Credit Crunch

[gedereco]

Hi all,
I haven't posted for a while been working away but i'd like to know if this credit crunch is effecting anyone. there is quite alot of firms in the northwest shutting down or have only a few weeks work left. So what's thoughts and is there any light at the end of these troubled times,,

:roll:

 

[wizer]

Whilst the country and indeed the rest of the world are certainly experiencing hard financial times, it's made 100 times worse by the media and the gossip. (Contradicting myself), I try to ignore it tbh. I'm looking after me and my own and we'll pull through it, it's not the end of the world.

 

[gedereco]

Your quite right wizer the hole world has jumped on the recession band wagon. I'm just glad some people still have common sense . i'm in ground works and joinery and were still busy and it's looking pretty busy next year. So at least some people still want work done, the good thing about it, is that the price of some materials is dropping a bit.Which is always a bonus. :lol:

 

[BradNaylor]

Whilst the country and indeed the rest of the world are certainly experiencing hard financial times, it's made 100 times worse by the media and the gossip. (Contradicting myself), I try to ignore it tbh. I'm looking after me and my own and we'll pull through it, it's not the end of the world.

I disagree.

The media played a major part in ramping up the speculative bubble in credit that led to the problems the world is now facing. The constant 'good news' stories about how money could be made in property encouraged people to leverage themselves to ludicrous levels in blind pursuit of a lavish lifestyle far beyond their means.

The bubble has now burst. The media quite rightly is reporting that fact. You can't have it both ways.

As I see it, the credit crunch is going to affect mainly those with high levels of debt, or those whose employment is dependant on companies who have high levels of debt.

The rest of us will simply have to tighten our belts a little as in previous recessions and get on with life.

From a personal point of view, I am pleased to say that my order book is now full until May next year with clients who have paid hefty deposits for furniture. I've turned down 3 big jobs this month because I couldn't do them in time for Christmas.

People forget that huge numbers of people own their homes outright, owe nothing, and have money in the bank. The crisis in credit does not directly affect them. It is among these people that I look for my business.

Cheers
Dan

 

[Karl]

The media played a major part in ramping up the speculative bubble in credit that led to the problems the world is now facing. The constant 'good news' stories about how money could be made in property encouraged people to leverage themselves to ludicrous levels in blind pursuit of a lavish lifestyle far beyond their means.

The bubble has now burst. The media quite rightly is reporting that fact. You can't have it both ways.

Just because the media ramped up the credit bubble doesn't mean they have to constantly bleat on about the Recession. I like to be kept abreast of things on the news, but the BBC's obsession with the Credit Crunch is ridiculous (Radio 4 have a series of programmes devoted to it).

The way I see it, the only people who are gonna be knee deep in the dung are those who need new finance. Banks not lending to each other or customers. But that can't go on forever - that is how they make their dough.

Final prediction - for all those home owners worried about -ve equity. Based purely on my own thoughts and picking of info i've accumulated from the endless hours of radio programming i've heard on the matter in the last few months. House prices drop a further 15% in the next 18 months, but will then begin to re-bound from Spring 2010 (once the banks start lending again and first time buyers are brought back into the loop). There isn't enough supply of housing in the country to meet the demand.

Once that happens, we can all re-mortgage and go out spending again.......:lol:

Cheers

Karl

 

[Fecn]

Sadly I don't agree that it's all media hype - I wish it were.

From a personal standpoint, I'm doing OK. House is worth more than when I bought it... Don't have any debts apart from the mortgage... No problems making the payments each month...

From a business point of view though...

We've pretty much lost one customer... They were a BTL mortgage company, but they're no longer accepting any new business. On their own, they kept one of my chaps busy on a month-by-month basis - Unless we can find enough additional work to keep him busy then his job is very much at risk as a result.

We're owed a bit of money by a property company who has failed to pay their bill... Court case in progress now to try and reclaim it.

We've got a prospective new client which will mean we'll have to spend a whopping huge sum of money on new servers for them. We probably only have 40-50% of this money sitting in the company accounts and will need finance for the rest.... if we can still get it. - If we can't get it then we won't be able to get the contract and we won't make £££ as a result.

Much as I'd love to be in denial about the whole situation, I'm having to face up to the fact that I might have to make someone redundant for Christmas.

 

[BradNaylor]

Final prediction - for all those home owners worried about -ve equity. Based purely on my own thoughts and picking of info i've accumulated from the endless hours of radio programming i've heard on the matter in the last few months. House prices drop a further 15% in the next 18 months, but will then begin to re-bound from Spring 2010 (once the banks start lending again and first time buyers are brought back into the loop). There isn't enough supply of housing in the country to meet the demand.

