To think it's depressing that everyone seems to think after this recession we should just return to exactly how things were?

[kake]

Does anyone else get this sense? What I mean is that everybody is lamenting this recession, quite rightly as it's awful, and I feel for everyone who has lost their job or is struggling.

But on the other hand there doesn't seem to be an acceptance that in some ways this has been at least a little bit caused by complete over-consumption in the good times and that we need to change our ways a little bit. Or a lot. When people talk about house prices especially, the consensus always seems to be that if there's any talk about a recovery that must be a positive thing, with the implication that we should be getting back to stupidly inflated house prices as soon as possible.

I find it depressing, as someone who didn't buy partly because we couldn't really afford it but also because we were really cautious and didn't want to overstretch ourselves. But now we're seeing a lot of friends who did somehow being rewarded as their mortgages have been slashed.

I'm also someone who wishes that taxes had been much higher for what I consider to be well paid people (and that would include my DH!) during the boom, so that there hadn't been such a disparity in income in this country then. It's a shame that higher tax levels in future will have to pay off debt not contribute to the national benefit! If I mention this to (well paid) friends they look at me as if I'm mad, although they are people who in principle I think sort of do believe in equality, just not if it affects their/our pockets. My view is that as satisfaction with income is largely relative (ie it matters more to people apparently that they get paid more than their neighbour than their absolute wealth), then if everybody is taxed more at higher income levels, then we'd all be in the same boat and it wouldn't make much difference.

But I feel like I'm STILL swimming against the tide, just when I would have thought more people would begin to feel like this. We have lots of friends who work in the banking sector for example who've been through a bit of a rocky time but now seem to be out the other side and better off than ever and sort of with no lessons learned!

It just seems ... so wrong! Or maybe I just got out of bed on the wrong side. And this post isn't as articulate as I would have hoped!

I think people who live in the matrix consume for consumings sake. They are so deprived of thought that they can think of literally nothing else to do, but spend.

We also go on nice holidays, have BBQ's, I even like buying a new dress occasionally (I only have about 5 pairs of shoes though).

But people who live a consumer lifestyle place no value on non monetry items. Sometimes at family gatherings ALL anyone talks about is new TV's, extensions, their new fence.

If I'm honest it is hard feeling different sometimes. When your parents and most people you have grown up respecting are telling you one thing, but you feel another, it can be confusing.

house prices are already down 21% in 14 months. that more than balances out any short-term gains from lower interest rates to pay off a mortgage. and prices have much further to fall ... the effects of unemployment will have far more impact than a slight pickup in mortgage lending from a very low base.

That's exactly the problem Vezzie, I panicked at one point and bought our house because I believe the government will play this one out until the bitter end. They genuinely do not seem to see the problem is that prices are too high and think without that £1,200 to find in stamp duty people will want to go and buy a house. The fact that they can't afford it doesn't seem to worry them and why would it.

When you buy a house you have to take out insurance that makes sure the bank never losses there money, so in an ideal world for the government you'd loose your home, the bank gets your deposit and your house and then you'd start again at least once over your lifetime.
The worse case scenario is that you pay that mortgage off because you can then work less or retire and if we all did that we'd be screwed hence they will not allow the market to collapse whilst they have breath in their bodies, but whether they can actually stop it remains to be seen.

actually banks can and do lose lots of money on the houses they lend against. directly and indirectly. pretty much the reason why the credit crunch started ...

Indemmity insurance which we take out over a certain loan to value makes sure the banks don't loose a penny.

in some, not all, cases.

vezzie - I think there's a huge disparity at the moment between 'announcements' and action. For the govt it's all about sentiment - sentiment is a big driving force in the markets and at the polls.

Look at the 'announcements' in november time - about all the help that was going to be made available for struggling homeowners...and then recently on the news there was an article about how no one has actually been 'helped' yet!!!

The only good thing I can see coming out of this is a massive increase in council housing stock - let's hope some fool doesn't sell 'em all off again in 20 years or so....

