To think another great Depression is coming?

[littleblackdress04]

Spoke to a surveyor friend yesterday - he said they can’t value houses at the moment as they think they could lose up to 50% of their value. Also read an article about how another Great Depression is coming.

Is it the re-set we need as a world? The end of billionaires when millions have no food? What will the societal impact be?

I personally hope it’s a fairer, kinder society where everyone gets their basic needs met

Things are not going to go back to normal.

You can hope thats a good thing, or be scared its a bad thing, but ignoring the change that has happened is pretty daft.

The question is what the new normal will be...or if we are already in it, will lockdown ever become fully rescinded and international travel be accessible ever again to ordinary people are questions that I'm starting to wonder.

will lockdown ever become fully rescinded

It obviously will. If it got to the point there was no vaccine and/or no effective treatment we would have no choice but to go for herd immunity. Eternal lockdown is untenable. I'd rather take my chances with the virus.

I thought our economy was fucked already with the trillion deficit, then austerity which made matters worse, then Brexit we were all waiting for to trash things even more, now the virus and everything is shut and hardly anyone is making any money and we still have actual Brexit at the of the year to contend with.

I can't see things being that great financially for a long time.

House prices are driven by lack of supply especially in the South East. Inflation will rise and so it won’t look like house prices have gone down much. Nobody knows right now what is going to happen. This could all be over in a few months and many people might have already had the virus in a mild form. Who knows! No point in panicking now. All recessions come and go. Let’s hope as this is an external enemy aka a virus rather than “rich bankers”, people might pull together and make the most of the situation. Surveyors cannot value right now due to uncertainty. In the last recession the housing market was very slow but those that didn’t have to sell just stayed put. That is a more likely scenario.

Think a little bit about what you are saying. The Great Depression caused huge income inequality and absolute poverty because there wasn’t a welfare state. While it’s not perfect most Western Countries do have them - this virus, like SARS, will eventually see normality return quite quickly.
The UK will not let the housing market fall and I imagine rates will be lowered, and extensions to help to buy will be provided.

I watched a webinar with three prominent people hosted by the Financial Times last week and it was very interesting.

It will be bad but probably not The Great Depression bad.

I'll get a link to the replay...

Link to on demand FT webinar

live.ft.com/Events/The-Global-Economic-Emergency

Debenhams is about to go into administration too- it’s like a house of cards. I think my original point is that things will need to change as a society as everything is changing at the moment and we won’t be the same country after this

Your evidence base for us not being the same country after this is the fate of Debenhams?

They were on life support before CV 19 happened.

During the credit crunch people were merrily predicting that life would never be the same again. That was only just over ten years ago. The economy will recover.

A Great Depression won't 'fix' things. It will indeed make the poor poorer, a lot of the middle class will become poor, and the billionaires and all their money and 'things' will still be theirs. Very few of the truly wealthy will suffer.

I imagine rates will be lowered, and extensions to help to buy will be provided.

They're already at 0.1% - where are they going to go, below 0?

Help to Buy is a total scam, it's just more debt and the houses it's available on are vastly overpriced to start with

This is a difficult period to live in but Debenhams has been over leveraged and about to go into administration for ages now. Really not a surprise to anyone who reads the financial pages in the papers.

I agree there will be a recession as people hang onto their cash, but let's not forget that many businesses are doing very well out of this. I think you can assume that the weaker supermarkets have just been handed a lifeline. Businesses which have invested in online sales are still selling and some of them are in sectors we have not even thought of.

Amazon of course is having a field day although the tax take on that will not do the UK any good unless we change the law (and I think we should).

Yes houses may lose some value, but most people will just sit and wait for them to go up again as we did in 1990 when lots of us were in negative equity. Yes it may change the way we spend our money and the way we holiday, but I'm not sure that's a bad thing. None of us needs a foreign holiday every year, none of us needs a new car every couple of years, none of us needs a wardrobe full of clothes we never wear. If we could keep a lot of vehicles off the road and replace them with cycles, that would be good for health and good for the environment.

