In the final quarter of 2010, house repossessions levelled out at around 7,900 for the closing period. That’s a drop of around 11% on the previous quarter. Good news. However – if the planned cuts as per the coalition manifesto go ahead it’s unlikely that the numbers will continue on the downward trend.
According to the economics and financial experts – the guys and gals that spend their days watching and analysing various markets, national and global spending and determining mid-term predictions – if inflation kicks in right alongside the spending cuts, more repossessed houses could well be on the cards.
The fact is that inflation will have to rise again at some point. As of today (Feb 14th) the inflation rate remained unchanged at 0.50%. However the likelihood of that staying as is was always an unlikely prospect. In many ways, enjoying a successive 23 months of ‘no change’ – whilst welcome – it’s also beginning to feel a little … frightening.
Of those among us that haven’t yet hit the financial wall – the coming year is going to be nothing short of a trial. Just because we haven’t hit it doesn’t mean we won’t with the slightest tip of the scales. Judging on the coalition’s spending cuts (that are now underway) and the likelihood of a rise in unemployment for those hit by the cuts – the future certainly isn’t orange.
Between what Gov Inc have in store for the UK as a whole, the proposed Big Society (getting off to a great start with Liverpool already backing out of being one of four targeted areas to spearhead the campaign) and the potential for more price hikes, pay freezes and benefits cuts the future of the ordinary working man (and woman) is looking ever narrower.
National and consumer debt is spiralling out of control – currently climbing above and beyond the really scary and likely to morph into the super scary in the next couple of years: 65% GDP as of now – predicted to rise to 79% by 2014 at the current spending rate.
Explaining national debt would make for a really long article and right now is not the time but – the biggest cause of debt in the UK is how our government spend our money. Labour doubled our national debt from 40% in 1997 up to the predicted forecast of 2014.
Unless the coalition stops spending and starts repaying the whole country will eventually go bankrupt. This kind of puts our position as the man at the bottom of the pile into perspective. If Gov Inc raise (nay – demand) ‘x’ amount in taxes – and yet spends double that amount – the money comes from investors.
In 2009/2010 £496.1 billion was raised from taxing the British population. The government spent £671.4 billion. That’s an overspend of £175.3 billion. 2011 isn’t going to get any brighter. So – can we expect to feel the strain even more – will there be rise in house repossessions, despite persistent statements from the experts to the contrary?
The simple answer is – yes. Inflation will rise, probably around May. It should rise (it will need to) at least twice more before the year end. Gov Inc need to spend to withdraw – despite the massive cuts they’re implementing, money will still go out of the pot and foreign investors will need to be repaid this years interest on national debt – as well as borrow more to bridge the gap between taxes raised due to the fiscal policy – and the amount need to keep the UK afloat.
How can you help? By not living beyond your means. Debt is debt – even at the lower end of the scale. The more you tighten your belt now, the quicker you move away from what you want and nearer to what you actually need, the quicker you’ll get a realistic hold on your finances.
How much is your mortgage? How much do you spend month to month? What do you owe on credit cards? Do you live in your overdraft? It really is time to take stock. Denial won’t help, waiting won’t help, and the way that the UK national debt and the banking systems are operating – you may well find that there’s no one left to turn to in a few years time.
Do your bit now. Stop spending what you don’t have. Make positive changes, realistic changes. Take your future into your own hands. The more you understand what’s going on around you – the more you will realise that the quicker you take stock, the less chance there is of losing it all in the future.