It's gloomy out there. The economy is shrinking, property values are falling and stock markets are in the doldrums
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Many people borrowed heavily during the boom, and now are tempted to pay off debt or save more for a rainy day.
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It's gloomy out there. The economy is shrinking, property values are falling and stock markets are in the doldrums
.
Many people borrowed heavily during the boom, and now are tempted to pay off debt or save more for a rainy day.
Spend more in my opinion to get the economy going again. The more cash flow there is, the quicker the economy will regain itself etc.
congrats on another pointless thread.
Spend, no brainer
surely spending more would put more money into the economy...
8Quote:
Originally Posted by Ramones
You cheeky little f***. Post a f****** debate then and lets see who post's the dumbest thread "KNOW TO MAN *FUC**** KIND"
You ungrateful donkey.
Edited by Wayne (Forum Moderator) Please don't be rude.
omg lol calm down dont get ur knickers in a twist.Quote:
Originally Posted by Clowgon
so yeah, spend more.
If you've got the money might as well spend it, if you don't just don't spend
easy.
why do you think VAT has gone down...
Prices are lower to encourage the public to spend more money which in turn will give companies and shops money for selling their products. Companies can then buy more products from suppliers which will give the suppliers money etc.
spend.... lmao
Spend, although I want to save so I can pay off bills and the like each month. So it's a bit of both, but more so on the spending front for me :P
Quote:
Originally Posted by Clowgon
How are we supposed to debate this? theres no argument for saving.
Just go back to discuss anything aka spam and post another 'what are you getting your grandma for christmas' thread
ahaha so well put that's brilliant, +repQuote:
Originally Posted by Ramones
well, you could argue that costumers may well expect shops to give extra discounts such as a further 20% like how m&s did for one day and so they may think they will do it again. This means they wont be spending, they will b e saving for the next bargains ;)
Thats a short term thing, and ultimately the costumers will consume more. Consumption long term will make the economy grow :)Quote:
Originally Posted by kk.
not necessarily. people will wait until they can get the best bargain they can. If the recession lasts for more than 2 years then discounts will last for this period of time
The thread isn't asking what people are likely to do, it's saying what should they do, and they shouldn't do that.
Plus alot of the 'bargain goods' will be necessity goods meaning people have to buy them, it's not a matter of timing it's about competition. If i had no cereal, and tesco were doing buy one get one free in 2 weeks, i wouldn't wait i'd just go to asda.
I'm not gonna wait 2 years to buy a new jumper or a new tv either.
Spending more would put more money into the economy...
but it would mean you having less money when you actually need it
i think its good to spend while during slump. that way you can help the economy get better. your advantage is that everything is cheaper :DQuote:
Originally Posted by Clowgon
No they're not necessary goods. Clothes shops will do it and as more people are not buying clothes which they'll throw away after a week, they will wait and buy higher quality goods which last longer. And my bad about should do etc. Of course we should buy but some people might not due to my reasonsQuote:
Originally Posted by Ramones
Necessity goods* And i dunno, it's all about consumer confidence, if people believe the economy is stable, prices aren't rising rapidly, unemployment is low, they'll spend more. But at the moment people aren't sure, they dunno if to spend 700 quid on a new tv cause all of their bills are rising and they're scared they might lose there job. So yeah, at the moment people are mostly saving, but to get out of the slump spending is needed.Quote:
Originally Posted by kk.
Spend more, otherwise we'll be in a worse suituation then we are in now.
dont correct me, they mean the same thing..Quote:
Originally Posted by Ramones
and we're not in a slump. Heading for one maybe but its best to keep optimistic lol. True, the increase in unemployment will worsen the effects of the recession. As less people are now spending money because they either cant because of too much bills, or they darent incase they will need it. Although the cut was small, its still a cut. it might not influence people to buy a £40 game because its a very minimal saving. But as i said before, if companies do things to try and influence people to go into their shops and buy such as 20% and the customers know we are in a recession, they will know that the company may do it again so they will hold of spending until the next sale comes along. It will more than likely happen as they need to generate important sales.
And on the matter about the price decrease not being passed on, it shouldnt matter too much ebcause that 2.5% will then go to their profits which they pay tax on and also, if the profits are big enough, they do not lay off as many people
Quote:
Originally Posted by kk.
I don't really understand what your on about, i think your looking at it from a social point of view rather than economic.
Can you give me an example of what you mean? You said clothes shops, but shops are having sales all the time COMPETING against each other, if i go shopping i'll go to the store which has the sale on alright, but what your saying is, all the shops are having 20% discount days at the same time, so people are waiting until this day and then buying everything, am i right? And it doesn't work like that, as i explained.
not what i meant lol,
just look at one shop say topman. If they decide tomorrow to do a one day discount of 30%, then you would probably go tomorrow and buy some clothes (if u shop their). If the customers had perfect knowledge of the current economic situation then they would realise that they are having to do this because of a fall in profits. Afdter they have done the 30% day, i would expect them to have a lower amount of sales from that point onwards because a lot of people know they will, surely, have to do another discount day until the recession ends. therefore, topman would see a drop in sales until the next discount day in which they would still only see a marginal rise in profits because the price of each product is so low.
hope that makes sense lol
To get the economy going again it's fairly obvious that public spending needs to increase.
