To think a recession is looming?

[GrannyBloomers]

I was quoted £2 a litre for heating oil. £1000 for 500 litres, a matter of weeks ago it was roughly a quarter of the price.

Energy bills set to be £3k per annum - potentially more when a new price cap comes in in October.

Diesel near me is 171p and rising.

I'm in a 3 bed semi, nothing special. I need at least 1500 litres of oil a year (it runs the hot water too). That's say £3k. No gas but electric. I'm doing ok with cutting use = £1.5k per annum.

That's 4.5k at todays prices for household power. What will it be in October - 6k, 9k more?

This is before other costs increase - food will go up when the cost of storing it (refridgeration etc uses energy) and transport also increase.

If all the average person's income is spent on rent/mortgage/ bills and energy, then there's no money to spend on anything else. No eating out, no leisure, no holidays.

Surely a huge recession will follow.

And what if a much higher proportion of people need benefits?

It’s blindingly obvious. Unfortunately.

Unaffordable ^

Predict the future...look at the cost of fertiliser per tonne...

DH is an agronomist. The increase is price is staggering. Food is about to become very expensive.

@Bringsexyback

This doom mongering needs to stop it’s a self-fulfilling prophecy if you keep talking down the economy it’s gonna end in disaster

I think you may be overstating the power of a few commenters on mumsnet! I think it's commodity prices/gas prices/Russians pulling out of London (or being kicked out) that's going to fuck the economy.

we've been happy to cosy up to Putin and entertain the oligarchs

Who was happy about this?

No-one asked my permission.

Yet I work in conveyancing and am just as busy as ever. I don't get it, I thought things would have tailed off slightly but they haven't. I just don't know where some people get their money from.

@OMG12

Re house prices I can’t see them falling by 50% . When this last happen for you might have lost say £30k. Now it would be £150k. People can’t afford that and more importantly banks can’t. Even repossessions will be sold at higher prices than that. There’s always cash investors that will buy up these properties.

People couldn’t afford £30k when it happened before yet …

All lenders will care about is retrieving their money so if the repossess a £300k house which has an outstanding debt of £150k, they’ll sell it for that amount. They won’t care about people losing their equity.

@Bringsexyback

This doom mongering needs to stop it’s a self-fulfilling prophecy if you keep talking down the economy it’s gonna end in disaster

Unfortunately, it's to doom mongering. You only need to read the news and look at what is going around you. We have very high and rising fuel prices and now fertiliser prices too which has and will continue to cause very large rises in the cost of essentials. This will have a significant knock on effect on discretionary spending which is a significant part of the economy. We already have high inflation and massive debt and a financial system that is inflated. it's all a recipe for trouble.

@rainingsnoring - if enough chicken Littles run around say in the sky is going to fall in it possibly will I remember reading all this shit when Covid started about how we were all going to be living in a hole in the ground and flog to sleep and getting up before we went to bed and we were to be grateful …. The far more likely scenario where is will tighten our belts until what’s happening with Russia is over and we all be absolutely fine this nonsense about house prices fall in 40 to 50% oh my god get a grip

I mean, people already living on the bread line are in such an awful position it makes me nauseas to think about. So many families are almost/already in poverty will genuinely be going to go hungry and cold. And for most of us (the squeezed middle) it's going to be a huge shock to the system. Those little luxuries and comforts that we are so accustomed to are going to need serious consideration. It's a hugely wide reaching situation and I feel as if everyone will be stepping down a tier, for example from middle class to working class, but where the f*ck are those already at the bottom of the ladder going to go?

The opportunities / treats / luxuries that I was able to provide for my now 5 year old, like ballet, gymnastics, horse riding, swimming lessons and so on, are now likely not going to be something I can offer my newborn. That makes me really sad. As I, like many, had another child based on what seemed like predictable and stable finances. And in fairness, they still are predictable and stable, however what I didn't factor in is the huge looming economic disaster. Rightly or wrongly, I do feel very guilty about that.

I can't imagine interest rates in double figures, with the way house prices are there would be civil unrest

@Blossomtoes actually the lenders have to recover as much money as possible for the incumbents if they get to the stage where a house is to be repossessed, luckily since 2008 they now put in stress tests to make sure that a person can afford their home right up to 10% interest rates, if necessary the government will step in and pay your mortgage for you to stop your house getting repossessed because that is the cheaper option than having to deal with your family in the council office asking for temporary accommodation. please stop this do mongering because you are probably stressing some people out and it’s all utterly unnecessary catastrophsizing.

