The next Recession!

[jimharri]

Yeah why not, we will sacrifice Milton Keynes too.

Does that include the concrete cows?

 

[SebastianBlue]

Happy Black Tuesday everyone! ;-)

 

[Gareth Barry Conlon]

US Jobs data out today. Stronger than expected with +128k beating the expected +90k. Markets are up as a result.

but but but. Context is everything.

 

[jacko74]

As bellbuzzer said, stagnant wages for 10+ years aligned with rampant asset price inflation, record levels of debt and the usual fraudulent figures on CPI and RPI means that in real terms the vast majority of people are worse off than they've been for generations... but hey we've not actually fallen into a ''technical/actual recession'' so all is good in the world.

 

[Gabriel]

Interesting piece in the Guardian on where future economic problems may arise.

Long read.
https://www.theguardian.com/busines...-dragging-us-towards-the-next-financial-crash

 

[Gareth Barry Conlon]

Interesting piece in the Guardian on where future economic problems may arise.

Long read.
https://www.theguardian.com/busines...-dragging-us-towards-the-next-financial-crash

Interesting. Something that i spend some of my time doing is looking into the tax implications of insolvency / debt recovery. A company can have £100m of debt secured by £100m of cash. Fine on the surface but if the cash is held off shore and can not be remitted back without crystallising a massive tax liability then there can be a problem. Generally the Banks as secured creditors will take the cash 100% and then the company that might have otherwise been able to survive will go under with a tax burden it will never be able to pay. Until these tax issues are forced they remain off the books as contingent liability. Benign under normal circumstance but would act like fuel to the fire in a further credit crunch / debt contraction and totally unaccounted for in market valuations of firms.

 

[hammocity]

As a bit of an armchair economist I have been seeing signs of an impending recession for a couple of years, but we and the rest of the world seem to be bouncing along pretty well, jobs numbers are very high globbaly and therefore GDP growth is tracking moderatley upward in most countries.

But you look at the more subtle financial indicators and they are all showing some pretty alarming trends. Interest rates are low yet investment returns are also low, Banks can't make money in that environment - when they cant make money they tend to reign things in as the returns are not worth the risk. Barclays have just anounced an 80% drop in profits. The chairman saying:-

We acknowledge that the outlook for next year is unquestionably more challenging now than it appeared a year ago, in particular given the uncertainty around the UK economy and the interest rate environment,”.

If you subscribe to the idea that these things always move in cycles then we had the dot com crash of 2000/2001, the credit crunch of 2007/8/9 (although you could argue that went on for 5 years or more) and we are now circa 10 years beyond that. Next year could well be tough.

It’s tough already, my small business is down around 25% on turnover and seemingly getting worse.

 

[hammocity]

Yeah the goat thing is always the second option as per Keynes if interest rates are already low.

Didn’t Keynes theorise high unemployment and inflation couldn’t happen together?