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see todays commentin the telegraph

Credit crunch awaits Brown

British household debt grew at a frightening 10.2pc last year, while the economy as a whole managed a piffling 1.8pc. We hear a lot about our trade deficit and our budget deficit but it is the underlying personal sector deficit which is the real horror show in the UK economy at the moment.

Our revelation in yesterday's paper that personal debt at £1,158 billion for 2005 was more than £30 billion higher than the nation's entire £1,127 billion economic output has caused widespread consternation among many people except, that is, with the one person who ought to be more worried than most - Gordon Brown.

Our collective debt has been likened to an economic iceberg. Many consumers are going to founder on this financial hazard which, bizarrely, remains almost completely submerged from most people's view in a mist of myopia, including the Chancellor's it would seem.

At a time when the consumer sector is holed below the water line and rapidly listing to starboard, Mr Brown seems remarkably sanguine about the state of the nation's finances. So relaxed is he that he spent yesterday talking about the Government's security measures, ID cards and a new law to ban the glorification of terrorism as he prepares for what he no doubt believes will be a glorious promotion to succeed Tony Blair when the Prime Minister hands over the keys to 10 Downing Street.

However, the decade of debt, which the naughties have turned into, will not only catch up with those consumers who have been profligate with credit cards, store cards, excessive mortgages and equity withdrawal and every other form of hock that the financial services industry can dream up. It will also catch up with Mr Brown and be the ruin of his political career.

It is not only consumers who are now drowning and no longer waving. The public sector's finances are also out of control, the only fix being an increase in taxes or a cut in spending, or both.

But add to this the impact on the economy of a consumer slow down and you have a slump the likes of which we have not seen for more than 15 years. All the signs are there. Rising bankruptcies, rising repossession, an increase in business failures plus a sharp slow down in high street spending in January and figures from the City that show a big increase in the demand for savings. It's all one way traffic down bad news boulevard at the moment.

Mr Brown's legacy will be this ugly fall out from the decade of debt, a legacy that will undermine his premiership, should he get one, and give his own successor an impossible job.

But the careers of a few politicians are nothing compared with the damage about to be visited on the United Kingdom from its debt-fuelled spending binge.

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Ouch...

Well Economic miracle... uhm..

so if everything that the UK earnt was put into paying of personal debt for a year and nothing else at all..

It wouldn't cover it.

and Brown is to be our next leader..?

What in gods green earth are the MPC up to?

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Guest Riser

What in gods green earth are the MPC up to?

What ever Brown tells them. No one should be left in any doubt that Browns placemen hold the balance of power within the MPC.

Edited by Riser

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Guest KingCharles1st

I find it incredible that this guy is sooo OSTRICH- I mean surerly by now he understands he can never follow "Our Tone" with the cheesey smiles, play acting bar none (Tone is a Leo BTW) and the people (idiots/eastenders watchers/white van man etc) will finally wake up at the same time Tony arranges a press conference, flashes the teeth, and holds the keys to no10 for the camera while having his other arm around Gordy.. Will this BURK EVER WAKE UP!!!!!!!!!!

Gordy baby is already toast- what a pratt- but you have to admire Tony for keeping charm as the No1 tool of the leadership...

Q- whats the difference between Tony Blair and Gordon Brown..?

A- Tony has an excuse.... Gordon!

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The Telegraph is really telling it like it is, they even mentioned a house price crash yesterday............

Comment

(Filed: 13/02/2006)

For the first time, even if Britons devoted every penny they generate this year to mortgage and credit card bills, they would not be debt-free come next January. News that household debt has overtaken GDP will not trigger economic disaster. But the only way out of this situation is either sluggish consumer activity for a number of years or a house price crash.

Telegraph/money

and the link for todays comment..........

Telegraph/Credit crunch awaits Brown

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If they're right about this, we're heading for a pronounced period of deflation then? In which case, where's the best place to put savings? Presumably out of equities/gold and into cash of some form?

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see todays commentin the telegraph

Credit crunch awaits Brown

British household debt grew at a frightening 10.2pc last year, while the economy as a whole managed a piffling 1.8pc. We hear a lot about our trade deficit and our budget deficit but it is the underlying personal sector deficit which is the real horror show in the UK economy at the moment.

real horrorshow... viddy well my pretties B)

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If they're right about this, we're heading for a pronounced period of deflation then? In which case, where's the best place to put savings? Presumably out of equities/gold and into cash of some form?