Labour have cut VAT and are planning a cut in taxes for people earning below 40K a year, which I hope will help.
If people don't spend, less money will go to the state, businesses will suffer, and people will loose their jobs.
I suppose in theory that would work, but in the real world we're no where near perfect knowledge. I don't think it would work like that in real life, again as i said earlier your not taking into account substitute goods/ rival shops. I know there are some little scenesters that only shop at topman but i myself shop at loads of different places and wouldn't wait for a sale to go shopping again.Quote:
Originally Posted by kk.
Whatever. Next time you -rep me, do leave your name. Coward.Quote:
Originally Posted by Ramones
I thought it'd be pretty obvious it was me ;)Quote:
Originally Posted by Clowgon
Calm down!Quote:
Originally Posted by Clowgon
Pump more money into the system, more money, the better we'll be.
The more money that is made, the less the value the pound becomes.
The idea of lowering VAT was to get us people to start spending again, which on the news sales have gone up again, but that could be a coincedence that many shops done one day sales. If we spend more jobs are created, which is good because recently people have gone jobless.
So I say start spending.
After talking to a few people about this, it's about as good to save as it is to spend, because after the price cuts and lower VAT will just mean we have to pay an ultimate price later. Something about what happened last time cropped up.
laaaaaaaaged soz delete
I disagree, i know what you mean but i don't think it will work like that. It's like part of a trade cycle, there will be slumps, and the lower prices and tax cuts lead to increased consumption push it back into recovery and then it might boom and then prices will get too high and it might slump again etc etc etc. The only difference is that this time it isn't just about the supply and demand of the UK population.Quote:
Originally Posted by GommeInc
If we save.. then what? we keep saving until half of the companies in the UK have gone under?
If we spend, which is triggered by lower prices, the firms will be losing out on profit but will still be supplying and the economy may not look great straight away but long term, it's what is needed.
It's what happens in 2010 when VAT is apparently set to rise, people are still thinking about saving because it'll be worse in the future than it is now. Sure, lower VAT, but raising it more than 17.5% which is one fear, won't make much difference to some businesses. It's delaying the inevitable in some cases...Quote:
Originally Posted by Ramones
Firstly, there has been no evidence to suggest it will rise above 17.5%, it was mistakenly put in a report at 18.5% when it should of been 17.5 and the idea of rising it above 17.5 has been dismissed by many officials.Quote:
Originally Posted by GommeInc
Secondly, in your first post you said saving was a good thing cause we're gonna have to ultimately pay it back later. Do you mean pay it back when the VAT up to 18%+, which isn't set to happen anyway, but i still don't understand why it would be better to wait?
I'm not talking about what people are likely to do, but about what we should do.
What people are likely to do is very important :/ It's like giving someone £10 to go buy something to eat and what they should do is spend it, when they are just as likely to save it.
And as I said, the "apparent" (not definite) idea of VAT increasing above that of 17.5% is making people think, even though there no solid evidence. The media and small mistakes like this do have an effect on some people and after talking to some other business studies students about this, it seems people are believing the worse from the government, which you can't blame them when some believe the government is utterly useless and deceiptful. It's how some people work.
Speaking of VAT cuts though, PC World was doing very good today. The one in town was advertising the 15% VAT rate and was packed for a change. They were even giving out documents about what the VAT change means i.e. £100 the Ex VAT is £85.11 and that £85.11 with the new VAT becomes £97.87, which means a saving of £2.13 (I think, too tired for math).
The VAT cut is being paid back as soon as it happens. The rich are gonna pay more income tax and something else is increasing but cant remember what. Its still a possibilty though that they may raise it above 17.5 after this 1 year is up
I'd like to hear why you think our government is useless? And also you didn't answer my question on why saving is good.
The thread was talking about what should we do, so i replied in most cases about that.
Now i think it's pretty damn impossible to understand what people are likely do, the way i see it, the VAT cut is good, i watch the news, i see that the they are planning on putting it back up to 17.5, not 18.5% in 13 months. I'm not scared about spending money. And i know alot of people including my family who share the same view as me, interest rates falling, taxes falling, people are gonna spend.
And theres been a possibility they may rise it above 17.5% for the past 10 years, but i just can't see it happening
I agree, so we need to spend. Im buying alot of stuff and planning on it - Electric Guitar - New Laptop and some other stuff.Quote:
Originally Posted by Wayne