What a cheery thought for the coming winter

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UK faces its worst economic crisis in 60 years. How bad do we think it will get?

People should be helped to keep their homes. When the right to buy was introduced local councils lost a huge chunk of social housing, it things do go belly up then there isn't enough social housing to accommodate even a small fraction of those who would be affected. There simply isn't enough hostels/bed and breakfast/council accomodation because most of the council accomodation has been sold off. This is probably why they are doing this.

They need to drop interest rates. They are too high, this is the only way to save these families houses. Savers never see a difference to their savings when rates are high anyway, it all goes into the banks coffers. The banks should be taking some of this flack. Greed, that's what's caused all this.

I remember the rolling powercuts (just) - at the time my mum made it sound like a great adventure, all of us bundled up in everything we owned (which was not a lot). God knows how she coped - 2 young dc, divorced, no way of working. And then farking power cuts on top of that.

Might phone her and say "bloody well done to you" actually.

I have friends who are younger who are blithely chucking in permie jobs at the moment "to see what it's like as a contractor". Those of us older and more jaded are

'People should be helped to keep their homes. '

But why at the expense of taxpayers and not those who loaned irresponsibly? Why be allowed to keep their asset when others can't afford one or opted not to buy more than they could afford so as to not endanger themselves financially?

God. I'm looking for anything that's secure. I have a law degree and a masters but no one's hiring at the moment. Even the local council has reduced it's vacancy adverts from 4 pages (about 100 adverts), to just 10 adverts.

I'm starting a NHS funded course next month, at least I know that's secure and I'll get paid, even if it is £9K. It's a bad time to be job hunting.

The same people want to upgrade their house and think it will be "easy" to sell.

A little dose from the reality fairy seems somewhat overdue.

Interest rates being low caused this.They are not high historically the average is 8% 5 is very low.Reality check required methinks.Anyway these are just pie in the sky measures to ensure he gets elected and then taxes will soar to pay it all back.

Lowering rates would have little effect they have been lowered 3 times but the banks haven't followed as they need to recoup huge losses and rebuild balance books.

I don't think Labour thought they were going to win the last election, that's why they went OTT with borrowing and interest rates. It wasn't sustainable. They, and we, are paying for this now.

Expat - totally agree.

Seriously - how the hell did banks justify lending people 100%+ of the house value and think it was a sustainable idea???

It's the banks fault they have lost money. It's because they lent money to the sub prime housing market in america. They shouldn't be penalising their customers here for their own mistake. Risk assessment is part of the financial market, they should have known that they would not get their money back if things went pear shaped in America. They have left themselves no other way of recouperating this money apart from making their customers suffer. If you were in business and made a mistake, you wouldn't make your customers pay for it. It's all about money and greed. It's shameful.

'It's the banks fault they have lost money. It's because they lent money to the sub prime housing market in america. They shouldn't be penalising their customers here for their own mistake.'

So people just innocently signed documents to borrow what they knew was way over 3x their salary/100%+ of the value of the property/very short-term interest rates? Did someone force them to do that?

They share the responsibility.

A loan is an agreement between two parties, lender and borrower.

Caveat emptor, it's up to borrowers to make themselves aware as well.

But Avenalife - it gets worse in that those who should have known better and those who approved these deals have been rewarded with huge bonuses and share options (not worth much if bank share prices are anything to go by!!) - they were actively encouraged and financially rewarded for gambling our money away..!!!

expat totally agree. That money should surely be going to refurbish the council properties that are unliveable : am I right in saying that there is a huge stock of them lying empty?

I don't think interest rates have been that low compared with the rest of europe: haven't they always been lower there and this is why we had to drop out of the erm?

It's not just one thing that's to blame for this, it's a whole load. The banks and sub prime lending is just one part, the excessive borrowing another. No one forced people to take out 100% mortgages. We've all sat and watched as the housing market has shot up, some have benefited and downsized, making a bucket of cash in the process. As prices have rose people being able to afford a first home have fallen, all the ones that have been afraid to wait have had 100% mortgages to buy a house. Not a good idea but only part of the problem. These people loosing their homes will result in them having no where to go because most of the social housing has been sold off under the right to buy scheme.

It is both borrowers and lenders responsible for this. No one pushed loans onto people but when they are handed on a plate, who would say no?

large multiples at 3% interest rates and the like made people only look at the monthly payment at the time and not the overall debt or the cost if rates rose.Both are responsible Also re mortgaging has hit record levels with people withdrawing the equity like a big piggy bank without realising that it is also a debt and lowers the equity in their home.Both need to sort this out although in previous recessions and downturns no one was bailed out at the tax payers expense and a lesson had to be learned.Why is it differnt this time?

There are a load of houses (hundreds) lying empty in Manchester because the council put compulsory purchase orders on them so they could regenerate the area. This is the same in alot of cities across the north. They could use those. It won't cost alot to do them up.

good point avenalife. When I bought my first flat in 1998, the banks would lend up to 3.5 x my income with a 5% deposit. So I saved very hard for 18 months and then bought. Down here there were even 105% mortgages so you didn't even have to save the stamp duty

'No one pushed loans onto people but when they are handed on a plate, who would say no? '

A lot of people with common sense did. It doesn't take a genius to figure out what a shaky deal that is even in the best of times.

Slightly OT but I do wish people would stop baning on about hard-working families. It's not just the parents of dependent children who work hard and struggle with money. Adult-only and Single-person households have a hard time of it as well.

If you have a house and its wirth 150 now and they bail you out by 50k Then they own a third and you pay rent on that.When and it is when the house is worth 100k then they will own half of your house It is a big con in the end.They are not going to 'give' this money without getting something out of it.

thing is, the credit crunch doesnt just affect homeowners does it.

Food costs are up
Fuel costs are up
Rents will no doubt go up to cover landlords increases
Wages and beenfits havent increased to cover the additional costs

SO even us mere renters will end up in the shit.

I am renting atm.The house has gas and electric key meters which i left because i thought we were here temporaily.Because of this i have been able to see the gradual increases in prices week by week as i charge them up.The problem now with the gas is that after 10 weeks of having the heating off i am paying the same as i was when it was on iykwim so when we need to start using it again my weekly costs are going to rocket!