Board logo

How bad will things get ....
woodster - 5/6/12 at 09:47 PM

This debt crisis seems to be building up speed , Greece seems to be a dead on its feet what ever it does, Spain's banks are emptying to a point where they could all collapse at any minute and now the uk banks are starting to admit they have more problems

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9312513/UK-banks-sitting-on-40bn-of-undeclared-losses.html


Where will it end ? In mass unemployment ? Soup kitchens for the masses ?

Or will it just sort its self out and I shouldn't give it a second thought

TAZZMAXX - 5/6/12 at 09:54 PM

Personally I think it will sort itself out providing people keep living within their means. This has been going on longer than any recession I've known and it doesn't appear to be anywhere near finished despite seeming like it's tailing off.

I'd like to see the media eating at soup kitchens as they are the prophets of doom that have extended everyone elses misery by inaccurate and sensationalist reporting.

StevieB - 5/6/12 at 10:13 PM

Personally I think it would be a lot better if the media would stop jumping all over things so much - shout recession enough times and people will stop spending their money and the recession will continue longer.

As said, if we all live within our means then it will tail off soon enough and we'll all learn an important lesson about credit cards and over financing as well!

Rod Ends - 5/6/12 at 10:14 PM

quote:
Personally I think it will sort itself out providing people keep living within their means.

What makes you think people want to live within their means?

Dangle_kt - 5/6/12 at 10:33 PM

quote:
Originally posted by woodster
This debt crisis seems to be building up speed , Greece seems to be a dead on its feet what ever it does, Spain's banks are emptying to a point where they could all collapse at any minute and now the uk banks are starting to admit they have more problems

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9312513/UK-banks-sitting-on-40bn-of-undeclared-losses.html


Where will it end ? In mass unemployment ? Soup kitchens for the masses ?

Or will it just sort its self out and I shouldn't give it a second thought


Isn't the point of that story that banks are busy covering their arses against potential losses, by not lending it to anyone else they are therefore holding it back in reserve in case the worst happens (which it might not).

From a " we are about to have a financial Armageddon" perspective, that is a good thing, and helps protect against it.

Plus that isn't a "new" story - just the media have just found out about it by an organisation analysising the 2011 books.

RK - 5/6/12 at 10:35 PM

An acquaintance of mine from autoslalom has a good idea: make the bankers and the like, endure media interviews, once a month, for the rest of their lives. It would certainly change things.

morcus - 6/6/12 at 12:48 AM

I'm more leaning towards the 'it'll sort it's self out' aproach as from the ground as it were, we should all be fine if we live with in our means. Granted some people don't like that idea, and I know from experience how hard it can be.

It's all very well blaming 'the media' but reporting is how they make money. This all probably wouldn't have been so bad if certain outlets had shut up though, and not scared people into acting stupid and causing alot of problems.

MikeRJ - 6/6/12 at 06:56 AM

quote:
Originally posted by morcus
I'm more leaning towards the 'it'll sort it's self out' aproach as from the ground as it were, we should all be fine if we live with in our means.


I'm a firm believer that it should be MUCH more difficult to live outside your means.

RazMan - 6/6/12 at 06:57 AM

I place most of the blame firmly on the media's shoulders - if they can't find a good story from the facts then they usually make up their own 'facts' and take things entirely out of context, causing the masses to carry on with a Tsunami of misinformation.
Gag the media on certain subject matter and watch the recession disappear

Slimy38 - 6/6/12 at 07:08 AM

quote:
Originally posted by MikeRJI'm a firm believer that it should be MUCH more difficult to live outside your means.


Amen to that. There should be reasonable access to essential debt (I consider a mortgage to be an essential debt, maybe a car loan if it's job related etc), but there should be no need to cover more debt.

And yes, I also blame the media. From my incredibly blinkered view this recession is a self fulfilling prophecy. We get told there might be a recession, people stop spending money, bingo there is a recession.

I'll get off my soapbox now...

Ninehigh - 6/6/12 at 07:21 AM

quote:
Originally posted by Slimy38
And yes, I also blame the media. From my incredibly blinkered view this recession is a self fulfilling prophecy. We get told there might be a recession, people stop spending money, bingo there is a recession.

I'll get off my soapbox now...


