Tuesday, 16 September 2008

Tuesday 16 September

A pretty non-descript day on all accounts, grey weather and all that.

The money world is in melt-down and things are only going to get worse. Inflation in the UK is rising towards 5%, for the first time in 16 years, and banks are beginning to fall over like dominoes. That's what you get when you lend money against no collateral. Or a collateral that, on the point of paying off the debt, does not match the extent of the debt. Negative equity in other words. Filling in one hole by plugging it with another, selling it to someone else - didn't know you could sell holes, but there you go. Here in Lewis, your average house now costs close to £140,000 - a huge increase over the past decade or so, I'm led to believe.

Don't think that a dip in the stockmarket does not affect you in this case. We all use banks, whether we like it or not, we all have our bitty bits of pensions lying about, invested in things - that are worth less and less. And you try to get a loan or a mortgage in the near future, well, you may find it rather more difficult, even if you've got a perfect credit rating. As an individual, that's an inconvenience. For business, it could be lethal.

No improvement in sight.


  1. One word comes to mind...from top to bottom....Greed...  Love  Sybil xx

  2. I agree whole heartedly with Sybil.Take Care God Bless Kath astoriasand http://journals.aol.co.uk/astoriasand/MYSIMPLERHYMES

  3. It is a scary time ~ we almost hold our breath and wait to see what is going to happen next.  Here in our area people were buying homes for more...yes I said more than the actual value of the home.  So they were financing more than the house was worth to begin with.  Doug is a custom home builder and the average house they build is between $350-$400K with all the bells & whistles and a mortgage payment of outrageous proportion compared to their incomes.  I don't know how they received the financing in the first place.  They've built two homes close to $1 million dollars..of which one is sitting empty in foreclosure.   Everyone was living high on the hog and now we are all paying for it.

  4. It is scary but I am not going to make myself sick worrying about it. They're saying on the news here today that it will rebound.  The stock market was up today.    Another beautiful sunny & warm day here.  Now the weather man is saying no rain until next week...that's a good thing.  Linda in Washington state

  5. It is scary, very scary, but I try to stay calm and not panic. I do wish the news would turn it down a notch though, it has my elderly parents absolutely wanting to take everything they have out and hide it under the mattress. These things tend to work themselves out, I just pray that this follows course.

    Pooh Hugs,

  6. It certainly does affect us all Guido, it looks as though we all must tighten our belts even further. The way things are going up in price none of us will have any money left for anything!

    Love Sandra x

  7. Jessie kept the majority of her $$ in her sock, under the feather bed.
    i have a large 401k in Merrill Lynch. If i lose that $$, i don't know WHAT i would do!!

  8. You're so right about that!

  9. A sad state of affairs i am afraid to say