Did our economy ever recover from the 2010 flash crash?

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nnth
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Did it recover in all areas or only in some?
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(Original post by nnth)
Did it recover in all areas or only in some?
When you say did the economy recover, you need to qualify it. The stock markets appear to have recovered in the main. Fuel prices appear to be returning to pre-lockdown prices. But the economy is tanking big style right now with output way down mainly due to travel and hospitality businesses being shut and people furloughed. When things reopen, our towns and cities are going to look very different indeed and after an initial upswing, I reckon it is going to be several years before you might say we have recovered. At worst it will be a decade or more, especially as Brexit starts to properly bite.
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"When you say did the economy recover, you need to qualify it." Okay

"The stock markets appear to have recovered in the main. Fuel prices appear to be returning to pre-lockdown prices. But the economy is tanking big style right now with output way down mainly due to travel and hospitality businesses being shut and people furloughed. When things reopen, our towns and cities are going to look very different indeed and after an initial upswing, I reckon it is going to be several years before you might say we have recovered. At worst it will be a decade or more, especially as Brexit starts to properly bite."

It seems like you're talking about the impact of covid on our economy here... When I said the flash crash, I meant the one that happened a decade ago, in 2010. I think you misunderstood me. However, lockdown and covid will have a similar effect on the economy too, probably more of a detrimental one.

I was just wondering whether our economy ever really recovered from the 2010 flash crash. If so, was it just particular areas? Or every sector?
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nnth
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"When you say did the economy recover, you need to qualify it." Okay

"The stock markets appear to have recovered in the main. Fuel prices appear to be returning to pre-lockdown prices. But the economy is tanking big style right now with output way down mainly due to travel and hospitality businesses being shut and people furloughed. When things reopen, our towns and cities are going to look very different indeed and after an initial upswing, I reckon it is going to be several years before you might say we have recovered. At worst it will be a decade or more, especially as Brexit starts to properly bite."

It seems like you're talking about the impact of covid on our economy here... When I said the flash crash, I meant the one that happened a decade ago, in 2010. I think you misunderstood me. However, lockdown and covid will have a similar effect on the economy too, probably more of a detrimental one.

I was just wondering whether our economy ever really recovered from the 2010 flash crash. If so, was it just particular areas? Or every sector?
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ThomH97
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No, because our economy is still too dependent on ever increasing house prices. So much so that it was permitted to travel through all the various tiers to visit other people's homes in order to buy/move.
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(Original post by nnth)
Did it recover in all areas or only in some?
Recovered in all. It was only a 0.5% fall. Recovered the next quarter, ie Q1 2011. Then there was year on year growth for eight years.

Why on earth do you ask?
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(Original post by Quady)
Recovered in all. It was only a 0.5% fall. Recovered the next quarter, ie Q1 2011. Then there was year on year growth for eight years.

Why on earth do you ask?
It's quite a random reason :blushing:... basically, I was looking at the difference between the search terms "women composers" and "composers" on google trends. However, from 2004 to 2019, I saw a large decline overall in the amount of searches for composers.
Name:  decline in searches for composers.png
Views: 16
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So, I was wondering whether the 2010 crash had any impact on this at all? Maybe my original question should've been more specific...
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Rakas21
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I feel the need to point out that the Flash Crash was a one day stock market event.
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(Original post by nnth)
Did it recover in all areas or only in some?
We have been in a K shaped recovery for a long time. However more people are finding themselves on the lower end. This is where the Useless Eater and Zombie terms come in.

You will get the Tories and Labour promising heaven and earth but the reality is they don't control the world. Amazon, Google, Facebook and Twitter control the world.

We are near the last phase of the crash. This is where the strong literally cut off the life lines to the weak. Its where you will see a lot of civil unrest and poverty. Tier 2 societies are popping up all around the UK. London is turning into a sht-hole and gated-towns and springing up in promising privacy & security away from the riff-raff.

If you've taken a BA you seriously need to dump it and choose a STEM course or skills-based course. There is no future for artists or cucks.
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(Original post by Rakas21)
I feel the need to point out that the Flash Crash was a one day stock market event.
No it wasn't, it covered the entire quarter.
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(Original post by Quady)
No it wasn't, it covered the entire quarter.
https://en.m.wikipedia.org/wiki/2010_flash_crash
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(Original post by nnth)
Did it recover in all areas or only in some?
It recovered, but when it did it benefited far fewer people. I was a fairly recent graduate in 2008 when Lehman brothers collapsed, I'd been working in back office banking for around 4 years at that point. So I'm one of the few millennials who really experienced pre-crash working life and what I've noticed in the past 13 years is that we're paid less in real terms (for example new graduates don't really get paid much more than I did when I started in 2004 despite 17 years of inflation), we pay more tax on our salaries (national insurance has increased by 2% for everyone) and we've lost access to benefits that were previously universal (e.g. I'm a parent now but child benefit is means tested these days so we don't get it). Salaries in various industries have been stagnant for over a decade now with no end in sight. COVID means millennials younger than me and gen Z that follows will probably experience this hangover for the rest of their working lives.

