"Credit Crunch"

[Easily Led]

Along with the term "journey", hardly a hour goes by without someone mentioning the threating situation which has this tasty sound bite name: "Credit Crunch". Well this summer economic laxity has bitten me too. Since I am frivolous by nature and have developed a very bad dance dependency (alongside the mysterious need for expensive new shoes), I need to tighten things up in a few areas and am in a position of having to put on a few pounds (financially) a month. My nearest "adviser" has suggested that if I could spend just £25 less per month , I would, like Mr Micawber, be able to live within my means. I wonder if anyone has any "fun" suggestions of ways to save money besides the inevitable "spend less"? (Especially dance related savings).

Today I visited "Aldi" s supermarket for the main weekly shop .... (instead of Waitrose / Tesco).

Are "Admit Ones" worth the initial expense?

[robd]

I wonder if anyone has any "fun" suggestions of ways to save money besides the inevitable "spend less"? (Especially dance related savings).

Today I visited "Aldi" s supermarket for the main weekly shop .... (instead of Waitrose / Tesco).

There was a suggestion in the paper I was reading yesterday that many people are going to the likes of Aldi rather than Tesco, etc and this has prompted in part the 'Milk Price War' currently underway.

I saved between 500 and 600 pounds during July - I had a big car bill after Southport and also chose to buy the parts for a new PC in June so I needed to recoup some of this expenditure. My main cutbacks were dancing (and especially the fuel getting there) - I only went dancing twice in the month -and making lunches instead of buying them. I also bought multipacks of things like crisps and choc bars at the supermarket rather than buying them singly. Pretty dull and not really what you were asking for but I was still suprised at how much I managed to save.

[Dreadful Scathe]

An easy way to save money is to buy food etc... cheaper. Here are some supermarket reviews. Part of the problem is people can be slightly snobbish about some supermarkets and do tend to believe at least some of the hype . We vary our shop between Lidl's for organic milk, lunch meat etc..., Aldi have some great sauces...farmfoods for pure fruit ice lollies (at less than half the price of tescos for the SAME brand), tesco still gets the bulk of our shop money but we avoid the (occasional) pre-packaged stuff and get that instead from M&S(well ok, thats not generally a money saver).

[Chicklet]

Loads of obvious ones here, have been on my own case these last few months to try and find pennies for a big hol in Jan.

In no particular order:

....watch out for the famous two for threes etc when buying perishables...might look like a bargain but if you went in for one, will you really eat / drink the second and the third before they are rank?
I employ the sniff test instead of the sell / use by date nonsense but still try to think twice about whether a bargain really is a bargain, espec on fruit.

Eat up the freezer and the back of the cupboards before starting again.
Lots of people have emergency cans for when there's a war on - eat that soup up.

Ditto with cleaning products (except don't eat them), get everything out of the cupboard under the sink to see what you've got. If you use a dishwasher every day / other day see if you can squeeze an extra day out of the routine by making sure everything is packed in tidy.

Make sure you have a pair of scissors handy to get another three days out of the corners of the moisturiser / hand cream / deep heat tube.

Make sure you USE your Boots advantage points card and their two fors and three fors for anything that you use religiously that won't be wasted but before that, check the cupboards for half used shampoos etc and use em up.
Old face moisturisers that give you spots won't give you spots on your feet, use them as body lotion.

Don't buy branded loo or kitchen roll. Does your arse really need to be caressed by puppy dog fur? Use a loo roll instead of tissues.

Do dogs and cats really need branded food? Put them on a diet lol.

This is the hardest one for me - check your own shelves regularly to remind yourself how many books / DVDs you have unread / unwatched so you can WALK ON BY Watersones and Borders or if you must have it check e-bay, Amazon used and Abe books for a second hand copy.

Have you got a gym membership? Do you really use it? If so, do they have an off peak tarrif and would that work?

What have you got on your shelves or in your wardrobe that you don't use or wear? Does it all REALLY fit?? Could a night of putting things up on e-bay be worth £100? I still amaze myself what people will buy. (13 x used 32 DD bras anyone?? I got £26 from a 99p start for them )

Take everything out of your wardrobe one rainy night and make up some new outfits instead of buying new clothes.

Grown ups DON'T NEED Heat magazine every Tuesday (maybe every other Tuesday just)

You can get two cups of tea out of every bag if you squeeze hard with a spoon.

If your tap water is drinkable don't buy any, remember to fill a bottle for out and about.

