Really really gloomy article from Robert Peston this morning

huntersc

Heyman wrote: »

Ah ok - yes, well that mentality went up in smoke when Northern Rock started offering 125% Mortgages and banks started lending to any Tom, !!!!!! or Sally, didn't it!

Even with a recession I still think it's going to take a fair while for people to snap out of the debt-culture that we've been in for the best part of a decade (and the rest).....

Hallelujah!

This is exactly the point I've been making throughout the thread but you're one of the first to cotton onto it.

wintersunshine

huntersc wrote: »

Hallelujah!

This is exactly the point I've been making throughout the thread but you're one of the first to cotton onto it.

And this is the point I have been making.

SGE1

huntersc wrote: »

PR is an example of one of those sectors that will feel the pinch because what it brings to the table is difficult to measure and more often than not a nicety. Very much like interior decorators that work for large organisations or even those in HR. These are the people that get laid off first. Why? Well because they add little to the balance sheet at the end of the year. That's all I was saying.

Oh, and btw, my wife is reading along with this and having a chuckle. She finds your description of me somewhat amusing. Perhaps a little too much

Perhaps she is laughing at how perceptive I am, and in fact she hates you and is only with you because you have an acceptably-sized penis? But anyway, enough of that

Actually, I disagree with you that PR is an easily dispensable sector that is most likely to be the first to go, in a company trying to cut costs. Given the current climate, consumer confidence is vital to keep business alive, and in some ways more vital than access to credit, especially so for larger organisation. For example, one could argue that Northern Rock went down not because of financial factors, but because of a PR disaster that led all customers to lose faith in the bank's liquidity, regardless of its real financial circumstances.

I assume your wife, working for a large PR agency, but have many large clients, who wouldn't dream of cutting their comms budget. In a climate of somewhat hysterical consumers, managing your reputation is key to make sure customers retain faith in your business. Yes, it is difficult to measure, but that doesn't mean people can't see the added value.

And btw, I don't work in PR, so this isn't a heartfelt rant to save my industry!

RobertoMoir

wintersunshine wrote: »

And I think you a heartless, selfish jerk. Not everyone can be as lucky as you my friend. Some people are born with nothing and live from hand to mouth everyday and are not able to build up massive savings to survive the type of recession that is going to hit us..

You say they're a "heartless, selfish jerk." I say they understand that sometimes medicine doesn't taste very nice, and has bad side affects, but still needs to be swallowed in order for the patient to get better.

sabretoothtigger

wintersunshine wrote: »

No I'm not bitter that the HPCers have cheered this recession on...:rolleyes:

Good because its the guys who bid up the prices who are more to blame for the crash after.
Someone sitting back not invested in housing before or after a fall is relatively neutral in comparison whatever they say or think

huntersc wrote: »

PR is an example of one of those sectors that will feel the pinch because what it brings to the table is difficult to measure and more often than not a nicety. Very much like interior decorators that work for large organisations or even those in HR. These are the people that get laid off first. Why? Well because they add little to the balance sheet at the end of the year. That's all I was saying.

PR would be part of the service sector and more reliant on a consumerist economy.

Many argue the west has spent too long consuming and not enough time actually making things like you say, if recession is adjustment then I guess those service sector jobs will suffer most of all

huntersc

wintersunshine wrote: »

And this is the point I have been making.

Don't worry about me, I'll be fine, I'm revenue generating, even if you paid me £10m a year I'd be a good investment. If I didn't do what I do then I could pretty much do any job I wanted.

However I do worry for those that aren't as lucky. It pains me to see more news of redundancies everyday. My brother in law, although not directly employed by ENTUK is likely to lose his job because of what's happening. It's sad and it's miserable but it's happening and we have to accept that and make the best out of it. We'll also feel a lot happier if we understand why this is happening and that, ultimately, it's necessary to enable us to move forward.

baby_boomer

wintersunshine wrote: »

But you HPCers got what you wanted - cheap houses

And about time too .

