What happens during a recession????

ww2_nut

ww2_nut

I know this is a bit of a newbie question to ask, but as I have not lived through/ experienced a recession in my adult years, I am wondering what happens during a recession?
What industries suffer/ prosper?
Do house prices fail or increase?
Is finance harder to obtain?
Are particular regions worse off/ better off?

I look forward to all your responses :)
 
The sun still comes up, chocolate is still available at the shops and the local is still open on Friday nights!

pinkboy
 
pinkboy said:
The sun still comes up, chocolate is still available at the shops and the local is still open on Friday nights!

pinkboy
Click to expand...

...an two wheeled commuting is still the best way to get around ;)

Best industries to invest: racing and gaming, casinos & pawn brokers.

Cheaper food options flourish eg. take away food sector like KFC, Maccas, Pizza Hut etc.

Consumer Spending generally is reduced affecting consumption patterns.

Finance is tighter.

High levels of unemployment.
 
I've not lived any of my adult years through one either.

I think for someone yet to invest in property such as yourself, any imminent recession should make you triple check your due diligence on any investing your are considering doing.

For those already holding property, I guess the same thing applies. I.e. checking that you can ride any storms tthrough for the next few years
 
Having a good cash buffer is important in case the boss gives workers the boot. Good time to brown up to the boss. Maybe even snitch on any co workers who aren't pulling their weight. This won't make you very popular and you'll get the occasional sneer but its the law of the jungle during a recession.
 
Sounds like a buyer's paradise! :D

Get 'em on the cheap and flog 'em in the boom. Oh, property
investing is so easy.
 
Shares drop drastically in value and don't bounce back.
Unemployment goes over 10%. No, over 12%.
Those with a job keep their heads down.
Those without apply and apply and get told they're over-qualified.
A generation takes an extra 10-15 years to get on their feet.
David Jones starts talking about whether they can afford to stay open or not.
The value of gold sky rockets.
Been there done that. It's all over now.

No offence everyone but I don't think we're in for a recession. It's just an adjustment out of mining back into our services. Now that the dollar is really getting down towards its average, tourism and international education will regain international popularity. So importers will lose out. Did they really think it would last?

It sometimes happens that a nation misses out on a recession because of serial good management and that seems to be what's happened to us with Keating, Costello and Swan.

Strong growth will return. We're just catching our breath. Funny lot at the top this time around. Oh well. We're still a long way off the conditions listed above.
 
Average prices drop to a degree , but you can pick up some really good deals of highly motivated vendors at well below market price.

Finance is hard if not impossible to get and it helps if you have access to money in a LOC obtained before the Sh..t hits the fan .

Cliff
 
In our case...1990...employees at the factory where my spouse worked all took a 10% wage decrease for a year...and job shared while EI (employment insurance) paid 94% of their wages.

Early 1980's...interest rates went up to 18-20%....people lost their homes.
(family member almost did)

Yeah...not good.
Credit hard to get.
 
I love recessions or downturns in the markets.

That's where the best deals are gotten by savvy investors.

The best deals I ever got (and a lot of my friends) was during the 'doom and gloom' sentiment of markets. I just love it.

Markets will always bounce back. Our liveable land is limited. People love Australia. Immigration is good. Most people want to live in the major cities. So im not worried that the medium/long term demand for property in Australia will suddenly disappear. When they can start to make the desert liveable and comfortable with great jobs and infrastructure, then I might worry a little. I suspect i'll be dead by the time that happens though.




Leo
 
I did spent about 100K to buy a 499K property during GFC. The capital gain for this property is over 1M today.

Now, like See-Change, I am selling one property and hopefully have 800K to 1M cash on hand.
 
LeoT said:
I love recessions or downturns in the markets.

That's where the best deals are gotten by savvy investors.

The best deals I ever got (and a lot of my friends) was during the 'doom and gloom' sentiment of markets. I just love it.

Markets will always bounce back. Our liveable land is limited. People love Australia. Immigration is good. Most people want to live in the major cities. So im not worried that the medium/long term demand for property in Australia will suddenly disappear. When they can start to make the desert liveable and comfortable with great jobs and infrastructure, then I might worry a little. I suspect i'll be dead by the time that happens though.

Leo
Click to expand...


How old are you, Leo? Unless your age starts with a 4 (at a minimum) you haven't seen or experienced a recession in Aus.
 
The first cab off the rank is unemployment,then you start to see Schadenfreude builders who will fail financially,and take all the subbies with them while everything is in the mistress or:rolleyes: daughters name..

Inbetween the share market implodes,real estate activity ceases together combined with interest higher rates,and the repayments are beyond the simple capacity of the normal income worker..

Over the past 14 years anyone investing have only see it all one way and those have been conditioned to believe that's the way it's going to stay,myself I have worked through 2 recessions in the 1980's and from 1991 up till about 1996,a lot of people lost everything during that period,and Banks in every contract have the all monies clause,property prices went nowhere and some houses bought in 1990 that sold for above 100k in Brisbane were sold in the mid 1990's for 35%less and would not sell for several months,i know this to be a fact because we bought a few with those numbers..imho..
 
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