I think the thing about being in the matrix or levels of materialism etc is that it's very hard to know by what standards to judge it. It seems to me that people, me included, judge this by their own specific belief on what they need and what they don't to live a comfortable life by their own standards and the standards of their particular class ie I'm not materialistic as I only buy what I need, or I'm not materialistic because I don't want everything, just some things. But what you think you need differs a lot.

I have to say Xenia, but having a lovely house, children at private schools and skiing holidays etc., sounds a little bit on the matrix-y side to me. I don't mean that to sound judgemental though, and I'm not saying that's bad, but I am saying that to me that would look matrix-y from both the inside and the outside.

And I'd also admit that despite not wanting to be materialistic myself, although I don't have a lovely house, or children at private school, I do love a trip to the shops to buy some new clothes for example, and I do have much more than I 'need', whilst also trying half-heartedly to compensate by not buying other stuff.

Another ramble ... sorry.

This is why we should all vote Green in the coming Euro elections and in any election. Those who say, 'what good will it do - they won't get in' fail to appreciate the long game. I'm thinking ahead past the next general election and onto the next generation.

kake - I know what you mean but TBH someone like Xenia is a special case. I am not judging either. She has debt for a specific reason which was really forced on her and she earns anough to afford the things she buys and holidays she takes. It is those people that live beyond ther means with no thought that I have no sympathy for.

Xenia - you were one of the first people I read on MN when I was lurking and I always liked your refreshing no nonsense honesty. I don't think you are in the Matrix.

Please can some one explain what "being in the Matrix" means in English?!!

happywomble - there is a film called 'The Matrix' in which the whole of human life is not real it is just generated inside a computer and humans live enslaved in suspened animation with their 'life' played out to them by a malevolant life form using the computer whuc is called the Matrix.

A few humans have escaped. They live outside the Matrix but are constantly in fear of being hunted down. I love intelligent Sci Fi so am a big fan. Synopis of the film is in the link - it is good even if you are not a Sci Fi fan.

The Matrix

People are talking about the Matrix on this thread because they feel they live outside the 'credit-consume-mortgage' culture that has enslaved our society.

Dear Fellow Revolutionaries. My story... Had a lot of money. Have lost everything bit by bit over past twelve months. Am enlightened. Poor and confused but enlightened. It is soul-breaking and yet soul building at the same time. Biggest enlightenment- the old folks were RIGHT! Damn. Risky investments, buying too many properties, living the dream. Realising we were careless, greedy and selfish (hard). Realising we were a product of our generation; a statistic, a stereotype (hard). Realising it was a dream and not a reality (hard). Realising that although we get used to certain things (nice cars, holidays, jewellery, properties, and eventually, petrol for the car, electricity bill, food, nappies) we don't have the RIGHT to anything (hard- cannot imagine what the wives of the disgraced bankers etc went through, hopefully they had an epiphany in the end). Realising that everything is tangible. Bringing forth the question... what therefore, is not tangible? What is certain? Family? Love? Health? God maybe? Faith at least? Truth definitely. And I think for our generation it can only be a gift from somewhere if we are all guided / forced / led to traipse, fall and crash our way back to the fundamental core of why we are here, what is important and what we want to achieve from our small time on earth. I once gave my Grandma a small brooch for Christmas. When she died, I got it back. Possessions are a futile waste of our time, energy and 'love'. I have worshipped false idols for years and am not entirely cured. My love affair with diamonds is most definitely still current (although now it is less a penchant for buying them and more a reluctance to sell the ones I have). I am working on it however. And I think to be enlightened, and then strengthened and then to live life in the pursuit of truth and personal evolution, is a wonderful, perfect and sacred gift to receive in return for your millions. We shall see.

Kake: I am with you in the revultion. It drives dh and I mad.

I live with a squirrel dh who beleives that savings are for spending in the good times. We have practically paid off our mortgage (flexible mortgage which we could draw down again on if we needed funds for the business he is setting up) and are sitting on heaps of savings. Our car is 6 years old and we have no intention of getting a new one any time soon. Our biggest financial outging by far every month is our council tax (£260/month - it's not even the top band )

The current interest rates mean that although our mortgage payments have gone down a pound or two, the interest on our savings has plummetted.

