Economic meltdown...are you affected?

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Neilster
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Economic meltdown...are you affected?

Post by Neilster »

This looks like it's going to be bigger than Ben Hur. How is everyone going? Have you been, or are you likely to be affected?

Luckily I closed that Icelandic bank account [X(]

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Dennistoun
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RE: Economic meltdown...are you affected?

Post by Dennistoun »

Yeah, working in the timber industry in the UK is a time-bomb. I was made redundant [:@] from a wood treatment plant last Tuesday with a week's pay extra (nice of 'em). Hopefully I can get a job with my sister's work...Fingers crossed and all that.
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sol_invictus
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RE: Economic meltdown...are you affected?

Post by sol_invictus »

I just thank God that I am still twenty-two years from retirement age. My portfolio has been taken behind the barn and beaten senseless. I am afraid that it will be a decade before I am back where I started. I am also afraid that we have not seen the worst yet. Oh well, nothing that self-delusion and apathy can't deal with.
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Prince of Eckmühl
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RE: Economic meltdown...are you affected?

Post by Prince of Eckmühl »

The family bean-counter kept us out of the four-thousand-square-foot "Tuscan-style" home that my wife had been eyeing, and the stock-market lost its appeal a couple of years ago, which is to say, we're fine so long as the government doesn't simply confiscate our bank account and other assets.

A little over a decade ago, I saw a fella on CNBC (USA business network) describing changes in Washington-mandated lending standards that would eventually lead to another "S & L" fiasco. Forewarned, I got to watch this whole mess unfold like a slow-motion train-wreck, one that appears much more grave than that which the television Casandra foretold.

I feel profound sympathy for USA who were forced into a housing market where they had to "bid" on properties against folks who couldn't afford to ever pay for it. Folks were getting loans for hundreds of thousands of dollars, with no money-down, and zero-percent interest (initially). Conversely, someone who made a twenty-percent down-payment and got a fixed-rate loan was hosed because prices were so inflated by the introduction of many millions of unqualified buyers into the market.

Likewise, the rest of the world is suffering, and let there be no doubt about this, that the US is TOTALLY responsible for every last bit of this crisis. Taking the nation's system of credit, which can only be sustained through deferrence to those who can (and will) repay, and turning it into a piggy-bank for those who can't (or won't), is gonna impose a crushing burden on the world's poor for a YEARS to come. Famine, plague, and war, you name it, there's gonna be hell to pay for this.

Obviously, I'm kinda disillusioned with my countrymen. [:-]

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GaryChildress
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RE: Economic meltdown...are you affected?

Post by GaryChildress »

I was laid off almost a year ago from my job at a real estate Title agency and haven't been able to find steady work since. I work in the office administrative field and even that is affected by all this. [X(]

I sincerely hope the "war" predictions in the above post are wrong. I think we've had enough wars to last for a while. Maybe this is payback for all the senseless violence in Iraq. When will politicians ever learn that wars are just not the answer.

Sorry to be political. I'll stop now. [:(]
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doomtrader
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RE: Economic meltdown...are you affected?

Post by doomtrader »

Markets are going up and down. Some people lost some people earn. Things happend.
 
Personally I think that the US Gov. should help people to paid their loans instead of giving the money directly to the banks.
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Terminus
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RE: Economic meltdown...are you affected?

Post by Terminus »

Haven't been affected directly yet (fingers crossed)...
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Neilster
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RE: Economic meltdown...are you affected?

Post by Neilster »

I keep a keen eye on financial stuff and I tried to tell people it was coming but nobody likes the bearer of bad economic tidings. This is an Australian investigative journalism program from over a year ago that predicted a lot of this...

http://www.abc.net.au/4corners/content/ ... 032799.htm

I'm not sure if it's accessible from overseas.

The blurb makes eerie reading now.

"When the US sneezes the rest of the world gets the cold."

Last month an unfamiliar expression appeared in the Australia media. A "subprime mortgage crisis" was unfolding in the United States. Homeowners across America were defaulting on loan payments and economists warned of major financial fallout occurring anywhere from Paris to Beijing to Melbourne. But why should a foreclosure in Cleveland affect a hedge fund in Sydney?

As Four Corners reports, Australia, along with the rest of the world, is at risk of a virulent economic virus thanks to financial globalisation where everything is interconnected through a sophisticated form of pass the parcel. And even more alarmingly, no-one knows just how bad it might get.

"A perfect storm."

Reporter Paul Barry explains how the subprime market was created through a unique set of circumstances beginning with the fallout from September 11. The program charts the rise of easy credit to the point where mortgage brokers were running out of customers. Enter the subprime loan, the loan you could get when, as one real estate agent tells Four Corners, the only criterion was to see if the client was breathing.

