Torygraph: Looming crisis for the Fed.

LisbonLaura

!!!!!!? wrote: »

Get ready for massive devaluation/inflation or much higher interest rates to attract foreign cash for government bonds.... There won't be much of a middle ground.

We already have some of the devaluation courtesy of Merv's swops with the banks. I wonder if he only allowed the digits on their screens (in exchange for some of their junk) if they promised to go for commodities ? ---- as a (futile?) attempt at a hedge against when the collateralised debt obligations arrive en masse.

Gentle rate hikes should have started years ago, but it wasn't 'convenient' as the very last drop had to be wrung out of Britain's last hurrah. -- & didn't it work well

ultra10

Dithering_Dad wrote: »

They probably spend more time in the 'real world' than people who spend their time obsessing about house prices, recessions and armageddon on this forum. Perhaps the reason the news isn't talking about the destruction of western society is because wont happen?

The oil story is old news - I remember all this during the 70's when I was a kid. The reality is that we invent new ways to extract oil from fields that were unprofitable in the past, we invent new technology to replace oil (such as hydrogen fuel cells, hybrid cars, etc) or we plant crops to replace oil, such as rapeseed, etc.

The housing market has fallen from a ridiculous height, a natural adjustment. Perhaps people think that they will just go up and up? People will adjust their lifestyles accordingly. Out of the window will go the new cars, holidays, designer clothes, large screen TVs. People will concentrate instead on debt repayment and necessities.

The banks going into meltdown. The larger ones will gobble up the smaller ones that have over stretched themselves. The bad credit will eventually be flushed from the system as people are forced to mend their ways - this is happening now, no more 100% mortgage and a return back to 3x salary lending.

We'll all have a period of financial hardship, and that's no bad thing. What won't happen in the destruction of Western Society.

Ahhhh ... another ..."There wont be a crash" or "prices will level off" etc etc types, :rolleyes: ..... you would have had lots of allies a few moths ago, but for some reason i fear you are fighting a loosing battle and a lonely one now !!... Brave Man all the same :T

Dithering_Dad

ultra10 wrote: »

Ahhhh ... another ..."There wont be a crash" or "prices will level off" etc etc types, :rolleyes: ..... you would have had lots of allies a few moths ago, but for some reason i fear you are fighting a loosing battle and a lonely one now !!... Brave Man all the same :T

I think you need to re-read (or perhaps actually read) my post. I never said that "There won't be a crash" or "prices will level off". I said:

The housing market has fallen from a ridiculous height, a natural adjustment. Perhaps people think that they will just go up and up? People will adjust their lifestyles accordingly. Out of the window will go the new cars, holidays, designer clothes, large screen TVs. People will concentrate instead on debt repayment and necessities.

I'll translate for you. House prices were at a ridiculous (unsustainable) height and so we are in a period of natural adjustment (back to levels that people can afford) and that it was naive of some people to believe the prices could go up and up. I then remarked that people would adjust and instead of buying more crap that they want, they will only buy the things that they actually need (i.e. cutting back and saving money).

Nope, no crash denial there, just common sense analysis of how the British public will struggle through the crash and possible recession without resorting to riots, death camps and all the other armageddon scenarios.

Many of us have been through a recession/housing crash before (I'm on my third, though one of these was during childhood), so in this respect I am not alone in knowing that it's going to be a difficult period, but you get through and become a little wiser financially as a result.

moanymoany

lostinrates wrote: »

Accepted, (as a person who has lived in America, the spouse of someone whose family live in America, and who works for an American firm;) ). The californian eco car bubble is specific, but tremedously more advannced a market than ours!

Can't match the American credentials, only the old man's comments however, the last time I looked California is only a part of America. As far as I recall my comments were quite general.

lostinrates

moanymoany wrote: »

Can't match the American credentials, only the old man's comments however, the last time I looked California is only a part of America. As far as I recall my comments were quite general.

Sure...and I didn't dispute that

Dithering_Dad

lot of winking going on in those in those last two posts. Nervous tick?

lostinrates

Stroke;)

I have Bells Palsy...its obviouly showing.

neverdespairgirl

Dithering_Dad wrote: »

Nope, no crash denial there, just common sense analysis of how the British public will struggle through the crash and possible recession without resorting to riots, death camps and all the other armageddon scenarios.

i agree with you there - I'm not at all convinced by the death camps / riots scenarios either. Just localised pain and upset.

baby_boomer

I can't believe that the US government has agreed to back Fannie Mae & Freddie Mac. That's a blank cheque for $squillions :eek:

So much for the USA allegedly supporting red blooded capitalism. However there could still be blood on the carpet as a result of this strange Republican version of a sort of social solidarity.

moanymoany

I think the US government are backing FM et al because they want their fellow God fearing chap to get in.

Just watching the second episode of 'The 1940s House', watch and weep - it will become similar. I can cope, I'm a longstanding member of the money saving OS board!