It's just as well we do have the savings as I am under risk of rednundancy and am the sole salary earner. Having the savings means that we are not having to panic.

I really don't understadn the logic of "spending too much money that we didn't have and living on credit got us/the country into this mess so to get us out opf it, we are going to encourage people to spend money"

This is a great thread, and encapsulates many of the things that my dh and I have been talking about for the last 2-3 years.

We do have a tracker mortgage and although a few years ago, we would have done far better to have been on a cheap fixed rate we plodded along on our less competitive deal. We are now seeing the benefit. We have never re-mortgaged to buy something daft (holiday, car, school fees). I fear for those who have.

Many of our friends had been seduced into the the buy-to-let market. We stayed away, and are glad of it. We had to be financially conservative because dh is self employed and I am a SAHM and happy to be so.

I think we have all been rather let down both by our government, but also by our opposition and media. I can only assume it is because they all had their fingers in the buy-to-let and remortgage pie, and so did not want to discuss the possibility of house prices falling.

I really hope that the time will come to reward those savers who have not taken on unsustainable debt. Of course negative equity is awful, but if house prices are still unaffordable for people not on the property ladder, then propping them up artificially seems counter-productive.

Madsometimes - just look at the number of MPs who have multiple properties. You are right there is a vested interest. Media types all seem to have their BTL portfolios too.

News on property prices is so often misrepresented.

Ironcially - we may now decide to use our savings to buy a flat to let out - on the basis that we would get more from the rental than we would in interest.

But until we know where we qare in my job, it is probably just as well we still have the savings in cash (premium bonds actually most of them)

Will Hutton's wife for example is a buy-to-let investor, so they will have taken quite a hammering personally, and yet also be benefiting from the low interest rate.

Although I suppose to be fair to Hutton he was also talking down house prices at time when only eccentrics were!

I think it would be nice to get back to a model where one person earning an average wage can buy an affordable, comfortable home and lead a reasonably nice lifestyle - i.e eat well, have money for days out etc..

It has long worried DH and I that couples both have to flog themselves to death to be barely able to afford to get on 'the ladder' - and many we know are/were counting on prices always going up to 'fund' stuff like having kids.

As for the matrix thing, it's a bit scary. People seem to have a sense of entitlement to a lifestyle that is disconnected from what I consider to be reality.

I look at how my grandparents/parents lived and then look at what is the norm now and I can't work out how we got from there to here.

My grandparents were the kind of people who bought a bottle of whisky in 1970 and still had the same bottle in 1989!! Things were repaired, reused. My best xmas present was a bike that my dad had got from the tip and done up. A holiday was a day trip to bridlington.

And now people are just able to sate themselves on stuff that is ultimately meaningless but they think that they 'need' it.

It's perplexing...

in defense of MPs and journalists - i don't think they are probably a big (relative) proportion of BTL landlords. Not exactly high-paying careers ...

But governments typically do promote home ownership through various policies. Supposedly home ownership results in a raft of beneficial things for society, such as higher savings rates, better grades for children, lower crime, etc.

There's nothing wrong with home ownership, it's enslavement of one generation to fund the lifestyle of another that gets up my nose

how do you reckon? i think i missed that point about the generations??

do you mean the bank of mum and dad? (who typically would have made most of their money from rising property prices!)

sign me up for the revolution too. Not least because we're another household with few ambitions to one upmanship but too many computers (we only have more occupants in this house than computers if you count the cats...).

i think this whole living out of the matrix thing is particularly important for women. Because when everything is measured in money, then what women do (in the main, not excluding SAHM dads etc etc) is worthless. When financial worth/recompense isn't your only criterion, then what women do matters.

DH and I have downshifted a fair bit. And sometimes I worry about it/miss it/wonder what the f* I am doing. But we've swapped it for a lifestyle in which I am mostly with DD, and he works from home and so is around for her too, and finishes work at 6 every day. I hope that when she's older she will value that more than expensive holidays in Dubai. We're in trouble if she doesn't.

Oh, hope I didn't upset anyone with my comment on matrix like behaviour. I really didn't mean to, was just trying to make a wider point but probably quite unsuccessfully!