Why is the pound in a state of collapse ?

[John50]

It is no wonder things are so very quiet around. A quid today buys only 1 euro 14.8 cents. Even this forum seems to have died ! This economic crisis is slowly killing the whole area.

[Warrior]

It is no wonder things are so very quiet around. A quid today buys only 1 euro 14.8 cents. Even this forum seems to have died ! This economic crisis is slowly killing the whole area.

If not the Whole World................!

[yllig]

Judging by the special Christmas Day and New Year's Eve party menus in the free papers they are not expecting a drop in bookings for the prices they are charging.

We are not even having a turkey or buying anything extra for Christmas Day and Boxing Day - just some lamb shoulder that we got reduced from Intermarche when they had their 40th anniversary.

We will also not be going anywhere New Year unless we can find a bar that is just having a normal evening and just have a couple of pints - I think Breeze Bar at Benimar had a free evening last year.

Is the bloody sun worth all this?

[John50]

Judging by the special Christmas Day and New Year's Eve party menus in the free papers they are not expecting a drop in bookings for the prices they are charging.

We are not even having a turkey or buying anything extra for Christmas Day and Boxing Day - just some lamb shoulder that we got reduced from Intermarche when they had their 40th anniversary.

We will also not be going anywhere New Year unless we can find a bar that is just having a normal evening and just have a couple of pints - I think Breeze Bar at Benimar had a free evening last year.

Is the bloody sun worth all this?

Well, I was on a rather good pension until this happened. Now ....

I think the expensive restaurants are anticipating a lemming effect - you know, damn the consequences we're out to have a good time and we'll think about the bills later.

It will be interesting to see if their theories work out ?

I have seen that the forecast is for a 1.08 euro/pound rate. Now that will be telling ! Not that anyone can see into the future of course but actually we're not a million miles off it now really.

[yllig]

I wonder if it will ever go back up again though?

We can live with not going out and watching every penny if things improve after a year or 18 months but if it was permanent then I think a lot of people may have to go back to the UK as I think it will be cheaper to live there than here with that sort of exchange rate. We would certainly think about it in a few years. We dont get the first of our pensions for another 6.5 years but even then I think it wont be easy.

[andywebb]

I think that when the world catches up with the EU the Euro will fall again. It is because the main focus recently has been on UK and USA with banks being bailed out left, right and centre.

When the same starts to creep through Greece, Italy, Spain, Portugal, France and eventually Germany - wait and see what happens to the Euro!

I think the New year will start to see this happen.

Those on a UK pension dont give up hope it has been like this before and the pound came back stronger than ever.

ps with a bit of luck Gordon and his cohorts will be flung out sometime soon and that will have a positive effect on the economy.

[John50]

I think that when the world catches up with the EU the Euro will fall again. It is because the main focus recently has been on UK and USA with banks being bailed out left, right and centre.

When the same starts to creep through Greece, Italy, Spain, Portugal, France and eventually Germany - wait and see what happens to the Euro!

I think the New year will start to see this happen.

Those on a UK pension dont give up hope it has been like this before and the pound came back stronger than ever.

ps with a bit of luck Gordon and his cohorts will be flung out sometime soon and that will have a positive effect on the economy.

I don't much know about the parochial politics as the UK doesn't rank that large now and this is a world crisis far larger than our little politicians in London. I so hope you are correct in your prognosis for the pound though. I and many others here are getting very worried indeed and I don't think the issue has yet hit home yet with some. Let us hope the limelight does fall a little more on the ECB and the Euro.

[yllig]

I echo those hopes entirely.

I think what you say makes a lot of sense. There has not been much on the world news about Spain, France, Italy and Portugal etc. I know there has been a bit about Germany but the newspapers and policiticans in the UK really talk the country and the economy down.

Spain dont seem to wash their dirty linen in public like the UK do. No wonder everybody is scared of sterling!!!!

I know that people have to know what is going on but there is nothing like the amount of bad news in the Spanish press as there is in the UK.

I cannot believe the amount of doom and gloom headlines in the press and on the news station websites. No wonder people are frightened to go out and spend anything. The 4 horsemen of the apocolypse are waiting in the wings along with the sword of damocles hanging over our heads.

If I was back in the UK I would be watching every penny. In fact I am doing that here anyway so no change there.

I was a mortgage adviser in the UK and every day for about 3 years I got email after email trying to talk property prices down - I was sick of hearing about the "property crash". So bad that in fact I decided to put our property up for sale and go into rented accommodation before we left the UK to come here. I am glad I did now.

[Warrior]

I wonder if it will ever go back up again though?

