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      10-01-2010, 12:07 AM   #1
scooba0010
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1 Trillion of debt

I just read the ONS state we have now crossed over into above one trillion of debt 1,000,000,398,000

Sounds scary to me but what about other european countries are they the same as the UK or are we just awful

Who is to blame Mr Brown and Mr Darling or was this unavoidable

I am guessing Mr C will be the one charged with getting some control over it ,and in the end being thrown out as the voting population wont like the bitter pill we are now being prescribed.

I work in a Government dept and there are 160 managers fighting for 100 posts so around a third are leaving ,

All i keep reading are cuts and more cuts is there any good news at present .
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      10-01-2010, 02:07 AM   #2
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Don't panic Scooba. We are not in bad shape compared to other european states. Ireland for instance is now completely knackered.

There are 2 layers of debt, the strutural deficit and the bank bailout. This first is about 42% of GDP, which is where we were in 1996. The second is a one off payment, that we will get back to a certain extent when the banks are privatised. At the moment, this would turn an 18% profit.

There are tough times still ahead unfortunately. The main economic indicator that remains completely out of touch with everything else is domestic property prices. Everything still suggests a massive property crash, but it is stubbornly refusing to happen.

We definitely need some austerity measures and I have no doubt that labour would not have been tough enough. Sadly Cameron is going to go over the top, which will not be good news for all the people that will lose their jobs in the next 12 months.
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      10-01-2010, 02:47 AM   #3
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If house prices do 'crash' then THAT will fuck a lot of people up. Either by negative equity or loosing a lot of cash.

lets all keep our fingers crossed.
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      10-01-2010, 03:48 AM   #4
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I'm more worried about what will happen when interests rates go up. Luckily, I should still be able to afford my mortgage (assuming rates don't hit silly figures) but there will be many, many people who will have fallen into negative equity and they will not be able to remortgage to more affordable deals.

When this happens there will likely be a lot of repossessions and the housing market will subsequently be flooded with stock, driving prices down yet further...causing more people to fall into negative equity....

I think there's going to be a lot of pain to come when (not if) the rates start to go up. Some people will inevitably have stretched themselves to the limit when deals were good....
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      10-01-2010, 03:59 AM   #5
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Don't panic Scooba. We are not in bad shape compared to other european states. Ireland for instance is now completely knackered.

There are 2 layers of debt, the strutural deficit and the bank bailout. This first is about 42% of GDP, which is where we were in 1996. The second is a one off payment, that we will get back to a certain extent when the banks are privatised. At the moment, this would turn an 18% profit.

There are tough times still ahead unfortunately. The main economic indicator that remains completely out of touch with everything else is domestic property prices. Everything still suggests a massive property crash, but it is stubbornly refusing to happen.

We definitely need some austerity measures and I have no doubt that labour would not have been tough enough. Sadly Cameron is going to go over the top, which will not be good news for all the people that will lose their jobs in the next 12 months.
Agree with most of that NFS. Not sure that everthing suggests a massive residential property crash. There is still, in many areas, a shortage of residential property. Where flats were overbuilt those prices have crashed (50% plus in certain areas) but there is a shortage of family homes, partic in South East.

As an Irishman it saddens me deeply to see what is happening back home. A key difference there is that there is a huge oversupply of housing - approx. 25% of residential dwellings lie empty. I get so angry at the obvious corruption that took place in local government that resulted in planning permissions being granted when there was insufficient population to support them.

Tough times ahead, for sure, but we need to stay strong and take the necessary medicine to correct the position in this country so that the next generation have a hope. I, for one, said before the last election that I would vote for whoever was going to raise taxes and cut public spending as it is so obvious that needed to happen.
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      10-01-2010, 03:59 AM   #6
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i stretched myself to the limit when buying my property in 2007... luckily since that time though my income has increased well oer 50%, and i should be able to weather the storm..

.. thank fuck!

otherwise, the car will be sold
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      10-01-2010, 04:03 AM   #7
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I'm with you on this Toxic. Interest Rate increases are going to give everyone the squeeze, at a time where everything else (food, fuel, etc) is also increasing (not forgetting loss of jobs). As long as it doesn't go silly it should be manageable...

...here's hoping.
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      10-01-2010, 04:15 AM   #8
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As a supplier of goods, there will be big price hikes again in the New Year. This is on top of the ongoing prices hikes this year and will be compounded by 20% vat.

There will be a big squeaze on disposable income for majority of households for all purchases and a interest rate hike on mortgages will tip many over the edge.
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      10-01-2010, 04:15 AM   #9
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We're waiting for interest rates to rise and prices to really drop - then we shall be laughing.

Buy a place outright and not worry about anything - in fact looking at somewhere today.

But it might never happen.

Went to SW Ireland last year and it's truly shocking out there - tonnes of empty and half finished new builds yet food prices are almost double what they are here. A nation truly f**ked.

I am convinced house prices will drop at least 30% once interest rates rise.

Cheery aren't I?
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      10-01-2010, 04:21 AM   #10
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I'm trying to sell my house at the moment in anticipation of a crash, rent for a while before emigrating.
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      10-01-2010, 04:26 AM   #11
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I'm trying to sell my house at the moment in anticipation of a crash, rent for a while before emigrating.
this is a serious option...
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      10-01-2010, 04:34 AM   #12
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prt - where you heading?
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      10-01-2010, 04:46 AM   #13
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Australia Matt, wife is Australian so no visa issues etc.

