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Good news for the prudent: we’re heading for recession

Richard Northedge

Wednesday, 9th July 2008

Richard Northedge says those who did not overspend during the boom years will soon be able to buy whatever they want at bargain prices, perhaps even with borrowed money

So Britain is talking itself into recession. Keep chattering. If people want a recession, let them have one, so that the rest of us can benefit from it. This is not a suggestion that cold showers do us good or that a spell of reality in the housing market is overdue; it is a reminder that when other consumers have lost their confidence, the bold can take advantage of their apprehension.

Slumps mean opportunities. When the majority are out of the market place, the brave can go there without being crushed or outbid. This is the time to be counter-cyclical. If for the past five years no builder even had time to give you an estimate, next year you will be swamped with workmen undercutting each other to win your job. Want a new carpet? They’ll be virtually giving them away to clear their stocks. Itching for a break in America? Watch the airlines slash prices to fill empty seats, even as aviation fuel prices soar.

It is not that we want a recession — a buoyant economy should generally be better for everyone — but if there is one coming, we must make the most of it. After all, we deserve it. Throughout the boom years the prudent among us held back from the vulgar rush to buy bigger sofas and Spanish time-shares, put off by inflated prices and packed shopping centres. Cautious consumers did not remortgage their homes to buy boats or holidays they could not afford, or run up credit-card bills to use tomorrow’s pay packet to finance yesterday’s purchases.

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