Friday, Dec 14, 2007
There simply isn't enough money in the UK to cover the debts.........
Money Expert: Personal debt exceeds gross domestic product for first time ever
"Britain's huge level of consumer debt is symptomatic of the country's well-established buy-now-pay-later culture. We can no longer generate enough GDP to cover the amount we owe."
The credit culture is something that a number of commentators have picked up on and a significant proportion have blamed both the ease of access to credit and media promotion of a glamorous lifestyle as seemingly enjoyed by celebrities and the rich and famous.
Posted by hpwatcher @ 02:59 PM (578 views) Add Comment
5 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. yorkshireman said...
The credit culture is one reason. Also, we have very little manufacturing anymore. Once, we had the finest engineering, shipbuilding steel manufacturing etc. Now, we seem to think we can survive by buying and selling shares and each others houses.
2. denzil said...
But this is a miracle economy, no?
3. Crash Already! said...
The UK does have too much personal debt but the GDP figure is for one year whereas the total debt includes mortgages which were taken out up to 25 years ago and so the comparison is meaningless. If the Earth happened to orbit the sun every 13 months then GDP would be more than personal debt.
Yorkshireman - whilst I understand your concern that manufacturing has declined, ask yourself the question: would GDP be higher or lower if we engaged in more manufacturing? We don't manufacture as many physical goods because other countries do it cheaper. If we were to do so then we would be directing resources away from more profitable areas. Services are worth just as much as physical goods (or in the UK's case, more) or people wouldn't pay for them - nobody gives money away!
4. drewster said...
Yes it's a miracle economy. Jesus turned water into wine. Our high priests of finance turned subprime mortgages into AAA-rated CDOs. The wine probably gave the people a massive hangover, let's see what the CDOs do....
5. yorkshireman said...
Drewster, you hit the nail on the head. There are generations of people who believe that profit is something that is bought and sold on the stock markets. They do not realise it has to be made by industry. The finance "industry" is revered and even worshipped by many people. In my view, it is not an "industry" as it produces nothing for the economy. It is a tool. The worrying aspect is that the high priests who run it are a bigger bunch of tools. If it was to be run on the lines of normal companies, there would be a whole load of the priests in jail.