Oddly enough I was saying this about a month after they started that... Plus I also blame the energy companies (along with fuel tax) that keeps a bit of disposable income out of our pockets

A1 - 6/6/12 at 07:31 AM

I think the problem is that a lot of people havent learnt thier lesson from whats already happened. A lot of the financial bunch are still doing things like hedge funds, that got us here, albeit partly, in the first place. until we sort them out the banks cannot think of improving the state thier in.
As said, people need to start/keep living within thier means and stop buying stuff they can't afford. I think the problem is waay worse than most people are aware, hence they keep living the same lifestyle they used to which doesnt help things.
I heard last year that there was at least another 8 years before it takes a turn for the better.
Thats if those bloody politicians dont f*** it up any more for us.

just me 2p

[Edited on 6/6/12 by A1]

Daddylonglegs - 6/6/12 at 08:16 AM

As they were saying on the radio (I know, media again!) this morning, the banks are still hoarding the money and making it almost impossible for businesses etc. to borrow cash. How on earth are things supposed to 'grow' when they refuse to lend to the very fabric of growth!?

balidey - 6/6/12 at 08:37 AM

I work in an engineering sector.
Just as the recession hit we, like others, felt the pinch.
After about 6 months we were busy again.
All the suppliers I deal with are the same. Very busy.
So ONE comment I would make is, we need to get engineering and manufacturing industries back into the UK. Get kids educated properly and not think they can rely on a job in IT or services.
Another comment. Credit has been far too easy to get for the past 10 years. This has made everyone think they are living within their means when they are not.
If I want a new TV, I save up then buy it.
Other people think they can buy it now and put it on the credit card.
This is not the same as the old 'never never' as with a credit card a £600 TV doesn't really mater when you have a credit limit of £10,000 on a card.
I do have a credit card, but its only ever used in dire emergencies, ie when our freezer packed up we didn't have time to save up, so we used the card. To me thats how credit should be used.

But the problem we are in now, my solutions above will not help as its not going to happen over night, or even in a decade.
So my vote is ride it out and push all the blame on the shoulders of the Bankers and Media.

Dangle_kt - 6/6/12 at 08:58 AM

quote:
Originally posted by A1
I think the problem is that a lot of people havent learnt thier lesson from whats already happened. A lot of the financial bunch are still doing things like hedge funds, that got us here, albeit partly, in the first place. until we sort them out the banks cannot think of improving the state thier in.
As said, people need to start/keep living within thier means and stop buying stuff they can't afford. I think the problem is waay worse than most people are aware, hence they keep living the same lifestyle they used to which doesnt help things.
I heard last year that there was at least another 8 years before it takes a turn for the better.
Thats if those bloody politicians dont f*** it up any more for us.

just me 2p

[Edited on 6/6/12 by A1]


I'm pretty sure hedge funds are a safer way if trading where risky shares are balanced against safer bets (the hedge).

If I have understood correctly it was more that people who were trading didn't understand what debt it was they were trading as it had been agreigated up so high and badged as safe by the credit agencies. When it became apparent that the debt wasn't safe, the house of cards fell in and ripples were felt all over.

I agree people need to live within there means, but coming.back to that link in the original post - it is not about banks being in trouble, that isn't the story.

Toprivetguns - 6/6/12 at 09:04 AM

Isn't there meant to be a massive meteor destined for our planet in 2019 ?

I say no point being the richest man in the grave yard, enjoy your hard saved money now !

motorcycle_mayhem - 6/6/12 at 09:05 AM

How bad? It hasn't even started yet.

Funding the retiring baby boomers, employing escalating numbers in public non-jobs, creating all the smoke to conceal the debt mess. Too much greed, too many humans.

From where you are, don't worry you'll notice nothing. Money will be printed to cover everything up, further generations will have their futures mortgaged for todays problems. The greed and the ruling class will prevail, God Bless JP Morgan.

The solution will be war. Coming soon, but for so many reasons that I can't decide which one will be deciding, but perhaps all of them. A bit of social unrest too from the disenfranchised masses, where's my gun...

nick205 - 6/6/12 at 09:06 AM

quote:
Originally posted by woodster
This debt crisis seems to be building up speed , Greece seems to be a dead on its feet what ever it does, Spain's banks are emptying to a point where they could all collapse at any minute and now the uk banks are starting to admit they have more problems

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9312513/UK-banks-sitting-on-40bn-of-undeclared-losses.html


Where will it end ? In mass unemployment ? Soup kitchens for the masses ?

Or will it just sort its self out and I shouldn't give it a second thought




Blimey....I thought George Osbourne had snuck into our camp for a minute there

LCB is as we know the font of all knowledge, but I'm not sure even we can resolve the worlds money problems.

coyoteboy - 6/6/12 at 10:07 AM

quote:

I do have a credit card, but its only ever used in dire emergencies, ie when our freezer packed up we didn't have time to save up, so we used the card. To me thats how credit should be used.


Personally I think even that is misuse of credit - we ensured we bought a house priced low enough that we could stash away enough cash to cover failure of just about every major appliance in the house, or some and a boiler or roof repairs. I use my credit card every month to put fuel on, then pay it straight back off. I took out a student loan (stupidly low rates for 12K) for my degree and banked it, then used that as a chunk of my house deposit and as a student lived within my means and worked all summer to pay for the year.

If I want something I only buy it with cash I actually have in the bank, this seems to be a strange concept to most folk.