However, there have been beneficiaries because the productive capacity pre-COVID was back to normal. However, certain decisions were made in 2008 that baked in inequalities - especially generational ones - that mean wealth now trumps income and by extension it's a lot harder to work your way to wealth rather than inherit it.

For example, the Bank of England slashed interest rates right down in 2008 and they've barely risen and then dropped again with COVID. This meant those who bought a house pre-2008 enjoyed massive drops in the cost of their mortgages and also increases in the value of their homes as the drop in interest meant people could temporarily afford higher prices (new affordability rules in the mid-2010s and Brexit finally stopped this). Consequently Gen Z find themselves in a position where wages have stagnated, the cost of a home (both to buy or rent) has rocketed, they seldom meet the bank's new affordability rules and they therefore have to rent. This in turn has pushed up demand on rental property and the cost of rents are often significantly higher than the costs paid to service the mortgages by buy to let landlords. The crash made this far worse and this huge social problem has persisted for over a decade with no end in sight. (A decent government would limit mortgage interest relief on investment property not just for individuals earning over a certain amount but on all individuals regardless of income and on companies too. However, the Conservative governments we've had over the last 10 years have been ideologically opposed to this).

Another decision has been to try and achieve a budget surplus. Essentially you get budget surpluses when governments tax their citizens more than they need to and what has happened is that the Conservative Government has focused on cutting spending and taxing more but focusing this on younger generations. For example, income tax that everyone pays has not risen since the crash but national insurance that people stop paying when they reach retirement age has risen a whopping 2%. Child benefit has been means tested, but state pensions haven't. Nursing training costs have been handed over to trainee nurses and only partially returned. Schools funding has been cut in real terms. Local governments have cut and cut to the extent that one day taxes will have to rise substantially just to stop bits of infrastructure like roads and bridges collapsing because of inadequate maintenance in the short term. So young people and the public sector really haven't recovered.

Business is a hard one because business is unrecognisable in 10 years. I only bought my first smart phone 10 years ago. Most people I know bought them around the same time, maybe a year earlier. The proliferation of apps to transact means some businesses have gone and new ones have taken their place but I think business was as strong immediately pre-COVID as it was in 2005. The difference though is that less of that money trickles down because firms offshore more, they automate more and they use cunning wheezes to avoid treating people who work for them as employees (although Uber has come a cropper on that one of late). The gig economy wasn't something many people talked about in 2008 because you didn't really have Uber, Deliveroo, Just Eat etc.

I think as a result of Brexit and to a lesser extent COVID, the UK is now embarking on another period of slow growth or maybe even another recession. It's also unlikely the incumbent government are going to be out of office until 2028 at the absolute earliest and this is a government who depends for its votes on prioritising the needs of older voters over younger ones and stokes culture wars that makes it hard for the country to move on or find any common purpose amongst the populace in a post-Brexit future. So I think millennial and gen Z endurance of the 2008 crash will persist. They will continue to have lower incomes than the previous generation in the same job no matter what that job is, they will continue to pay far more for their housing and most of them will rent and they will find work more insecure both as a result of the gig economy and also because Brexit is taking a sledgehammer to businesses that export. Unfortunately I think it will be a long time before the UK even begins to address these problems because it has a government that is kept in place by an older mortgage free retired generation who are quite happy with the status quo.
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(Original post by AW_1983)
It recovered, but when it did it benefited far fewer people. I was a fairly recent graduate in 2008 when Lehman brothers collapsed, I'd been working in back office banking for around 4 years at that point. So I'm one of the few millennials who really experienced pre-crash working life and what I've noticed in the past 13 years is that we're paid less in real terms (for example new graduates don't really get paid much more than I did when I started in 2004 despite 17 years of inflation), we pay more tax on our salaries (national insurance has increased by 2% for everyone) and we've lost access to benefits that were previously universal (e.g. I'm a parent now but child benefit is means tested these days so we don't get it). Salaries in various industries have been stagnant for over a decade now with no end in sight. COVID means millennials younger than me and gen Z that follows will probably experience this hangover for the rest of their working lives.

However, there have been beneficiaries because the productive capacity pre-COVID was back to normal. However, certain decisions were made in 2008 that baked in inequalities - especially generational ones - that mean wealth now trumps income and by extension it's a lot harder to work your way to wealth rather than inherit it.

