What is going to happen next?

PasturesNew

moanymoany wrote: »

And yet, when I go out everything seems normal.

When things are happening to you, you aren't out or you look normal.

If I am driving home from being made redundant, you see a person in a car.
If I am sat in my house awaiting the bailiffs, you pass a house on the street.
If I have £100k of debt on a card and will be laid off tomorrow, you see a person walking down the street.

You can't see a recession until you feel you are part of the club. Once it's affected you directly or somebody close directly, you start to spot things.

I've noticed when I go out in my car these days, there are less cars on the road.
I noticed less people in a pub when I went out.
There was no queue in the kebab shop.

Small stuff is what you see now.

Generali

posh*spice wrote: »

I seen an analyst posit that inter bank lending might be done for and that Central Banks might have to take on this role permanently. Interesting view point.:rolleyes:

It is an interesting PoV. Presumably the Central Bank takes on the role that the Central Clearing House has in the equities market.

The only trouble is, if you sell a share to someone you don't care about their credit worthiness as you exchange the cash for the share so the risk is quite low. The share has to fall in value and the counterparty go bust for there to be a problem.

If you lend money to someone creditworthiness is a problem. Does the Central Bank really want accusations that they forced a bank into bankrupcy by hiking rates on them just as they were vulnerable? Given that most Central Banks are nationalised (the BoE was a private institution for centuries before nationalisation in the 1940s) that then brings in political interference, "We cannot allow the Central Bank to increase interest rates to a fine institution such as Usary Bank just at the time when it most needed our support" and so on....

Dithering_Dad

posh*spice wrote: »

Oh look I have my own troll. What an honour:D

I believe you went around telling posters not to put their pensions into cash at the beginning of the year? That must keep you awake...:rolleyes: Especially given all the grief you gave Edinvestor about her poor financial advice. Didn't you want to sue her?

Hmnnn, you believe or you posted the above load of old rubbish?

The amount of duplicate logons within the Housing board is getting ridiculous. It ruins the debate when one person logs on several times and pushes the same viewpoints. The mods really need to take charge here.

As far as EdInvestor is concerned, you're wrong she doesn't give poor financial advice. She is actually a very valuable member of the pensions & investment boards, just like Dunstonh.

Max_Headroom_3

domcastro wrote: »

She told me that it's just the media's fault for panicing everyone. She then went on to tell me to buy now as house prices will be going up again soon. I said they had to go down as the price was too far away from income multiples. She wouldn't have it!!

It is staggering how many people think it's all "a fuss about nothing" and will "all be back to normal next year".

posh*spice

Generali wrote: »

It is an interesting PoV. Presumably the Central Bank takes on the role that the Central Clearing House has in the equities market.

The only trouble is, if you sell a share to someone you don't care about their credit worthiness as you exchange the cash for the share so the risk is quite low. The share has to fall in value and the counterparty go bust for there to be a problem.

If you lend money to someone creditworthiness is a problem. Does the Central Bank really want accusations that they forced a bank into bankrupcy by hiking rates on them just as they were vulnerable? Given that most Central Banks are nationalised (the BoE was a private institution for centuries before nationalisation in the 1940s) that then brings in political interference, "We cannot allow the Central Bank to increase interest rates to a fine institution such as Usary Bank just at the time when it most needed our support" and so on....

Just noticed this

the "age of innocence" of cheap lending between banks "will not quickly, if ever, return". MERV

http://news.bbc.co.uk/2/hi/business/7682723.stm

IF EVER - surely that's news worthy

phil_b_2

while i think that there will be knock on effects which haven't really happened yet, I also think that some people spend too much time on forums cacooned in a world of overwhelming trajedy that simply isn't reality.

Many will barely be touched by what is going on. You can't wander outside of internet forums into the real world and expect to see burnt out cars and folk fighting over a half eaten Burger king happy meal in the street.

joshiesaunt

hi all
know what you mean about everything still 'seeming' normal - I was in Birmingham at the weekend and the shopping centre was jam packed (and I overheard a sales person on the phone saying it was a great day and he hopes it continues like this for xmas). however, I have noticed little things - the taxi driver taking me back said that business was bad - there had been a 50% downturn in business in the last 3 months, there were a quite a few £1 type shops in place of some of the chains and I heard that a friend of ours had been made redundant (from an international sales position).
I have just sold my house at an 11% reduction and actually feel so relieved and happy to be off the ladder - that seems to be a normal response these days - we know the bad times are coming, it's time to batten down the hatches! I just about remember the bad times of the 70,s (young girl then) but really remember the thatcher recession/depression quite well - it hit the manufacturing industry hard. It snowballed once unemployment rose and I think the same thing will happen again with the knock on effect in all areas of the economy. If manufacturing is decimated - what are we left with? just a service industry really and that is'nt a basis for a sound economy.
Having said that curious to see what will happen to interest rates - obviously they rose very high in thatcher era but seem to be heading downhill now - will that make a difference?

space_rider

My OH reckons Leicester will be protected from the worst of the financial crisis because of the large Muslim population, who by and large don't use credit, and as a result operate in an almost completely separate economy, which often seems to be doing well when the larger economy is struggling. I'm not so sure - I think the problems this time round are big enough to have a significant effect on the Muslims as well. Only time will tell. But thinking back, whenever I have actually bought something from this shopping centre, I haven't had to queue to pay. These hoards of people are "just looking" - shopping as a pastime despite not actually having any money to spend?[/quote]

I saw something on the TV a week or so ago where they were talking to asian shopkeepers who were saying that people are cutting back on the things they would normally buy ready to celebrate Diwali.

Generali

posh*spice wrote: »

the "age of innocence" of cheap lending between banks "will not quickly, if ever, return". MERV.....

IF EVER - surely that's news worthy

Too right it's news worthy. That's 300 years of banking history (trust) in the bin for a start if he's right.

If he's right though.....this won't carry on forever. Capitalism needs banks and unless we're going to do away with Capitalism entirely then this will be fixed one way or another.

Generali

space_rider wrote: »

I saw something on the TV a week or so ago where they were talking to asian shopkeepers who were saying that people are cutting back on the things they would normally buy ready to celebrate Diwali.

Diwali isn't a Muslim festival - it's Hindu/Sikh.