to think the current economic crisis is far from over

[Litchick]

I know that the Bank of England announced we were back in growth, but when I look around me things still seem pretty dire.

Two shops in my local town have shut down in the last month.
A friend recently closed her internet business.
The industires I know most about are in melt down. Publishers are ridding themselves of staff and taking on very few debut authors. DH tells me the city is dead and the start of 2010 has been the worst he can remember.

Do we really think there's going to be a turn around soon? Or are we in for a long hard slog?

what pagwatch said, we are as a country in a deep deep mess. I am very fearful for the post election tax hikes and public sector spending cuts, I think they are going to hit hard. Wish I could be more optimistic really.

basically to cut a long story short, the future is looking pretty sh*t for most of us.

I am scared for my children, don't really care about us when we're old if they can be ok. Same for everyone I guess. What the hell are they going to do.

I don't think it is unreasonable for people to want to retire, or to expect to. As much as our lives have increasingly revolved around work, I don't think it is unreasonable to want a few years at the end of a working life to chill and do what we want to, otherwise why bother? Work, work, work, work. I accept that it is becoming unrealistic to be able to retire at an age where we still have some healthy years left to enjoy our lives, but that doesn't mean it is unreasonable to want to be able to do so. I think it is very sad to say that healthy people shouldn't retire, I very much hope that I am in a position to do so like my parents!

When it was originally set up, because retirement as we think of it is a relatively resent social construct, it was designed so that most people would die within 5 years of ending work.

It's not set up for more and more people to play golf for 30 years whilst developing more and more expensive to treat health problems, so unfortunately, is unsustainable in its present incarnation.

I didn't say it wasn't unsustainable to many, I suspect it might be now. I just think it is sad to say that people shouldn't be able to retire, or that they would be unreasonable to want to. Just because something is a 'recent' construct doesn't mean it isn't a reasonable one. I am certainly hoping to have a few healthy years at the end of my life, and we're making provisions for that now so it isn't an unreasonable goal. I just heartily object to the idea that life is solely about work, and we shouldn't be allowed to expect anything else if we can support ourselves.

But that's just me, and I have been known to be stubborn in my opinions!

John Lewis partners bonus has been announced at 15% of salary, so they must be happy with that.

On the other hand the NHS is cutting back on staffing by around 15% - not on basic grade nurses or health care assistants, but on other staff. This will mean a huge number of job losses - 1,368,000 people worked for the NHS in September last year so job losses need to be 205,000 - likely to be from natural turnover and voluntary redundancy.

Local government will be similar. This hasn't happened much so far but will in the next 12 months - meanwhile interest rates are going to rise. Public sector pay freezes start in April 2011.

Young people continue to pour out of universities with massive debts and there are no well paid graduate jobs waiting for the majority of them.

Property prices in my area are going up again.

Every company should be run like John Lewis then the economy would look up.

Earthstar - your last two sentences sum up the last decade very well.

Young people coming out of University to be faced with low skill low paid work unable to afford to buy a house yet house prices still go up and the mortgage debt these young people have to take on as a multiple of their meager salaries spirals ever upwards as a result.

That is the essence of the credit crunch.

I'm worried by people on this thread who write they will be in trouble "if interest rates go up.." Interest rates surely will be going up again, if they don't it will be unprecedented in the modern economy - having said that we do have the lowest interest rates in modern history so perhaps there's a tiny hope but seriously, if you couldn't survive with interest rates a couple of percent higher it would be better to try and act now if possible.

..and yanbu..I don't think it's over at all either. I was pretty shocked when the local Labour party leaflet came through the door claiming that the recession was over.

I agree eurostar I know several people who couldn't cope with even 2% up yet are ready to blame the govt completely and somehow expect low rates.If you think you couldn't cope ACT NOW!!!!!!!!

We are lucky enough to be immediately unaffected by interest rate increases but we are still losing sleep over the projected increases in utility bills which are already pretty much out of hand.

There was never really a slump in property prices/sales in London as far as I can see. Most of our friends who left during last year managed to agree a sale within a few days. I can just about remember all the repossessions of the early 90s (through indifferent, kiddie blinkers, of course).

agree MrsC2010

wouldn't look at them myself...
actually i think he problem is not early enough houses are being built. I think high house prices have a strong negative effect on the lives of the poorest (those who don't already own a house) whilst only benefitting those wwealthy enough to own more than one house.

sighs wistfully<

if my husband had a job, we would re-signed up for a fixed rate mortgage. bugger, we look to be missing our chance....

'and people in the UK seem to eat enough..so far as can be seen! '

Yes, but the grain (or a lot of it) comes from North America. The vegetables and fruit (a higher proportion than should be the case) comes from Africa, lots of the meat now comes from South America, etc, etc.

Fuel prices will keep on going up. It is going to become very expensive to import food thousands of miles across the globe.

And the farmland near us that is being built on is currently growing vegetables.

