Are there two economies out there?

I have spent this week travelling around Britain doing some interviewing and generally seeing what has changed in the past few months. There appear to be a lot more empty offices out there. A few less shops but generally high streets look in better nick than some of the business parks.

I asked at the various hotels and restaurants I visited how business was going. Pretty well, they all said with some surprise. Everyone had been expecting the worst, but a number said their business was up on last year. This seems at odds with what I read in the news. Last week I was talking to bankers and they do seem scared by it all.

But with this gap in what is going on I began to wonder if there are two economies running in parallel. The global economy which does all the modern clever stuff with financing. Here companies do everything on debt, you rent your offices, outsource as much as possible, make money on the turn. It's all in the abstract notions of shareholder value. Making money out of money. Here the news does seem to be bad because it is so difficult to find money.

The other, which I'll call the local economy is business as it used to be. Whether making things or providing a service, it is a slower growing model. Grow organically, perhaps borrow a bit to expand the business but all rather considered and cautious. You know your customers and they know you. Here the impact of the global slowdown seems to be rather less. It may not be easy out there, but it's not that bad either.

Before we all get too complacent, it may just be a timing thing and as the year goes on and unemployment rises, these businesses will suffer as well. But for the time being it seems as if there are two parallel worlds out there and only one is a rollercoaster (at the moment).