Ed Balls: Crisis more serious than the '30s

amcluesent

> Maybe there is some new bailout on the way<

Well, the only ready source of cash that's left to steal is the nation's savings.

I've posted before that Clown would steal anything we have over £6,000(*) due to the 'national emergency' and we'd be 'compensated' with worthless perpetuals paying 0.5%.

Loads of people were pauperised by a similar trick in 1939-45 when the government sold 3% 'war loan' that has still not been redeemed.

Right now, I'd be following the smart money and buying bullion that's held offshore in a Swiss vault. Clown is out of control, psychotic. Let's hope the army have plans.

(*) Anyone with savings more than this will be denounced as a 'hoarder' and 'enemy of the hard-working family'. Sound familiar?

oldMcDonald

I love your posts, amcluesent.

They may be full of doom and gloom, but I still love them.

novazombie

Maybe the only reason we haven't had 70% drops already is because the Gov slashed the base rate down to 1% in an attempt to stop repossessions in every street in the UK. All they have done is delayed the problem.


Let me as this question what would happen if the base rate went back up this year. Maybe even higher than it was?

How many will be in neg Equity or the main question how many repossessions will be happening every week?

It will happen, the base rate will go back up. A lot of people are in a false sense of security, thinking they can afford their mortgage repayments even though they are in neg equity. When huge numbers are losing their jobs and the base rate goes back up it will be catastrophic.

Andrew64

I saw this story on the front page of today's Independent. This, after Brown's 'slip of the tongue', makes you wonder what they are discussing in Cabinet meetings. What do they know that we don't? A few days ago the head of the IMF was in Malaysia to meet Asian central bankers and he talked about depression too. Looks like we should all prepare for one!

[Deleted User]

tell that to anyone who lived through the 30s crisis

Generali

For it to be like the US in the 1930s is very unlikely - 30% off GDP I think.

The UK GDP by about 10% in the 1930s which IMO is much more plausible.

That GDP could fall to 1930s levels is deeply unlikely without a major war or other catastrophe.

Andrew64

The problem is that when people say Great Depression, it's the US and it's statistics that get used. The Depression in the UK was bad but not dreadful like in the US. In fact, the UK's Great Depression was in the early 20s, right after WW1.

Does anyone have the UK stats for 1929-33 to hand?

vivatifosi

Andrew64 wrote: »

Does anyone have the UK stats for 1929-33 to hand?

Thank goodness for the world according to Wiki:

http://en.wikipedia.org/wiki/Great_Depression_in_the_United_Kingdom

whathavewedone

Novazombie, the low interest rates aren't affecting all mortgage holders. Lots are on fixed rates of around 5 or 6%.

I also think you insult people's intelligence a bit - interest rates have only been really low since October - I don't think many people genuinely expect them to stay this low forever.

If interest rates shoot up into double figures then the rate of repossessions will rise considerably but I can't see that happening in the near future. If it does it will mean that inflation is rising which means that house prices will rise also which means that people will be starting to dig themselves out of negative equity.

mbga9pgf

If it does it will mean that inflation is rising which means that house prices will rise also which means that people will be starting to dig themselves out of negative equity.

No it doesnt. Prices in the shops rose around 4% according to CPI last year.

House prices fell 20%. Inflation can in fact lead to lower prices, as individuals have less disposable to spend as the essentials are now costing so much more.

What it will mean though is wages should be rising more rapidly, meaning that debt can be eroded more quickly. a £2000 mortgage on a 20K salary = misery, on 60K not a problem!

Thats if you have a job mind, which may be an issue in an inflationary environment...