The market is gathering momentum.

fc123

Kez100 wrote: »

You know what I mean.

To me there are two elements to this recession. It's the second I want changing and I look at Conrad's post as an indication funds may start to flow.

I dont worry unduly about a normal recession. It's healthy when you see how complacent and wasteful people get during a boom. I look forward to continued falls in house prices, they need adjusting, and I say that as a home owner (although one who couldn't give a damn what it's worth)

However, what worries me this time and we desparately need to stop far more poepl suffering than need to, is liquidity. Businesses are squealing for cashflow. This happened with such speed no one got any chance to reassess. Promised support has disappeared and margins increased suddenly and little one can do because you can't just move banks at the moment. About the only thing you can do is shout and scream and hope you get through. I had a mate in this situation the other day. The only way we could get out of it was me go with him (as I have business savings with the same bank) and I said that I would move banks if he didn't have his margin returned to normal. We ae not talking big beer here. Very small beer, actually. This lack of liquidity is really, really worrying me.

This worries me......I have read Alan M's post, but didn't post on it as I have zero knowledge on the granite business.
Mr dodgy income can get a loan now...but a sound business get's it's finance withdrawn.
I know there is always more to everything than meets the eye but, on face value, seems like they are tring to recreate the past, rather than moving forwrd, with the lessons learnt from past mistakes.

Could it be that the old 'Housing boom' industry is trying to be re-ignited by the Govt.?
Afterall, from what I can see, it seems to have been the biggest earner in taxes and earnings (via MEW, Flipping, mortage/EA fees etc) over the past few years.
Then there was all the city stuff going on.....creating income from...well what? Nothing really. Fees from this, bonuses from that, a cut from every churn. Much of that was property related too.....rising values ad infinitum.


I think I am turning into crazeee woman.

Kez100

I don't know what is going on. I have also read Alan M's post and really feel for him. I have only two examples that I know of. One was a promise they could borrow £90k (they own outright property of about £1m at height values but it isn't selling despite drops) but they had lived on a lot less borrowing only half of the promise, 45k. Then they had some tax to pay went to draw on some of the 'promise' and was told no more! Apparantly there is a system where you can spread tax at the moment so they have applied for that and agreed to pay it off over a few months.

My mate was margin. They wanted more due to higher risk. His income hasn't dropped, although it might but he isn't in a obviously problematic business - like car sales or anything. The risk is all due to banks crashing! He was wild. I was sort of wild thinking it could so easily have been me. So, we just got together and paraded in and gave them what for. As I said it is really very small beer but my savings were twice his overdraft and his margin increase 1%. My savings are bringing in very very little in interest, so it had to be to their advantage to drop his increase. I was annoyed enough I would have moved, although who knows where too!

luvpump

Yep ..we have entered what will be the deepest Recession since the depression of the 30's & the Market is gathering "Momentum" .... whatever you say !!

fc123

Not wanting to go off topic too much (hard I know....and no funny ha ha'a please at that expression either) but our problems at the moment are proving easier to solve without any access to borrowing.

It's hard to explain but we are having (almost have now) to decide which fork to take based on what is actually coming in and what we can finance today, on our own.
It was the same when we started out 22 years back.....zero access to borrowing.

I don't want to pass the above as judgement, paticularly on Alan M's thread as I run a different type of business and we are currently researching bankruptcy, beneficial interest and the rest so we can discard the old to concentrate on the new.

I will post a seperate thread on it at some point...but I don't want to jeopardise our masterplan.

Bankruptcy doesn't just involve profligate spending on Plasmas....it can involve signing bad lease agreements 11 years back during a static market...and the LL not agreeing to surrender out of spite and avarice....no other reason.

Kez100

I know someone who had an offer today. Low, but not ridiculously so.

Conrad

mewbie wrote: »

Surely letting the banks go under ( their problem, capitalism, get over it) and using the money to support the rest of business (people who make and sell useful stuff) might have been better.

Many American Banks went pop in the Great Depression, which lead to people not wanting to deposit thier money which in turn lead to mass business failures and ended up with millions in abject poverty. Central Park had a cardboard city.

If RBS had failed there would be mass panic followed by Great Depression 2, where for example little old ladies pension pots could be wiped out in a day.

Conrad

fc123 wrote: »

Mr dodgy income can get a loan now...but a sound business get's it's finance withdrawn.

Yes, but he still has to prove he is trading with some invoices and maybe Bank statements, and he is borrowing under 50% ltv.

We all like to sound off about Mr Dodgy not paying his share of Tax, but lets face it people in all walks of life obtain advatages. Take for example Kirsty Walk, the good ole socialist presenter of Newsnight. She received £400,000 for a few days consultancy - apparantly her views on the design of the new Scottish Parliament building was worth that!!:rotfl:

Such people squeeze opportunity from all thier contacts, just like the old Tory boy network used to.
Similarly Lenny Henry loves to get his face all over Red Nose day, for "free", how nice, but what of all the free publicity that turns into real income in his trouser pocket as a result.

I'm not making my point well here, I know, but I'm trying to say that Mr average builder also wants to make the most of his opportunities.
He doesnt have the luxury that Bonno enjoys - off shore Tax havens. He doesnt have the 'lucky' contacts of Kirsty Walk.

twirlypinky

A large part of me thinks that this recession is going to clear the decks a bit. Only very financially sound, good, buisnesses will survive, and I think that's a good thing. When woollies went under i felt like the only person that thought it was a good thing. Woollies was no longer a good shop, they're weren't really cheaper than anyone else and they didn't have anything unique.

Also, hopefully when all this is over house prices will be reasonable, instead of stupid as they have been lately. As things stand at the moment, you still don't have much hope if you're sinlge unless you have huge amounts of savings (and having just scrambled my way out of a marriage, that's not me!).

On top of both of those plus points, credit will be harder to get for the people that shouldn't really be having it. Can't afford to pay back? Then you shouldn't be borrowing. This is a basic fact, yet over the last 10 or so years more and more people have been borrowing above and beyond what they could afford.

So yes, on the pesimistic side things are looking crap, people are losing their jobs and that's terribly sad. But i think when things have finished falling and changing and started to level out again this country will be better off.

Okay, commence pelting me with rotton fruit [twirly pulls on plastic jump suit and crash helmet].

Kez100

I disagree. There are good businesses that may have been able to have build up reserves differently if they had known they had too. They were using the markets and suddenly everything dried up. There will be some sound businesses going down - or being charged more - and they do not deserve that.

I also think Woolies had become a waste of space.

Conrad

The Halifax figures this morning seem to indicate the market is indeed regaining some momentum.