One of the blog’s major themes is that it fears the idea of a quick V-shaped recovery will prove wishful thinking. New figures from the Bank of England seem to bear out its caution.
The slightly complex chart shows that net UK lending for mortgages (yellow line, then red diamond) has been falling steadily since the beginning of 2008. And provisional data (not included in the chart) suggest it actually fell in July, for the first time since records began in 1993.
Overall, mortgage holders paid back £418m ($681m) more than they borrowed. This was in spite of approvals for new mortgages reaching a 17-month high. As the Guardian notes, “cautious consumers and strict lending criteria kept net lending low“.
The UK’s housing bubble created major demand for most chemicals. If consumers and lenders remain cautious, as seems likely, it will prove very difficult to quickly replace these volumes with other applications.