What do you remember from the 2008 financial crisis?

[Uppercut]

It's sort of become this massive shadow hanging over everything, like The Event in those Mitchell and Webb sketches, and I can't imagine a world where it didn't happen. But it's kind of hard to describe what it was like to people who were kids at the time. So I'm, uh, outsourcing my teaching. But I'm also really interested.

EDIT: Can a mod move this to OT, I meant to post it there.

 

[harsh.ag]

My econ prof advising us all to buy gold

 

[Shri]

not much

i only started reading about it seriously a few years later

 

[silentstriker]

I remember when all of a sudden people were talking about dollar figures in the trillion dollar range. I distinctly remember that. Like oh, we may need a "trillion dollar bailout". Those type of numbers didn't really seem to be in the public debate before, for anyting.

 

[smalishah84]

I remember the palpable fear of being laid off any moment (thankfully I didn't get laid off) but hearing people getting laid off left right and center

 

[Uppercut]

I remember when all of a sudden people were talking about dollar figures in the trillion dollar range. I distinctly remember that. Like oh, we may need a "trillion dollar bailout". Those type of numbers didn't really seem to be in the public debate before, for anyting.

Haha, I remember it feeling kind of ephemeral, and totally left-field. People thought the world-as-we-know-it would end with a terrorist attack or a nuclear war. Instead it was like "some American investment banks have gone out of business. Turns out that means it's the apocalypse."

 

[weldone]

I struggled to get my first job (2009) of a standard anywhere near I could normally expect after my post-graduation

Later I found out that Companies in India stopped hiring just due to being cautious; the impact of global meltdown in India (except stock markets) was minimum and short-lived.

 

[Cabinet96]

I remember going home from school and seeing huge queues outside of Northern Rock.

 

[andruid]

I remember the Guardian's Steve Bell caricaturing Gordon Brown breaking his teeth on the new breakfast cereal 'Credit Crunch'

 

[cpr]

The timing of it was most unfortunate for me. I'd just started my first 'proper' job with the tax office (i'd been working full time for about 2 years, but nothing career worthy) 3 weeks before Northern Rock fell on its arse. Suddenly my plan of living at home for a few months until I found a house was out of the window. Before then banks were happy to issue 100% mortgages (I'd even seen friends get 102% mortgages on a 'do-upper'), but when the floor fell out the chance of getting on the housing market was yanked away. Having to move into rental soon after (mum cashed in on her house pretty quick to move up the coast somewhere cheaper as she knew RBS would offer her redundancy!) combined with public sector pay freezes has basically left me chasing my tail for years after.

A bit woe is me here, but I think I really got the brunt of the timing. If it'd been a year earlier I'd have been able to plan financially for a recession world. Probably wouldn't have been able to buy, but I'd have been able to make certain life decisions with recession in mind (ie start saving for a much needed deposit whilst living at home). Likewise a year later and I'd have been a homeowner in a secure job, it'd have been tight, but I wouldn't have been pouring thousands a year out in rent.

This is one of the reasons why many over 40 just don't understand how big a problem the recession was for young people at the time. Having jumped onto the housing market before the crash, their biggest worry was making sure they can keep the interest on their repayments low. Those trying to get on after (or at the time) had to watch lenders freeze up accessible mortgages for first time buyers, deposit share jump massively, and house prices accelerating at a rate far beyond even the kindest pay increases, meaning more needed for deposit again. The vicious circle of getting onto the ladder has really kicked the younger generations hard (and given I was literally about to step onto it, boy am I pissed about that)

 

[Shri]

on the plus side we always live like another recession is just around the corner these days

permanently

 

[sledger]

It's sort of become this massive shadow hanging over everything, like The Event in those Mitchell and Webb sketches, and I can't imagine a world where it didn't happen. But it's kind of hard to describe what it was like to people who were kids at the time. So I'm, uh, outsourcing my teaching. But I'm also really interested.

EDIT: Can a mod move this to OT, I meant to post it there.

I guess I was lucky enough to not really see any effects of it. I remember hearing about it constantly, but it never really changed that much for me personally apart from prices of things going up a bit. I was working full-time at the time, and it really did seem like business as usual so far as I was concerned. Mind you, these were the days in which I had very little knowledge of such things, nor did I have any inclination to learn.

