Sorry to be boring but....

[QuakerBear]

Is there a global recession coming?

I've been reading and listening to the news and I'm worried.

If it does, what will it mean for me, I don't own my house and I'm just a little person (no not a toddler, I'm older) who potters about?

[ina]

I think there is!

It's not at all boring, of course. No idea what it will mean for the likes of us, but in a way I'm glad about it: I've been saying for years that we can't grow and grow and grow...

[Annpan]

It's the weird way our financial system works... It is all speculation. If everyone realises it will be over by the end of the week, then the markets will recover by the end of the week. However if everyone thinks there is a recession then there will be.

For me it means its going to be more difficult to get any loans we may need to complete work on the house, and it might be tougher should I try to set up my own business. But apart from that, because we don't gamble in stocks I don't think it'll effect us too much.

Don't worry, be happy

[hamster]

I think there is too, but this is more a general 'arrrrrr, feel it in me bones' sort of sense of foreboding (i.e. we're running out of oil, we're messing up the climate, fuel and food prices are going up, we can't carry on like this) than because I actually understand anything about economics!

My bf (my polar opposite) works in pensions so knows all about long-term investments etc, and I asked him last night if we were all going to hell in a handcart, and he said we weren't, but that it was a little worrying. He also said it tends to be self-perpetuating: so if people think the markets are strong, they will invest and buy stuff, so the markets will continue being strong, whereas if people are afraid the markets are weak, they won't invest, so the markets will continue to be weak. (I think. I am happy to be corrected on this.)

I don't know what it means for you and me, though. I think we're going to see a lot of change in the next few decades, but that it will be gradual and mostly civilised. I'm sure that our self-sufficientish ways will prepare us for a bit of enforced frugality, if things get really bad. I seriously doubt your landlord or mine is going to kick us out tomorrow.

[red]

I think it tends to filter down to everyone in the end... because even if you and I dont have investments in shares and wotnot.. other people do and will be feeling the pinch.. they stop spending as much... that might mean a business that depends on money from these peolple struggles and has to lay off employees etc etc..
it can work in weird ways too.. Down here in the westcountry a lot of businesses depend on the holiday trade.. but you can see an increase in spending during a recession as people might snatch a weekend away in Cornwall instead of their 3 weeks in the Maldives
who knows perhaps the toffs will flog their second homes to make ends meet and there might be houses for locals? you never know..
yes.. because everyone believes in it.. it might well happen.. andit will change thigns for most people.. its just not always clear how.

[Smooth Hound]

i think there will be a serious recession, and although it does have a bearing as to how people think, it wont make much difference as its a world wide recession, it will hit people that have been living on the increase of there property values first, as a lot of self employed people andsome employed have come to rely on the incresa in there properties to bail them out in the short term, in away this is what the world economies have been doingfor 10/15 yrs now, living in a false aconomy, and times run out, it will in the long run effect us all, the american govt have been trying to prop things up by giving tax breaks, not only to businesses but workers too, apparently the equivelent of almost 400 pounds a person, in the hope they will spend it and inject that cash into the economy, a desperate measure that hasnt worked. another short term idea. i cant see that there is anything they can do now to save the economy, but in general most people that arent up to there eyes in debt will be fine.

[QuakerBear]

I am greatly re-assured by what you've all said. So if it does happen it might mean abit of belt tightening, but nothing too bad for me and certianly no zombies. I'm still worried about peak oil though, especially as there was an article in the Guardian about ESSO planning to exploit oil shales. They sound desperate.

[eccentric_emma]

i'm glad somebody asked about this, as i was thinking about it as i caught the news last night and wondered how it would affect me. but i dont have any debt, am a saver rather than a spender etc etc. oh and hopefully my job should stay secure (although saying that one of our shops in the neighbouring town is being closed down in 2 months but ours always has had a steady trade). its all very confusing though.

[ina]

I'm still worried about peak oil though,

The only thing that worries me about that is that there are so many people who still carry on as if it wasn't happening!

[Welsh Girls Allotment]

I feel there has to be some sort of recession, whether gradual or a slap in the face type, people have been abusing the credit system for to long houses prices are way out of control.

If the markets do go pop it will filter down to the little people and hit them hardest because we always bear the brunt, food prices will escalate along with fuel prices -- I feel like the scottish guy in Dad's Army We're doomed I tell yer we're doomed

[mauzi]

Good thread and definitely not boring. Yes, I believe their will be a serious recession - in fact, I believe it has already commenced but many people are either ignoring it, thinking it will pass without much event, or hoping it will go away or possibly the worst is believing the spin that is currently in motion "that everything is fine and that it will pass".

One of the biggest issues in my opinion is not just the recession but that so many potentially intensely problematic issues are coming together and when viewed as a whole rather than looking only at one area, it signals the need for change - that is change of attitude mostly - and then the necessary action of that change. I am talking here of Climate Change, including associated food shortages, Peak Oil, GM food concerns, minerals running out some in as little as two years and so on.

Regarding recession though, one of my concerns is that in the past, if there was a recession in one country, it would have a great deal of effect on that country and a little flow to other countries but with the current global business status, the effect of a recession in America (as an instance) would have far and serious reaching effects on most other countries more than likely, I believe, causing a global recession.

[camillitech]

Yep,
I think there is a big one on the way but as has been said if your not up to your eyes in debt and don't value the quality of your life on the number and size of your possesions you'll be fine A bit of belt tightening and a few sacrifices here and there is not in the grand scale of things very serious and even if was just remember your still better fed and better off than most of humanity. Me I now have a full week ahead of me without listening to the news or seeing a paper so no resesion here

Cheers, Paul

[QuakerBear]

Lucky you Paul, enjoy your break.

The other factor that's added to my worry is the price of minerals and raw materials. Mr. QB is a casual watcher of international prices of raw materials and he says the prices, especially for copper, have gone up a huge amount in the last couple of years. The raw material price I'm aware of is that of gold which is also very high. To me this seems to indicate that those with a good understanding of ecconomics are investing in tangible and essential materials as a safe option. If they don't have much confidence in the global economy then... oh I don't know... perhaps I'm twittering about nothing .... I'm going to get some breakfast.....

[Thurston Garden]

As the public begin to tighten their belts, retail property values begin to decline as businesses don't take on new outlets, but begin to close less profitable ones to reduce financial losses. People lose their jobs as a result, at a time when other employers are not hiring. So more people have less money and subsequently spend less.

Most people's pensions will have an element of commercial property in their funds so the pension values begin to decline....people tighten their belts and try to save money.

Some commercial Property Funds are 'inviting' the head honcho's to take a sabatical to reduce their costs. Others (Aegon I think) have placed a one year hold on investors withdrawing their money from commercial property funds cos they have to sell properties to realise the cash, and at a lower price too, thus weakening the fund and making more people want out.

Vicious circle all round. All caused by perception.

[MikeM]

we live, as the saying goes, in interesting times. If this had been 5 years ago then I'd have said yup, we're in for a big one. However, the big mitigating factors are China and India. Their internal economies are so strong that they may be able to offset any downturn from a US led western recession.
My gut feeling is that we will have a recession, but it won't be a bad one (more like the US recession of '03 and not like the early 90's worldwide one).
If, however, China and India go into recession then we're in for a wold of hurt. Ofcourse, if they continue to keep growing at anything like their current rate then we're all in for a world of hurt, but that's be a few years down the line.