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Realistbear

" Britons Still Spending Despite Market Turmoil"

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http://uk.reuters.com/article/businessNews...20?rpc=401&

Britons still spending despite market turmoil

Thu Sep 20, 2007 2:24pm BST

By Christina "Chris" Fincher
LONDON (Reuters) - Rising borrowing costs and financial market turmoil have yet to bow the consumer, according to surprisingly strong retail sales and mortgage lending figures on Thursday.
Retail sales volumes grew by a healthy 0.6 last month, wrongfooting analysts who predicted growth would grind to a virtual standstill.
And mortgage lending rose by a near-record amount, suggesting confidence in the housing market remains robust.
"August's figures gave no indication of the financial market difficulties," said David Dooks, director of statistics at the British Bankers' Association.
Stronger than expected money supply growth
and an upbeat manufacturing survey reinforced the view that troubles in global credit markets have yet to spill into the wider economy -- despite claiming a major casualty in mortgage lender Northern Rock (NRK.L: Quote, Profile, Research), which has had to seek help from the authorities.

The miracle has legs you have to admit it! Spending frenzy, Abbey launching new 125% mortgages, "robust" confidence in the house market despite the doomsayers at RM, NAEA and the press in general. Gordon is standing behind the banks who fule the demand so why worry--he just has to make sure money supply is raised to meet the higher and hihger levels of consumer debt. No wonder sterling is soaring.

Keep on printing Gordon--you may soon need helicopters to dump all that new money supply on the sheeple to keep them spending.

Edited by Realistbear

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Changing people from borrowers and spendthrifts into thrifty savers will be like trying to herd cats over hot coals.

September is beginning to look like a total train wreck of a month. I wander what next month figures will be like.

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http://uk.reuters.com/article/businessNews...20?rpc=401&

Britons still spending despite market turmoil

Thu Sep 20, 2007 2:24pm BST

Retail sales volumes grew by a healthy 0.6 last month, wrongfooting analysts who predicted growth would grind to a virtual standstill.

And mortgage lending rose by a near-record amount, suggesting confidence in the housing market remains robust.

"August's figures gave no indication of the financial market difficulties," said David Dooks, director of statistics at the British Bankers' Association.

It does not surprise me, it is only really since the NR incident that I expect sentiment to start shifting properly. It dragged a lot of bearish views out onto the News channels which even the thickest skinned should have taken some on board.

You have to understand people have been condition for the last ten years, their perception of money has changed considerably and it is going to take time for people to realise what has been going on.

I have friends who have accepted a full asking price on their house with the last few weeks before NR, not sure if it will complete but it shows there are still some nutters out there oblivious to reality! :o

One of the biggest player facilitating the extreme lending have be knocked out of the ring and they were clearly lending at a ferocious rate right up until last week. If there is no let up in mortgage approvals in the month of September it may be time to throw in the towel then.

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Up up and away with the true measure of inflation.

the scene is now set for the deaparture of merv in december.

so what happens next.

my prophecies for the next 12 months.

1)GC2 finally reported for what it is.....during october.

2)rachel lomax appointed governer of BoE in december.

3)inflation measure to be changed back/altered to include housing costs by the next budget,allowing for IR cuts.

4)gord revs up the printing presses and money supply grows to 20%p.a

5)lets throw some military action agains iran into the mix.

6)major public sector disquiet and strike action.

7)retail sector/financial sector job losses on an unimaginable scale

8)the true scale of immigration and its effects on the indigenous folk start to emerge,and we get race riots.

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Yes. Joe Public is far less interested in the credit crunch and the banking crisis than who's the new Chelsea coach or who killed Maddie.

A couple of people buying houses at work were still jabbering on about when they're going to exchange with no hint of the banking crisis having anything to do with them.

Back in the mid-90s, when the economy was coming out of recession the Tories fretted that no one had the 'feel good factor'. Now it seems nothing can shake the sugarbuzz 'feel good factor' of buying loads of tat.

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Guest Popalot
the scene is now set for the deaparture of merv in december.

so what happens next.

my prophecies for the next 12 months.

1)GC2 finally reported for what it is.....during october.

2)rachel lomax appointed governer of BoE in december.

3)inflation measure to be changed back/altered to include housing costs by the next budget,allowing for IR cuts.

4)gord revs up the printing presses and money supply grows to 20%p.a

5)lets throw some military action agains iran into the mix.

6)major public sector disquiet and strike action.

7)retail sector/financial sector job losses on an unimaginable scale

8)the true scale of immigration and its effects on the indigenous folk start to emerge,and we get race riots.

Back to the Blair-Brown restaurant pact:

Brown: OK you be front man and I will make everyone in Britain feel wealthy, then you hand the reins to me

Blair: OK, out of interest how will you do that?

Brown: Ramp up the housing market and throw everyone into debt up to their eyeballs on the promise of eternal growth.....the banks will love it, more profit, no regulation........

Blair: What about interest rates?

Brown: Ah that is the cute bit. I will divide and conquer in the City, pretend the BoE is independent but infitrate it with my people. They will keep rates low.

Blair: And what if things start to go wrong

Brown: Easy, I will blame the "independent" BoE, and they will be the sacrificial lamb. always set up your fall guys well in advance...

