Never thought I would see the day.

kennyboy66_2

http://www.creditaction.org.uk/assets/PDF/statistics/2009/august-2009.pdf

Total UK personal debt actually falling.

May £1459bn
June £1458bn





*I know, I know, its all those people who have gone into insolvency*

mbga9pgf

Ah well. One bill down, only another 1458 to go.

(although realistically, we need to cut our debt by around half IMO, not eliminate it completely.)

Generali

kennyboy66 wrote: »

http://www.creditaction.org.uk/assets/PDF/statistics/2009/august-2009.pdf

Total UK personal debt actually falling.

May £1459bn
June £1458bn





*I know, I know, its all those people who have gone into insolvency*

It's deleveraging innit and it's why I still think there's a serious risk of deflation in the UK.

The same thing happened in Japan in the 1990s, the UK in the early 20s and the US in the 1930s.

It's not people becoming insolvent, it's people chosing to pay down their debt/increase savings because they're worried about the future.

Keynes called it the Thrift Paradox: people save more because they're concerned about losing their jobs in the future. That causes GDP to fall so they lose their jobs.

Graham_Devon

Good stuff if you ask me.

People are starting to take control of their finances, and this is certainly on the right track, and I hope it stays that way.

I would also assume part of the decrease is to do with credit now being harder to get, so people are giving up easier. Whereas one look on the credit card board a year ago, people thought having credit was a fundemental human right judging by the many threads I saw on "I have been declined, not fair, what can I do".

System

I cleared my car loan this month, and student loan is all cleared as of May. I'm giving myself a pat on the back for reducing the nations debt.

Californication

Generali wrote: »

It's deleveraging innit and it's why I still think there's a serious risk of deflation in the UK.

The same thing happened in Japan in the 1990s, the UK in the early 20s and the US in the 1930s.

It's not people becoming insolvent, it's people chosing to pay down their debt/increase savings because they're worried about the future.

Keynes called it the Thrift Paradox: people save more because they're concerned about losing their jobs in the future. That causes GDP to fall so they lose their jobs.

But you're describing a closed economy. We have trade and a free float currency. As long as someone will buy what we make, people will have jobs. The problem is how the world works when the consumer nations (USA, UK, etc) try to export. We shall see...

--C

Generali

Californication wrote: »

But you're describing a closed economy. We have trade and a free float currency.

People across the Western world seem to be paying down debt.

milliemonster

Yep, that billion reduction is mine!!!! (maybe not quite but it sure feels like it)

Thrugelmir

kennyboy66 wrote: »

http://www.creditaction.org.uk/assets/PDF/statistics/2009/august-2009.pdf

Total UK personal debt actually falling.

May £1459bn
June £1458bn





*I know, I know, its all those people who have gone into insolvency*

This only makes sense if we know the figures for savings. Building Societies have suffered net withdrawls of deposits. Suggesting that people in part are repaying debt.

Though any reduction is good news.

Thrugelmir

milliemonster wrote: »

Yep, that billion reduction is mine!!!! (maybe not quite but it sure feels like it)

So at one billion a month thats 60 years to halve the debt!

treliac

Generali wrote: »

People across the Western world seem to be paying down debt.

That's paying it down earlier than necessary?

Then there's those who can't afford to pay what they owe when they owe it. So how easy is it to declare bankruptcy and have debt wiped out? What effect does the level of unpaid debt have on the Thrift Paradox and the economy in general?