We can live with not going out and watching every penny if things improve after a year or 18 months but if it was permanent then I think a lot of people may have to go back to the UK as I think it will be cheaper to live there than here with that sort of exchange rate. We would certainly think about it in a few years. We dont get the first of our pensions for another 6.5 years but even then I think it wont be easy.

If you can´t make ends meet here in Spain you certainly can´t afford to live in the UK, think of all the outrageous taxes & rates & fines for late payments.
Until the rate drops to GBP 2 = € 1 then you´re better off staying put.

[yllig]

I dont agree Warrior. We might have had £1400 council tax a year there but we have 1500 euros private medical here so no saving there.

We paid a lot less for our internet, less for our car insurance, our electricity and gas - 3 bed central heating was £60 per month. We pay on average 129 euros a month here and certainly no central heating. In fact, hardly any heating!!

Our water was metered in the UK - metered here. About £40.00 an year more in the UK.

OK fuel is a bit less here, tv licence doesnt exist, car tax is less, booze is a bit cheaper but we dont drink loads so that is not the be all and end all.

We used to pay around £60.00 a week on food in the UK. Here we are spending around 85 euros which will soon become equal to £85.00.

Our buildings and contents insurance here is more than the UK for a smaller house!!!

Dont know what you mean about fines and penalties. Never paid any.

All in all is it worth it for the weather alone?? We think so at present but if we cannot afford to go out or travel around Spain, we would be better off back in the UK working and at least be able to afford to have a meal and the odd holiday.

No chance of a holiday here. In fact a chinese menu of the day would be nice at the moment.

Unfortunately like a lot of others we bought at the peak of property prices and came over thinking we were going to get 1.40 ish maybe more for our £. My god what a cock up!!

[6mauledrv]

Two points:

First - the euro will do better than sterling. Europe simply has not accumulated the level of public debt that the UK has. There are doubts now that the UK gov. will be able to repay the money they've borrowed; this will further degrade the pound if no one wants to buy gov. bonds.
We still haven't dealt with the accumulating private credit card debt. Have you heard that folk are using their credit cards to make mortgage payments? You don't have to be too smart to figure out where that is going to lead. The s**t will hit the fan very soon.

Second - the main difference ( and the largest in money terms) between living costs here and the UK is the cost of owning and running a home.

[John50]

I just read this on the other site:

"I own a property in Villamartin which i have been trying to sell for over 2 years now.

12 months ago i signed up with a local rental company to attract rentals to the house and also with the hope that they may be able to sell the house as well

4 months ago they found us a long let for 9 months which in the current financial climate was great news, however this is when the problems started. Everything seemed to go wrong in ths house, repairs we required constantly, the TV broke, the oven etc etc and as the months went on our monthly rental of 600 euros was reduced to very little!

being based in the UK i have no control over this and had to assume that the company were correct in their findings. recent conversations i have had with them i have advised them that i am not happy with their service and will consider not renewing my contract with them on 1st December 2008, and guess what................the tenants have suddenly disappeared!! amazing

anyhow, i need some advice on the following please

the mortgage currently is far more than i can afford to pay, and in the current climate i dont envisage any hope of selling the property in the near future, even if i give it away, which is what i have been trying. so therefore, what are my options?

what is the outcome if i can not afford the mortgage? is it the same principle as in the UK regarding repossessions? will it effect my credit scoring in UK?

if possible i do not want to go down this route but currently the outgoings far away the incomings

any help would be greatly appreciated"


The sad thing is that I know this person is not alone. I thought I was reasonably comfortably off but having just seen my pension income I am seriously worried, more so than in several years. Many people around me have actually gone back to the UK now and stay with relatives there finding it cheaper - heating, food bills etc. When I read things like above I wonder quite where this will all end ? In the words of the song....'Regrets, I have a few' even more so now. I used to enjoy it here but the worry is exceeding the benefits increasingly.

The pound is currently at 1.145 euros.

[yllig]

I absolutely agree with that comment that the worry is outweighing the benefits.

It is the only thing I can think about at the moment!!

[John50]

Well, it's made the BBC at long last

BBC NEWS | Business | Sterling hits new record euro low

[yllig]

I saw the BBC Website and that article.

This afternoon Alistair Darling got a grilling from the Treasury Select Committe (from the opposition members anyway). He was asked that with the decline in the value of sterling at what point would government intervene, and what action would it take.

He replied that there had been a great deal of volatility in currency markets generally and his job was to ensure that the economy recovered as quickly as possible. The committee member said 'so you don't intend to take any action to support the pound?' There was an embarrassing pause, some shuffling on his seat and he then simply repeated his earlier response!

So not help from that quarter!!!