You're probably a bit young to remember fully the last crash in house prices Karl, but it actually took 8-10 years for prices to regain the levels that they were at in 1989.

This crash is likely to make the last one look like a minor blip in comparison.

My prediction is that it will take until around 2020 until house prices reach 2007 levels again. Anyone who took out a 100% mortgage last year is likely to be stuck in negative equity until then unless they can pay some capital off.

I'm not a doom and gloom merchent. Just realistic.

Cheers
Dan

 

[Paul Chapman]

Much as I'd love to be in denial about the whole situation, I'm having to face up to the fact that I might have to make someone redundant for Christmas.

I reckon we are going to see a lot of that in the coming months and years where many people, through no fault of their own, are going to get caught up in this mess. Very sad

Cheers :wink:

Paul

 

[woodbloke]

I'm not a doom and gloom merchent. Just realistic.

Cheers
Dan

http://www.dadsarmy.co.uk/Resources/laurie.jpeg

:-k :lol: - Rob

 

[lurker]

I know an accountant who remortgaged his house last year - I guess the mortgage is now about 150% of the house value
He & his wife have £25K on credit cards & a 6 month old car on a loan.

True the banks should not have let him do it but to suggest its not his own fault, is damn stupid.

problem is, people over the last 10 years seem to think they have a "right" to a certain lifestyle, come what may.

It was obvious to even an silly person like me the house prices were unsustainable so what sort of cretins were the mortgage lenders employing??

At the risk of sounding an old fart - when we bought our first house we were allowed x2 of my earnings & X0.5 of my wife's. Because of that we "got though" the inflation period where mortgage interest hit 18%

 

[Sawdust]

I know an accountant who remortgaged his house last year - I guess the mortgage is now about 150% of the house value
He & his wife have £25K on credit cards & a 6 month old car on a loan.

True the banks should not have let him do it but to suggest its not his own fault, is damn stupid.

problem is, people over the last 10 years seem to think they have a "right" to a certain lifestyle, come what may.

It was obvious to even an silly person like me the house prices were unsustainable so what sort of cretins were the mortgage lenders employing??

At the risk of sounding an old fart - when we bought our first house we were allowed x2 of my earnings & X0.5 of my wife's. Because of that we "got though" the inflation period where mortgage interest hit 18%

Agree that it's his fault for doing it but what about the poor devil who is going to be made redundant in time for Christmas - he's done nothing wrong other then be the victim of a load of incompetent greed b*stard bankers who have caused all of this.

I heard on the news yesterday that some guy got seven years for forging a few tens of thousands pounds worth of bank notes. The bankers have cheated the country out of billions and they get off scott free and are bailed out by the government.

Bloody crazy!

 

[Digit]

I might have to make someone redundant for Christmas.

Yeah! I've had to do it in the past. It goes with the job.
Doesn't make it any easier though does it?

Roy.

 

[harryc]

I find it amazing that people can blame the media for the state of our economy. That sort of just sums up our society blame somebody else for all our problems.
It was not the media that made the Economy contract by 0.5% last quarter.

Its just a reality that we have an economy built on cheap credit and when one of the main pillars of growth the CITY has now been uncovered to have just been a big casino game played by rich idiots. We are all going to pay for their gambling debts.

We need to get a rebalance in the economy between manufacturing and finance.

Harry

 

[Digit]

There's nothing wrong with cheap credit in principle Harry, but as you say the balance needs to be understood.
The sub 30 yr generation seemed to think it was a right and would continue for ever without a pay back. Some of the younger generation are facing reality for the first time in their lives it would seem.

Roy.

 

[harryc]

Roy, I agree nothing wrong with cheap credit, heck I wish my mortgage rate would come down.
Point I am making is that it is unsustainable to have an economy built on borrowing, just look at Iceland for an extreme example.

Harry

 

[Digit]

I agree Harry, that's what I meant with some of our youngsters, they seem to think that system was sustainable. Now at least they know different.

Roy.

 

[harryc]

Roy glad you agree it makes a change on the OT forum :lol: :lol: :lol:

Harry

 

[Digit]

I'll say!

Roy.

 

[Evergreen]

The news media didn't cause the credit crunch but they certainly seem to be wallowing in it. Plenty of jobs for parasitic journos and holier than thou hacks, whichever way the wind blows.

 

[Rich]

Once again (yawn) we come back to Mr Micawber, income- 19 shillings, outgoings-20 shillings, result misery, I know I sound like a stuck record but prove me wrong if you can.

Regards,

Rich.