I'm also trying the switch off at the wall thing for leccy, don't know that me bill was / is high enough anyway for that to be a noticeable diff but it's a double whammy cos you get green points too

Cut beauty shop facials, pedis and reflexology to every six weeks rather than once a month.

Now where did I put that jumper I'm unravelling to re-knit?????

[robd]

I still amaze myself what people will buy. (13 x used 32 DD bras anyone??

You're amazed that people buy used underwear? Welcome to the Internet

[Chicklet]

You're amazed that people buy used underwear? Welcome to the Internet

you're not wrong!
I do wonder sometimes if I'm now on some kind of government list as a "supplier"

[Georgious dancer]

This is the hardest one for me - check your own shelves regularly to remind yourself how many books / DVDs you have unread / unwatched so you can WALK ON BY Watersones and Borders or if you must have it check e-bay, Amazon used and Abe books for a second hand copy.

Hi Chicklet,

Sounds like you have a similar problem to me, I just can't resist the new book thing! I have just started looking at book swapping as a way to get new books without paying out too much money (except for posting) and making sure my old books get some more use! I belong to a book forum and you can advertise books that you want to swap with others! If you've got anything you fancy swapping let me know by PM!

Easily Led, hope the money saving is going well. When I need to save money I try and walk rather than drive where possible. With the current price of petrol this could be quite good!

Also the economy brand stuff, food wise, is not always so bad. Asda Smart price smoked salmon is just the off cuts of the more expensive salmon from Youngs that was the wrong size for Youngs!

[~*~Saligal~*~]

Avoid using a clothes dryer if you can... they eat up a lot of power.
Also, turning off appliances rather than leaving them on stand-by mode can save a little too.

[Daisy Chain]

This is the hardest one for me - check your own shelves regularly to remind yourself how many books / DVDs you have unread / unwatched so you can WALK ON BY Watersones and Borders or if you must have it check e-bay, Amazon used and Abe books for a second hand copy.

Join the library. Books are free. I've been a member since early childhood when my parents couldn't afford to feed my bookish habit.

Daisy

(A Well-Read Little Flower)

[Chicklet]

Join the library. Books are free. I've been a member since early childhood when my parents couldn't afford to feed my bookish habit.

Daisy

(A Well-Read Little Flower)

Absolutely !

One of my downstairs rooms actually IS a library, two whole walls of books and a coal fire, fab for the winter. Unfortunately my two local ones cater much more for the Catherine Cookson and John Grisham crowd than for my colonial history and travelog habits! But I am down there for story tapes every couple of weeks.

[Whitebeard]

You can get two cups of tea out of every bag if you squeeze hard with a spoon.

What !!!! Washupwater tea ?? No, no, no, it takes two bags of strong Assam to make a decently coloured mugga. And three spoons of sugar, with just a dash of semi-skimmed.

Give up chocolate instead !!!

[Astro]

There was a suggestion in the paper I was reading yesterday that many people are going to the likes of Aldi rather than Tesco, etc and this has prompted in part the 'Milk Price War' currently underway.

Whichever supermarket you shop at, always check your bill before you leave the store.

I must have saved hundreds of pounds over the years by checking.

Tescos and Sainsburys being the worst at overcharging.

Plus if you buy special offers, check that you've only paid what you expected to as it's easy for them to trick you.

For instance you may have got the wrong size BOGOF of Domestos.

(have not read the whole thread yet, so sorry if it's been mentioned).

I also bought multipacks of things like crisps and choc bars at the supermarket rather than buying them singly.

Buy in bulk,eat in bulk.
Expanding waistline.

[Feelingpink]

... My nearest "adviser" has suggested that if I could spend just £25 less per month , I would, like Mr Micawber, be able to live within my means. I wonder if anyone has any "fun" suggestions of ways to save money besides the inevitable "spend less"? (Especially dance related savings).

Today I visited "Aldi" s supermarket for the main weekly shop .... (instead of Waitrose / Tesco).

Are "Admit Ones" worth the initial expense?

My suggestion would be to look at Money Saving Expert: Consumer Revenge - Credit Cards, Shopping, Bank Charges, Cheap Flights and more for ideas. The founder, Martin Lewis, goes through a number of things that don't 'hurt' your quality of life, such as checking that you're on the cheapest electricity tariff, cheapest credit card interest etc ... then trying things like you've just done with Aldi. There's also a fantastic thing called the demotivator, where you key in something you spend money on that you don't really need, say a Starbucks latte, and it can tell you how much money you will save per month if you give it up.

