Business depends on confidence.

Fair or not is not the point. The business that is perceived as successful will usually be successful, but the business which is perceived as being unsuccessful will soon find itself in trouble.

So the entrepreneur always has to be positive about his business. After all, how can others have confidence in a business if the man who knows it best is negative about it?

However, he cannot be seen to be unrealistic or ignoring obvious facts. If he is, then he loses all credibility and his display of confidence actually counts against him. Remember Saddam Hussein’s Minister of Information?

It is a difficult balancing act: the entrepreneur must be both honest and positive at the same time, even – indeed, especially – when he has good reason to feel negative.

Entrepreneurs must therefore have some sympathy with governments and central banks who must manage the same balancing act, talking up their national economies in the same way that entrepreneurs talk up their individual businesses.

Yet the negative comments of the Chancellor of the Exchequer, the UK’s finance minister, about the state of his country’s economy cannot simply be excused as erring a little too much on the side of honesty.

It has been obvious for some time to anyone with the ability to count that Britain is in a difficult financial position, but such negativity can only make a fragile situation worse.

Every businessman should know that being honest and realistic does not mean talking down business by running around screaming about how bad things are.

The problem is that British politicians these days are not businessmen.