Debt spirals out of control
#1
Debt spirals out of control
2006 will go down in history as the year that Britain’s economy began to finally fall apart.
For the first time in British history debts accrued by British families have overtaken the total size of the national economy due to the fact that people have borrowed so much money on their credit cards that the total amount of that combined debt has outstripped Britain’s gross domestic product. The amount of money owed by British families has risen by 10.2 % and is now at the staggering figure of £ 1,158 billion.
According to figures being prepared by the Treasury this was £30 billion pounds more than economic output across the whole of the British economy in 2005. This ever inflating bubble of consumer credit sooner or later has to burst, and either consumers reduce their credit spending or house prices will have to crash in order to stabilise the economy itself.
This has coincided with the fact that British household debts have also passed the one trillion pounds mark whilst the rate of business bankruptcies have soared to record levels and mortgage repossessions have also began to rise again.
Oil dependency
This year will also go down in history as the first time since the advent of North Sea oil that Britain became a net importer of oil.
This year is a watershed for Britain. Its entire economy is perched on the edge of crisis. Energy security has risen to the top of the political agenda and dominates the agenda in relation to nuclear energy and climate change.
Whilst the credit bubble is about to burst, the housing market is on the brink of collapse and the British economy has begun reeling from increased energy costs that can only lead to higher inflation, the forthcoming conversion of New Labour PLC to the Gordon Brown model of leadership, even though this change of leadership was not part of their manifesto promises and the British public did not vote for Gordon Brown, looks more and more like a poisoned chalice is being passed.
For the first time in British history debts accrued by British families have overtaken the total size of the national economy due to the fact that people have borrowed so much money on their credit cards that the total amount of that combined debt has outstripped Britain’s gross domestic product. The amount of money owed by British families has risen by 10.2 % and is now at the staggering figure of £ 1,158 billion.
According to figures being prepared by the Treasury this was £30 billion pounds more than economic output across the whole of the British economy in 2005. This ever inflating bubble of consumer credit sooner or later has to burst, and either consumers reduce their credit spending or house prices will have to crash in order to stabilise the economy itself.
This has coincided with the fact that British household debts have also passed the one trillion pounds mark whilst the rate of business bankruptcies have soared to record levels and mortgage repossessions have also began to rise again.
Oil dependency
This year will also go down in history as the first time since the advent of North Sea oil that Britain became a net importer of oil.
This year is a watershed for Britain. Its entire economy is perched on the edge of crisis. Energy security has risen to the top of the political agenda and dominates the agenda in relation to nuclear energy and climate change.
Whilst the credit bubble is about to burst, the housing market is on the brink of collapse and the British economy has begun reeling from increased energy costs that can only lead to higher inflation, the forthcoming conversion of New Labour PLC to the Gordon Brown model of leadership, even though this change of leadership was not part of their manifesto promises and the British public did not vote for Gordon Brown, looks more and more like a poisoned chalice is being passed.
#3
Re: Debt spirals out of control
Originally Posted by eurotramp
Are this your own words or did you read it somewhere?
#4
Re: Debt spirals out of control
It is an interesting point.
Problem is consumer credit is now a resource - the tax and bank profits produced by furnishing this borrowing is now UK's only primary industry!
Mr Brown noticed early on if you can let the individual take the debt then you can reduce national debt and look 'prudent' (and pretend that the UK is not in a recession), coupled with pride in a 'world-leading' financial industry.
We must keep borrowing.
Can you lend me a tenner?
Problem is consumer credit is now a resource - the tax and bank profits produced by furnishing this borrowing is now UK's only primary industry!
Mr Brown noticed early on if you can let the individual take the debt then you can reduce national debt and look 'prudent' (and pretend that the UK is not in a recession), coupled with pride in a 'world-leading' financial industry.
We must keep borrowing.
Can you lend me a tenner?
#5
Forum Regular
Joined: Apr 2005
Posts: 49
Re: Debt spirals out of control
Originally Posted by pdohr
2006 will go down in history as the year that Britain’s economy began to finally fall apart.
For the first time in British history debts accrued by British families have overtaken the total size of the national economy due to the fact that people have borrowed so much money on their credit cards that the total amount of that combined debt has outstripped Britain’s gross domestic product. The amount of money owed by British families has risen by 10.2 % and is now at the staggering figure of £ 1,158 billion.
According to figures being prepared by the Treasury this was £30 billion pounds more than economic output across the whole of the British economy in 2005. This ever inflating bubble of consumer credit sooner or later has to burst, and either consumers reduce their credit spending or house prices will have to crash in order to stabilise the economy itself.
This has coincided with the fact that British household debts have also passed the one trillion pounds mark whilst the rate of business bankruptcies have soared to record levels and mortgage repossessions have also began to rise again.
Oil dependency
This year will also go down in history as the first time since the advent of North Sea oil that Britain became a net importer of oil.
This year is a watershed for Britain. Its entire economy is perched on the edge of crisis. Energy security has risen to the top of the political agenda and dominates the agenda in relation to nuclear energy and climate change.
