[Archived] Global Recession Looming

[broadsword]

Ha, I'm sure all this would've never have happened if no-one had mentioned it!

"Don't mention the credit crunch and carry on as usual, it'll go away dear."

yes, I'm sure that would've got the money supply flowing again.

[stuwilky]

Ha, I'm sure all this would've never have happened if no-one had mentioned it!

"Don't mention the credit crunch and carry on as usual, it'll go away dear."

yes, I'm sure that would've got the money supply flowing again.

That isnt what I meant of course Bryan - it was (and still is) the impact the ridiculous sensationalism has on consumer spending - in fact didn't you say something similar or is my mind playing tricks on me again?

[thenodrog]

Alot of consumer spending has been financed by people remortgaging their homes to release capital. Perhaps the shock of negative equity because their mortgage debt now exceeds the value of their increasingly worthless homes might force some into changing their behaviour.

No it won't, that level of stupidity is ingrained. I rather think that it means that their bank / building society manager will stop their irresponsibility for them.

[broadsword]

Consumers aren't spending, that's true. But you can't put that down to "ridiculous sensationalism" (whose? the media's?)

People are worried about their jobs, they're worried about the debt levels they already have, they're toghtening their belts and trying to avoid putting anything more on the tick. Businesses are finding it hard to get loans.

I think there's more to this than "ridiculous sensationalism", I don't think that has anything more than a minor part to play right now.

If only the cold facts had been reported and no-one got worried at all that I would bet we'd still have 0.1% interest rates and negative inflation right now.

[jim mk2]

No it won't, that level of stupidity is ingrained. I rather think that it means that their bank / building society manager will stop their irresponsibility for them.

Bank and building societies are equally as irresponsible for the present mess as individuals. Fliers for credit cards and loans continue to arrive in our post and from anecdotal evidence lenders are starting to offer 95 per cent loan to value mortgages again.

Strict rules need to be put in place for mortgage lending either on loan to value or multiples of income (tiresome political dogma warning ) as existed before Thatcher (end tiresome political dogma warning) to prevent another house price bubble and consumer boom ten years down the line.

[thenodrog]

Bank and building societies are equally as irresponsible for the present mess as individuals. Fliers for credit cards and loans continue to arrive in our post and from anecdotal evidence lenders are starting to offer 95 per cent loan to value mortgages again.

So what? I've never responded to any credit cards / loan offers that arrive through my letterbox have you? Anybody that gets themselves in trouble financially not through desperate need but simply through responding to easy credit offers does so through ingrained stupidity.

Then again whose the stupid ones? It's weird but now if they have nowt for the bailiffs to take the courts frequently let em off their debt.

[thenodrog]

The time is coming to remortgage the house and put it all into the stockmarket : stick to bricks and mortar if you like but there is serious money to be made in banks shares over the next 2 - 3 years.

Alot of consumer spending has been financed by people remortgaging their homes to release capital. Perhaps the shock of negative equity because their mortgage debt now exceeds the value of their increasingly worthless homes might force some into changing their behaviour.

[Eddie]

That's an easy answer when it is just a few individuals getting into a financial mess, but when we are all dependent on these banks it isn't good for us all if people can't pay off their debt. People shouldn't get into debt, it's as simple as that, but banks shouldn't either and by offering up as many credit cards and loans as they have that is exactly what they have done. If they act in the same way that they did before this crisis then we are in for a huge amount of trouble.

[Bazzanotsogreat]

That's an easy answer when it is just a few individuals getting into a financial mess, but when we are all dependent on these banks it isn't good for us all if people can't pay off their debt. People shouldn't get into debt, it's as simple as that, but banks shouldn't either and by offering up as many credit cards and loans as they have that is exactly what they have done. If they act in the same way that they did before this crisis then we are in for a huge amount of trouble.

The crux of the argument is this IMO. Why is the recession deeper in the UK than any other Western nation? Including the US where the credit troubles started.

Secondly, why is the UK the most indebted nation (proportionally?) in the Western Hemisphere. Even Labour’s most blinkered of supporters can’t put a positive spin on either of these disastrous indicators.

[jim mk2]

QUOTE (jim mk2 @ Mar 15 2008, 00:31 )

The time is coming to remortgage the house and put it all into the stockmarket : stick to bricks and mortar if you like but there is serious money to be made in banks shares over the next 2 - 3 years.

Thanks for bringing that back up and very good advice on my part.

I was 6 months early because as it turned out bank shares continued falling until November but in the past 6 months Barclays have risen 400 per cent, RBS by 300 per cent and Lloyds by a similar amount. All three have much farther to go.

I gambled on Pendragon (the motor dealer) 2 months ago and they are up 600 per cent. Recessions are good for some.

[jim mk2]

The crux of the argument is this IMO. Why is the recession deeper in the UK than any other Western nation? Including the US where the credit troubles started.

