What should we make of the Spring rebound in the London property market? According to Nationwide prices were almost 5% higher in June than in April. Some agents say there has been a 10% bounce off the bottom in parts of the capital. It is typical of this most enigmatic of recessions.

On the one hand there is the Private Fraser tendency: otherwise sober commentators who get their kicks from cheering the country with their "we're all doomed, doomed I tell you" warnings. For them it is either the worst downturn since the War, the Thirties Depression, for 100 years or since the Great Flood. I don't know and neither do they.

On the other there are the anecdotal stories from the frontline of the real economy, which paint a very different picture. One household name luxury retailer told me this morning that like-for-like sales are up 20% this year. And not just in London where you might expect the tourist dollar to artificially inflate takings. No, he told me the picture was the same all over the country. In fact the strongest performance of all is in Manchester. It is the same story on fine dining, where Gordon Ramsay, for all his travails, is still doing record business at his London restaurants.

You don't spend that sort of money on what are essentially fripperies, if you really think that it is time to hunker down. So why the discrepancy? One theory of mine is that it is simply so long since the last recession that no-one under 40 can remember it as a fully fledged participating member of the economy. They still don't quite believe what the eco-Cassandras are telling them. They're used to spending easy money and can't give up the habit when they don't have to.

The over-40s, by contrast, grew up in an era of perpetual economic crisis and are more easily persuaded that the bad times have returned. The length of the upturn also meant that many people were able to accumulate such huge cash resources that they are essentially recession proof in a way that far fewer were in the Eighties and early Nineties.

Don't forget also that 93% of the working population still have jobs and of those perhaps a quarter are substantially better off because of falls in mortgage rates. Again that is in contrast to recessions of yore.

None of this is particularly scientific. Every recession has its own peculiar characteristics. If the early Eighties was a failure of industry, the early Nineties a failure of property, then this one if perhaps a failure of banking. Whether that makes it easier to contain and recover from only time will tell. Perhaps another Dads Army catch-phrase is the appropriate response: Don't Panic

Regina v Darling, or more likely v Osborne, will be one of the more fascinating departmental spending struggles of the coming years. Next summer the Queen's senior courtiers lock horns, or perhaps tiaras, with Treasury mandarins over the future funding of our Head of State.

It could be a defining moment for how Britain wants to run its Monarchy. The annual Civil List, the public income used to pay for the Queen's daily costs, mostly staff salaries, has been set at £7.9 million for the past 20 years. It now only covers about half of her spending, the short-fall made up from reserves. Those reserves are almost depleted now and will be down to just a few million by the time the Queen's next 10 year financing cycle starts in Spring 2011.

Just to keep the Queen's way of life at current levels would mean increasing the Civil list by at least £7 million and more realistically probably £10 million a year.

The claim will come against one of the bleakest public spending backdrops in British history. It also comes in a new era when hostility to the taxpayer funding the lifestyles of public servants is more intense than ever.

The Queen cannot be compared to "flipping" MPs of course. The public expects a little Majesty from their Monarch, but prefers humility from their political representatives. Nonetheless the case for the extra money is going to be an unbelievably hard one to make.

If anything the public mood could harden over the next two years as the grim reality of deep public spending cuts takes hold. It was anger over alleged Royal profligacy that forced the Queen to start paying tax on her income during her annus horribilis in the last recession in 1992.

We could be approaching the moment when the Monarchy takes another lurch towards a pared down Scandinavian model. Less Majesty it may be but the Queen has finely tuned political attenae. If the alternative means stoking up Republicanism she will happily accept more tupperware and less flummery at the Palace.

They say that City bonuses are back. They've even invented an acronym for it - BAB. I would coin a different one - BAND or bonuses actually never disappeared.