That's what the Japanese did and it stagnated their economy for years. The fall out from Gordon's "economic miracle" will be serious given the magnitude of the debt that is a reality as Mervyn King has said. Whereas house prices are just opinion.

Gordon "miracle economy" Brown for PM? I think a bet with Ladbrokes on him not making it would be a good investment. :lol:

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Guest

Yeah. but the Telegraph also printed an article a few weeks ago (on the front page I think it was) saying how DIVORCEES are propping up the market!

:blink:

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That's what the Japanese did and it stagnated their economy for years. The fall out from Gordon's "economic miracle" will be serious given the magnitude of the debt that is a reality as Mervyn King has said. Whereas house prices are just opinion.

Gordon "miracle economy" Brown for PM? I think a bet with Ladbrokes on him not making it would be a good investment. :lol:

How about a dabble with Ladbrokes on HPC for 2007? What odds would you get for that and considering many peoples conviction on this site (mine also) that its simply a matter of time what would peoples thoughts be? I personally think that it will be a hard fall off the cliff sharpish and I thnk this year or next is a reasonable call....the ecoonomy needs a sharp correction and economics are not sentimental to fools gold.

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Wow! Strong and sobering words indeed - entirely unexpected from a British newspaper, lol. I'm more used to seeing a euphemistic and "the sky isn't falling" spin to potentially ominous signs. Especially in the world of housing.

Something that just recently occurred to me is, it's been at least 10 years since the last, *serious* world recession. Yes, there was the slowdown when dotcom bombed, but it mostly affected the high-tech sector and barely caused even a technical recession (2 quarters of negative growth).

People who think the economic cycle is dead are just fooling themselves (or may be too young to know any better). Like the Big One (earthquake) that has been predicted for California for years, we are closer, rather than farther from, a major downturn in the economy, if for no other reason that things have been good for so long. If the fundamentals were still sound, then things could continue status quo for quite some time. But the ominous signs are building, especially the mountains of debt, falling currency, US trade deficit, US government deficit, and similar. While the inevitable can be delayed (and perhaps allayed), it can't be put off *forever*. As past recessions have shown.

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People who think the economic cycle is dead are just fooling themselves (or may be too young to know any better). Like the Big One (earthquake) that has been predicted for California for years, we are closer, rather than farther from, a major downturn in the economy, if for no other reason that things have been good for so long. If the fundamentals were still sound, then things could continue status quo for quite some time. But the ominous signs are building, especially the mountains of debt, falling currency, US trade deficit, US government deficit, and similar. While the inevitable can be delayed (and perhaps allayed), it can't be put off *forever*. As past recessions have shown.

Ignore all of that. The Yanks, no doubt aided by the UK, France and Germany, are going to blitz Iran this year, probably in the Summer. After an enormous air strike and much loss of life it will be discovered that the Iranian nuclear programme was barely scratched. The oil taps will be turned off and the World will plunge into a massive recession come panic come depression.

All over the World young men will shrug their shoulders, sigh and pull on their uniforms.

Yes, I know that sounds terribly, terribly depressing but... we are now on a collision courses with Iran over this and it ain't going to be nice.

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we are now on a collision courses with Iran over this and it ain't going to be nice.

Bush may be. There's no reason why the rest of us have to be.

Maybe we'll get lucky and the Republicans who'll lose their seats in November if oil is at $200 a barrel will hold him back.

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I think 2007 will be too late. Iran will get blitzed this Summer IMPO and I think the fall-out will bring the global economy down.

I was wondering if it will be next month. When did they invade Iraq ? Wasn't that in March ? I thought that the summer months were too hot if they sent troops in.

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Bush has no troops to send to Iran. If there's fighting on the ground it will be because the Iranian army invade Iraq after US bombing and the Shi'ites rise up, slaughter the British troops and attack the Americans.

Edited by MarkG

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They ain't going to send troops in.

They will do a massive air and missile blitz and it would not surprise me if they take the decision to use a tactical nuclear tipped cruise missle on one of the bigger sites.

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They ain't going to send troops in.

They will do a massive air and missile blitz and it would not surprise me if they take the decision to use a tactical nuclear tipped cruise missle on one of the bigger sites.

Shock and awe again? I thought if country A uses a nuke against country B, then B has an automatic right to retaliate with a nuke.

Edited by Mr Blek

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Shock and awe again? I thought if country A uses a nuke against country B, then B has an automatic right to retaliate with a nuke.

exactly right then b turns into c then c turns into d etc etc and before you know it it's nuclear winter and we all perish!!!..... in theory ;)

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  • 337 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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