Wad

Too right. I knew a bloke who bought one of the old Whitbread yachts. Obviously it was a proper racing yacht but he had had it kitted out in real luxury and he told me that he could not even cover the cost of crew when he chartered it out never mind upkeep of the thing. Eventually he sold it for less than he paid in the early 1990s dip in yacht prices.

What you need is a length of used 'pit belting' that they use to shift coal on conveyors of of coal mines. Can be coiled or twisted into any shape on a wooden frame and left outside for ever. Friend of mine also had a death slide rope across his garden between two trees about 10 feet up. Kids loved it

I agree with other posters - all my wedding stuff just sits in a cupboard. I just use plain glasses and white crockery bought from Cargo a few years ago. I went in after Xmas few years ago and just cleared their shelves it wa so cheap. I expected to chuck it away after a year or two but I use it day in day out and apart from a few chips from bashing it about it is still perfect despite hundreds of dishwashings. Nott surprised once Royal Worcester went - Wedgwood was surely just marking time waiting for the inevitable.

Too right. I am no musician but bought a Roland electric piano at Xmas and am stunned at the capaibilities of the thing. Add on Sibelius and a bit of other music publishing kit, a decent voice and some muscial skill and frankly I could have my music free on the web in a few days. Why do we need recording studios and record companies and record shops? Surely they will just be pure marketing companies soon. Adding no real value other than advertising. Surely this is an industry that really has been destroyed by the interent and the digital age and no one saw it coming. What are music publishers going to do? S

I just went and had a look at the Hearnes website and to be honest it is pretty easy to work out what the asking price is even on a POA property. All you have to do is put no search criteria in to the Search page they have and then just press enter. It lists all their properties in exact price order with the POAs just listed in between properties that are listed with published prices on so you know the price bracket that the POA sits in. I do the same thing with Rightmove and Prmelocation. Most EAs list their properties in actual price order on Righmove and Primelocation even if they are POA.

I am looking to relocate to Worcester and I have viewed a few houses at the top end of the market over £500k that I have made an unsuccessful offer on over the last few years that suddenly went for 15% under the original asking price last summer. Problem is that not every asking price in EA windows is being dropped that much - and only the motivated seller who finally has to take an offer is really getting a sale. Many others are just sticking at ridiculous asking prices with people refusing to take offers. A lot of these properties at the top end of the market have been on the market for 2 - 3 years but the sellers are often elderly and they have no mortgage so unless they get ill, die or run out of savings it has been hard to move them off their asing price. However, with savings rates now so low and having been on the market so long I can see a few elderly sellers being forced sellers quite soon and quite a few houses are now being advertised 15 - 20% below the original asking price of 2 years ago. These asking prices are still too high and the vendors are chasing the market down. They are now prepared to take an offer at spring/summer 2008 price levels but at the time of course they expected to get peak spring/summer 2007 prices. Nevertheless, slowly slowly catch monkey! Its just a matter of waiting for capitulations. Most younger people who are highly mortgeged simply cannot take an offer at all as they would not be able to pay the mortgage off and they have no other cpaital to make up the difference. These will be stuck for years or they will have to default and be repossessed. There is no point in making offers to these type of sellers - they cannot accept even sensible offers that are below the value of their mortgage.

Just had a closer look at the Halifax data from their website at: http://www.hbosplc.com/economy/includes/02...istoricData.xls Went to the AllMon (NSA) sheet and calculated a 21.21% % drop from the peak in August 2007 (£201,801) to December 2008 (£158,437). I think that if the market continues to drop at the pace it has over the last year then houses will have reached equilibrium fair value by around September 2009 (i.e another 15%). However, how many people will be that brave enough or even able to get finance enough to buy when the market has fallen another 15% from here? Assuming we do not get massive wage deflation and Bank Rate hits 0.25% and mortgage rates are 2.5% that may not be a bad time to buy. However, if banks keep on insisting on large deposits, job losses and repossessions also rise quickly then prices may well overshoot to the downside and anyone stepping into the market next year will have to be prepared to suffer almost certain short/medium term capital loss.

I had never heard of Morgan. When my wife shouted down the stairs they had gone bust I thought she meant the sports car firm. She put me straight and said she used to go in and liked the shops. News to me. Still what is important to remember here is that for every large and medium sized retail casualty we hear about there are probably hundreds of 1 - 2 shop enterprises going bust as well. I live and work in and around Oxford and Worcester and I have seen probably 10 one man band shops go bust in each place this last six months and expect to see a whole lot more boarded up over the next 3 months.

