Recession & Economic downturn

So it’s been increasingly predicted with some tangible evidence an economic downturn is coming.

I have asked the question on another thread about the impact on silver and gold bullion.

But now what is the impact on each of us and more importantly how do we protect what wealth how little or large we have left?


For example
I have read across multiple outlets at the end of 2023 or even middle of 2024 house prices will be down around 25% , it will be a good time to invest in housing but by then anyone with savings in £s will have lost over 25% of its value due to inflation.
So actually that bargain house is costing you more!

The least bad situation is your money rises with inflation.
Historically the rule is the same, only commodities rise with inflation or above inflation with few exceptions.

At some point silver will increase in value significantly, if after masses of government money printing, wars, energy crisis and world wide recession are not the trigger then what is?!

The gold to silver ratio is too large we are at 90:1

I don’t see any slow down in the gold price, infact I expect $2,000 an ounce to be the minimum going forward.
Transferring £10k into gold won’t see a huge return.
Of course it unlikely to go down, the government can’t print gold.

So logic then takes me to silver increasing in value.
But why?
Again, the government can’t print it.
There has been increased retail demand since Covid.
Silver is still mined at a ratio of 8:1 compared with gold, that hasn’t changed much.

The reason I ask this question is my friend has approached me , he has £80k from his recently departed parents and doesn’t know what to do with it.
The one thing we both agree on the answer is not to leave it in sterling.

My default answer to him was buy physical silver! But he is not sure.
I’m maybe naive but I don’t see many other options.

I think the " buy physical silver " is correct. If you look at SPOT price atm, it is lower in ratio than Gold and also it is overall low. 

Yes I appreciate the house idea. However if one could afford to purchase property outright than I would suggest that. 

Gold, well it is not too high but it is neither cheap. The Spot price again is as you stated above, at a point where a return would be unlikely if any at this point. 

Crypto, something I did not see you mention and in my opinion a good thing.... but HECK NO. 

Savings, or ISA, ... NOPE that banks have not bothered to put the interest rate up for us savers as well. 

So Physical Silver. YES.

Robert Kiyosaki (Rich dad poor dad author) has added his voice to those of Jamie Dimon, John Waldron, Warren Buffet, Charlie Munger, Elon Musk and other quite prominent people in saying worst crash in history is coming. None of them people I would care to contradict.

I had better start stacking…baked beans, instant noodles and candles.

Funny you wrote that, as in Germany they are having a toilet roll shortage and people are either being rationed to 4 loo rolls at a time or buying them from across the boarder in Poland!

"British households borrowed on their credit cards last month at the fastest annual rate in over 17 years, a potential reflection of consumers struggling to make ends meet as the cost of living crisis intensifies. According to data from the Bank of England, the annual rate of credit card borrowing in July was 13%"

Never mind govt debt, private debt is far more significant.
Is the UK set for a wake up call?
You have to pay it back at some point?

Yes, they're a great way to pay but a terrible way to finance. I don't know what the answer is, and it is simplistic to say people must cut down, but I remember what conditions were like when I was a child (no central heating or double glazing and no washing machine, just a boiler with a mangle) and later on our mortgage peaked at c 13%. I do suspect that things that I still see as luxuries are thought of as necessities, and I have no doubt that my parents' and grandparents' generation thought exactly the same about their descendants (Soap! Who needs soap?). Whatever their faults (and there are many, I'm certainly not carrying a torch for them) the energy companies can't be expected to sell cheap if they are having to buy dear , and they lost c£20bn in 2020. I think the lack of a sensible energy policy, that made no requirement for resilience, at Government level has dropped us into this hole, and it will take a while to get us out of it, while people who struggle to afford necessities have an even harder time of it.

SanMarino wrote:"British households borrowed on their credit cards last month at the fastest annual rate in over 17 years, a potential reflection of consumers struggling to make ends meet as the cost of living crisis intensifies. According to data from the Bank of England, the annual rate of credit card borrowing in July was 13%"

Never mind govt debt, private debt is far more significant.
Is the UK set for a wake up call?
You have to pay it back at some point?

There have been a lot of reports of banks removing overdrafts without consulting the customers and energy companies are being a lot more aggressive regarding late payments etc. Potential dark times ahead, unless there is a massive change.

No one is talking about the excessive electricity that has been produced by renewable energy throughout the summer that has been ‘thrown away’ because the Uk government and its governing body OFCOM do not make electricity producers or suppliers store excessive electricity.
Yet throughout Europe it’s a pre requisition to any private company selling electricity or gas on the national grid.

Why ?
Because they would rather let the companies keep making multiple millions in profits for their shareholders and senior managers than do what’s right for the general public, the nation and the environment.

They should also separate the cost of electricity and gas, electricity is considerably cheaper than gas to produce and supply.

Interesting read

https://duncanweldon.substack.com/p/whats-in-the-price