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How personal debt grew to £1.4 trillion.
Comments
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Groundhog day.'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0
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Wow - a 10% real terms decrease in debt over 2 years - that must be historically unprecedented (except maybe during periods of very high inflation?)- amazing the money supply has remained positive against such a headwind.
250k of that debt is mine - it is secured against a property worth nearly twice as much and it is also on deposit earning more interest than the mortgage costs - of course if I subscribed to the 'all debt is bad' arguement that seems to lie behind this type of scaremongering I would be more sensible to use the capital to pay down the debt and forgo the 2-3k after tax profit I make on the borrowings...
Hence QE. Anything to stop M4 measure of money going negative for an extended period. Deflation is in all places and at all times a monetary phenomenon.0 -
someone should do a line graph with UK personal debt one of two Y-axes, UK average pwoperdee price on the other of two Y-axes.
and then anyonymise the axes, challenge people to guess which line is which.
prior to 2008 it would be impossible to do this because the two track each other almost to the millimetre.FACT.0 -
If the entity that is done through is based abroad (eg Luxembourg, Ireland, Cayman Islands; there are lots of places you could chose for all sorts of reasons) then the debt disappears from these figures. The likelihood is that the Bank of England numbers will be understating the actual amount of consumer debt by an unknown amount.
*Securitising debt is when you parcel it up and sell on the flow of income and principal repyment to someone else.
I really doubt this is the case. I know the figures often have movements in due to securitisation, however if you the BoE definition it suggests that the numbers include all sterling loan balances execpt those made by non profit organisations.
http://www.bankofengland.co.uk/statistics/ms/articles/art1feb10.pdf
Read this - it made my brain hurt though.0 -
RenovationMan wrote: »Still, let's not let facts, figures and logic get into the way of (yet) another AD9898 debt rant.
Wouldn't really say it was a rant, just posted an article with some figures and made a comment, not so much about the debt, more about the bankruptcies, debt rescheduling etc.
Of course due the nature of this board, no one is ever likely to say, yep I'm one of the ones that is screwed, however go to other areas of MSE and they are quite a significant minority, which is all I said in my OP.Have owned outright since Sept 2009, however I'm of the firm belief that high prices are a cancer on society, they have sucked money out of the economy, handing it to banks who've squandered it.0 -
As I say Groundhog day.
https://forums.moneysavingexpert.com/discussion/comment/41383136#Comment_41383136'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Was that deliberate? Clever, I see what you did there
It wasn't, but I take your point 'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
I really doubt this is the case. I know the figures often have movements in due to securitisation, however if you the BoE definition it suggests that the numbers include all sterling loan balances execpt those made by non profit organisations.
http://www.bankofengland.co.uk/statistics/ms/articles/art1feb10.pdf
Read this - it made my brain hurt though.
Ok, I get it (I think).
The loan table I got my data from (which tallies with the OP's data) is A5.2. This is what the document you found has to say about that:For the lending to individuals data, loans that have been securitised to UK-resident SPVs are already included in the lending figures prior to 2010, as part of lending by ‘Other Specialist Lenders’. In January 2010, these loans will switch from lending by Other Specialist Lenders to lending by MFIs. Loans that have been securitised to non-resident SPVs in the past are not included in pre-2010 data, so there will be some increase in total lending to individuals to account for these loans being brought back on MFI balance sheets.
The way I translate that is that there will be an ongoing process to bring securitised debt onto bank balance sheets and hence into the lending figures shown in the table. That should have the impact (in most cases) of increasing the amount of debt reported as outstanding.
The last change seems to have been in December 2010 when there was a noticeable jump in credit card lending as a result of a securitised debt being brought back onto the bank balance sheet. Looking at the footnotes on my figures suggests that the process of bringing stuff back onto the balance sheet may well still be ongoing, albeit at a slower pace. It may be all done now or there may still be masses of the stuff still waiting to be brought onto the balance sheets of the banks. Given the opacity of bank financial statements I doubt it is possible to tell unless the banks are going to fess up.
IME honesty isn't the first thing that bankers reach for. Obfuscation and weasel words are more what we go for.0 -
85% of personal debt is mortgage debt. This might explain the rise (in house prices and debt):
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