Where is the world/UK (economy) headed

[Mudball]

Was on a call where the forecasters were fairly gloomy about the forecast for the UK economy into next year. They predicted a very good strong chance of recession and high inflation. So expect higher interest rates later this year et al. Unfortunately, this will impact the levels of unemployment.
Ofcourse the UK economy is not an island and this seems to be the case for the many others too. How long the Russian war prolongs, the shadows of gloom lengthen. From a business scenario planning, already being asked to forecast what happens when existing order book is cancelled and things have to pivot to other customers and sectors that are likely to be less affected.

Ofcourse, this is all forecast and none of it may come true. Tomorrow, Putin may change his mind, oil will tank, all of us will get a raise and the pound will go galloping...

Anyone else - esp those in scenario planning - looking at similar headwinds?

PS: this is not a political thread and who rules the country is irrelevant

 

[Billysboots]

As someone with no mortgage or other borrowing, a decent chunk of money invested, and an index linked pension, for the first time since I started work all those years ago I am actually less concerned about inflation and interest rates than I once was.

Whilst accepting that rising inflation obviously means I’m paying more for goods, at least my pension will be going some way to keeping pace with those price increases, and as a saver interest rate rises will be welcomed with open arms. It’s nice to start seeing a return on simple savings accounts for the first time in years.

 

[Swinglowandslow]

As someone with no mortgage or other borrowing, a decent chunk of money invested, and an index linked pension, for the first time since I started work all those years ago I am actually less concerned about inflation and interest rates than I once was.

Whilst accepting that rising inflation obviously means I’m paying more for goods, at least my pension will be going some way to keeping pace with those price increases, and as a saver interest rate rises will be welcomed with open arms. It’s nice to start seeing a return on simple savings accounts for the first time in years.

Come on Billy, things aren't so bad for you now. And whilst you think they'll financially get better for you ( will they really?) , with savings rates increases as you suggest, why would you think it a good thing when many hard working people with bloody great mortgages and card debts are going to struggle more and more....and some go under.
A society getting more and more unstable is not a good thing for anyone.

 

[HomerJSimpson]

Down the pan

 

[Lord Tyrion]

If the last few years have taught us anything it is that forecasting is a mug's game and those making forecasts proclaiming to be experts are best ignored. I'm firmly in the Ian Malcolm camp of chaos theory having too much of an impact to know with any certainty.

Looking at things, coming out of a pandemic and the energy crisis of the Ukrainian war, things don't look great. Who knows what else might happen though. Hopefully good.

From our own business perspective, we are not looking that far ahead. Since Brexit we have looked ahead in terms of months, not years. Same boat now.

 

[Billysboots]

Come on Billy, things aren't so bad for you now. And whilst you think they'll financially get better for you ( will they really?) , with savings rates increases as you suggest, why would you think it a good thing when many hard working people with bloody great mortgages and card debts are going to struggle more and more....and some go under.
A society getting more and more unstable is not a good thing for anyone.

Interest rates are like politicians. Whilst some will like a certain politician, others will be diametrically opposed to him/her. The same goes for high/low interest rates.

Throughout all of our lives there will be times when we hanker after ridiculously low interest rates. I certainly did when I left a job offering heavily subsidised lending rates and, virtually overnight, saw my mortgage rate increase almost four-fold following Black Monday in 1992. At that time there will have been investors rubbing their hands with glee.

As individuals, all of our circumstances are different and, for that reason, this is an issue on which there will rarely be agreement. Consequently, having set out my own personal preferences, I’m out. Virtually every thread here seems to descend into an undignified slanging match these days and I have little wish to be involved in another one simply because my circumstances mean my opinion might not toe the party line.

 

[Tashyboy]

Interest rates are like politicians. Whilst some will like a certain politician, others will be diametrically opposed to him/her. The same goes for high/low interest rates.

Throughout all of our lives there will be times when we hanker after ridiculously low interest rates. I certainly did when I left a job offering heavily subsidised lending rates and, virtually overnight, saw my mortgage rate increase almost four-fold following Black Monday in 1992. At that time there will have been investors rubbing their hands with glee.

As individuals, all of our circumstances are different and, for that reason, this is an issue on which there will rarely be agreement. For that reason, having set out my own personal preferences, I’m out. Virtually every thread here seems to descend into an undignified slanging match these days and I have little wish to be involved in another one simply because my circumstances mean my opinion might not toe the party line.

There is so much in that thread that brings back bad memories. Black Monday, bloody hell I sat at the top of my garden with my head in my hands thinking what have I done. I had taken out a 35K mortgage in the March of that year.
like Billy am comfortable. That comes with 36 years of mining working 6/7 days a week doing unsociable hours. 96 days without a day off. doing a weeks shopping with £12.20 in the local COOP for 4 of us. The bad times pull you together or tear you apart.
Yeah am Comfortable but it came at a price. So I look to todays situation and see a real financial “ perfect storm”. I said this to Missis T on Monday and have heard that term all day on the news. And I honestly think it is going to get worse, a lot worse. At this point am out because without having a political rant I cannot comment anymore. Apart from saying thoughts to those with mortgages and kids. Ave been there and it is crap.

 

[PhilTheFragger]

It’s going to be a period of adjustment for Western Europe including us.

Russia is going to be given the cold shoulder, in terms of gas & oil supplies.
Ostracised until Putin is replaced.

Its going to be a difficult 18 months, but hopefully things should settle down

But then again, my crystal balls are a bit cracked

 

[SocketRocket]

If there were to be a world depression and significant downward pressure on available government funds there could well be a bailing out of state indexed pensions as they are a significant part of expenditure, the recent bailing out of the state pension triple lock being a precursor.