Slimy38 - 6/6/12 at 10:15 AM

quote:
Originally posted by balideySo ONE comment I would make is, we need to get engineering and manufacturing industries back into the UK. Get kids educated properly and not think they can rely on a job in IT or services.


Personally I think job satisfaction would be so much better in the engineering and manufacturing industries. I love the fact my IT job pays silly amounts, I hate the fact that I don't appear to be doing anything constructive. I guess that's partly why I want to build a car, to have something to show for my efforts instead of a series of 1's and 0's that is no better than the 1's and 0's that it's meant to replace.

coyoteboy - 6/6/12 at 10:45 AM

The problem with engineering and manufacturing jobs, and I'm an engineer, is that it's a lot cheaper elsewhere and will be for the foreseeable future or unless we lose all human rights and living standards. China etc can churn out parts far cheaper than we ever will. We in the UK are a hub of super-high-tech engineering but that only pays a few bills and the products generally get made elsewhere.

Sometimes I'd love a stupidly high paid 9-5 as a sysadmin. I'm just not sure I could spend every day doing similar stuff, so I pay for it by having a low wage despite 2 engineering degrees and a shedload of experience.

bi22le - 6/6/12 at 12:13 PM

quote:
Originally posted by coyoteboy
The problem with engineering and manufacturing jobs, and I'm an engineer, is that it's a lot cheaper elsewhere and will be for the foreseeable future or unless we lose all human rights and living standards. China etc can churn out parts far cheaper than we ever will. We in the UK are a hub of super-high-tech engineering but that only pays a few bills and the products generally get made elsewhere.

Sometimes I'd love a stupidly high paid 9-5 as a sysadmin. I'm just not sure I could spend every day doing similar stuff, so I pay for it by having a low wage despite 2 engineering degrees and a shedload of experience.


I am also an engineer in design and manufacturing but see a slightly different twist to this.

1) We design and make complex and world leading parts in this country. Leave the mass production to the east, they can get away with poor quality and lower tolerancies.
2) It costs, and will always cost, a lot of money to get things from china to the end user. Not just fuel but import tax.
3) Take the cotton and other past UK industry boom trades as an example. We discover and perfect an industry and let the east make the parts.
4) We need to shape our international position to make sure we stay on top of the pecking. China has some of the cheapest recycling methods in the WORLD to date. This is helping keep metal values down and consumer goods lower than would of been expected 15 years ago. Who knows how the world will evolve in the next 15 years.
5) The world is a small place. The majorty of the chinese population dont have any money so cant buy their 'locally' manufactured goods. If EU and US run out of money who are they going to make things for?

The above can be aurgued as short term thoughts and that the east IS the consumer as they are modernising but there are still many millions of people outside the east and many new industry businesses starting all of the time. Many that the east just cant grasp.

It is very complex and the world is going through a stage and change in state that nobody has ever witnissed. Sit back, hold on tight and scream if you want to go faster!!!

Biz

coyoteboy - 6/6/12 at 02:57 PM

quote:
2) It costs, and will always cost, a lot of money to get things from china to the end user. Not just fuel but import tax.


I agree in general but this really doesn't hold true. On several occasions we've found we could source cheaper, higher toleranced parts faster from the east, especially short turnaround one-offs and 100's of small items. For example we were quoted around £120 per CNC upright, plus postage, from china, delivered in 5 days. In the UK we were struggling to find the metal alone at that price, or anyone that could get them to us within 3 weeks.

Dick Axtell - 6/6/12 at 03:02 PM

This is the title of a book, authors of which were Harold Lever and Christopher Huhne, (wownder if its the same one???). It was published in 1985, and sub-titled "The World Financial Crisis". I used this book as a reference for studies during the 80s.

Apparently, according to the authors, having demonstrated how the world financial system balances on a knife-edge, they postulated that with decisive reform, it would be possible to re-establish sound credit, and defuse the world-wide catastrophic debt bomb.

And this was 1985, remember. So --- why is that our politicos of today didn't read this book??? (Always assuming that they can read, of course).

Final quote from this work - "Iresponsible borrowing cannot exist without irresponsible lending".

When will we (and our banking system) ever learn?

D Beddows - 6/6/12 at 03:16 PM

quote:

On several occasions we've found we could source cheaper, higher toleranced parts faster from the east, especially short turnaround one-offs and 100's of small items.



That's undeniably true at the moment - in 5 -10 years when 3D printing becomes an established technology it might not be quite as clear cut......

I work in the construction/interior fitout industry and I have to say the small company I work for are VERY busy this year and it shows no sign of slowing down - the profit margins are nothing like they used to be but people do seem to be finding the money to invest in their businesses. While we could all do with a bit more money we're not constantly having crisis meetings about cost cutting which was the norm in the industry 2 or 3 years ago.