Lol 'doom mongering', you don't need an economics degree to understand that historically significant price rises of essential commodities is going to lead to a huge decline in disposable income, which directly impacts our - service based - economy. People who complain about doom mongers are usually just people who want to stick fingers in their ears and sing 'la la la'. Or in this case, the very well off who will ride it out and profit eventually.

@lorking

I can't imagine interest rates in double figures, with the way house prices are there would be civil unrest

No there wouldn’t. There wasn’t last time. There were lots of people being sick on their shoes every time the rate went up and lots of people losing their homes. History very sadly has a history of repeating itself.

I'm a position where we are thinking of moving and also moving jobs to a fixated term which quote 'has always led to full time jobs' (DH also works there so testifies that this is correct.) now I'm wondering if it's the right move

[quote Bringsexyback]@rainingsnoring - if enough chicken Littles run around say in the sky is going to fall in it possibly will I remember reading all this shit when Covid started about how we were all going to be living in a hole in the ground and flog to sleep and getting up before we went to bed and we were to be grateful …. The far more likely scenario where is will tighten our belts until what’s happening with Russia is over and we all be absolutely fine this nonsense about house prices fall in 40 to 50% oh my god get a grip[/quote]
I disagree. A few posters on MN are not going to cause a recession. Most people who have responded clearly think this is far more serious than you do.

There were indeed people catastrophising at the start of the pandemic. Equally there were those who were convinced it would be over in 6 weeks and those who thought it was a cold.

I can't see how it is going to work out. I read today that spending 10%+ of your income on bills officially puts you in fuel poverty.
When you factor in wages standing still, inflation in food prices, all other things on top, that means that half the population will be in fuel poverty to some degree or another. People will go into debt, or choose between food/fuel/rent or mortgage. And that's just not sustainable.

There surely has to be some kind of intervention for government to subsidise it when so, so many people will be affected. I know they've let down people before when it's smaller groups, but if it's so many people then I can't believe they'd risk possible protests/losing all votes next election.

actually the lenders have to recover as much money as possible for the incumbents if they get to the stage where a house is to be repossessed,

They don’t. All they have to do is recover their debt.

Annoyingly my family can't seems to able to not leaving lights, monitors on when not use. Lights in every room is always on because opening the curtain is too much effort, TV on all day when someone is at home, doesn't matter if someone is watching or not.

Sorry about the moan, it's worrying as our fixed rate mortgage is coming to an end. Our household income also been reduced after our redundancies from previous jobs recently.

@Blossomtoes

actually the lenders have to recover as much money as possible for the incumbents if they get to the stage where a house is to be repossessed,

They don’t. All they have to do is recover their debt.

You need to update your knowledge if you’re going to put the fear of God people about this sort of stuff, they are insured to recover the full amount so if they want to sell it for less that needs to be a bloody good explanation and a judge needs to sign it off. I worked in estate agency in 1994 and they had to do it then they most definitely have to do it now.

@PaddleBoardingMomma

"I mean, people already living on the bread line are in such an awful position it makes me nauseas to think about. So many families are almost/already in poverty will genuinely be going to go hungry and cold. And for most of us (the squeezed middle) it's going to be a huge shock to the system. Those little luxuries and comforts that we are so accustomed to are going to need serious consideration. It's a hugely wide reaching situation and I feel as if everyone will be stepping down a tier, for example from middle class to working class, but where the f*ck are those already at the bottom of the ladder going to go?"

Exactly this. It's so upsetting. I'm now in the squeezed middle like you, but have been at the other end, and I feel so much for those who are already needing foodbanks because their wages can't cover their costs.

But if France can ensure fuel prices only rise by 5%, so can we, if the government is willing to make a stand. They're not yet, but if enough people are affected, then they may feel a lot of pressure to step in.
But that isn't going to happen quickly enough to stop a lot of suffering in the meantime.

French people are far less passive, they would riot at the costs. We don't

It’s not a case of if, it’s a case of when.

Employers should continue to let people work from home where it's practical, especially over the summer where people won't need the heating on - we all need to use less fuel for lots of reasons.

I keep thinking about Weimar Republic or the Great Depression.

I cannot see how these sanctions are not going to have monumental effects on the world economy.