 

[G1z1]

If the last few years have taught us anything it is that forecasting is a mug's game and those making forecasts proclaiming to be experts are best ignored. I'm firmly in the Ian Malcolm camp of chaos theory having too much of an impact to know with any certainty.

Looking at things, coming out of a pandemic and the energy crisis of the Ukrainian war, things don't look great. Who knows what else might happen though. Hopefully good.

From our own business perspective, we are not looking that far ahead. Since Brexit we have looked ahead in terms of months, not years. Same boat now.

I managed to retire because I seen the 2008 crash coming so I must be a mug. Now the next crash is well and truly on its way and again I’ll profit hugely.

 

[Lord Tyrion]

I managed to retire because I seen the 2008 crash coming so I must be a mug. Now the next crash is well and truly on its way and again I’ll profit hugely.

For every winner there are a thousand losers, more in reality. Fair play if you came out of it well.

 

[PJ87]

you have to remember that with interest rates we wont see what we saw in the past because interest rates are now controlled by the bank of England and not set by central government.

We may or may not see rises up to say 5% long term which would be shocking for some people (most people probably) but you wont see the shock 10-15% of the past

 

[IanM]

Wars and pandemics are bad for confidence! So little doubt we're on a bumpy path.

Hope to be somewhat protected by always living within my means. I had periods of feast and famine in my working life, so not all rosy.

Any "wise after the event" is unhelpful.

My economics prof used to say the surest way to start a recession is to think one's coming and adjust your behaviour accordingly. But that is also a form of prudence...tough times.

 

[Tashyboy]

you have to remember that with interest rates we wont see what we saw in the past because interest rates are now controlled by the bank of England and not set by central government.

We may or may not see rises up to say 5% long term which would be shocking for some people (most people probably) but you wont see the shock 10-15% of the past

I think interest rates are a small piece of a crap pie. A lot of people have massive increases in utility bills that don’t have mortgages but rents etc.

 

[IanM]

I think interest rates are a small piece of a crap pie. A lot of people have massive increases in utility bills that don’t have mortgages but rents etc.

And landlords have the properties on mortgage, so guess what happens to rents?

 

[SocketRocket]

And landlords have the properties on mortgage, so guess what happens to rents?

They won't get paid in a similar way that utility bills won't get paid.

 

[Wildboy370]

The Uk economy is doomed. We have become a society of champagne life style when sadly paid lemonade wages. Then it’s everyone mainly the governments fault they are in trouble. No responsibility, no common sense. There was a professor on sky news not long after the first lockdown, who was asked when do you think things will get back to normal. His response was. We don’t ever want to get back to normal as normal was the problem in the first place. How true he was.

 

[Mudball]

If the last few years have taught us anything it is that forecasting is a mug's game and those making forecasts proclaiming to be experts are best ignored. I'm firmly in the Ian Malcolm camp of chaos theory having too much of an impact to know with any certainty.

Looking at things, coming out of a pandemic and the energy crisis of the Ukrainian war, things don't look great. Who knows what else might happen though. Hopefully good.

From our own business perspective, we are not looking that far ahead. Since Brexit we have looked ahead in terms of months, not years. Same boat now.

From a business perspective.. one of the benefits of Big B is that we are getting better at dealing with uncertainty. Every day is a school day. Not good for bottomline or stress levels but the uncertainty is the new normal.

My end of Q1 review started with ‘given the war is still going and the Chinese are shutting down again for Covid, what will happen if the existing orders are cancelled because our clients cannot afford it?’ WTFish

The Uk economy is doomed. We have become a society of champagne life style when sadly paid lemonade wages. Then it’s everyone mainly the governments fault they are in trouble. No responsibility, no common sense. There was a professor on sky news not long after the first lockdown, who was asked when do you think things will get back to normal. His response was. We don’t ever want to get back to normal as normal was the problem in the first place. How true he was.

To balance it, did they drag out someone who said it is all going to be fine? . Haven’t seen the interview, he could not be more right. The world will be different. The gap between the have and have nots is going to get bigger.

I must admit, I had some luck. Just before Putin got off the wrong side of the bed, I had sold some of my holdings in my pension. The idea was to pick up some other stocks. Got the money and then the markets crashed and I got another 10% off my purchase price. Now they are back up. The value of luck in investing is highly under-rated

 

[phillarrow]

I wonder if we're going to see a reduction in consumerism?

The world has lurched from one existential crisis to another for more than 2 years now and I think, for many people, it has caused them to reevaluate their priorities.

None of this has been good, but if there is a greater emphasis on 'doing' than 'having' as a result, then the long term effects might be positive in so many ways.

 

[PNWokingham]

Interest rates are like politicians. Whilst some will like a certain politician, others will be diametrically opposed to him/her. The same goes for high/low interest rates.

Throughout all of our lives there will be times when we hanker after ridiculously low interest rates. I certainly did when I left a job offering heavily subsidised lending rates and, virtually overnight, saw my mortgage rate increase almost four-fold following Black Monday in 1992. At that time there will have been investors rubbing their hands with glee.

As individuals, all of our circumstances are different and, for that reason, this is an issue on which there will rarely be agreement. Consequently, having set out my own personal preferences, I’m out. Virtually every thread here seems to descend into an undignified slanging match these days and I have little wish to be involved in another one simply because my circumstances mean my opinion might not toe the party line.

another totally unprovoked dig at you for nothing. I am not surprised you cannot be bothered!