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cashinmattress

Britain's Total Assets Fall For The First Time Since The Early 90s

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Britain's total assets fall for the first time since the early 90s

The total value of assets in Britain fell last year for the first time since the recession of the early 1990s, to £7 trillion, official data revealed yesterday.

The Office for National Statistics, releasing its annual tally of what Britain is worth, said the new figure represented a fall of 2% compared with 2007 but was still well above the £4.2tn total value seen at the turn of the millennium.

The new figure chimes with the slide into recession in the second quarter of last year, but whereas gross domestic product measures the total value of goods and services produced in the economy, yesterday's ONS report adds up the value of the economy's building blocks such as property, factories and machinery.

The main reason for last year's drop in total asset values was the sharp fall in house prices. The report said that the total value of residential houses and flats tumbled by nearly £400bn, or 9%, to £3.9tn. Housing still remains by far the most valuable single asset class, accounting for 56% of the country's net worth. Commercial buildings shed £100bn of value to be worth a total of around £600bn.

With all property values having fallen further so far this year, it is likely that the total asset value will fall again.

The value of all the country's vehicles, including planes and ships, fell by £25bn to £160bn last year, following a collapse in new car sales which pushes down the average car or truck valuation. The figures also include £22bn for the country's mobile phone spectrum. Total agricultural assets remained fairly steady at £55bn.

The report also says that depreciation, or capital consumption, totalled £151bn in 2008, with plant and machinery accounting for just over a third of that. Over the past year, the value of total assets in use rose 4.3%, showing investment was greater than depreciation. In 2008, the cost of replacing all capital assets in their current condition would have been £3tn.

Well there you have it. This 'wealth' is only realized if you find somebody to purchase or trade your asset for something of equal value. British housing, wholly untransportable and so very subjective in terms of real value, is only worth something to Britons. You would only get a sense of this by having an extended sabbatical away from here.

There is very little of actual value within the UK which the rest of the world want access to. We sold off our oil and are now left with nothing.

Whover says we haven't experienced a crash is bonkers, and tying desparately to cash out.

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Considering the FTSE 100 has fallen by £500B (2000 points)

You then have the FTSE 250, the AIM market and lots of private businesses most of which would have fallen in value as profits fell. Say another £500B for all of those.

Note: not all stocks are owned by people in the uk but we own some foreign stocks which probably averages out.

Then you have about 22m houses which fell in value about £40k each giving a fall of £880B

Then commercial property has fallen in value by 45%, which lost some £300B.

Then the government has borrowed some £200B in our name, which is a debt or a loss.

I make the total lost at about £2.2 trillion in the uk.

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Then the government has borrowed some £200B in our name, which is a debt or a loss.

Don't think that's accurate.

I'm no accountant but surely debt refers to cashflow, gain or loss refers to balance sheet?

EG I borrow £200B from NatWest for home improvements. I now have £200B in my current account and a debt of £200B - IE no gain nor loss.

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Don't think that's accurate.

I'm no accountant but surely debt refers to cashflow, gain or loss refers to balance sheet?

EG I borrow £200B from NatWest for home improvements. I now have £200B in my current account and a debt of £200B - IE no gain nor loss.

Isn't this debt to fund current expenditure? In which case, in your model, we've splurged the £200Bn on granite worktops, a four-oven AGA AND an AGA Companion, AGA fridge/freezer, beech kitchen units, marble flooring, etc etc and now we have nothing left in the bank and a £200Bn debt. Our home improvements have been spent, sorry, invested in an asset that is going down in value.

Analogy, schmanalogy... who cares as long as we know who the villian is.

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Don't think that's accurate.

I'm no accountant but surely debt refers to cashflow, gain or loss refers to balance sheet?

EG I borrow £200B from NatWest for home improvements. I now have £200B in my current account and a debt of £200B - IE no gain nor loss.

You then spend the money on the home improvements. This does not increase the value of your house. You then have a debt with no compensating asset and are therefore 200B worse off.

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What a pointless report. You may as well just quote how much private mortgage debt we have as a nation, if housing makes up the biggest asset class. All the report does is highlight the fallacy of our "wealth."

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What a pointless report. You may as well just quote how much private mortgage debt we have as a nation, if housing makes up the biggest asset class. All the report does is highlight the fallacy of our "wealth."

+1 housing wealth is a total illusion

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whoa! 56% of the lot is housing. Well done. :ph34r:

Just ripe for the next bubble. 10 million immigrants by 2030. That should make us all incredibly rich.

Sorry - I mean, it should allow the minority of capital owners make even larger profits and confine everyone else to abject poverty. Slip of the tongue, my mistake.

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