The program reveals how predatory lenders were unregulated and often unscrupulous, targeting people they knew couldn’t pay. The broker would make the loan, take a fat commission, and pass on the responsibility as quickly as possible. One lawyer tells the program: "It’s American capitalism at its worst."

"The last one out of Cleveland please turn off the lights."

A 'market correction' is a nice economic expression that goes nowhere near capturing the heartbreaking human cost of this financial disaster. This year and the next more than two million American families will lose their homes. Four Corners visited Cleveland, Ohio, where the streets are lined with empty houses, dead gardens and demolition notices pinned to the front doors. One in 20 homes are now in foreclosure. Paul Barry talks with home owners facing eviction and the lawyers trying to save them.

"The crisis is just beginning."

US economists are warning that the worst may still be to come. They are even talking about the "R" word: recession. And one leading financial expert warns if the US slips into recession: "I don’t think anybody anywhere in the world is going to be immune. It’s a question of degree rather than whether they’re affected."


I also read that local governments are having to kill mosquitoes in the pools of all the abandoned houses in some places to keep the threat of disease down.

I'm glad the Australian governments have resisted the demands from the "free-market fundamentalists" to slash the regulation of our financial system. You simply couldn't get a subprime loan here and so the banks are reasonably unaffected.

Mainly due to the resources boom, our economy has also been very strong for ages and we've got basically no government debt and have a budget surplus. That, combined with the anticipated continued strong growth in our key export markets of China and India mean that we should be able to ride this out reasonably well. The government has a pretty big war-chest to pump cash into the economy through infrastructure projects and the like. Also, because until this sucker hit our biggest problem was keeping a lid on inflation due to growth, interest rates are quite high. That means there's plenty of scope to reduce them to stimulate the economy too. Most economists expect economic growth here to continue but it will be slashed.

Some of this is good management, some is luck. One major problem we've got is a housing bubble. Prices are around 2-3 times the long-run average and there is going to be a major correction. Household debt is at historically high levels too, mainly because people saw the value of their house go through the roof and thought they were rich.

I know a lot of American economists are angry that such slack regulation occurred there. As usual it's the little guy that gets the shaft when the greedy fat-cats screw it up. They've been squirming in the spotlight lately but that doesn't get people's houses back.

Cheers, Neilster
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Hertston
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RE: Economic meltdown...are you affected?

Post by Hertston »

Affected in the way teddy and Gary have been, mercifully no, so far anyway. I'm a government employee (Revenue & Customs) and although we are mid way through an economy drive, losing a quarter of the workforce and half the offices, that was started sometime prior to the present shambles and they haven't needed to actually fire anybody, so far at least.

I'm actually pretty mad at the moment because of our pay offer over three years of 2%, followed by 1% and 1% (with inflation at, what, 4.5%?). In view of the current situation I might even have public spiritedly voted to accept that IF the bastards hadn't come straight out and admitted that they were effectively lowering pay because our relatively low resignation rate means they think they can get away with it until enough of us start resigning in disgust. So it will be strike time at some point. Won't achieve anything, and nobody will give a sh*t, but the point has to be made.

Famous last words, maybe, but I'm reasonably confident armageddon has now been avoided. If I'd had any money I could afford to lose I'd have been buying as many bank shares over the last week or so as I could. I think banks with no problem other than a general market perception of weakness in the sector are significantly undervalued now, and there's a lot of money to be made if you accept the gamble and don't panic if there is an initial fall in the value of your investment.
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andym
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RE: Economic meltdown...are you affected?

Post by andym »

Im not bothered,i am a BANKER.(No im not)Its not really effecting me in UK at present but then i have no money anyway.[:D][:D][:D]
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SireChaos
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RE: Economic meltdown...are you affected?

Post by SireChaos »

I have to say, watching this kind of thing unfold for real (so far I have barely been scratched, thankfully) is a lot more scary than reading about it in a history book or hearing about it in class.
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RE: Economic meltdown...are you affected?

Post by GaryChildress »

ORIGINAL: SireChaos

I have to say, watching this kind of thing unfold for real (so far I have barely been scratched, thankfully) is a lot more scary than reading about it in a history book or hearing about it in class.

Very true. Some of us hear stories of the Great Depression and sort of shrug them off as "That could never happen to me." Now you read the news and in the back of your head know that this could be the beginning of something we could never have imagined. [X(]

Knock on wood of course. [:o]
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andym
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RE: Economic meltdown...are you affected?

Post by andym »

Looks like we have upset the Vikings in Iceland![:D][:D][:D][:D]
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RE: Economic meltdown...are you affected?

