This the thread about the post-Thatcher British economy

"Affordable" is relative. What you can afford now won't be what you can afford when lenders are tightening down something fierce.

Was talking to a comedy octogenarian banker over Christmas. He says teh recession has been put off for so long that it will be so deep we'll need a war to recover. Then he cackled off into apocalyptic visions.

haha, wrong thread really, but yeah I am definitely going to be spending more post-holiday (probably in january alone) than I did in the run-up to thanksgiving and beyond

i remember even as a kid that the early 90s were fucking GRIM.

hmm, is there no ideal situation (for me) in sight, whereby house prices level off to a reasonable affordable level? the buy-to-let people have pretty much fucked everything up for first-time buyers so the worse they get hit the better.

Why do you want to own anyway? Renting is cheaper and you don't have to spend any money on fixing the place if there is a problem

Buy-to-Let people haven't fucked up anything themselves particularly (other than their own finances if bought too late in cycle) - they have merely been part of the bubble

Was talking to a comedy octogenarian banker over Christmas. He says teh recession has been put off for so long that it will be so deep we'll need a war to recover. Then he cackled off into apocalyptic visions.

I guess it has been postponed since 2001. As for recovery, they'll do anything to prevent/postpone, which means inflate inflate inflate (already multiple rate cuts talked about next year) and fuck the pound

Everyday changes are hard to predict but presumably you noticed prices for certain foodstuffs rocket in 07 anyway (bread?)

It'll be ok if you can keep your job and can reduce your debt exposure

or will they raise the interest rates to a crazy amount?

Huge rate rise looming for sub-prime credit card users

does that mean other credit card companies will follow and raise their interest rates?

wondering what industries will be hit hardest by all this, and which will thrive. surely the entertainment industry will be first to suffer? or will people *need* to cut loose as a way of forgetting their economic troubles? is there any truth in the old trope 'recession leads to times of exciting music/culture'?

Not really, because 'entertainment' (music and TV in particular) is kind of suffering already for reasons that aren't directly connected to the economy. If people are worried about what's going to be in their pocket in 12 months time the first thing they cut back on is new furniture/kitchens/expensive holidays.

Obviously finance will be hit first in terms of job losses - the question is how long banks can go on buffering the impact of the credit crunch before they start passing it onto the average borrower on the street. Assuming they haven't already.

Why do you want to own anyway?

it's an investment, or it has been.

the entertainment industry comes a long way down the list of sufferers. for one thing it's a global industry, for another a large section of the uk entertainment industry is protected, and anyway it's often done well in times of crisis. notion of the 'quality' of culture increasing during depression is harder to argue for. there is enough 'culture' stockpiled, i'd have thought, to see you through.

Duffy and Adele will pull us through

This month is the second month-on-month decrease in house prices since 2000, btw. My little-used emergency credit card sent me a letter the other telling me my rate is now 23%!

http://image.guardian.co.uk/sys-images/Guardian/Pix/gallery/2005/03/23/John-Major.jpg

If I were a Premiership Chairman, I'd be very worried about my season ticket sales next year. Especially if I'd borrowed say, 800M, to become a Chairman. And especially if I'd seen my repayments on that borrowing rise to 100M a year as a result of the credit crunch.

kids these days have far too much disposable income

Why do you want to own anyway? Renting is cheaper and you don't have to spend any money on fixing the place if there is a problem

Also, you don't have to up sticks and move every time your landlord decides to raise the rent/sell the house. That said, post-Thatcherite ownership culture has certainly been part of the problem - 20-somethings scraping every penny together in order to be able to afford a deposit can't be good for the economy at all.

scraping every penny together

YMMV

Mildly pessimistic viewpoint from the BBC: http://news.bbc.co.uk/1/hi/business/7162733.stm

As bad as it will be here, it will be worse in Europe
(from Rolling US Economy Into The Shitbin Thread)

is this true? how so? i thought the US would have it worse because of the whole subprime thing, which isn't as big an issue over here, is it?

more to lost/at stake here?

everyone knows $ is falling but its still worlds reserve currency and a lot of countries are tied to it. £ is stronger/worth more but is already falling against the $. thats right..falling against a falling currency. all time low against euro as well. euro got own problems brewing (ireland spain holland etc) and will the germans want out soon? pound falling so the foreign money we always hear about is getting worse returns as it falls. any interest rate cuts exacerbate that. would you want to be in sterling right now?

strongest drivers of uk economy for last how ever many years? housing, finance, retail. which are the 3 areas about to fall off a cliff? perhaps our manufacturing sector will bail us out?

low unemployment? low inflation? believe that? really? and the job losses are starting already this year

subprime? a us problem...really? lie-to-buy? self-cert? 9xsalary mortgages? 120% mortgages? interest only? buy-to-let? oversupply? never mind extraordinary credit card debt

levels of personal debt in uk surely higher than in us

it happened in us first is all

manufacturing growth fell sharply last month, so count that out too.

I don't know that we have higher levels of personal debt, however. And for how long can the $ remain the global currency as it turns into pulp?

i was being facetious about manufacturing. didnt realise we had any left

$ as global currency for how long is interesting. the gulf states and china hold a lot of dollars and would really prefer it not to tank. whats the alternative, the euro? the euro is surely merely a 'least worst' option right now. would the euro really be an alternative considering the difficulties ahead it faces?

well, everything has difficulties ahead, but the dollar's woes are pernicious. China won't want it to shift, however.

of course if they ALL fall...

Gold passed $900 today. Bubblicious

i'm pissed that the pound is back down to $1.95. my dvd costs are up.

stop killing the planet

Gold passed $900 today. Bubblicious

Looks like one. Except, isn't it supposed to be a hedge against inflation and aren't we merely at the beginning of the inflation game? Also how many people do you know with gold? Bubble will surely be when people at work start buying into it (maybe they already are!). Won't gold fall once things start looking ok again..and when will that be?

I know a couple of people who've been buying gold!

Some of the gold price increase is due to the collapse of the currency it is valued in, i.e. the dollar.

Gold is a stupid thing to invest in it is worth very little. Platinum would be a better hedge in this day and age.

(i think it's hilarious that the us econ thread is tom being all lolbitchy and the uk econ thread is some ancient s. clover question about simon reynolds!)

The worse it does the better everything else is so its not too bad

Platinum is subject to VAT?

is it worth very little. the central banks aren't selling it off anymore (and may be buying back in?)

almost of gold price increase is due to collapse of currency its valued in (dollar)..as pound is now falling even against the dollar it makes it go up even faster

and most importantly..what events do you think will bring gold back down?

Platinum is subject to VAt in the UK, not in the channel islands though. Palladium Bullion is also becoming popular.

and the conditions which will bring price of gold down?

(i think it's hilarious that the us econ thread is tom being all lolbitchy and the uk econ thread is some ancient s. clover question about simon reynolds!)

-- gff, Monday, January 14, 2008 7:08 PM (40 minutes ago) Bookmark Link

^^^

http://www.independent.co.uk/multimedia/archive/00263/frontpage190108_263078a.jpg