Panicking slightly - can people please convince me this is a good thing

carolt

Trying to view current economic situation calmly, but finding it hard, as news is just one thing after another.

Short of taking deep breaths, can anyone older and wiser (or indeed younger and calmer) please explain gently why this is all a Good Thing or why it's better to get it all out of the way, or some such.

Could really do with some optimism.

Alternatively, does anyone know any funny stories or irrelevant but cheery anecdotes to take my mind off the sound of dominoes falling, houses of cards crashing etc.

Please.

ess0two

Knock Knock........whos there?

The bailiff,provident,ocean finance,gas/elec cutoff man.


Take your pick in order of preference.

Sir_Humphrey

Well, this should be the end of Neo-Liberalism. Shame it had to happen the nasty way.

That is what cheers me up.

carolt

So what comes next then?

ad9898_3

I guess most things come with consequences, I for one would like house prices to fall at least 30% from peak, the thing is a whole load of s**t has to hit the fan for this to happen, part of which we are seeing at the moment. Will I suffer the "consequences" of maybe losing my job, or other people on this board who want house prices to go the same way, I'm sure its a real possibilty.

Lifes a bit of a gamble in most areas, what you are given in one hand, maybe taken from your other hand, I guess you just hope that it doesn't happen

JayZed

Carolt, it would be hard to argue that this is a Good Thing overall: we're in some very choppy waters and there's probably more bad news to come. It's not something that just affects investment bankers or people who have overstretched themselves - it's going to cause (is already causing) job losses, house repossessions, unaffordable price rises etc for everyone. People will argue - with some justification - that this is a much-needed correction, but that doesn't make the impact on individuals any more palatable.

Having said all that, what you have to consider is how likely it is to affect you personally, and what you can do to mitigate the likelihood and impact of the risks. Is there any danger that the situation might affect the security of your job? This will depend on the industry you work in, on your personal position, and so on. Are you likely to need insurance to cover mortgage payments etc in the event that you lose your job? If so, now would be a good time to think about that. How affordable are you mortgage payments and other essential outgoings? If they're stretched, what cutbacks can you make? Do you have a savings cushion?

All I'm saying is that the situation is a bit grim, but it's not a reason to panic - just a good time to make sure that you have control of your finances and are taking sensible precautions against the possible effects of an economic downturn. In other words, a good time to be an MSE!

WestonDave

Its a good thing IF it wakes people up to properly understanding and managing their finances rather than sleepwalking into whatever financial institutions want to sell them. The banks have fuelled this crisis by overlending and allowing house prices to get way beyond realistic levels, and its no surprise they are the epicentre of the fall out. Its a good thing IF the NIMBY's are forced to realise that we need to build more homes in this country to reduce the ridiculous excess demand which also fuels house prices, and that way people can have some of their income left to spend rather than being tempted to MEW off illusory equity to enjoy life - that IF coupled with a more responsible attitude to unsecured debt (by borrowers and lenders alike) should lead to a more stable economy.

There's a lot of if's in there and some of them are in the "if pigs could fly" category of likelihood!

slipthru

Sir_Humphrey wrote: »

Well, this should be the end of Neo-Liberalism. Shame it had to happen the nasty way.

That is what cheers me up.

Well i am hoping it is the end of something. But i am thinking it may go on for a good few years yet.

StevieJ

WestonDave wrote: »

Its a good thing IF it wakes people up to properly understanding and managing their finances rather than sleepwalking into whatever financial institutions want to sell them. The banks have fuelled this crisis by overlending and allowing house prices to get way beyond realistic levels, and its no surprise they are the epicentre of the fall out. Its a good thing IF the NIMBY's are forced to realise that we need to build more homes in this country to reduce the ridiculous excess demand which also fuels house prices, and that way people can have some of their income left to spend rather than being tempted to MEW off illusory equity to enjoy life - that IF coupled with a more responsible attitude to unsecured debt (by borrowers and lenders alike) should lead to a more stable economy.

There's a lot of if's in there and some of them are in the "if pigs could fly" category of likelihood!

Unfortunately it is causing less homes to be built

WTF?_2

carolt wrote: »

Trying to view current economic situation calmly, but finding it hard, as news is just one thing after another.

Short of taking deep breaths, can anyone older and wiser (or indeed younger and calmer) please explain gently why this is all a Good Thing or why it's better to get it all out of the way, or some such.

Could really do with some optimism.

Alternatively, does anyone know any funny stories or irrelevant but cheery anecdotes to take my mind off the sound of dominoes falling, houses of cards crashing etc.

Please.

carolt, are you honestly saying you didn't see this coming?

This is precisely why most of the bears here have been so convinced the housing market would crash and so anti-HPI.

The crazy HPI of the last years has been sowing the seeds for economic catastrophe which will hit us all - that much has been clear to anyone who took the time to read the facts in the last few years. We had the chance to maybe have a soft landing in 2005 but those idiots in the MPC messed it up. After that, it was just a matter of time until meltdown.

moanymoany

Why are we here? Reckless lending and reckless spending. Go over to DFW board and you will find someone with a £250k mortgage and £50k debt who is talking about keeping money for Christmas presents and presenting with a totally unreal attitude to what they have to do to keep house and home together - but dh wants to keep his sports channels at £48 a month - which could feed the four and a half of them for a week!

What we hear is the sound of chickens coming home to roost. For the last four years I have told anyone who would listen that the economic miracle is entirely due to borrowed money - talk about a house built on sand!

The day had to come when it would all end. This is that day. The bad side is that millions will be hurt - and not those who deserve it!