OutByEaster? Posted January 7, 2017 Moderator Share Posted January 7, 2017 33 minutes ago, HanoiVillan said: Once again, it hasn't happened yet, but even so, you're just flatly wrong here. The strength or weakness of the pound or the rate of inflation do, in fact, have a bigger effect on people's lives than Christmas adverts (!). Ultimately yes - but at this point in terms of household spending in between the referendum and christmas - the idea that householders are thinking "Hmm, I'd like to get the oldest a new bike, but I should probably consider the impact of Brexit on the value of the pound before I do so" is absurd. Of course households are affected by economic conditions, but those effects tend to take place over a really long period of time and because of this, unless they're really extreme, they go to a certain extent unnoticed. There is a separation happening between 'the economy' as its talked about and real life in my opinion. We came through a recession in which consumerism didn't flicker a jot, it's all built on a sandy bubble of debt, but the average householder reads about the economy and then goes out and buys a new phone regardless of whether what we read is good or bad. The assumption in the article is that economic conditions matter in the same way to the householder as the economist, it's ridiculous. Householders won't worry about the effect of the value of the pound, they'll worry about the price of a bottle of Chablis, now those things are absolutely linked, but the thinking doesn't go to the point of inception - that's simply not how the world works in terms of real peoples lives. Quote Once again, it hasn't happened yet, but even so, you're just flatly wrong here. The strength or weakness of the pound or the rate of inflation do, in fact, have a bigger effect on people's lives than Christmas adverts (!). Of course it has more of an effect on peoples lives, but it has a lot less effect on how people think, what they want and where they spend their money. 1 Link to comment Share on other sites More sharing options...
brommy Posted January 7, 2017 Share Posted January 7, 2017 1 minute ago, snowychap said: Of course it is. That's rather the way debates (should) go, isn't it? Indeed. It does make it impossible to define whether the decision was correct. As such, I think it's poor to label either side as idiots or wrong. Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 4 minutes ago, OutByEaster? said: We came through a recession in which consumerism didn't flicker a jot, it's all built on a sandy bubble of debt, but the average householder reads about the economy and then goes out and buys a new phone regardless of whether what we read is good or bad. Yet wasn't the household debt to income ratio dropping from the high of 2007/8 until some time in 2014? Link to comment Share on other sites More sharing options...
OutByEaster? Posted January 7, 2017 Moderator Share Posted January 7, 2017 4 minutes ago, snowychap said: Yet wasn't the household debt to income ratio dropping from the high of 2007/8 until some time in 2014? I have no idea. I'd have to look it up. Most people would. Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 4 minutes ago, brommy said: Indeed. It does make it impossible to define whether the decision was correct. As such, I think it's poor to label either side as idiots or wrong. What on earth are you on about? Link to comment Share on other sites More sharing options...
brommy Posted January 7, 2017 Share Posted January 7, 2017 16 minutes ago, snowychap said: What on earth are you on about? Are you serious? Link to comment Share on other sites More sharing options...
HanoiVillan Posted January 7, 2017 Share Posted January 7, 2017 38 minutes ago, OutByEaster? said: We came through a recession in which consumerism didn't flicker a jot, it's all built on a sandy bubble of debt, but the average householder reads about the economy and then goes out and buys a new phone regardless of whether what we read is good or bad. 29 minutes ago, snowychap said: Yet wasn't the household debt to income ratio dropping from the high of 2007/8 until some time in 2014? 24 minutes ago, OutByEaster? said: I have no idea. I'd have to look it up. Most people would. I'm lost as to what you're even arguing at this point, OBE. Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 (edited) 35 minutes ago, OutByEaster? said: I have no idea. I'd have to look it up. Most people would. I think it was until some time around late 2012 according to this from an article in the Indie: Quote Since 2008, when the debt to income ratio peaked at 170 per cent, households have been deleveraging. Edit: I think there was an article in the news recently about unsecured household debt increasingly at a faster rater in the last six months than ever before (or maybe just for a longish time) but I may have misheard that. Edited January 7, 2017 by snowychap Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 5 minutes ago, brommy said: Are you serious? Yes. What has that to do with what I am posting? Link to comment Share on other sites More sharing options...
brommy Posted January 7, 2017 Share Posted January 7, 2017 13 minutes ago, snowychap said: Yes. What has that to do with what I am posting? If economic performance is what many in this thread seem to be focussing on in regard to the decision to leave and as you acknowledged, economic analysis is debatable, there can be no definitive right or wrong answer to the question. I'm therefore surprised there are so many posts in this thread that imply or directly call supporters of one side or the other, idiots or similar. It was a simple as that. Link to comment Share on other sites More sharing options...
