Yesterday I was talking to a friend who works in the City.
The way he explained the situation is like this.
If you have a good party then you will end up with a hangover. What the Government are doing at the moment is staving off the hangover by giving out more booze.
He reckons there is a lot of surplus in financial sector, which needs to go, probably the same in a lot of different sectors. The sooner this gets sorted the sooner things can start picking up, this is from a guy who thinks his job has a 75% chance of being gone within a year.
His prediction is a rally in share prices as the big players pick up some bargain price shares, but then a proper crash as these people unload them to grab their share of the silver. Due to our intrest rates the pound won't be such a good investment and the currency dealers will be putting their money into other currencies. Not being a manufacturing economy we will end up importing inflation.
The way I see it there are three stages we will go through. Denial, deliberation and action. At the moment it's denial. So many seem to think it might get bad but not as bad as they say. So they will quite happily plod on and wait to see what happens. By the time we need to take action it's probably going to be a lot more painful.
My usual work is extensions, loft conversions etc. but that is definately tightening up. I'm not seeing this big increase in extending rather than moving, so I'm starting my action now. I've started looking at the small jobs, a couple of days work, at prices that basically cover the wages. This is giving me a different type of client base, and being known for good prices. If it goes t1ts up the I'll need might need a lot more of this type of work, if it doesn't and I keep getting plenty of big jobs, then I've just done some work without profit just wages.
