Tuesday, Apr 03, 2007
Same as 1989
The Telegraph: Recession fears as household savings fall
Excluding the contribution made to household pension funds, the underlying saving ratio actually went into negative territory at the end of last year for the first time since 1989.
More evidence that we are nearly there but not quite
Posted by sold 2 rent 1 @ 09:48 AM (137 views) Add Comment
5 Comments
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1. doomwatch said...
Yet another bleat (yesterday we had property to fall in 2008) from the Torygraph to somehow persuade the MPC not to increade the base rate. It's as shameless as it
is transparent.
There a lots of people with savings; mostly the ones who refuse to be mugged by the media backed mortgage companies.
2. paul said...
We've been told before by Crash Gordon that this is a good thing because it means that people are loosening the purse strings. David Smith from the Times has often aregued that MEW is wealth creation too.
3. cyril said...
Do people get paid for writing this drivel?
If you exclude pension contributions from the savings rate it goes down. If you exclude oil prices from inflation it goes down. Dur.
4. Tony Marshall said...
David Smith from the Times is not a very bright person.
This article touches on what can be regarded as the 'undertow' at the turn of the economic cycle. Everyone focuses on rising interest rates and credit squeezing, but that’s the froth on the top of the wave - when the populace as a whole gets that nagging feeling that things are getting worse and they need to draw in their horns and put a bit by for that rainy day, that’s the undertow that will really drag the economy down. Remove the core spending support and the whole thing will collapse.
Of course, Gordon has done his bit to undermine people’s confidence in their future prosperity – when he raided the pension funds, he hoped that the long-term effects would be, well, long-term – what he almost certainly did not anticipate was that they would start to show, just as he was about to be handed the keys to Number 10…
5. sold 2 rent 1 said...
doomwatch,
I am not convinced this is an “MPC manipulating” article just before decision day.
Yesterday’s article “property to fall in 2008” was from the quarterly data by LSR and I could have written the headline a month ago.
I can tell you now that on 2nd July 2007 Edmund Conway will write another article similarly named. Although the nearer we get to 2008, the more the “C” word will be used. “House prices set to crash over the next 3 years”, will be my guess at the title in July.
The Telegraph has been one of the more bearish papers on the subject.
HPC still very much on target to start early 2008.