For example, the Bank of England slashed interest rates right down in 2008 and they've barely risen and then dropped again with COVID. This meant those who bought a house pre-2008 enjoyed massive drops in the cost of their mortgages and also increases in the value of their homes as the drop in interest meant people could temporarily afford higher prices (new affordability rules in the mid-2010s and Brexit finally stopped this). Consequently Gen Z find themselves in a position where wages have stagnated, the cost of a home (both to buy or rent) has rocketed, they seldom meet the bank's new affordability rules and they therefore have to rent. This in turn has pushed up demand on rental property and the cost of rents are often significantly higher than the costs paid to service the mortgages by buy to let landlords. The crash made this far worse and this huge social problem has persisted for over a decade with no end in sight. (A decent government would limit mortgage interest relief on investment property not just for individuals earning over a certain amount but on all individuals regardless of income and on companies too. However, the Conservative governments we've had over the last 10 years have been ideologically opposed to this).

Another decision has been to try and achieve a budget surplus. Essentially you get budget surpluses when governments tax their citizens more than they need to and what has happened is that the Conservative Government has focused on cutting spending and taxing more but focusing this on younger generations. For example, income tax that everyone pays has not risen since the crash but national insurance that people stop paying when they reach retirement age has risen a whopping 2%. Child benefit has been means tested, but state pensions haven't. Nursing training costs have been handed over to trainee nurses and only partially returned. Schools funding has been cut in real terms. Local governments have cut and cut to the extent that one day taxes will have to rise substantially just to stop bits of infrastructure like roads and bridges collapsing because of inadequate maintenance in the short term. So young people and the public sector really haven't recovered.

Business is a hard one because business is unrecognisable in 10 years. I only bought my first smart phone 10 years ago. Most people I know bought them around the same time, maybe a year earlier. The proliferation of apps to transact means some businesses have gone and new ones have taken their place but I think business was as strong immediately pre-COVID as it was in 2005. The difference though is that less of that money trickles down because firms offshore more, they automate more and they use cunning wheezes to avoid treating people who work for them as employees (although Uber has come a cropper on that one of late). The gig economy wasn't something many people talked about in 2008 because you didn't really have Uber, Deliveroo, Just Eat etc.

I think as a result of Brexit and to a lesser extent COVID, the UK is now embarking on another period of slow growth or maybe even another recession. It's also unlikely the incumbent government are going to be out of office until 2028 at the absolute earliest and this is a government who depends for its votes on prioritising the needs of older voters over younger ones and stokes culture wars that makes it hard for the country to move on or find any common purpose amongst the populace in a post-Brexit future. So I think millennial and gen Z endurance of the 2008 crash will persist. They will continue to have lower incomes than the previous generation in the same job no matter what that job is, they will continue to pay far more for their housing and most of them will rent and they will find work more insecure both as a result of the gig economy and also because Brexit is taking a sledgehammer to businesses that export. Unfortunately I think it will be a long time before the UK even begins to address these problems because it has a government that is kept in place by an older mortgage free retired generation who are quite happy with the status quo.
Why do you think the flash crash of 2010 had such a dramatic impact?
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Quady
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I assumed the OP was referring to this
https://www.theguardian.com/business...-five-per-cent

I suspect you're right though
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nnth
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(Original post by AW_1983)
It recovered, but when it did it benefited far fewer people. I was a fairly recent graduate in 2008 when Lehman brothers collapsed, I'd been working in back office banking for around 4 years at that point. So I'm one of the few millennials who really experienced pre-crash working life and what I've noticed in the past 13 years is that we're paid less in real terms (for example new graduates don't really get paid much more than I did when I started in 2004 despite 17 years of inflation), we pay more tax on our salaries (national insurance has increased by 2% for everyone) and we've lost access to benefits that were previously universal (e.g. I'm a parent now but child benefit is means tested these days so we don't get it). Salaries in various industries have been stagnant for over a decade now with no end in sight. COVID means millennials younger than me and gen Z that follows will probably experience this hangover for the rest of their working lives.

However, there have been beneficiaries because the productive capacity pre-COVID was back to normal. However, certain decisions were made in 2008 that baked in inequalities - especially generational ones - that mean wealth now trumps income and by extension it's a lot harder to work your way to wealth rather than inherit it.