Our indebted young people were entering a future without hope until the crash came along .

Not cheap enough, yet, though.

Really2

huntersc wrote: »

You see, that's exactly the attitude that got us here in the first place. "Who cares about debt, savings are crap anyway".

I mean for goodness sakes, don't we want to encourage people to save? In any case, your analogy isn't exactly valid is it?

Cēterīs paribus the person with the savings will be in a better position than the one without.

:rolleyes: Did i say that. No.

I take it no one should have a mortgage? (I have no debt other than a mortgage.)

I have £100K in my property, which also means my mortgage is hundreds of £'s cheaper than renting.
Meaning I can pay it off faster.

If I have more money than you on paper would that make me in a better position than you?
I would have thought keeping our jobs would be more relevent and protecting what you have should your circumstances change.

PS most on here want cheaper houses so they can buy a house with a mortgage (hello debt)

huntersc

SGE1 wrote: »

Perhaps she is laughing at how perceptive I am, and in fact she hates you and is only with you because you have an acceptably-sized penis? But anyway, enough of that

Actually, I disagree with you that PR is an easily dispensable sector that is most likely to be the first to go, in a company trying to cut costs. Given the current climate, consumer confidence is vital to keep business alive, and in some ways more vital than access to credit, especially so for larger organisation. For example, one could argue that Northern Rock went down not because of financial factors, but because of a PR disaster that led all customers to lose faith in the bank's liquidity, regardless of its real financial circumstances.

I assume your wife, working for a large PR agency, but have many large clients, who wouldn't dream of cutting their comms budget. In a climate of somewhat hysterical consumers, managing your reputation is key to make sure customers retain faith in your business. Yes, it is difficult to measure, but that doesn't mean people can't see the added value.

And btw, I don't work in PR, so this isn't a heartfelt rant to save my industry!

Certainly not the penis size but I have a really really nice car which I let her prang a lot so maybe it's that...

Northern Rock's collapse had nothing to do with bad PR, that's a totally different issue. They could have employed every PR agency on the planet and had them singing carols outside of branches and the same thing would have happened.

Furthermore PR isn't really about revenue generation. It's about positive exposure. As such PR budgets of large companies are being severley cut back and the budgets moved to marketing. Take Tesco. It has lost complete ionterest in the green agenda, sustainable farming, pollution, all those things that the PR agency worked so hard to promote. Now it's about 50% sales, pushing profits rather than pushing an agenda. As such marketing is now at the fore and PR has taken a back step.

I think you're somewhat mixing up PR and marketing. I understand they derive from the same department and are sometimes undertaken by the same agency but they are tow very different functions.

huntersc

Really2 wrote: »

:rolleyes: Did i say that. No.

I take it no one should have a mortgage? (I have no debt other than a mortgage.)

I have £100K in my property, which also means my mortgage is hundreds of £'s cheaper than renting.
Meaning I can pay it off faster.

If I have more money than you on paper would that make me in a better position than you?
I would have thought keeping our jobs would be more relevent and protecting what you have should rour circumstances change.

PS most on here want cheaper houses so they can buy a house with a mortgage (hello debt)

You have £100k in your property today. Of course to realise that you would need to sell which, in this market, is a little unlikely. But tomorrow that £100k is £99,990. If you're lucky this time next year that £100k will be £60k. Sorry, that's a bit of a distraction but probably worth pointing out to you.

Getting back to the point, the poster said:

"I'd rather have tons of savings than tons of debts during a recesssion."


You disagreed with him. I think it's very difficult arguing from an economic perspective that having debt during a recession or in an inflationary or deflationary period is a positive!!

Right now everyone should be doing everything to pay down every little debt that they have. Get rid of it and don't get into any new debt. Being leveraged 5/1 right now is bad, very very bad.

Spending money, although potentially good for the economy (depending on which school of thought you subscribe to) is not good for the individual. It's even worse if you're spending on the basis of future wealth,m i.e, on credit.

And once again, with all things being equal, the person with no debt is in a better position than one with debt.