StefanAVFC Posted January 7, 2017 Share Posted January 7, 2017 14 hours ago, brommy said: I recall a campaign warning of instant damage to the UK economy. Even those who voted leave that I have spoken to, expect there to be some affect on the UK economy during the exit itself. Only time will tell what the effect is and how long it will last. After that we'll all be able to debate whether the 'cost' was worth it; a subjective soup further clouded by guesses of how bad or good the UK would have been if we'd remained. Predictions made in the scenario that everyone expected, in that DC would enact article 50 immediately. As @blandy says, all we've done so far is vote to leave. The worst (then maybe the better) is very much still to come. Link to comment Share on other sites More sharing options...
brommy Posted January 7, 2017 Share Posted January 7, 2017 Just now, StefanAVFC said: Predictions made in the scenario that everyone expected, in that DC would enact article 50 immediately. As @blandy says, all we've done so far is vote to leave. The worst (then maybe the better) is very much still to come. Yep. At the moment it's like we're trying to predict the outcome of a 90 minute game after the first couple of minutes when no one has even put a tackle in. Link to comment Share on other sites More sharing options...
OutByEaster? Posted January 7, 2017 Moderator Share Posted January 7, 2017 23 minutes ago, HanoiVillan said: I'm lost as to what you're even arguing at this point, OBE. That people don't think about the economy and then plan their lives, that the average household doesn't know or care about the debt to income ratio. People acknowledge the effect of these things when they affect things that actually happen in their lives, the conceit of the economist in thinking that people will have looked at the effect of Brexit on the economy, at the changes it causes to the pound, at the figures that matter to the economy and to economists and then decide what they'll buy is wrong in my opinion. People don't consider economic factors in this way, people go and spend the additional £1 on a bottle of Chablis at Asda, they tut and then don't get that Fruit n Nut bar they wanted. They might then when they next read something in the paper think, this downturn is a pain in the arse, but they don't read the financial times and then change their outlook for the day. The original article suggested that spending between the referendum and today was a direct result and measure of people's reaction to Brexit and gave a number of options as to what that told us about the spending. I'd suggest the premise was wrong in the first place. I also feel I'm not explaining this very well. 1 Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 4 minutes ago, brommy said: If economic performance is what many in this thread seem to be focussing on in regard to the decision to leave and as you acknowledged, economic analysis is debatable, there can be no definitive right or wrong answer to the question. I'm therefore surprised there are so many posts in this thread that imply or directly call supporters of one side or the other, idiots or similar. It was a simple as that. You're conflating such a number of different things in there that it isn't 'as simple as that' at all. If you want a discussion with the 'many in this thread' and the posts implying or directly calling people idiots or similar then why don't you start quoting them so that we can follow that debate and clearly see your criticism? It would be very handy as you've picked on someone who doesn't think that economic performance is what should necessarily be the focus when discussing the decision to leave the EU and who has acknowledged, as you posted, that economic analysis (as with most other social science/humanities analysis) is debateable and it really isn't making much sense to be making/pressing your 'point' in reference to what I have posted.* * I left out the last bit because I have undoubtedly called supporters of one side or the other idiots or similar or worse, especially if they're Farage, Gove, Cameron, Osborne, Johnson, &c. 1 Link to comment Share on other sites More sharing options...
brommy Posted January 7, 2017 Share Posted January 7, 2017 8 minutes ago, snowychap said: You're conflating such a number of different things in there that it isn't 'as simple as that' at all. If you want a discussion with the 'many in this thread' and the posts implying or directly calling people idiots or similar then why don't you start quoting them so that we can follow that debate and clearly see your criticism? It would be very handy as you've picked on someone who doesn't think that economic performance is what should necessarily be the focus when discussing the decision to leave the EU and who has acknowledged, as you posted, that economic analysis (as with most other social science/humanities analysis) is debateable and it really isn't making much sense to be making/pressing your 'point' in reference to what I have posted.* * I left out the last bit because I have undoubtedly called supporters of one side or the other idiots or similar or worse, especially if they're Farage, Gove, Cameron, Osborne, Johnson, &c. I took your acknowledgement that economic analysis is debatable. I've re-read my comment after I quoted you and realise I should have included a term such as 'others' to ensure you didn't think I was accusing you. 1 Link to comment Share on other sites More sharing options...
