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The Masked Tulip

Debt And Doom

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So how might trouble start?

Imagine that we have some bad news – a terrorist attack on London, a political scandal, a fall of a few percent in house prices, and so on. My neighbours Mr and Mrs Jones get jittery and decide not to buy a new car in the Spring. I no longer feel compelled to keep up with them, so I hang on to my own old car, and we all save more instead. Everyone around us notices and cuts back. The local shops hit hard times. They lay off a couple of people. Those employees’ families cut spending. Folk all around begin to pull out of property purchases. Confidence wanes. People fret, and then fret a little more. Debt starts to concern once-confident shoppers. Confidence sputters.

Economies are really giant spirals of shopping. Take the fizz out, somewhere up the giant Catherine wheel of spending, and the result can be ripples from which it is tricky to escape. What spirals up can spiral down.

I think it is sensible to worry.

I was reminded of Andrew Oswald's article on how a UK HP crash might begin when reading all the latest news about the slowdown in High Street spending. Maybe, at last, AO's forecast is coming true? Is the above what is now happening?


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  • 302 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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