The cost of the recession

There are all sorts of costs, some very personal such as losing your job and some very difficult to quantify, like future income or pensions prospects.

This morning PricewaterhouseCooper's calculations on asset value losses were published by the Independent. They make grim reading:

Since 2007
- the total value of shares and homes owned by British households has fallen by 28%, from £6.8. trillion to £4.9 trillion.

During the credit crunch
- houses have lost 20% of the value, or £800 billion, and equities 40%, or £1.2 trillion.

On average each adult has lost £17,000 from the property slump and £23,000 in the shares, whether held directly or indirectly in a pension fund. These are averages, and while some will have lost little in one or both categories others will have lost much more.


These are sobering statistics. Recent figures suggest that families are still massively in debt. The total personal debt on credit cards, overdrafts, mortgages, etc, is still of the order of £1.1 trillion.
It is this last figure which may persuade many , if they come by extra income from the Brown splurge, decide to reduce their debt rather than increase their spending as he wants. This may drag out the recovery phase, when it comes.