Spend, spend, spend

david69_2

I've got a load of credit cards i dont use say 10 each with a £4k- 10k limit total £80k .I could buy an aston martin and sell a year later for half that

jaygrunt

MrMicawber wrote: »

Yup - keep teaching your children the good old values. Here's a little example of steady saving and compound interest. If your ancestors (and we've all got them). Put £1 per year into a savings account paying 5% (after tax) at the start of each year and began at the start of 1AD what do you thing would be in your account today?
.
.
.
.
.
.
.
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£74,187,686,346,115,300,000,000,000,000,000,000,000,000,000.00

If your married there is no chance of ever seeing it go over £5000 :rotfl:

Jonbvn

MrMicawber wrote: »

Yup - keep teaching your children the good old values. Here's a little example of steady saving and compound interest. If your ancestors (and we've all got them). Put £1 per year into a savings account paying 5% (after tax) at the start of each year and began at the start of 1AD what do you thing would be in your account today?
.
.
.
.
.
.
.
.
£74,187,686,346,115,300,000,000,000,000,000,000,000,000,000.00

Yes but a pound in 1AD would have been 100 years wages!

meunier

Atlee - with all very best intentions - created the welfare state that continues to steal insidiously within the mindset of this country. It is not JUST - as so often proclaimed - 'the young'. Blair and Brown, following the path they promised to change ('no more boom and bust') have literally held the proverbial housing credit carrot up to the nags and now - NOW when the market began to toy at withdrawing it - voice shock that they bolt. They whimper that it is unfair; UNFAIR that they should have less to skim off of our tops. They do so, they say, on OUR behalf. Indeed, they have even kindly seen that the instrument measuring inflation itself has been re-adjusted so as to not reflect our own government's wealth management magnet. Contrary to the more populist cries their measures were, it now seems, much more akin to Theodore Roosevelt's Big Stick than ever they were to Franklin Delano's New Deal.

Or is it perhaps that the Emperor's New Clothes are now simply becoming a tad too material for their owners' liking?

One thing in my simplistic view, however, has never altered: ONE SIZE NEVER HAS NEVER FIT ALL. I remember - years ago now - being at a large charity shop for the blind in New York City - the Lighthouse. The wealthy would give plenteously of clothes they had but worn, perhaps, once. Indeed, they were given a tax credit for doing so. I was upstairs stealing through the racks of men's apparal and looked down unto what was called 'the ladies'. Two matronly women were tugging in a 'man of war' from their respective corners on a sequined floor length Bob Mackie original 'donated' by Raquel Welsh. 'You'll never get into this,' one howled. The other replied: 'It's a squeeze, but it'll stretch.'

Bring on Obama and Isolationist America I say. Did Brown actually hear his acceptance speech the other night? The special relationship doors - politely - will be shut. They will be shut firmly once again, this time in the name of an independent green. America - as it has historically - with its economy diversified away rather than into its Banks - will be the more hearty survivor in the end. It has been there before. Or, Gordon, did the Depression truly teach nothing?

The tales of one American son, (one who was, in fact, my father), born into almost absolute poverty in the late twenties and dressed in relative wealth by the early seventies still ring in this progeny’s head. I vividly remember his enormous pride to see 'that man walk on the moon' as he put it. 'We made it,' he'd say. Sadly that was more than many members of his family did. When his brother, my uncle, a noted child prodigy violinist, was run over by the tractor he was trying to repair on an estate field their father worked upon - and upon which the almighty pater made all three of his young sons toil in order to help earn the family's keep - my father learned a lession that was to serve him and his nation for many decades to come. Prudence. It was a hard lesson. However, it was well learnt. My father who was near to his brother at the time of the accident ran back to the house they lived in on the edge of the estate. He would never forget that there was no petrol in the car his family shared with others. When he ran back - and this was a lad who would soon be a champion Oxbridge rower on a Rhodes Scholarship - his brother was dead. By the time of the late seventies, when his own son (me) was nine I, too, was told to find a job, although he noted at the time that I was, 'in the eyes of the law, largely unemployable.' I made my West End debut that year. I ran in that play for two and a half years. Proudly I never missed a performance. My father died when I was nine. I remember going from his funeral to school and on to the theatre. That is how he would have wanted it. Still his words have never left my mind. I well remember some weeks after his internment low those many years ago standing in front of the Stockpot on Panton Street - only a few doors down from where it is today - and debating spending 40 pence on dinner because someday that money might be needed for the petrol to save a life. Today I find myself doing the same thing. Decades after that point - and finding myself back on my father's native continent although a different nation - I found myself a Director on Staff at New York City's Metropolitan Opera. I was told I had the same disease that killed my father: cancer. I insisted on having my chemo sessions at 6.00 am so that I could be back at work for 10.00 am rehearsals. I would walk to the Met from Sloane Kettering Hospital. The consultants thought I was mad. Perhaps I was, but I had my father whispering in my ear. Eventually I beat the odds they had placed on me - and I've never been a gambler myself. Still it was a calculated risk. If I hadn't taken on that challenge (it was a choice) I wouldn't be here to proudly write this today. I outlived the year they proscribed for me. Oddly I'm STILL well. When I was finally given the all clear after the proverbial five years, the chief doctor said as I was going out the door: 'Maybe it was all those walks.' I turned and said: 'No. It was the Depression. It was my dad."

