As the great consumer and easy credit bubble begins its rapid deflation I thought I’d share my own personal thoughts on what, In Britain we are possibly left with in terms of our ability to weather any potential oncoming storm.
Walking Without Crutches
A Britain without the artificial crutch of high consumer spending and ever increasing property prices may reveal a less favourable environment for surviving an economic downturn without a degree of turmoil.
The Bubble Bursts
The housing bubble may well adjust itself to more sustainable prices as many estate agents go out of business but will we be able to accept the changed landscape that removes the great British dream of owning a property from under the noses of an entire generation as future mortgages require a much greater deposit down payment and which has already relegated 95% mortgages to the past.Things will become particularly unbearable if a greater degree of regulation is not introduced into our housing rental market or if truly affordable housing is not built built and protected from future market speculation.
We already had a pensions short fall problem and the world economic downturn will only exacerbate the shortfall especially if the over reliance on ‘property as pension’ turns out to not be the great guarantee of security it once was.
Whilst many European countries may cope well with the fallout from US financial woes which will surely effect the world markets in the coming weeks and months ahead,I suspect that Britain may well wake up to find that a lot of its benefits were in fact temporary illusions that masked some very real intransigent problems that may continue to have a detrimental impact on our society for a very long while to come.
Britain has been for some time now a very expensive place to live and is likely to remain so which will only make it more difficult for those that may find themselves in different financial circumstances.
The question is how well we’ll each be able to adjust to new realities and restricted possibilities. It’s often said that the true key to happiness is to limit our expectations.It may or may not be a new socio economic era is just dawning around us.The rush for fool’s gold has ended with little of real worth to show for it.