Can anyone remember the 2008 crash?

[Camouflags]

I was too young but can anyone tell me what it felt like before it crashed? Why did it crash? What crashed?!
Personally how did it affect you? Is this worse so far?

Banks sold 100 or 110+ percent mortgages to some people

Some banks failed

Nothing remotely on this scale happened in 2008!

A lot of redundancies, company closures, price hikes, some people lost savings and investments. But it was all only money really. Yes some people became much poorer and crossed the poverty line - that was probably the start of food banks etc (I don't remember them being so prevalent before then, anyway).

Yes, I remember it.

By 2006, we knew the crash was coming.

This time - its arrival is very sudden.
Although a recession was clearly looming anyway.

For me the 2008 crash was barely noticeable at first. Dh and I are public sector workers with what were then pretty secure jobs and were locked into a 3 year pay deal. About 18 months later things hit us properly, pay cuts for next 2 years (due to 0% rise and substantially increased pension contribution) followed by 0 or 1 % every year after that (Which in fact only ended last year!) Threat of compulsory redundancy, massive voluntary redundancies, recruitment freeze, funding slashed, we now have 1\3 fewer staff than in 2008 and more work! We have still been very lucky though, we kept our jobs, bought a house which we never would have afforded without the price crash, still had enough savings for me to take maternity leave for 12 months. So for me it's been a ripple effect over 10 years and we got off fairly lightly.
This is a lot lot worse!

@rosie1959 agree this is a completely unique situation.

Yes we were completely unaffected until the government decided pay freezes in the public sector and cuts to public services was a great way to move the effects of risky investment banking away from the city of London and on to ordinary people.

I wasn't personally affected as I was in uni at the time, my parents had paid off their mortgage and were both in stable jobs, but I noticed (and still notice) that the cost of living has gone up, and quality of life has gone down since then.

Yes, but the ones a bit earlier, late 80s, early 90s, did the damage for my peers. We boomed and bust, had high unemployment levels and also the Loadsa Money crowd

Yeah. 1987 was worse than 2008.

This is NOT worse as the economy will bounce back once restrictions are lifted.

A key lesson for me was the old cliché of 'cash is king'. All of our money was in our house and our pensions, apart from the recommended three months buffer, and we were close to going under.
Cash in the bank will be important again now and in the coming months. This is maybe why the stock market has crashed as everyone is liquidating their shares.

You can't pay the bills with home equity or pension projections.

I was lucky I was lucky enough to be in a good, steady job, and I’m still there, so didn’t have too much trouble. We did all take pay cuts, but we got them back a couple, of years ago.
Two things I remember is the price of petrol went from €1.50 to €1.00 per litre. Also, I got married in 2008. My best friend tried to talk us into buying the house next door to her for €280,000. Two years later the prices on that road were averaging €130,000.

It was actually good for us, husband had remortgaged his flat just before it on a tracker at 0.5% above the base rate. The rate kept dropping so when I moved on we paid barely anything for the mortgage.

@Camouflags your money in the bank is protected up to £75k

This will be alot worse alot of companies will go bankrupt over the coming weeks/months, alot of jobs lost, country's all over the world have lowered interest rates to bear zero, pumped hundreds of billions in and it is still not helping, we are guanteed a recession and possibly a depression, it will pick up all ways does after a recession but it will take a very long time to recover after this.

Should I be taking out some money and keeping it in the house just incase?
I don't like the idea of looling at my bank balamce and losing all my money. Or does that not happen to smaller amounts like under 10k.
One consequence of 2008 was that money in any UK bank up to £85k is guaranteed by the government so as long as your cash is in a mainstream UK bank you don't need to worry about that

My dad always kept £1000 cash in his dresser drawer after 2008. He was so worried. It was his life savings. I found it after he died

I was working for a bank in 2008. That was nothing in comparison to this. We all still went about our daily lives and wasn’t mainstream talk in the street.

This on the other hand....

I was 17 but all I really remember is vat being reduced to 15%

This is definitely different. People cannot buy stuff physically and also do not have the money to either. I'm being tight as a-holes. Trying to figure out how to get the most meals out of a roast chicken so there is zero waste.

I worked in financial services in Ireland. It was devastating to a lot of people, particularly the pre-retirement customers who saw much of their planned retirement gone overnight. Yes, it was invested money, but they'd bought these products and they were performing well, and then all of a sudden all of the gains plus a lot of their initial investment was gone. It was awful.

This is worse.

I remember the queues of people at the banks, the footage of northern rock and everyone rushing to withdraw their money.

Then the footage of housing estates (new builds) half finished just sat abandoned - I think this was particularly in Ireland - but lots of businesses just folding over night.

And the high street, shop after shop going under.

In terms of understanding WHY it happened, the film ‘The Big Short’ is really good. Additionally it has Christian Bale in it

I was employed 10 years to a great company, 60 years in business when it closed. I think it caused MH issues from losing long work friendships, worrying about bills, for many people, it was a weird time.
This cloud is much darker.

Dya remember the pre 2008 days when petrol was fairly cheap? I remember being able to fill my car for under £40, it’s about 55£ now

Also the mortgages - 100% or more sometimes.

I’m kind of glad I was skint pre 2008 because no doubt I’d have gotten a mortgage and ended up with repayment issues.

We are in the middle of buying a house at the moment.

Really scary times and I have no idea what to do for the best.

Interest rates just slashed again to an all time record low of 0.1%
But this is because of 2008 - we never got rates back up to normal levels after it, we should of been back to to 4%+ and cutting from there. They are running out of tools to stop the economy tanking.

From my circle of friends who were around about 30 in 2008, and at the settling down stage of life, some were barely affected other than the longer term subtle effects of inflation and lack of salary increase. Some lost jobs fairly quickly, then got new jobs that were either underemployed for their experience or temporary contracts and seem to have struggled for long-term job security since. One was made redundant 2 weeks after buying a house, then a few years later redundant within a week of a BFP on a pregnancy test.
Some people found it devestating, and others didn't, but over a decade on, the toll is still being felt by the economy.

This is very different. Due to the health/ social distancing side, only an off-grid, self-sufficient hermit would fail to notice any impact.
As to the economy, this is global, this is hitting so many industries, the only saving grace is if policies are put in place to suspend the financial consequences of suspending the economy and it does look like something will happen. Is it enough? Who knows? It's not in any government's interest to let theirs (and the global) economy collapse and all the social structures with it. Goodness knows how it will be paid off and pan out.