Post by pad152 »

The Aussie joke that maybe China can save capitalism! [X(]  A bank fails in China the bankers get shot,  a bank fails in the USA the banker's go on a five star vaction! [8|]
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RE: Economic meltdown...are you affected?

Post by GaryChildress »

ORIGINAL: pad152

The Aussie joke that maybe China can save capitalism! [X(]  A bank fails in China the bankers get shot,  a bank fails in the USA the banker's go on a five star vaction! [8|]

Unbelievable, is it not? AIG sends it's execs off to never never spa land in California after taxpayers bail them out. Only in America! It defies comprehension. But my favorite part of the story is that AIG execs later were thinking of purchasing air time (again on taxpayer bailout money) to run ads giving "their side" of the story. Fortunately a PR guy told them that it would be a bad idea to waste tax payer money any further. Gotta love AIG! ....not! [8|]
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RE: Economic meltdown...are you affected?

Post by Tactics »

We went looking for a house/townhouse last weekend and again yesterday afteroon. We live in California, specifically the San Francisco Bay Area. The county we live and were looking in is said to account for 16% of the total job losses in California as a whole.
 
I was expecting for sale signs all over, people standing out front with steak dinners - "come buy our house" and deep down inside I imagined hot soccer moms pulling up their skirts and saying - "make a legitimate off on our home and you can touch me."
 
I was totally set to be a hero, with a mouth full of steak and a handfull of hot housewife thigh.
 
What we found was very solid market that was short on inventory. The sales lady at one planned unit development said (when I asked if they offered any incentives) "we are not negotiating prices. We're doing very well, but if you use our lender we offfer $5k credit on closing costs" - Their townhomes started at $547K in San Ramon, CA.  They were also sold out until April of 2009.
 
We drove by two other places in Walnut Creek, CA taht were at the lower end of our price range - $300k. Both places were in crap areas. The kind of places I'd be nervous to let 'the boss' go jogging after sunset.
 
I know a lot of people are in a bad way. I was laid off 6 months ago also. But I dont see this whole housing thing. Maybe all the foreclosures are in crap areas, or areas in the middle of nowhere.
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RE: Economic meltdown...are you affected?

Post by GaryChildress »

Wow! I'm living with my folks in a relatively decent neighborhood. We walk the dog in evenings, wave to the neighbors, no problem. But my God, there are abandoned houses everywhere in our neighborhood which people can't unload. lanscaping gone to complete trash. Building has come to a standstill because there is so much inventory out there in my area (Orlando, Florida). Builders are laying off people down to bare bones staff. Everything is at a standstill, one of the worst economic areas in the country right now I'm told. I need to move to San Francisco! [X(]
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RE: Economic meltdown...are you affected?

Post by Ike99 »

I think Matrix needs to have a World Depression Sale, 50% price down sale on all games.

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RE: Economic meltdown...are you affected?

Post by HansBolter »

ORIGINAL: Gary Childress

ORIGINAL: pad152

The Aussie joke that maybe China can save capitalism! [X(]  A bank fails in China the bankers get shot,  a bank fails in the USA the banker's go on a five star vaction! [8|]

Unbelievable, is it not? AIG sends it's execs off to never never spa land in California after taxpayers bail them out. Only in America! It defies comprehension. But my favorite part of the story is that AIG execs later were thinking of purchasing air time (again on taxpayer bailout money) to run ads giving "their side" of the story. Fortunately a PR guy told them that it would be a bad idea to waste tax payer money any further. Gotta love AIG! ....not! [8|]

My take on things is that little will change until the outrage of the common people leads them to cut the priviledged executive class off at the knees and yank their heads out of the clouds. These people live in never never land.
Hans

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RE: Economic meltdown...are you affected?

Post by GaryChildress »

ORIGINAL: HansBolter

ORIGINAL: Gary Childress

ORIGINAL: pad152

The Aussie joke that maybe China can save capitalism! [X(]  A bank fails in China the bankers get shot,  a bank fails in the USA the banker's go on a five star vaction! [8|]

Unbelievable, is it not? AIG sends it's execs off to never never spa land in California after taxpayers bail them out. Only in America! It defies comprehension. But my favorite part of the story is that AIG execs later were thinking of purchasing air time (again on taxpayer bailout money) to run ads giving "their side" of the story. Fortunately a PR guy told them that it would be a bad idea to waste tax payer money any further. Gotta love AIG! ....not! [8|]

My take on things is that little will change until the outrage of the common people leads them to cut the priviledged executive class off at the knees and yank their heads out of the clouds. These people live in never never land.

A very wise observation, me thinks. [:o]
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