For example, the Bank of England slashed interest rates right down in 2008 and they've barely risen and then dropped again with COVID. This meant those who bought a house pre-2008 enjoyed massive drops in the cost of their mortgages and also increases in the value of their homes as the drop in interest meant people could temporarily afford higher prices (new affordability rules in the mid-2010s and Brexit finally stopped this). Consequently Gen Z find themselves in a position where wages have stagnated, the cost of a home (both to buy or rent) has rocketed, they seldom meet the bank's new affordability rules and they therefore have to rent. This in turn has pushed up demand on rental property and the cost of rents are often significantly higher than the costs paid to service the mortgages by buy to let landlords. The crash made this far worse and this huge social problem has persisted for over a decade with no end in sight. (A decent government would limit mortgage interest relief on investment property not just for individuals earning over a certain amount but on all individuals regardless of income and on companies too. However, the Conservative governments we've had over the last 10 years have been ideologically opposed to this).

Another decision has been to try and achieve a budget surplus. Essentially you get budget surpluses when governments tax their citizens more than they need to and what has happened is that the Conservative Government has focused on cutting spending and taxing more but focusing this on younger generations. For example, income tax that everyone pays has not risen since the crash but national insurance that people stop paying when they reach retirement age has risen a whopping 2%. Child benefit has been means tested, but state pensions haven't. Nursing training costs have been handed over to trainee nurses and only partially returned. Schools funding has been cut in real terms. Local governments have cut and cut to the extent that one day taxes will have to rise substantially just to stop bits of infrastructure like roads and bridges collapsing because of inadequate maintenance in the short term. So young people and the public sector really haven't recovered.

Business is a hard one because business is unrecognisable in 10 years. I only bought my first smart phone 10 years ago. Most people I know bought them around the same time, maybe a year earlier. The proliferation of apps to transact means some businesses have gone and new ones have taken their place but I think business was as strong immediately pre-COVID as it was in 2005. The difference though is that less of that money trickles down because firms offshore more, they automate more and they use cunning wheezes to avoid treating people who work for them as employees (although Uber has come a cropper on that one of late). The gig economy wasn't something many people talked about in 2008 because you didn't really have Uber, Deliveroo, Just Eat etc.

I think as a result of Brexit and to a lesser extent COVID, the UK is now embarking on another period of slow growth or maybe even another recession. It's also unlikely the incumbent government are going to be out of office until 2028 at the absolute earliest and this is a government who depends for its votes on prioritising the needs of older voters over younger ones and stokes culture wars that makes it hard for the country to move on or find any common purpose amongst the populace in a post-Brexit future. So I think millennial and gen Z endurance of the 2008 crash will persist. They will continue to have lower incomes than the previous generation in the same job no matter what that job is, they will continue to pay far more for their housing and most of them will rent and they will find work more insecure both as a result of the gig economy and also because Brexit is taking a sledgehammer to businesses that export. Unfortunately I think it will be a long time before the UK even begins to address these problems because it has a government that is kept in place by an older mortgage free retired generation who are quite happy with the status quo.
Yes, so horribly true... We're living in a world where Baby Boomer Tories are leading Britain, with their mid-20th mind-sets which prioritize money over people. What's even worse, like you mentioned above, our country won't learn from the current epidemic or from Brexit and will likely vote for the tories in the coming decade. This is due to the majority of the newspapers being right wing, providing the public a right-wing perspective of the world, hence increasing the likelihood of them voting conservative.

It's common for you to move further right on the political spectrum as you age, to support and protect your wealth and land. So, the fact the population shape is transforming into a dome shows how the tories are really destined to have more power and elections, especially with the electoral system we currently have (first past the post).

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Quady
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(Original post by nnth)
Yes, so horribly true... We're living in a world where Baby Boomer Tories are leading Britain, with their mid-20th mind-sets which prioritize money over people. What's even worse, like you mentioned above, our country won't learn from the current epidemic or from Brexit and will likely vote for the tories in the coming decade. This is due to the majority of the newspapers being right wing, providing the public a right-wing perspective of the world, hence increasing the likelihood of them voting conservative.

It's common for you to move further right on the political spectrum as you age, to support and protect your wealth and land. So, the fact the population shape is transforming into a dome shows how the tories are really destined to have more power and elections, especially with the electoral system we currently have (first past the post).

Image
The Chancellor is a Millenial you know right?
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nnth
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The Chancellor is a Millenial you know right?
Really? No... I didn't know... I dropped gov. and politics and the start of year 12 and haven't been as in touch with the political state of Britain since. What do you think about his tactics as the Lord Chancellor?
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(Original post by nnth)
Really? No... I didn't know... I dropped gov. and politics and the start of year 12 and haven't been as in touch with the political state of Britain since. What do you think about his tactics as the Lord Chancellor?
Medieval.
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(Original post by Quady)
Medieval.
lol :lol: Why so?
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(Original post by nnth)
lol :lol: Why so?
DYOR
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