What will actually happen?

[usernamechanged1]

There are many threads on here about mortgage, rent, utility, food prices all going up. I don’t think there are many left who aren’t noticing the financial strain.

So, whilst we’ve all heard “this can’t go on…” and “when will this stop…”, it is continuing to go on and shows no signs of stopping. I’m wondering what we should actually expect.

I feel like we’re heading towards a place where people will be working but literally unable to survive. I appreciate there are people in that position already, so what happens when this is a mass problem affecting a majority of the country.

It’s akin to working an eight hour shift and having 13 tasks taking 1 hour each to do. It’s simply impossible; the maths don’t add up.

Is it out of the realms of possibility that we could see people take to the streets? For crime to shoot up (shoplifting, robberies etc).

I think many of us thought the CoL crisis would be temporary, but maybe it isn’t.

In a literal answer, I think the UK economy will start to do better when we begin to politically unwind the Brexit vote (allowing for cheaper imports) and get a new government which will invest in the green economy (helping to drive growth).

We need more immigration too.

We are currently living in an experiment of what happens when you model your economy on the paranoid fantasies of the Daily Mail readership. Not good.

In the UK we blame each other, migrants and moan at how unfair it all is. In France they blame the government and they get out on the streets and do something about it ! Nothing will change for us because they know we’ll continue to take it.

I am bemused by this no one went abroad nonsense. I was born in 76. Grew up in a suburb of a northern city. All of my friends went abroad every year for their holidays. I was the odd one out because I didn’t. My grandparents had two holidays abroad every year and they weren’t rich. Grandad was a petrol tanker driver and then a bus driver when he got a bit older.

The problem with this is that people can't afford the pricier, manufactured in the UK, all natural fibres, items. It's easy to say 'instead of buying 5 £12 dresses that won't last, buy one for £290 which hasn't travelled halfway across the world and will last forever'. Well, perhaps, but you have to have the £290 in the first place.

I know that's not entirely your point, but we've created a society obsessed with stuff , where if you don't have a new dress or shoes or bag for Saturday night it'll be a wash-out. Advertising and lifestyle promotion have made our society like this and people are really resentful at having to miss out. Every time I go into Primark I'm shocked at the size of people's baskets. It's huge piles of stuff.

And how does rioting help .
Burning down restaurants of hard working people , staff will lose their jobs and owners will be just another family whose livelihood trashed .
Then the additional costs to rebuild the devastation . Who pays for that , yes hard working people . Social order is what keeps us safe not the hair shirt feckless nobodies trashing the streets .

We are an incredibly class based deferential society who largely think this is the way it should be. Look at the number of people with barely a pot to piss in who voted for Johnson because "hes one of us", not understanding or caring that he's laughing all the way to the bank. Look at the deference shown to the hideous hypocrites of the royal family? The apathy shown to countless social injustices? The insane attitude to taxation.

It's all bloody depressong.

Interesting post. Even your idea of your house eventually being sold and the money going to your children will that even happen if you and your DH had to go into a care home for years.

If people look at the social history of the uk, the vast majority were serfs to the rich. Our history is of being slaves to the upper class. We have humour and a stiff upper lip because we are and have always been owned by the upper classes.

The freeze in income tax bands is a huge stealth tax

@GettingThereCharleyBear I agree with you.

Economies are cyclical and what we’ve had over the last 30 ish years is very cheap money and an environment where we, as consumers, have been persuaded to buy more and more stuff… and take on cheap debt to do so.

We’ve now just fallen off a cliff. Or maybe we’ve been pushed.

The energy crisis is sh1t and the profits these companies are making are staggering, and the banking situation seems very shaky at the moment.

It’s going to take a while to settle down. We’ve had it so good for so long.

So many people saying 'we will just have to tighten our belts yet further' or 'this is what life should be like and we've had it too easy for too long'. There's almost a sense of pleasure in a collective r suffering.

I accept that interest rates have been artificially low for too long but those increases (which let's not forget had a helping hand from Liz Truss's moment of fiscal recklessness) plus the energy and food prices are not sustainable for so many people.

It's not about swapping Mallorca for Margate but about not being able to feed or keep your family warm through the winter. the absolute fundamentals of our communities: housing, heating and food. Meanwhile the government looks on with sad eyes saying how much they understand whilst having to be forced to do something by Martin bloody Lewis now and then because their natural support base want harder cuts and faster.

My only hope is a GE and that's not much of one because I think so much damage has been done (and I'm not a huge fan of Starmer).