Obviously people need houses and obviously a lot of the need for new ones is to do with factors not relating to immigrants (divorce, for instance). But why do all these new builds have to be in the south? Is there no way we could stimulate depressed parts of the north by encouraging businesses to move up there?

I agree Riven, house prices will come back down to a normal level

We are the sort of people who are going to be inibiting growth. The ones that Riven mentioned, who have benefited from house price growth, and we have always scrimped and saved, so we have savings, and we still have a decent income from one of us.

I think our money is far better spent than saved at this point. Far better spent than in tax too. We need stuff, things for the house, and we need things doing to the house. We need to spend the money on plumbers, builders, curtains, painters, decorators, kitchen things, clothes, electricians, DIY materials etc. We need to spend money in local shops, that will go into people's pockets and help keep them in business, help them to spend and buy things, and so keep going a circle of business and income generation. We could easily borrow against our equity too.

The problem is, I doubt we will because we are so worried ourselves about when interest rates will go up, what we should keep for a rainy day, and so on and so forth. I think there will be a tranche of people like us, holding on to money for safety, for our children, for emergencies, and in the end it will all go anyway in some kind of tax, when it would have been better spent in the first place.

I am trying to persuade dh to spend but he is the earner and he is as worried as everyone else.

I'm giving the impression we're rich, we're not: but as we seem to be in a better position than so many people it's almost our duty to spend at the moment. That's the way I feel anyway.

Also I think the view that we should accept lower house prices is correct. The inflated value of our house is useless to us and agonising for others. We fear price drops so we won't remortgage to free equity. We have never seen that money and we never will as we will be tied for at least two decades to a certain area by work. It will eventually cost us enormous amounts in tax, in fact already does I suppose in council tax. Most important of all, what is the point of sitting on a massively expensive house, whose innate value is less than half its nominal value, when people just starting out with jobs and families will never hope to be able to afford it.

It's time people like us reduced expectations. It should be enough to have a decent home, decent food, decent area, decent school and decent healthcare. For example, the quality of one's life I think improves hugely when you buy in local greengrocers, butchers, bookshops etc. It might be more expensive but big sheds are so soul destroying. We are the sort of people that can afford to do it and should. The pleasantness of shopping local, knowing the tradesmen and so on far outweighs the extra tenner cost, which you'd probably spend on parking and some exploitational crap from a shed that you don't need anyway. That's just an example.

But it's only by people like us putting out that people like our children will benefit.

I have to say, I think the funds are far better spent than taxed, where they would be completely wasted. At the moment I'd even rather spend in black than pay more tax.

I suppose on oem levels I still view things in a narrow, individualistic way. My craft is fairly recession proof and thankfully, no one close to me has been adversely affected. That's not to say I go around with my head up my arse or am complacent!

Abride

I am not aware of what happens up North but do know that here in Wales, and in the part of less - than - scenic Somerset where I come from (collpased industry etc- lits as if they took Newcastle, boil washed it to shrink to size then aitlifted it to the middle of the Quantocks IYSWIM ) there were always initiatives to try and hget people to move there, and companies did as well, at least in the areas with decent road access: Newport and Bridgwater do-able, Tenby and Minehead perhaps not so much. Those companies do seem however to have been hit hard, and my guess is the same factors that affected the industries in bridgwater at least- low skilled local workforce etc0- can take out anyone. I haven't been ehre (Wales) so long but do know my city is one of the three ahrdest hit areas in the recession, just not sure why although anecdotally DH tells me of 3 major employers habving to pull out becuase of bridge toll costs- far cheaper to be based in England and send in a few wagons a day than the reverse. Indeed its that factor that is significant ion him being without a mFT job as haulage was his industry.

So i think there are things to try and eprsude companies to move and spread housing etc but there are plenty of other factors that work against that- and trust me when the villagers of Somerset get vocal about housing builds they are every bit as determined as the residents of the south east (and in fairness my home town has seen a lot of expansion lately, and a lot of empty houses too)

House prices will drop, but you can't really say that current owners should 'suck it up' as if it is their fault. I know plenty of families who have had to massively stretc h themselves just to buy a house where we live...they are not bad, or axtravagant people by any means. They are not multiple purchasers or buy-to-letters (I have one) they are just normal people. And it is normal people who are being screwed by it, if they were forced to sell they would be screwed for the rest of their days with the ridiculous negative equity. These people are as much 'victims' as those who couldn't/can't afford to buy.

Hmm

MrsC I sort of agree, but equally negative equity is surely mainly only relevant when selling or cashing in?

And those people did at elast have tha chance to get the right house to own

(I know thats ridficulously simplistic btw- people move, have kids, need disability bungalows etc)

I do know that we lost our home years ago due to sickness / job loss, and while it was far too tiny, and rotten compared to this beiutiful house, I would probably somehow squash us back into it for the value of owning our own home again (and that would be 4 kids in a 2 bed)

This shouse I adore, it is home, we've been here 5 yrars, baby born on the carpet- the problem with rented is that who knows what the next house will be like?