Whilst the credit bubble is about to burst, the housing market is on the brink of collapse and the British economy has begun reeling from increased energy costs that can only lead to higher inflation, the forthcoming conversion of New Labour PLC to the Gordon Brown model of leadership, even though this change of leadership was not part of their manifesto promises and the British public did not vote for Gordon Brown, looks more and more like a poisoned chalice is being passed.
For the first time in British history debts accrued by British families have overtaken the total size of the national economy due to the fact that people have borrowed so much money on their credit cards that the total amount of that combined debt has outstripped Britain’s gross domestic product. The amount of money owed by British families has risen by 10.2 % and is now at the staggering figure of £ 1,158 billion.
According to figures being prepared by the Treasury this was £30 billion pounds more than economic output across the whole of the British economy in 2005. This ever inflating bubble of consumer credit sooner or later has to burst, and either consumers reduce their credit spending or house prices will have to crash in order to stabilise the economy itself.
This has coincided with the fact that British household debts have also passed the one trillion pounds mark whilst the rate of business bankruptcies have soared to record levels and mortgage repossessions have also began to rise again.
Oil dependency
This year will also go down in history as the first time since the advent of North Sea oil that Britain became a net importer of oil.
This year is a watershed for Britain. Its entire economy is perched on the edge of crisis. Energy security has risen to the top of the political agenda and dominates the agenda in relation to nuclear energy and climate change.
Whilst the credit bubble is about to burst, the housing market is on the brink of collapse and the British economy has begun reeling from increased energy costs that can only lead to higher inflation, the forthcoming conversion of New Labour PLC to the Gordon Brown model of leadership, even though this change of leadership was not part of their manifesto promises and the British public did not vote for Gordon Brown, looks more and more like a poisoned chalice is being passed.
In the last two years the atmosphere has changed in the UK and the “herd” are beginning to feel twitchy and nervous as the great illusions of spending the banks wealth begins to fall apart at the seams. Media and advertising is full of bankruptcy and debt stories these days, whereas two years ago it was all “Place in the sun”, “Relocation, relocation” and release equity quickly for that dream holiday and car.
A kick in the nuts to tilt the scales is around the corner and will more than likely be created by some sort of oil/ energy crisis. Within 6 months to a year I believe that petrol could be a conservative minimum of a £1 a litre possible £1.15. Doesn’t sound much really, but to around 6 million households who already struggle paying bills, this will drive them into ruin as petrol/ heating/ transport/ food rise in price. In turn business will go bang, inflation will rise and cheap houses will begin to flood the market again.
The early warning signs are already visible. NHS Trusts and Councils are running out of money and are coming onto the “rate payers” for more, high street shops are vanishing many due to extortionate rates as well as supermarket competition, but very noticeable are the amount of friends and colleagues who owe literally thousands on credit cards alone who are now biting their nails.
In my opinion I would not come back to anywhere in Europe. Apart from issues such as debt there are other deeper problems which are building in this part of the world. Europe has few natural resources and will become very reliant on places such as Russia for gas and other commodities….consider for a moment what has just happened in Georgia and Ukraine.
Britain has destroyed its agriculture, manufacturing and overstretched its military involving us in dubious ventures around the globe enraging the populace of those countries. Big trouble is coming between Islamic cultures and the west, no matter how the Liberal press try to play it down.
PS…I have noticed that the Brazilian Real$ has strengthened immensely against the British pound in the last 6 months. In addition various Brazilian shares are doing very well indeed especially those ones in energy.
#6
Re: Debt spirals out of control
Originally Posted by eliscolin
cheap houses will begin to flood the market again.
That said I really do hope you're right about the above quote - my folks have their mortgage paid so they won't be effected unduly and one of the reasons I had to move abroad (house prices) will be eliminated.
I look forward to the day when I can come home, buy a few properties and put the feet up
#7
Re: Debt spirals out of control
Originally Posted by Polyphemus
It is an interesting point.
Problem is consumer credit is now a resource - the tax and bank profits produced by furnishing this borrowing is now UK's only primary industry!
Mr Brown noticed early on if you can let the individual take the debt then you can reduce national debt and look 'prudent' (and pretend that the UK is not in a recession), coupled with pride in a 'world-leading' financial industry.
We must keep borrowing.
Can you lend me a tenner?
Problem is consumer credit is now a resource - the tax and bank profits produced by furnishing this borrowing is now UK's only primary industry!
Mr Brown noticed early on if you can let the individual take the debt then you can reduce national debt and look 'prudent' (and pretend that the UK is not in a recession), coupled with pride in a 'world-leading' financial industry.
We must keep borrowing.
Can you lend me a tenner?
#8
Re: Debt spirals out of control
Originally Posted by BigDavyG
Ione of the reasons I had to move abroad (house prices) will be eliminated.
I look forward to the day when I can come home, buy a few properties and put the feet up
I look forward to the day when I can come home, buy a few properties and put the feet up
#9
Re: Debt spirals out of control
Originally Posted by uk+kiwi
Perhaps there was nothing wrong with UK house prices in relation to your income. Could your desire to "buy a few properties" have something to do with it? You were simply being too greedy.
Where I was from I was looking at 6 times my salary for a 2 up 2 down 10 miles from the city center
When I go back I'm going to buy it all, all I tell ya