I think this thread is well above par.

Well lets all remember that Girly Girl has to earn an extra £1.67 p/h if she is a 40% tax payer to cover that cost. Now I know that does not sound much but then again there are few if any employers offering pay rises and most are offering a job only on the condition you accept a pay cut. I have two kids 8 yrs and 6 yrs and I pay £4 per (inc VAT) per hour to send them to a top quality day camp in holidays which includes archery, fencing canoeing, cricket/rugby, art, lots of team games and activities, swimming lessons, go carting, rock climbing, survival skills and a free occassional trip to meet a F1 racing team or some other activity. I would say that £4 is really the going rate.

True - look at this chart in the recent spectator article to compare external debt in various G8 nations. http://www.spectator.co.uk/business/coffee...ains-debt.thtml Japan has also tried 'zero interest rates and quantitative easing' to stimulate their economy look how it and it failed to do the job - so why should the USA and UK be any different? Still a fall of that magnitude in manufacturing output is pretty clearly a true Depression level statistic. EDIT: Forgot the link.

Yeah but does that really make you more productive? The fact that I can log on to HPC posting comments on my WiFi laptop while also being sat on my backside in front of a flat screen TV in a centrally heated house means I have more enjoyment of my leisure time but my desk PC which I use for work is no more productive now than it was 5 years ago. I have absolutely no need for any 'newer version' of Windows, no more processing power and no faster internet connection. These things would be 'nice to have' but would make me no more productive.

Not sure about that. TBH Argos was the only shop I have been in before Xmas that actually had a queue. They are not cheaper than anywhere else but if I want something that is a standard purchase without going and ordering it over the internet then Argos is always the place I try first. I just cannot be bothered searching along teh shelves in four other shops first. Better to just go and stab the item into the Argos machine and shove in the credit card. Agree wth a lot of your other suggestions though - I have noticed that almost all the coffee chains I have been going in lately have hardly anyone sitting down. Lots of people are now just popping in for a takeout if they are going in at all. In a place like North Oxford the 'coffee culture' took off but it really does seem to to have died on its feet in teh last few months. I would also add 'juice bars' and 'nail bars' and 'internet cafes' and 'hairdressers'as being typical small businesses that are already and will contineu to close in their thousands across the economy.

To bring the thread vaguely back on topic. This year I spent about 1/3 of the money I spent last year on Xmas presents. The credit crunch is just about to hit the real economy of my children's lives. Also, I went to Oxford to get last minute bits and pieces this morning. It was definitely much quieter than any Saturday of the last year. Bah humbug!!!!!

Dead right. It was also the arguement that was had before the Great Depression got going. Back then the Fed were slow to act because Austrian thinkers held sway. The severe Depresison that followed did clear out the dead wood of the system and actually cleared the way for FDR to eventually do a very successful 'Keynsian' stimulus to deal with the social consequences of the severe economic contraction. Banks were allowed to go bust by the 'Austrian' thinkers but FDR got people back to work using Keynsian methods after that had worked its way through the system. What we have today is 'Keynsian' methods being applied even before the bust gets going and this time the bailout is not being aimed at individials but the bankers. All wrong in my view. Let the banks go to the wall, but deal with the social consequences of job losses and protect savers by moving all bank deposits below £50k into National Savings. At the moment we seem to be bailing out evey big business and bank with a powerful political lobby pack behind it but allowing individuals and small businesses to be destroyed without a care.

I disagree. His series was good because he is a historian who well understands that economics is a social science (i.e it is concerned with attempt to describe complex human behaviour) and not as a mathematical science which so many economists in academic institutions believe it is. When you hear an economist say 'lets assume' and then proceed to 'prove' a theory by reference to a complex mathematical formula you know it will not be like that in real ife. His last programme in particular took apart the Long Term Capital management Nobel Laureates who were 'right in theory' about options trading but nearly destroyed the global financial system in priactice. I have spent all my working life in front line trading financial and commodity markets and have also have been trained in advanced theoretical financial mathematics and statistics. Theory and practice both have their place in understanding where we are today - but one on its own is meaningless without understanding the other's contribution as well. I would never trust a mathematical concept such such as modern portfolio theory to base my investment decisions on but I do use it every day to test my own thinking about things I MIGHT want to invest in.