Wrong. GDP is forecast to fall 3.5 per cent compared with similar falls in the US, France, Spain, 4 per cent in Italy and 6 per cent in Germany.

[Bazzanotsogreat]

Wrong. GDP is forecast to fall 3.5 per cent compared with similar falls in the US, France, Spain, 4 per cent in Italy and 6 per cent in Germany.

Wrong, again you choose to believe Darling's heavily spun stats. The city predict the UK's GDP decline to between 5-6.5%. Even the IMF criticised Darlings optimistic prediction.

[stuwilky]

bazza,

What are the actual falls as recorded by those nations thus far?

[Bazzanotsogreat]

bazza,

What are the actual falls as recorded by those nations thus far?

In one quarter alone the UK economy shrank a staggering 1.9%.

The budget predicts what will happen for the financial year 2009-10. Your man Darling predicts that the economy “will only” contract 3.5- even the IMF believes that figure is vastly optimistic.

[stuwilky]

In one quarter alone the UK economy shrank a staggering 1.9%.

The budget predicts what will happen for the financial year 2009-10. Your man Darling predicts that the economy “will only” contract 3.5- even the IMF believes that figure is vastly optimistic.

Yeah I know that.

He isnt my man. What did I ask?

[Bazzanotsogreat]

Yeah I know that.

He isnt my man. What did I ask?

The US has reported a contraction of 0.5%/0.7 for the last two quarters.

Guardian: IMF predicts recession to be harsher in UK than rest of the Western world

[jim mk2]

Depends who you want to believe. This says the US is heading for a 6.2 per cent GDP decline.

http://ablog.typepad.com/key_trends_in_the...of-decline.html

[Bazzanotsogreat]

Depends who you want to believe. This says the US is heading for a 6.2 per cent GDP decline.

http://ablog.typepad.com/key_trends_in_the...of-decline.html

Tut Tut. As an ex-hack, I thought you of all people would check your sources. That link is nothing more than someone’s personnel blog. I will stick to the IMF predictions thanks.

[jim mk2]

Tut Tut. As an ex-hack, I thought you of all people would check your sources. That link is nothing more than someone’s personnel blog. I will stick to the IMF predictions thanks.

Read it again #. It's an analysis of a press release by the Us labour department.

If you need to be spoonfed here's more. It also says Germany and Japan is likely to be even worse than the US.

http://news.bbc.co.uk/1/hi/business/8024839.stm

[Bazzanotsogreat]

Read it again you twerp. It's an analysis of a press release by the Us labour department.

Errr no Jim it’s a blog from a website which appears to ‘loosely’ associated to a Chinese research facility which specializes in Globalisation.

When you click on the hyperlinked texts, it does corroborate any of the claims made in body of the text.

Read it again you twerp. It's an analysis of a press release by the Us labour department.

If you need to be spoonfed here's more. It also says Germany and Japan is likely to be even worse than the US.

http://news.bbc.co.uk/1/hi/business/8024839.stm

So you a retired ex-hack, are claiming to have a better insight than the IMF & World bank?

You are wasted on here Jim.

[jim mk2]

Figures in the BBC story are from the US federal reserve and the IMF.

[Neil Weaver]

QUOTE (jim mk2 @ Mar 15 2008, 00:31 )

Thanks for bringing that back up and very good advice on my part.

I was 6 months early because as it turned out bank shares continued falling until November but in the past 6 months Barclays have risen 400 per cent, RBS by 300 per cent and Lloyds by a similar amount. All three have much farther to go.

Nice one Nostrodamus, have you been taking advice from Alastair Campbell ? Makes a big difference to share prices does 6 months.....

             March 08    Nov 08   Now
Barclays     300ish      150ish   280ish
RBS          250ish       50ish    44ish
Lloyds       300ish      100ish   110ish

Invest in November and you'd have a bit of profit (not sure I'd agree with your numbers though, maybe Jan 09 rather than Nov 08?) but if you'd shelled out in March you'd be well out of pocket.

Not disputing that the stockmarket is the place to have money for the long haul btw.

[stuwilky]

Bazza, sorry if I was unclear. I am not after forecasts - I am after actual declarations. Surely that is the only way to review "who has it worst". A forecast isnt really worth a right lot (or lets face it, Id be loaded)

[jim mk2]

Not disputing that the stockmarket is the place to have money for the long haul btw.

The Footsie peaked at around 7,000 in 2000 and is now around the 4,000 mark so I'm not sure that's true any more.

In between however there have been some enormous swings up and down all of which have been extremely profitable if you got your timing right.

[pg]

My 3 y.o. son could do as good a job as economic 'forecasting' as the IMF, World Bank..or anyone else for that matter.

Has anyone ever seen verification statistics, or skill-scores published for any economic 'forecasts'?