blandy Posted January 7, 2017 Author Moderator Share Posted January 7, 2017 1 hour ago, OutByEaster? said: We came through a recession in which consumerism didn't flicker a jot, it's all built on a sandy bubble of debt, but the average householder reads about the economy and then goes out and buys a new phone regardless of whether what we read is good or bad. The assumption in the article is that economic conditions matter in the same way to the householder as the economist, it's ridiculous. Householders won't worry about the effect of the value of the pound, they'll worry about the price of a bottle of Chablis, now those things are absolutely linked, but the thinking doesn't go to the point of inception - that's simply not how the world works in terms of real peoples lives. "consumerism" didn't flicker a jot - well, perhaps as a kind of Capitalist society it din't. But to say that people carried on spending in the same way as they did, say, during boom times is completely wrong. I know it's a complex picture, but high street closures, businesses going bust, with people losing their jobs and having to take up part time and zero hours work. People having to use food banks because they can't afford to buy food (or anything else) - that's not "the same old same old" consumerism. Yes the economists analyses are dry and at a general level, but they are absolutely not removed from the real world. People don't think in terms of economic analysis, but the oft cited "consumer confidence" is a reflection of (collective) normal people's thinking and views. Low interest rates perhaps is another factor - why save when you get nothing for it, why pay off debt when it's so cheap - might as well buy a new TV or whatever might be a part of it, so ultimately economic conditions do matter in the same way to the householder as the economist, it's just the terms it is expressed in differ, IMO. 2 Link to comment Share on other sites More sharing options...
blandy Posted January 7, 2017 Author Moderator Share Posted January 7, 2017 23 minutes ago, OutByEaster? said: the average household doesn't know or care about the debt to income ratio. This is an example of wrong (IMO). In simple terms, surely "my" income from my wages and "my" debt from my borrowings and outgoings is a massive influence and concern when it comes to spending decisions. So at individual and family levels it's exactly the opposite of what you say, OBE? Economists basically look at the whole collated national picture made up of all the individual "me" situations, but its' the same thing, ultimately. 1 Link to comment Share on other sites More sharing options...
snowychap Posted January 7, 2017 Share Posted January 7, 2017 (edited) 28 minutes ago, OutByEaster? said: That people don't think about the economy and then plan their lives, that the average household doesn't know or care about the debt to income ratio. They don't have to. 28 minutes ago, OutByEaster? said: People acknowledge the effect of these things when they affect things that actually happen in their lives, the conceit of the economist in thinking that people will have looked at the effect of Brexit on the economy, at the changes it causes to the pound, at the figures that matter to the economy and to economists and then decide what they'll buy is wrong in my opinion. I think he's rather explained it badly. He seems to imply that all households are sitting down and making clear, strategic decisions after a full and detailed analysis of economic conditions whereas I think he means a much less conscious (though still informed, i.e. made on the basis of information taken in at some sort of level) process across the sector that manifests itself in an increase in short term spending. Quote People don't consider economic factors in this way, people go and spend the additional £1 on a bottle of Chablis at Asda, they tut and then don't get that Fruit n Nut bar they wanted. They might then when they next read something in the paper think, this downturn is a pain in the arse, but they don't read the financial times and then change their outlook for the day. You may well be right when you are talking about incidental spending - a few pounds here or there - or substitutes (dropping one treat as the price of another has increased) within a weekly household grocery budget but I don't know that you're correct when you're talking about larger sums. Look at how much people look around for 'bargains' (whether or not they actually are is immaterial) at certain times of the year or through specific websites, for example. People also do read up on interest rates for ISAs and savings accounts, they do watch the Martin Lewis programme on ITV and listen to his slots on 5live, they do go on price comparison websites, &c. No, people don't read the FT and change their outlook for the day (nor should anyone) but then again I don't think people spend without any consideration for their individual economic circumstances or, collectively, without being influenced by the economic circumstances around them. Edited January 7, 2017 by snowychap 2 Link to comment Share on other sites More sharing options...
Awol Posted January 7, 2017 Share Posted January 7, 2017 Morgan Stanley is "eating humble pie" over its post-Brexit forecasts Morgan Stanley, one of the world's biggest investment banks, is - in its own words - "eating humble pie" over its post-Brexit economic forecasts. So far I make that the IMF, the Bank of England, Morgan Stanley (and any more of the false prophets I've missed in their stampede to recant) all now saying they got it wrong. Experts, eh? I sh*t 'em. Link to comment Share on other sites More sharing options...
StefanAVFC Posted January 7, 2017 Share Posted January 7, 2017 (edited) We're not "post-Brexit" though. How can anyone say anything has been proven right or wrong either way? If they mean 'post-Leave vote' then I'd pay a bit more attention. But even then, as stated 2 or 3 times, the predictions were based on the expected immediate outcome of the vote, immediate enactment of article 50. Edited January 7, 2017 by StefanAVFC 2 Link to comment Share on other sites More sharing options...
Recommended Posts