I'm not one of these "this country's f**cked" blah blah people, we'll give it a go and if it suits we'll stay, if it doesn't we'll come back.

Exchange rate brings tears to the eyes currently though....
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      10-01-2010, 04:57 AM   #14
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no speeding fun in oz! :O

kinda rules it out for moi
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      10-01-2010, 05:04 AM   #15
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prt - cool. Know a few that have done the same and got a few "rellies" from the wife's side over there.

If this country got intolerable, I'd emigrate to France.
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      10-01-2010, 05:17 AM   #16
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prt - cool. Know a few that have done the same and got a few "rellies" from the wife's side over there.

If this country got intolerable, I'd emigrate to France.
France is a great place, it's just a shame it's full of French people
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      10-01-2010, 10:50 AM   #17
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Interest Rates

I wish they would go up now , All my income is in bonds earning between 2.75 and 3.25% it is rediculous if they were to double to around 6% or 7% i would be .

No mortgage for me and we bought our house last time prices were low.


I get Ireland/Spain/Portugal /Greece are proper screwed but how about Germany ,italy .

Property prices are weird I have looked for my inlaws and some property here is still advertised at higher prices than in 07 and early 08 ,I asked the agent and said I have cash and can buy now but imho price is high, he said thats what the vendor wants it advertised at , Any movement Not at present sir.


I could well be interested in a couple of nice detached bungalows if they drop 10 or 20 % . Rent them for a few years and put the lads in when they are ready to leave home

House prices have supposed to be dropping for several years but i dont see it around this way (south coast between Brighton and Eastbourne) How long do you wait
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      10-01-2010, 12:42 PM   #18
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prices in some parts of Manchester are still mental, some areas will never drop. if more people want to live in that area than houses then theyll keep their price, regardless of anu recession
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      10-01-2010, 12:49 PM   #19
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yeah, some places it will never be an issue.

i think unless there is a plague in the south east that will be pretty much fine.. but hey, you certainly pays the premium for living there!

*sigh*
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      10-02-2010, 01:25 PM   #20
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We don't have a problem with debt. We are not broke, we physically cannot go bankrupt.

Let me explain. Cameron made repeated comparisons to Greece. That country is in the Euro, so doesn't control its currency, cannot change its interest rates, and has very large debts all in this foreign currency which need repaying/refinancing with foreign investors in the next 2-5 years.

Britain on the other hand has its own currency. It prints this currency which handily happens to be the same currency that all its debts are in. Those debts are all long term (<15 years before payback/refinance) and the MAJORITY of them are owned by UK pension funds.

Our debt is high compared to the last decade or so (after Labour paid off a lot of debt) but compared to all our competitors in the G8 we're pretty low. And debts always sit across the balance sheet from assets, and we have rather a lot of those in the form of our money invested abroad.

We need to cut the current account deficit - we spend more than be bring in each year. Of this number a few percent is structural (Labour overspent from 2002 onwards having massivelu underspent pre-2002), but the majority is from the drop in tax receipts caused by the recession. The only way to fix this is to create growth which creates jobs which creates tax receipts. You cannot mug benefits claimants for the money - it will cost more due to the increase in benefit claimants.

So should we be worried? A little. But we're not Greece or Ireland or Eastern Europe. Nor do we have much exposure as and when those countries collapse.
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      10-02-2010, 02:50 PM   #21
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We don't have a problem with debt. We are not broke, we physically cannot go bankrupt.

Let me explain. Cameron made repeated comparisons to Greece. That country is in the Euro, so doesn't control its currency, cannot change its interest rates, and has very large debts all in this foreign currency which need repaying/refinancing with foreign investors in the next 2-5 years.

Britain on the other hand has its own currency. It prints this currency which handily happens to be the same currency that all its debts are in. Those debts are all long term (<15 years before payback/refinance) and the MAJORITY of them are owned by UK pension funds.

Our debt is high compared to the last decade or so (after Labour paid off a lot of debt) but compared to all our competitors in the G8 we're pretty low. And debts always sit across the balance sheet from assets, and we have rather a lot of those in the form of our money invested abroad.

We need to cut the current account deficit - we spend more than be bring in each year. Of this number a few percent is structural (Labour overspent from 2002 onwards having massivelu underspent pre-2002), but the majority is from the drop in tax receipts caused by the recession. The only way to fix this is to create growth which creates jobs which creates tax receipts. You cannot mug benefits claimants for the money - it will cost more due to the increase in benefit claimants.

So should we be worried? A little. But we're not Greece or Ireland or Eastern Europe. Nor do we have much exposure as and when those countries collapse.
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      10-03-2010, 11:03 AM   #22
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France is a great place, it's just a shame it's full of French people
We're 1 month into our time living in France - and don't plan to return to UK for at least 3 years (fingers crossed).

France is great, but the standard of driving is woeful and the cost of living can be high (food can be expensive, esp eating out, insurance is high - nearly EUR700 for the BMW (300 in UK)).

On the other hand, the food is great, there's no road tax, and the weather is considerably better - just had 26deg sun all weekend - with lots of exciting new stuff to see and do.

Strikes seem to be common, so France is not immune from the pressures of the current economic situation - seems to have been almost 1 a week so far.

It'll be interesting to follow what happens in the UK - esp with interest rates. We've rented out our UK house, but we'll see if our UK rent income goes down rather than up. I'm very worried about the pace of Govt spending cuts forcing a worse than necessary recession, and 'financial misery' on a scale not seen since for many years.
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