More toxic fallout and the Return of Inflation
Gabby says:
Every day we hear more and more about the sub prime mess.
At first it was said that it would just affect America, and that a quick recovery could be made.
Then there was a brief mess in the UK, with institutions such as Northern Rock being quickly eaten up by the crisis.
Then there was talk that it was all over. The credit crunch was dead. Past. On the road to correction.
And now it seems that this is clearly not the case at all. It is spreading Internationally and its bite is still to be felt by many.
When you look at the facts you can see that in the US 17.9 million homes were without residents in the third quarter of 2007. Never before have so many homes stood empty.
“According to Congressional estimates, up to 2 million families are expected to lose their homes over the next two years.” That’s on top of the 1.7 million foreclosures so far in 2007. 1
In Australia there is growing concern amongst many people about our ability to deal with debt - especially with mortgage defaults having soared by 329% since 2005. General credit defaults and interest rates are on the rise as well. In many respects it’s a disturbing trend, but it’s not as doom-and-gloom as the media puts it.
No matter how things transpire there are always options, and now that there’s a pretty good chance of a downturn on the horizon, now is a good time to start considering your options.
If there is economic bad weather on the horizon, what measures can you take now, in order to protect yourself when the storm hits?
The most obvious ones to me are to reduce debt and increase saving - and of course there are many more.
I’d love to hear your suggestions!
PS. Don’t forget to check out our new article “Inflation Returns” : No matter where you live, world wide inflationary pressures are back! And it requires different approaches to everything to do with money - including wage contracts, borrowing for whatever purpose and any form of investment.