I was talking to a taxi driver in Oxford today about the economic situation. Not a minicab driver but one of the 'black cab' licensed drivers that can go on ranks. He said he had gross income of £35 yesterday after 7 hours - simply not worth going out as he was earning less than minimum wage. He said things had really made a dramatic and serious downturn in the last two months. Last summer was OK with good steady work but that dropped off in September and on his really big pay day on Friday / Sat night he used to see £250 gross taking each night but now down to £160 for a 10 hour shift with drunks and a fair bit of violence thrown in. People are not just seeing wage freezes but nominal wage drops out there. That is deflation in action!

I would not rent a property where the previous tenant had a dog without a total refurb. I grew up with 30 - 40 dogs but only one lived in the house and she was bathed once a week and groomed within an inch of her life (she was a show dog). My parents have still got 15 of them but they all live outside in purpose built kennels. If you rent a big house in the country with land and the dog lived in a kennel I do not see what objection there could be but a flat in town would be surely unfair to the dog and other people in the block?

I have had this nagging feeling that in the end the US Govt / Fed will nationalise the banks and buy up the bond and stock and property markets to restore confidence. Well they have made a good start or bank nationalisation and the bond market will be 'bought up' by the Fed when it starts quantitative easing so I guess buying up other asset classes is pretty much one tiny step away form where we are now.

You should remind them it was 'locals' who sold their houses to incomers and then scarpered with the loot. I believe it is the same in Wales and parts of North Yorkshire where I am from.

What a very interesting article. It reminded me that my old school (a private boarding school) which was founded in 1877. The reason it was founded was that it was the amalgamation of 3 earlier private schools that had all gone bankrupt due to falling school rolls which I presume was caused by children being taken out by their parents who could no longer afford the fees. I always wonderd why those schools had failed - now I know. The final ironic twist was that one of the schools in York was bought by a property developer and knocked down to build houses. I believe he also went bankrupt too!

Remortgaging is a modern phenomeon indeed so is the concept of a 'second mortgage' which remortgaging has become so closely tied to it is almost indistinguishable in peoples' minds. You know the phenomenon - lets get a new mortgage and pay down the credit card and the overdraft and car loan at the same time but its OK because our house has gone up in value. I remember my parents in the 1970s talking in hushed slightly disapproving tones about people who had remortgaged or heaven forbid been 'forced to get a second mortgage'. People who remortgaged or had second mortgages were regarded as people who were living beyond their means or 'on their uppers' as my parents used to say. The idea that someone would have debt as a newly married was OK but not someone who was in the middle age. Seems to me the idea of paying off a good chunk of debt by teh time you were middle aged was pretty sound one - look at all the people in middle and late middle age now with debt who are really struggling. Mind you I did live in a very small village in Yorkshire back in the 1970s so we probably were living in the 1950s with our attitudes back then.

I know... I know... but eventually Kirsty will be right that buying house is the right thing to do. To be honest I think she has always been right on this point that life events drive house buying and selling at least to some extent. Indeed, thats exactly what should drive house buying and selling not silly get rich quick properdee dreamers and BTL schemes.

I still think that in the end the UK banking system wil be 'effectively' nationalised. What I mean by that is that more Govt capital will be required and more Govt guarantees and in return for all that the Govt will impose very onerous terms which include target amounts and specified interest rates that teh bansk may charge customers. In effect a command and control banking system. Nationalised in all but name. The big political problem - for this has nothing to do with economics - is that banks are not pasisng on the new capital in the form of new loans to customers. Old customers are increasingly stuck on SVR with their mortgage as houses are 'down valued' and any new customer has to put up 25% deposit. Add to that apossible withdrawal of credit card limist and overdrafts to personal customers and small business and the credit crunch is total. Only by imposing total Govt control can banks be forced to lend out the capital they get.

The next stage for this site is to help people decide when to step back into the market. There is a real sense of fear out there that is palpable and it is mainstream now. No point in carrying on telling people that house prices will crash - they know that it is really happening. However, life still goes on and as Kirsty Allsop says people still get born, they get married, they get new jobs, they lose old jobs, have kids, get divorced, and then they die. All of those life events trigger house buying and selling decisions. What people will need help with is understanding what is fair value and when it will be sensible to buy a house. I suspect that fear will become so acute that even when it becomes much much cheaper to buy than rent then people will hold off too long agonising about when to step back in. Just look at the BBA mortgage advance figures today to see a real economic manifestation of that fear. I think this site can still be a real catalyst for helping people to make sensible decisions. For my own part, having rented for nearly a quarter of century I am now very seriously looking to buy and plan to do so in June/July/August next year if the trend continues as it has for the last 18 months. As a few posters have noted, mortgage rates are now so low and going lower that the whole rent / buy equation is turning round to buying for the first time in a decade.