There was, is and always shall be a price for everything.

Perhaps another Depression might not be SO dreadful a thing.

Perhaps another man will walk on that moon.

corngoat

justaquickie wrote: »

I was thinking along very similar lines earlier today. Then I thought: the knee-jerk reaction to spend is probably one of the outcomes the rate cut is intended to precipitate. Excepting those who live off their savings interest - and they have my sympathy - for the rest of us it's the differential between taxed interest and inflation that is the important metric. I believe inflation will fall to almost 0 fairly quickly if people continue not to spend, leaving the differential pretty much intact. Good old supply and demand. So, I think all us prudent savers should refrain from spending, in our own interests... after I get back from the pub, of course.

I will continue to save, maybe not as much and indeed the interest rate cut is intended to get people spending again but as for inflation falling to almost 0% it must be remembered that as most of what is in our shops comes from China nad the like the drop in exchange rates is pushing import costs up by almost 33%
:beer:

bjorn_again

justaquickie wrote: »

I was thinking along very similar lines earlier today. Then I thought: the knee-jerk reaction to spend is probably one of the outcomes the rate cut is intended to precipitate. Excepting those who live off their savings interest - and they have my sympathy - for the rest of us it's the differential between taxed interest and inflation that is the important metric. I believe inflation will fall to almost 0 fairly quickly if people continue not to spend, leaving the differential pretty much intact. Good old supply and demand. So, I think all us prudent savers should refrain from spending, in our own interests... after I get back from the pub, of course.

That is pretty much how I see things. The problem is it's very difficult to actually "see" the results of low inflation in your daily life, whereas it's easy to see the interest on your savings.
Having been through many of these "economic cycles" I know that nothing ever stays the same and the pendulum will swing again. I look for the positives in my daily life and am just happy that I have savings.

Sam37

I am probably odd, but as I save for the long term this cut means I try to save more rather than less.

What I don't earn in interest I try to make up in less spending and more savings.

1.5% less on 5000 pound is 75 pound. So one unnecessary piece of kitchen appliance, or a pair of trousers I don't really need not bought, and I've made up for the cut in interest (for as far as relevant as most savings now fixed for a period between 6 months-2 years, which I obviously won't be spending)

To me this is a good thing as I don't like (over)consumerism (though guilty at times), and although I wish everyone prosperity I hope is not the road policy makers will continue to take.

asd030

This savings thing is a funny business right now...

The money I have has been hard saved over nine years, and taxed and taxed again, (like everyone else's here). I did it with the intention of buying a house without a mortgage. That was my goal. But house prices just kept rising and going further and further out of my reach.

Now I'm probably a bit odd, as I know very few other people would have done that when they can get what they want NOW and live for today. But I didn't want debt on my shoulders, and I knew this bubble would burst.

My only hope is that everything goes to plan, in that by mid-2009 house prices will be maybe 10% less than they are now, as many 'experts' predict. AND I still have my savings...

I doubt I'll ever be in the position again in the future to save anywhere like the amounts I have done. And I wouldn't do it again now even if I could. I wouldn't hoard more than say £4K, as that would preclude me from benefits etc if ever needed, so would be a silly thing to do.

But I don't know what I'd do with the cash as I'm simply not in the habit of buying expensive cars, holidays, having kids, nights out etc etc, like the masses are, after all these years of going without. Watching every penny is all I know.

Swipe

asd030 wrote: »

This savings thing is a funny business right now...

The money I have has been hard saved over nine years, and taxed and taxed again, (like everyone else's here). I did it with the intention of buying a house without a mortgage. That was my goal. But house prices just kept rising and going further and further out of my reach.

Now I'm probably a bit odd, as I know very few other people would have done that when they can get what they want NOW and live for today. But I didn't want debt on my shoulders, and I knew this bubble would burst.

My only hope is that everything goes to plan, in that by mid-2009 house prices will be maybe 10% less than they are now, as many 'experts' predict. AND I still have my savings...

I doubt I'll ever be in the position again in the future to save anywhere like the amounts I have done. And I wouldn't do it again now even if I could. I wouldn't hoard more than say £4K, as that would preclude me from benefits etc if ever needed, so would be a silly thing to do.

But I don't know what I'd do with the cash as I'm simply not in the habit of buying expensive cars, holidays, having kids, nights out etc etc, like the masses are, after all these years of going without. Watching every penny is all I know.

I'm the same as you i.e. buying my house for cash or with just a very small mortgage but I plan on not using my ISA to form part of my house fund. That is purely there for later in life and any real emergencies. I have no intention of ever claiming benefits (I'd sooner do manual labour or take a minimum wage job) so having more than £16k in savings is not an issue.