If you haven't done any of these cost- cutting exercises before, I would have thought that you could easily save £25 a month.

[Rachel]

...I wonder if anyone has any "fun" suggestions of ways to save money ...

Ooops I just noticed the word "fun" in your question. Sorry for my rather over-serious response!! I enjoy it though...


Yes, I am a wannabe accountant ...

[Beowulf]

this tasty sound bite name: "Credit Crunch"

Perhaps it's just me , but when I hear the words "Credit Crunch" I immediately think of some form of Breakfast Cereal.

"Housing market bunged up? suffering from painful bloating due to enlarged gas bills? The why not start the day with a healthy bowl of new Credit Crunch. A source of natural financial fibre, low in interest and saturated tax and proven to reduce cash flow clogging cholesterol*. Belt tightening has never been so tasty.

Now available in two exciting flavours .. Original Strawberry sub-prime and honey coated housing crash.

*When taken as part of a credit controlled diet. Please consult your financial advisor before starting any belt tightening regime"

[Bibi]

Food for thought

CrossingWallStreet.com: The Three-Month T-Bill

[marcusj]

Interested to receive the views of those working in the City - was the primary cause of the start of the troubles people in the US defaulitng on sub prime mortgages, or was it the financial sector creating and trading in derivatives they didn't understand the full implications of, or a bit of both ?

[JiveLad]

Interested to receive the views of those working in the City - was the primary cause of the start of the troubles people in the US defaulitng on sub prime mortgages, or was it the financial sector creating and trading in derivatives they didn't understand the full implications of, or a bit of both ?

Well there would not have been any defaults - if the money had not been lent in the first place.

As banks/financial institutions became more expert in financial wizardry then, as the regulatory framework loosened up (together with lower interest rates) - then all the ingredients are there for more risk taking.

Interesting to hear the description of how the Halifax Building Society was formed back c. 1850. The guys got together for a coffee and wrote in an exercise book to the effect, we will take savings from the local community and then lend money to the local community for buying houses.

In recent times, that model changed so with the globalisation of financial markets the effects ripple through the world. Who knows who is exposed to what risks?

I sense there is a lot more to come............more banking consolidation for sure. More 'scares' (there is nothing to be frightened of really - but that's another thread). And longer term, US defence spending is likely to suffer (at least in relative terms) - as the dollar drops and fiscal changes come in to play - so what will that mean? Will China or Russia become 'top dog'? Or will Ceroc gain world domination? Only time will tell.
After spending time in China in 2006, I remarked that it was more capitalist than the USA. Now with Fannie and Freddie under the wing of the government the USA is moving more towards being a socialist republic (see FT today for a good analysis of that).......

Time for a rule change to allow Arnie to become the boss?

And where is the great British leader of our times?

Nick Clegg anyone?
David Cameron?
Gordon Brown? .....not enough rofl's to fit on the page.

[Bibi]

Interested to receive the views of those working in the City - was the primary cause of the start of the troubles people in the US defaulitng on sub prime mortgages, or was it the financial sector creating and trading in derivatives they didn't understand the full implications of, or a bit of both ?

You are right! It is everything you say

But I don't agree that derivative trading is to blame just because things have gone sour. Trading in Futures and Options has aided immensely to create healthy economic growth globally and many can argue that this sector might see us through these times. To understand the what went wrong we have to look at the history of the Derivates as the industry has gone through changes over the years

CBOT (Chicago Board of Trade) founded in 1848 - the first organised Futures market for grains. The Grain Market literally exploded! These were very good times indeed! Farmers were in the biz - their produce would secure prices whether or not it was a good crop or not because of the concept of Futures i.e. agreeing to buy and sell a standard quantity of a specified asset on a fixed future date at a price agreed today. Around this time, the first customized option contract were offered.

1970’s: Dawn of Financial Derivatives - Good Economic Times
- Introduction of standardized options
- Deregulation of foreign exchange rates. So when foreign exchange rates became free floating, new currency markets (example Eurodollar) developed and also markets for trading customized forward contracts in foreign currencies were formed. The players were and still are domestic international banks who set the stage for the banking industry to become more involved in trading of other types of financial derivatives.

1980’s: Age of Deregulation - Good Economic Times and ofcourse the "Yuppie" era!
The idea - to create products designed to alleviate the risk exposure to “certain situations” and “certain players” Banks were not the only ones profiting from financial derivatives designed to pass on the risks elsewhere - investment banking firms (derivatives dealers) soon joined in this space of derivative markets.