 

[fredfertang]

When the **** first hit the fan I had a few sleepless nights but, fortunately, we always ran a tight ship at my firm and we survived intact. On a personal level I was already financially established, but fully understand the way cpr feels - that generation was absolutely shafted and still is

 

[andmark]

I was quite a hero by refusing to go to my secondary school prom because I knew the parents were struggling financially as everyone else was.

 

[Burgey]

Apparently it didn't happen.

Also, well targeted fiscal stimulus actually works.

 

[Uppercut]

Apparently it didn't happen.

Also, well targeted fiscal stimulus actually works.

I forgot you guys dodged it. You’re like the control group in a deeply unethical experiment.

 

[Burgey]

According to the Tories down here, it was just a European problem and the then govt should never have gone into debt to stimulate the economy and avoid a recession, which is what they did.

And it worked a ****ing treat. They basically went in for a program of every school getting an infrastructure project, which kep the construction industry and tradies going. The "school halls program" was then used as an apparent example of waste. Literally the only reverse NIMBY policy I've ever seen - everyone loved their hall/ library/ upgrade, but thought no one should have one. Also did a thousand buck cash hand out to every household to keep consumer demand up. That was also criticized because "Muh cheques being sent to dead people!" who, last I understood, couldn't actually cash one.

It was an interesting exercise - basically Treasury heads told the PM an cabinet "Go hard, go early, go households." I get the impression they had sort of disaster-rehearsed for it within the bureaucracy, which is to their enormous credit.

Certainly better than the austerity bullshit you lot have had for nigh a decade, which has bred nothing but more misery by all accounts.

 

[GIMH]

**** loads of redundancies

 

[stephen]

I forgot you guys dodged it. You’re like the control group in a deeply unethical experiment.

We hardly dodged it, more softened the landing. The real economy contacted over the year (we avoided a technical recession by stimulating every other quarter). Equity markets dropped 50% (further than global markets) and rebounded much more slowly than global markets (and everyone is invested in equities through super in this country). We did better on unemployment, peaking at 5.8%, which is way better than the global average.

Basically overseas the landing was harder but the recovery faster. Australia had a softer landing (due in large part to the government's financial position at the time - no net debt gave the freedom to stimulate the economy).

There were a number of businesses who went under and the deposit guarantee basically cemented the big four banks as the only game in town (thankfully that's no longer the case).

Avoiding a recession was a huge win for the government and economy of the time because it meant that confidence was higher than it would otherwise have been, meaning spending didn't drop as badly as it could have. Many equities survived by doing multiple successful capital raisings over the time (turns out there was a lot off spare cash floating about after 17 years of growth). Schools ended up with a couple of extra demountables and Australia now has a substantial amount of debt again. A number of industries got annihilated though. The high dollar of the time killed a lot of software development studios (particularly video games studios) and a lot of the bigger players snapped up the cheap assets on the table, meaning we now have fewer competitors in a lot of industries. Personally software companies did massive layoffs which didn't directly affect me, though I could easily have lost that round of Russian roulette.

So yeah, Australia did get smashed, but not perhaps as badly as others. Which is offset by our far slower recovery.

 

[Bahnz]

My abiding memory of the crash is walking into one of my last classes in my honours year in economics on the morning that Lehmans went under, and watching all the would-be financial sector employees in basically shitting themselves. I was lucky enough to get a job at the Treasury a few weeks after I finished school even though applications for graduate positions had already wrapped up months earlier - they obviously took the attitude that "this is the last time for a while that we're gonna have any money in our budget for hiring people, so might as well splurge a bit". The atmosphere within Treasury was fairly tense - I know there was a war room of senior policy and financial sector experts who basically worked 16 hour days for the next few months until things settled down. It was pretty shocking going to a couple of the organisation wide briefings and finding out that more or less overnight the Government had gone from being billions in surplus to being billions in debt.

NZ didn't fair too poorly in the end because Australian law had mostly forced the Aussie-owned banks to keep their noses out of the worst of the dodgy financial products that Wall Street was creating. Also the National government over here didn't go full-austerity and instead decided more or less to run up debt in order to cut taxes and keep the public services on a BAU footing. All up it worked fairly well (I still get worked up about all the crap I saw at the last election about how awful it was that national debt had grown under the National government).