Us Consumer Gloom- Link- But A Question About 1992

[Guest KingCharles1st]

Its obvious we are going to get this, but, although I got hit hard in '92, I didn't take any interest in the US' problems back then.

Question- was the 89-92 recession in the UK limited to the UK, or was the problem imported and built on great wondrous things from the US like the current crisis.

Link

[DrGUID]

I think it was bad in the US, but then we had our own particular problems, like the ERM debacle and the housing market crash. US house prices didn't crash that time.

1992 was a terrible year though. I was at Uni, but my dad lost his skilled engineering job and ended up on a production line making crappy fridges for about £3 an hour. I couldn't get my usual summer job in a garden centre that year either (even though they used to pay me a measly 1.76 an hour) .

[Guest Mr Parry]

I think it was bad in the US, but then we had our own particular problems, like the ERM debacle and the housing market crash. US house prices didn't crash that time.

1992 was a terrible year though. I was at Uni, but my dad lost his skilled engineering job and ended up on a production line making crappy fridges for about £3 an hour. I couldn't get my usual summer job in a garden centre that year either (even though they used to pay me a measly 1.76 an hour) .

My lot went bust. Lost everything. Everything!

[Guest KingCharles1st]

US house prices didn't crash that time....

Thats what I had been thinking

Edited July 16, 2008 by KingCharles1st

[skomer]

Question- was the 89-92 recession in the UK limited to the UK, or was the problem imported and built on great wondrous things from the US like the current crisis.

Link

I seem to remember that the early 90's recession in the UK was a local problem, a combination of a housing bust feeding into a recession in the building & service industry/retail sectors (like now) and by the then Conservative government economic policy of tying the pound to the deutsch mark (ERM).

After German reunification the German economy went into something of a boom (later to bust in the late 90's), the deutchmark rose in value with the result that the pound became severly overvalued. This destroyed much of the UK's manufacturing base at the time with consequent unemployment . At least now the pound is floating , unlike Ireland & Spain, so we have some room to manouvre.

[Tiger Woods?]

I seem to remember that the early 90's recession in the UK was a local problem, a combination of a housing bust feeding into a recession in the building & service industry/retail sectors (like now) and by the then Conservative government economic policy of tying the pound to the deutsch mark (ERM).

After German reunification the German economy went into something of a boom (later to bust in the late 90's), the deutchmark rose in value with the result that the pound became severly overvalued. This destroyed much of the UK's manufacturing base at the time with consequent unemployment . At least now the pound is floating , unlike Ireland & Spain, so we have some room to manouvre.

Australia had a bad time during the same period, so I don't think it was purely the UK. Mortgages and loans to farms were 22% pa. I can remember one of my math lecturers chortling with glee that his mortgage was fixed at 13%. A lot of farmers had taken out loans (read: had loans pushed on them by the banks) earlier in the 80s, and then banks hiked the rates up to over 20% (think we had bad droughts at the same time too) and many, many farmers whose families had been on the land for a 100 years were repossessed.