Change is not always bad and even when it is bad it is not uniformly bad.

@GrumpyHoonMain The UK will not let the housing market fall and I imagine rates will be lowered, and extensions to help to buy will be provided

UK plc has just bailed out the entire private sector- interest rates are at 0.1% - there is no where to go with this! And if it’s a true ‘market’, a tory government will not be interfering in it. There’s nowhere to go with this thing- and I say that as a homeowner with a big mortgage (before I get accused of dripping in glee again)

And Help to buy has literally done nothing positive to help house the people who needed it

I also agree with what Jassy said.

In truth no-one can truly predict what will happen - it's pointless comparing to previous recessions because the context and environment are completely different.

No, it will affect the poor. The rich are working from home in their lovely corporate jobs.
It will be the wc and those on benefit that will lose out, those on zero hours and min wage.
The mc double income wfh have lost nothing.

They're already at 0.1% - where are they going to go, below 0?

Negative interest rates are possible!

But this all makes me point about universal basic income more pertinent in some ways- as I have tried to say - it could be a moment to try and end the inequality in this country

No, it will affect the poor. The rich are working from home in their lovely corporate jobs.

Actually I don't think we'll see that this time.

There are lots of middle class people being very impacted by this due to redundancies or their work completely drying up but not being eligible for Govt support (like me).

On the other hand lots of factories are still going. Lots of minimum wage jobs and manual jobs are considered essential like carers, refuse collectors, mechanics, etc.

And why would there be a war? Other countries are in the same situation facing the same enemy. If anything this will mean Brexit is less likely to happen/be postponed again. Post world war 2 when powerful economies supported each other there was actually a boost? An energy and drive to rebuild? Pretty sure China will make sure they support rather than risk being seen to be profiting from the situation in Europe and the US. We are their main markets and they know that. Even Russia has kept relatively quiet? More likely this situation might bring countries together.

@Iamthewombat no, Debenhams was one example 🙄 I also cited an article by David Blanchflower, professor of economics who set finance policy during the last financial crash at the BOE

This is VERY different from previous recessions. There is a very tangible reason why companies are not trading and as soon as things are back to normal there will be a boom (similar to the one after the Second World War in America) China have reported not just a bounce back, but an IMPROVED economy since it reopened. The data was so surprising it had to be independently verified by financial watch dogs from other countries. Everything will be fine, and those that are wishing for 50% drops in property prices just so they can get on the leader, shame on you for wishing misery on others for your benefit!

Do people actually read the threads on these posts? I have said right from the start that I am a homeowner and yet you just get people screaming ‘shame on you’ for the merest hint of the fact that house prices might drop! I would lose 50 per cent of the value of my house too!!

What Jassy said - in part.

I work in construction, and have my own business. We've only recovered from the 2008 crisis in the last 2 or 3 years. Construction is always a very good barometer of the economy in general, and speaking to developer clients in the last 2 weeks, the feeling is that it will take 10 years to come back. But as we have done in the past, it will come back

"But I’m not saying it’s anything to cheer about- I am saying it’s coming and maybe it could be a chance of a better society". Do you come from the future? Yes, something bod might be coming. Or we will start a normallish life in a few weeks and people will spend like there is no fucking tomorrow, most people will get their jobs back and we will all look at each other like "what the fuck just happened?"

Shit might happen, but why do some people rejoice so much in predicting the worse like they have inside knowledge and it's the only option.. Let's cross that bridge when we get there, life sucks enough right now...

I think "Ok, Gloomer" is going to be the new "OK boomer".

"that is the end of life as we knew it" "OK, Gloomer"

"We are going to be in lockdown for at least 16 years" "OK Gloomer"

Imagine what a one-off emergency tax on all assets over £1bn could do to help.

It's been tried before and found unworkable.

If a Wealth Tax is Such a Good Idea, Why Did Europe Kill Theirs?