So do we all think there is a recession on the way or are you still hopeful we'll avoid one?

[Callisto]

Barratt housing have announced this morning that they are expecting to lay off 1200 workers having experienced a near 50% drop in house sales recently. Bovis and Redrow have also laid people off. The City is, allegedly, laying people off too. So with unemployment on the rise (I've heard 2 million will become unemployed in the next couple of years), manufacturing shrinking for the last two months, inflation running at around 9.5% and no end in sight to high oil prices, is there any way at all we can avoid a recession? And do any of you think that the Govt can do anything to prevent it?

[dinny]

Fannie Mae and Freddie Mac, I mean, Callisto

[ihatebikerides]

Think I am suffering from 'survivor guilt.' My much-loved MIL died last year and left DH and me a whopping shed-load of money. We are therefore in the fortunate position (financially) of being well-cushioned at the moment, BUT at the cost of having lost someone we loved dearly. So, at the moment, I am staring, aghast, at what seems to be happening (or about to happen) to other people. If MIL was still with us, we'd be toppling into a financial abyss. So, it's hard to feel fortunate, although it must look from the outside as though we're OK.

[Callisto]

NFK - presumably because gold has an intrinsic value which money doesn't have. Money has a notional value but the notes in your pocket are worthless in themselves. The Zimbabwean (dollar?) currency is a good example.

Dinny???

[dinny]

bloody hell, things are grim in the States

[nkf]

And can someone explain why gold is supposed to be the thing to buy in a recession?

[nkf]

I think if I was fixing a mortgage now (and I will be remortgaing next year) I would go for five year fixed.

[noddyholder]

I know why did he do that when he was advised to the contrary?

[Callisto]

And can I just mention at this point our gold reserves that Gordon Brown sold off at the bottom of the market and against all advice?

[noddyholder]

I know it is an absolute disaster.A whole ten plus years of people living off credit with no thought to how they were going to cope when it ran out.The UK produces nothing now and what it does is so expensive.The reputation of the uk has carried it for years but in reality all that has turned to dust and god knows what is about to happen.

[1dilemma]

Don't have a solution to all of this sorry!

[1dilemma]

global recession coming
UK is a country in decline (apparently an economist said this about 1st world countries I wish I could remember who)
Just what do we actually do in the UK anymore? we can't even grow enough food to feed ourselves and for what we do we seem to need to import all the pickers and packers from Bulgaria etc.
we had a load of money and the gov has pissed it up the wall
where's our Sovreign wealth fund anyone?

I mean really who needs 18 week wait counters? our ecomony just can't afford them!

[noddyholder]

We need one but its going to be tough.

[1dilemma]

In a wierd and slightly selfish way I'm quite hoping we get one. I'm in a rel. recession proof job, we don't spend much, we're poorly paid and trying to get on the property ladder. I havn't got much to loose.

(Obv not wishing any ill on anyone personally)
Maybe I should have name changed for that!?

[noddyholder]

An improvement in 2 years is optimistic.

[lucykate]

i have to admit i'm a little scared. we don't have loan debts or credit cards but do have a big mortgage. we're just swapping to a new deal as our old one finished last week, and the new mortgage is at a higher rate of interest so our repayments are going up by quite a bit. we went for fixed rate this time, we used to have a tracker, so at least we know where we are with it for the next 2 years, just hoping i've made the right decision going for the 2 year one, i was hoping by then things may be better, but what if it's worse?

[nkf]

How high could interest rates go? That is my main worry.

[Callisto]

Noddy - I was reading an article in the New Scientist last night that argued that all of the data on oil field production is pointing to peak oil having been reached in 2005. Current oil production is around 74 million barrels per day and the world uses 88 million barrels a day. The shortfall is made up by using natural gas and oil reserves. It is unsustainable already and yet demand is only going to increase. You're absolutely right that house prices are going to be the least of our worries - oil/food/water wars are our future.

(Sorry can't link to article as you have to subscribe online to the NS, but it was called Kicking the Oil Habit from June 28 edition).

[UnquietDad]

nkf - I realise that. But I don't think this woman was saying "gosh, I'm, going to let my cleaner go so she'll have less work as a result, poor woman." She was saying "Yes, things have got so bad financially that I have got to give up my cleaner." Which some people might tentatively suggest indicates she lives on a planet some distance from that of people who are truly in financial difficulty.

[noddyholder]

Callisto that is right and I was reading somewhere that all of the food price and supply predictions that have been in the press in the last 3 months have been based solely on the effect of oil prices and that once weather has been factored in we are looking at an even harsher scenario.This feels like something monumental and tbh the prices of our houses will be the least of our worries

[Callisto]

The problem with this recession is that we are in or nearing peak oil so even if oil prices come down short term they will go back up again, and by 2012 (I think) we will be experiencing nationwide power shortages. To compound this Australia is already warning that their wheat harvest will be 9% less than normal, and this is optimistic, plus the flooding in the mid-west of America has meant that their food crops will be down in yield too. So food prices will remain high. There is no global reserve of wheat/rice anymore and I doubt there will be again unless we curb the global population and cool the planet somehow.

We are living in scary times.

[fiodyl]

I think the current predictions are that its not likely to botom before 2011ish with no significant upturn before 2015 but your right its not an exact science and no one can say for sure

[MissingMyHeels]

I don't have any recollection of the last recession either, in fact, I find it difficult to imagine what is going to happen and the impact of it all.

I work in recruitment which I doubt is a very secure industry, specialise in media and already most of my clients have recruitment freezes. However, am on maternity leave at the moment so not dealing with it first hand.

Apart from a rise in living costs, what essentially happens in a recession? Who struggles the most? What should I expect?

[sumomum]

As someone who is too young to remember the impact of the last two recessions, although i do remember my parent holding more crisis talks behind closed doors. My question is, is it possible to predict how long this one will last?

I know it not an exact science, however, from reading this thread and various other material it would seem that many believe that this downturn will be significantly worse than the previous in the 90's.

[fiodyl]

nkf Im not too worried, as I had an idea this was coming so have already made some plans, which is all you can do really. No one knows for sure how bad it wil be this time, and even the most well prepared will feel the pinch if its really bad.

Do you have debts? any savings?
try looking at your outgoings and seeing where you can make cutbacks e.g. switching to cheaper gas/electric companies and car insurance providers.

[nkf]

I need to plan rather than worry.
That would make me feel less anxious.