1990’s: Electronic Trading - Still good economic times
Saw a period where the Exchanges went though changes - some merged, some consolidated but they all had one thing in common - the need for less regulation. Aside from organisational changes, derivative exchanges changed the way they traded and moved from the floor to the “screen” and electronic trading was born. Many did not fully understand the topic of risk management systems and this coupled with less regulation resulted in derivatives dealers possibly trading above limits. However, in today’s climate, investors appetite for risk has reached it’s lowest level ever as they adopt the “most risk-adverse mindset yet recorded” as reported in CITY-AM

21st Century - yes here we are. Credit Crunch. The general consensus London and New York are the world’s primary markets for derivatives.



Bibi

(Source: Futures Industry).
In terms of size, today the U.S. accounts for almost 35% of futures and options trading worldwide. However, the Korea Stock Exchange is the largest derivative exchange in the world. The second largest by volume is the Eurex (German-Swiss), followed by the Chicago Board of Trade, the London International Financial Futures and Options Exchange, the Paris bourse, the New York Mercantile Exchange, the Bolsa de Mercadorias & Futuros of Brazil, and the Chicago Board Options Exchange. Note that in 2001, these exchanges traded in aggregate 70 million derivative contracts

[marcusj]

You are right! It is everything you say

But I don't agree that derivative trading is to blame just because things have gone sour. Trading in Futures and Options has aided immensely to create healthy economic growth globally and many can argue that this sector might see us through these times. To understand the what went wrong we have to look at the history of the Derivates as the industry has gone through changes over the years

CBOT (Chicago Board of Trade) founded in 1848 - the first organised Futures market for grains. The Grain Market literally exploded! These were very good times indeed! Farmers were in the biz - their produce would secure prices whether or not it was a good crop or not because of the concept of Futures i.e. agreeing to buy and sell a standard quantity of a specified asset on a fixed future date at a price agreed today. Around this time, the first customized option contract were offered.

1970’s: Dawn of Financial Derivatives - Good Economic Times
- Introduction of standardized options
- Deregulation of foreign exchange rates. So when foreign exchange rates became free floating, new currency markets (example Eurodollar) developed and also markets for trading customized forward contracts in foreign currencies were formed. The players were and still are domestic international banks who set the stage for the banking industry to become more involved in trading of other types of financial derivatives.

1980’s: Age of Deregulation - Good Economic Times and ofcourse the "Yuppie" era!
The idea - to create products designed to alleviate the risk exposure to “certain situations” and “certain players” Banks were not the only ones profiting from financial derivatives designed to pass on the risks elsewhere - investment banking firms (derivatives dealers) soon joined in this space of derivative markets.

1990’s: Electronic Trading - Still good economic times
Saw a period where the Exchanges went though changes - some merged, some consolidated but they all had one thing in common - the need for less regulation. Aside from organisational changes, derivative exchanges changed the way they traded and moved from the floor to the “screen” and electronic trading was born. Many did not fully understand the topic of risk management systems and this coupled with less regulation resulted in derivatives dealers possibly trading above limits. However, in today’s climate, investors appetite for risk has reached it’s lowest level ever as they adopt the “most risk-adverse mindset yet recorded” as reported in CITY-AM

21st Century - yes here we are. Credit Crunch. The general consensus London and New York are the world’s primary markets for derivatives.



Bibi

(Source: Futures Industry).
In terms of size, today the U.S. accounts for almost 35% of futures and options trading worldwide. However, the Korea Stock Exchange is the largest derivative exchange in the world. The second largest by volume is the Eurex (German-Swiss), followed by the Chicago Board of Trade, the London International Financial Futures and Options Exchange, the Paris bourse, the New York Mercantile Exchange, the Bolsa de Mercadorias & Futuros of Brazil, and the Chicago Board Options Exchange. Note that in 2001, these exchanges traded in aggregate 70 million derivative contracts

Thanks Bibi - an interesting and informative reply.

Maybe I have a naive view but for me futures and options in the early days were simple and understandable not only to those that created them but to those that used them, they allowed people to buy certainty with the people selling the financial products an opportunity to turn a profit.

In more recent years I think things have gone a bit haywire with even the people creating the financial products not understanding their full implications and potential impacts.

Once again I must be naive, even though I am an accountant and operate in the financial world, I have real trouble with the concept of people making huge sums of money gambling with others people's money, all the upside and little of the downside, and the world somehow thinks it's more honourable than the shady bloke in the betting shop putting his own money on the horses.