Friday, 12 December 2008

Home Sweet Home

I am hoping that 2009 will be the year we can finally buy a place of our own. I guess we hanker for the responsibilities that so many already have but don't enjoy... The possibility of having a space you can call your own, place things where you want, rent out to others if you like and generally take responsibility for. I used to own and then sold, so I am fully prepared to do it again.

This time round though we are in a position of power, as FTB generally have such a better outlook right now. *However* what is different this time is that the banking sector not only caused this crisis, but now fails to help FTB get onto the ladder to begin to solve it. OK, so some may say this is a simplistic view, but consider this: Have the banks lost out? They earned billions over the last 10 years and paid themselves fat bonuses and large share dividends. Then the tip of the iceberg hit with the credit crunch and bad mortgage debt. Now we find they are going cap in hand and getting handouts from the government as well as interest rate reductions.
The governments round the world have bailed them out. However, none of these benefits are passed on by the banks us. Instead they are lining their coffers and 'preparing' for a time when they can pass the money on, presumably a good 6 months from now.

Savers are seeing their rates fall with immediate effect, and yet mysteriously mortgage holders are seeing a 'delay' or even most times no saving at all as their mortgage 'doesn't apply' to the falling rates. Yet again more cash in this 'gap' for the banks to save up and keep.

So what can we do? The banks are clearly protecting themselves at this point, and claiming no responsibility for what has happened in these past 12 months. Following on from bailing them out, the government is on one hand asking them to pass on the savings to us, and on the other, forcing them to be far more careful and accountable with transactions.

Time will tell, but at this point I imagine that 2009 will all be aout 'Cash Is King'. as the old saying goes. With the likelihood of more job losses and the much heavier stages of recession, we all need to reconsider our priorities. Will that new TV be feeding us next year? I know I look at purchases differently, with a 'what if I have no job this time next year' angle.

So my point is, we're saving like crazy for a place to buy, yet if that doesn't happen at least we will benefit from a cash cushion which will be far better for us than any new items we may buy, or expensive trips/meals out. I will sleep better at night knowing we are doing all we can *now* to prepare for the coming storm.

If we are however lucky enough that for us there is no storm, at least there will be a nice cold Gin & Tonic in the garden we can call our own...

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