agent for the machinery supplier and the company started producing stuff it could not sell).
At the canteen you would want to see workers eating and drinking (at the right time) and being generally happy. If the canteen is poorly stocked, it means the workers are not spending money there.
These are rule of thumb methods but they serve as good guidelines.
To gauge the health of the economy I observe heavy equipment movement on the roads and those tall construction cranes at construction sites. If you see lots of large tractors, earth movers and caterpillars being moved around on the low loaders, then you know that things are moving in the economy.
One tractor which to me is a good indicator of the pulse of the economy is the simple Back-hoe tractor. Here is a picture of one which my wife captured just a few days ago as we were driving to work.
These tractors were missing from the roads for the past six years. But now almost every morning you can see these Back-hoes on the move again. They can be seen everywhere.
I hope all this translates into good economic growth.