Blair: Nasty...but nice. We hava a deal. Another Granita?

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A lot of posters here and elsewhere are purist economists - what we've seen over the past few weeks/days is the reality of politics.

BoE will bail out any bank that is bad so no excuse to stop the taps.

Competition between banks will get more agressive (eg the Abbey 125%) - they are gorging on it

Cue houses up again. Cue everyone feels rich. Cue more Gordon Brown.

Look at the Sun, Express, Mail, Times headlines on the web today - nobody gives a f*k

Just ocurred to me that a lot of the posters here (me included) fit into the "prudent" camp. Waste of time. As we are in the minority we have no value to the bankers or government so do fully expect higher taxes for the "middle class" to continue to rescue/bail out the majority. Majority = vote majority.

Miffed & Confused of London!

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A lot of posters here and elsewhere are purist economists - what we've seen over the past few weeks/days is the reality of politics.

BoE will bail out any bank that is bad so no excuse to stop the taps.

Competition between banks will get more agressive (eg the Abbey 125%) - they are gorging on it

Cue houses up again. Cue everyone feels rich. Cue more Gordon Brown.

Look at the Sun, Express, Mail, Times headlines on the web today - nobody gives a f*k

Just ocurred to me that a lot of the posters here (me included) fit into the "prudent" camp. Waste of time. As we are in the minority we have no value to the bankers or government so do fully expect higher taxes for the "middle class" to continue to rescue/bail out the majority. Majority = vote majority.

Miffed & Confused of London!

I know what you mean, but don't lose heart. The housing market is grinding to a halt.

Prices are already going down in most areas, asking prices have gone down, and the expectations of meeting asking price, I reckon have also disappeared. that equates to a significant drop already. Round our way, things were going over asking price back in April May, and now the stock is starting to stick quite seriously.

That is when the EAs start to precipitate the crash by managing the expectations of sellers.

And if you think that the NR scare is going to mean the banks are going to go full steam ahead, I think that is wrong. For a sart the FSA and BoE will be working to make sure that NR doesn't happen to anyone else and that means a dramatic decrease in risky loans. There is loads of evidence that the sub prime boys have almost completely shut up shop.

When you are about to go down the other side on a roller coaster, it doesn't start off very fast.

There is nothing they can do now to stop this train.

All my own opinion obviously

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Suspect the punters have reached the end of their attention span re credit crunch and the papers know it, house prices will never be cheaper and I suspect 125% mortgages will be all the rage by next week, buisness pages only from now on. Government has papered over the cracks with some new inflation money and its BAUsual. Was at the boat show yesterday and it was well populated, asked around the major boat sellers how they were going this year and all were full of enthusiasm, lots of people buying and finance was available for anyone who could sign a piece of paper.

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A lot of posters here and elsewhere are purist economists - what we've seen over the past few weeks/days is the reality of politics.

BoE will bail out any bank that is bad so no excuse to stop the taps.

Competition between banks will get more agressive (eg the Abbey 125%) - they are gorging on it

Cue houses up again. Cue everyone feels rich. Cue more Gordon Brown.

Look at the Sun, Express, Mail, Times headlines on the web today - nobody gives a f*k

Just ocurred to me that a lot of the posters here (me included) fit into the "prudent" camp. Waste of time. As we are in the minority we have no value to the bankers or government so do fully expect higher taxes for the "middle class" to continue to rescue/bail out the majority. Majority = vote majority.

Miffed & Confused of London!

I can see where you are coming from and totally agree with your comments about people on here being purist economists and being prudent, however I still strongly believe what is happening at the moment is beyond the control of purist economics or political intervention! We have made our bed and just as this was never going to be finished by the slow ramping of interest rates it wont be fixed by political meddling.

If house prices continue to rise and wages do not renting becomes more and more of a no brainer. Rents can not rise excessively in the face of stagnant wages so as per earlier renting will be a no brainer as housing stretches away (which even the no brainers out there might start to wake up to). If GB drops rates and the economy continues to be strong it will cause greater inflation than we are seeing now, this will pinch money from peoples pockets making home ownership harder and keeping pressure on rents as earlier meaning renting is the best option.

We are at saturation point, the government can't escape this one, sadly all this may be coming at a point in the World economy that may make recovery a very slow process.

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A lot of posters here and elsewhere are purist economists - what we've seen over the past few weeks/days is the reality of politics.

BoE will bail out any bank that is bad so no excuse to stop the taps.

Competition between banks will get more agressive (eg the Abbey 125%) - they are gorging on it

Cue houses up again. Cue everyone feels rich. Cue more Gordon Brown.

Look at the Sun, Express, Mail, Times headlines on the web today - nobody gives a f*k

Just ocurred to me that a lot of the posters here (me included) fit into the "prudent" camp. Waste of time. As we are in the minority we have no value to the bankers or government so do fully expect higher taxes for the "middle class" to continue to rescue/bail out the majority. Majority = vote majority.

Miffed & Confused of London!

The way things are going it makes you feel like building up as much debt as you can to spend on fast cars and property. The message that is being given is 'lead by example'.

Will prudence ever pay? Or is it better to live life for today and spend and play, never to repay. ;)

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Money supply rising exponentially ... I recently read (can't remember where) that it takes the average UK household until JANUARY to service the previous years debts !!!

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