@gawditswindy people can afford. I think UK are very fortunate and they don't know it. You said it yourself people are obsessed with buying new things. I don't spend £290 on a dress infact I NEVER have. I have shopped on Vinted and Depop.

I think the poster meant invest in jeans from Topshop for £50 and they will last for years. People want the LASTEST trend and that's what sells the £12 dresses.

A lot of people will moan they can't afford this and that but have the latest phone contract for £40 a month.

COL for me means you need to budget better.
I have always had excellent money management and I am quite organised so for me these 2 things are KEY. People could earn 30k or 50k it's how you spend your money!

"The journey to a higher tax burden has already begun. In 2019-20, ahead of the pandemic’s impact on the public finances, taxes were 33.1 per cent of GDP. This fiscal year, the figure is 36.8 per cent, on its way to a projected peak of 37.7 per cent from 2026 onwards.
This is new territory. The average tax burden for the UK (national accounts taxes as a percentage of GDP) is 32.1 per cent, in figures that go back to 1948. The only year that comes close to what is in prospect now is 1948’s 37.2 per cent, when taxes were coming down from wartime economy levels."

Completely agree @GettingThereCharleyBear

40% of the voters have caused this.

We were so much better off under Tony Blair and Gordon Brown's government even though during that time there was a very deep global recession (collapse of the American sub prime market).

We're OK at the moment, but being self employed is hugely risky; contractors are typically the first to go and I still have a big mortgage...

Re the people spending money point, We are in a period of adjustment where inflation will start dampening off demand significantly.

Lots of holidays are booked and paid for in advance. We priced up to do a holiday next year and it cost 20% more than what we paid 6 months ago.

Similarly cars, we bought a new car on finance a year ago, no way would we have been able to afford the same car now with the increase in interest rates.

Home improvements we have consciously spent some savings on home improvements we would have put off because we can see prices rocketing and it’s “cheaper” to do it now than wait a year when prices will have jumped again.

We both work in the private sector husband had a tiny % salary increase which makes no difference after you factor in tax and inflation. I got no payrise. We’ve had a period of spending money but the inflationary lag has caught up with us and things we could afford last year are no longer on the cards for us.

Yes. The BoE, FED and others have to raise interest rates now because they’re trying to put the brakes on a juggernaut of their own making. Printing money like it was going out of fashion was always going to be unsustainable.

They will continue to increase interest rates until businesses just can’t cope. Then they’ll drop 0.25 and that’ll be the new normal.

Demographics and globalisation are also a problem. Demographics changes means that although the total number of humans will increase to around 10/11 billion, there will be no increase in children being born. Populations are just ageing. No country in the world has a workable economic plan as yet for how to cope in that scenario. We cannot continue to expect growth - so we have to learn efficiency and make it something we can sustain.

globalisation is another matter - the supply chains are breaking down and it’s doubtful that they’re coming back. So countries need to be able to self sustain and it’s not yet something the uk govt seems to be planning for (because that would be a long term plan). The economy is in for an extremely rough ride.

I'm 59 and have fibromyalgia. I still have a mortgage on the flat we live in. I cannot see me being able to work until I am 67 and cant afford to retire before that. I am genuinely scared for whats left of my life. I already work Monday to Friday but have also worked the last two Saturdays as well and will be working late Monday and Tuesday this week too as extra hours became available. I can save some of this money but I'm knackered.

Well here is the reality. We can stop pondering. It was only affordable on extremely low interest rates and lots of things on credit. Now interest rates have gone up it is no longer affordable.

But for so many people they are not choices. With housing and rent costs high and wage stagnation, (and NMW and zero hours contracts) people aren't buying cheap clothes for the fun of it, it's because that's what they can afford. ditto food.

I can't work out how much it will help but with minimum wage and benefits (inc state pension) are going up around 10% next week, it has to do something to help those with the lowest incomes but I don't know how much.

I agree, along with the ‘want it now’ that didn’t really exist when I was a child in the 50’s- you had HP but not credit cards etc. You had to save for virtually everything except the essentials- I’m not saying that it was better but that was reality.
People nowadays are far more acquisitive too, wanting the latest trainers/tv/car/own house/clothes etc. Few people owned their house, all my friends parents rented and most women worked. SAHM we’re unusual.

I paid £7 at a local pub for a pint the other week 😵 and I'm not in London. It was a 'nice' craft beer but still. Crazy price.

Um, yes, it could have gone on, quite easily.
Most of these price rises are because of Brexit.