Ask not whether we are good for a loan, but if it's good for us

The Great Depression changed the way a whole generation thought about work, saving money, investing and planning for the future.

The Great Depression changed the way a whole generation thought about work, saving money, investing and planning for the future. My grandparents, for example, used to store far more canned goods than they ever could need in a pantry, a behaviour typical of Depression-era children like them. I remember discovering a rusty tin of corn in that room many years ago, a relic of attitudes developed at a time when resources were scarce and the future seemed extremely uncertain. My grandfather still saves useless items - old broken toasters, brittle nails removed long ago from boards and shingles, yellowed newspapers and discarded pots and pans - and resists any attempt to clean up.

The Great Recession hasn't been quite so bad as the Great Depression - not yet, at least. Back in 1929, the US economy started shrinking and didn't return to its pre-Depression level until 1939, ending the longest and deepest period of economic turmoil in modern history. This time, global GDP started to shrink in the middle of 2008, and stayed on a downward trajectory into last year before rebounding.

Even if it doesn't turn out to be all that nasty, though, this recession's job losses and long duration are probably going to change the way people think about their finances and their futures. Maybe it won't be on the scale of the Great Depression, but people's notions about money and how they interact with the economy are probably in for at least a mild rethinking, especially among segments of the population that have never experienced an economic blow-up of this magnitude. And that's just about everyone.

The Great Recession is almost sure to change how people all over the world look at borrowing, if it hasn't already. As most of us know from experience, getting credit before the crisis was about as easy as signing up for a magazine subscription. Even people with distinctly chequered credit histories were able to get credit cards, mortgages, home equity loans and all sorts of other advances and overdrafts. It was easy - too easy, it turned out.

As regulators across the globe put curbs on some of the most irresponsible forms of lending that preceded the financial crisis, banks themselves are being much more careful about who they will give a loan to. People and companies are still interested in borrowing, but banks are shutting many of them out. According to the European Central Bank's July bank lending survey, banks in the euro area reported tighter credit standards in the second quarter of the year. The report cited "renewed constraints in banks' access to funding and liquidity management" as the reasons for constraint on lending. Demand for loans, meanwhile, "continues to recover".

Those higher lending standards are probably here to stay. And that means our attitudes towards borrowing are likely to change. Instead of deciding whether it makes sense to borrow money, we'll increasingly be wondering whether the banks will approve our loan applications. When they do - especially on mortgages and other large loans - it will be an occasion worth celebrating. Another change likely to be brought about by the Great Recession is a shift in thinking about retirement. For many years now, many of us have planned for our twilight years with an unwarranted dose of certainty, even as lifespans became longer and healthcare costs went up. We were told stocks were a pretty safe bet, and that if we saved enough money and budgeted properly we'd be able to spend the last couple of decades of our lives on a permanent vacation.

In the new economy emerging from the recession, retirement dreams will be harder to reach. Tougher times will probably inspire more people to save, but lower spending, coupled with less bank credit floating around, will mean businesses can't expand as fast as before. And that ought to translate into less stellar profits for businesses that people invest in and depend on for retirement. At the same time, retirement is likely to cost more money in future because of the advances in medicine that are keeping us alive longer. That should mean we're able to work well past today's official retirement ages. If retirement is longer because we live longer, it will also naturally cost more.

We'll probably also see housing differently, and more logically after the recession: not really as an investment, but as merely a place to live. We'll certainly see housing bubbles such as the one currently inflating in China, but buyers and regulators will approach property with scepticism for a long time because of the tremors lax lending standards and fast price increases in the US ultimately sent through the global financial system.

The full social effects of the Great Recession are hard to gauge at this stage. That will take time. As governments decide how to put the humpty-dumpty of our global financial system back together again, however, it's becoming clearer that our recent economic troubles will have a long-lasting impact on our attitudes toward money; changes that are likely to have as many repercussions as the regulatory reforms that result from the crisis.

@Email:afitch@thenational.ae

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries

Emergency phone numbers in the UAE

Estijaba – 8001717 –  number to call to request coronavirus testing

Ministry of Health and Prevention – 80011111

Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre

Emirates airline – 600555555

Etihad Airways – 600555666

Ambulance – 998

Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries