HBOS Plc: GENERAL ELECTIONS AND HOUSE PRICES

Doc showing the average cost of things including houses, bread etc when various Governments were elected and during their reign. The not so interesting John Major did a very good job of keep bread prices under control, a loaf rising by 1p from 51p to 52p during his tenure. House prices also fell for the first 4 years he was in power, having also fallen in the last year of Mrs Thatcher. In the same year Major took power (1990) beer was only £1.14 a pint. The real Champion house price demolition expert was Harold Wilson. In real terms, he knocked 13% off house prices, and although the nominal increase was 7% at a time when wages were going up at 20%. This time wages are not going up anything like that, so expect nominal falls -ie prices lower without accounting for inflation.

Independent, The (London), Apr 23, 1995: Sellers Loosen Grip of negative equity

I have been doing a historic web search for old web articles on the last crash. My first recollection of the internet was about 1991 and I can't find anything going back that far as the web was still Geek toy then and estate agents and their media friends hadn't worked out how to use it at that stage. But I did find this nice article from 1995 reciting the history of the previous crash. Last time it took sellers 5 years to escape the negative equity trap, this time it will be longer because the boom was longer

FT: Rightmove benefits from slowing housing market

Would you believe it ?
"The property sales portal is paid by advertisers on a subscription basis per month, which means that the longer new-build property stays unsold and on its website, the more it earns."
"....revenue rose 69 per cent ..."

Times: Buyers who do not have 10% deposits are left out in the cold

You remember those BTL i@iots repeating the mantra "the power of the fiinnannciall llleevveragge" AAHHHAHAH now it is the curse!! Divide a large number by a small number, what you get is a mess! Prices will fall like leaves in autumn!

Times: Quantum's Jim Rogers says US 'out of control'

Investment biker Jim Rogers says America is “completely out of control”, there will be a 20-year bull market in commodities, and that prices will be in turmoil. "In a blistering attack on US monetary policy and the “helicopter cash drop” responses of the Federal Reserve, Mr Rogers described the American dollar as a “terribly flawed currency”...The dollar may have declined recently, he added, “but you ain’t seen nothing yet”. Gold would continue to rise, the analyst Christopher Wood told fund managers, “because it is the exact opposite of a structured finance product”." recons it will go to $3,500

Telegraph: US stocks fall as credit 'cancer' fears grow

''Insurance giant AIG was among the hardest hit after revealing its biggest-ever quarterly loss as a public company after taking an $11.12bn (£5.63bn) write-down on investments linked to US sub-prime mortgages. Those fears were exacerbated after analysts at UBS estimated that losses in the credit markets may soar to $600bn from $160bn.''

BBC News: Inflation rise hits US customers

US consumer spending rose more than expected in January, but much of the gain was down to rising prices. The Commerce Department said personal spending rose 0.4% last month, a bigger rise than economists were expecting. But the report showed that a key gauge of inflation rose 0.4%, with shoppers spending more on food and fuel.

Safe Haven: Gold Investments Market Update

Interesting article on Safe Haven regarding the precious metal markets and there is a chart showing the surging price of gold in GBP. Showing that gold's strength is not just a function of dollar weakness as some would have you believe. The FT reported today that Barclays said "Commodity prices are going up in all currencies. Supply losses, strong demand and low inventory levels are the key drivers, not exchange rates." Gold and precious metals are the primary asset class that will protect rich and poor in the coming years.

vnunet.com: Internet facing 'meltdown' by 2010

Being privilieged to visit the HPC website. It has taught me a lot, opened my eyes to many things. Being able to read various views in relation to house market conditions and all the relative evidence to support various points of view. The reason for this submission, was due to reading opinions expressed on HPC. And by pure chance, a simple conversation, the answer to a question was glearingly obvious. What if the consumer using the expanded data volumes (excessive MB's) and as a consequence intentional or otherwise. Imagine switching on your PC, to find that you & everyone could not connect to the world wide web. It would be instantanious, and would effect all, a short period of darkness would descend, this situation is in my view very real.

CNN: Furniture company - or hedge fund?

Now we have DFS, CSL and Land of Leather in the UK who are so reliant on the housing market. I wonder how this will play out....?

Citywire: Mortgage lending at same level as 1995, Bank of England says

Mortgage lending picked up by 2.7% in January but the number of approvals is at the same level as September 1995, according to the Bank of England. Approvals for house purchase mortgages rose to 74,000 in January from 72,000 in December, but are still close to historic lows of 71,000 approvals in May 1995. The 74,000 approvals granted to home buyers during the month still remains close to historic lows and represents a 40% decline compared with January a year ago,

MoneyMarketing: When the going gets tough

"Woolwich announce it will be cutting buy to let loan to values to 75 per cent. In an email to brokers, the lender says it was to withdraw its 85 per cent LTV BTL. range so that is can effectively manage the flow of business it has received" This means an immediate drop of 40% in the house price (just do 100/85% compared to 100/75%) what a crash AAHHAH AHHAHAAHA AHHAH reported by a broker so situation must be worse AHAHH AHHAHHAH

icWales: Tenants at risk after collapse of buy-to-let firm

AHHA HHA HAHAHHAHHA. I m preparing to laugh very hard at the increasingly common stories of failed BTL ventures. From BBC: "A & A Property has been by hit by serious financial difficulties and administrator Grant Thornton has been called in. Michael Jones, director of the Michael Jones Estate Agents in Cardiff, said the news came as no surprise. "People who've bought at the top of the market and suddenly find that prices are falling, and of course there is a hole in their funding and the banks are starting to get very nervous about it" banks are getting nervous AHAHAH HAHHAH

MoneyWeek: Are we seeing the return of stagflation?

Forget the recession debate – the question now is 'how hard the landing will be'. And given the latest miserable data from the US, it’s hard to disagree.

FT: Peloton Partners in $2bn assets sale

“It is the classic story of when leverage goes wrong,” one investor said. “But I can’t believe this problem is confined to these guys alone.” No I can't either. This WAS one of London's most successful funds, which only LAST MONTH was named 'best new fixed income hedge fund'.

BBC News: Credit crisis claims hedge fund

A London-based hedge fund has become the latest victim of the credit crisis after Peloton Partners began shutting a $2bn (£1bn) fund due to severe losses. Peloton's fund, known as ABS Master Fund, had bet that sub-prime mortgages would decline in value and instead had focused on better quality US home loans. But these investments have also become tainted by the problems in the sub-prime market, resulting in a steep decline in their value.

MoneyWeek: Why banks may regret hiking their dividends

Royal Bank of Scotland has hiked its dividend, just to prove it still can. But with the future of the mortgage market far from certain, that might be something it comes to regret at a later date…

Independent: Inflation makes an unwelcome return

(See 3rd section of this article.) Interesting analysis of factors pointing to higher prices: "This sort of inflation is likely to prove sustained and must eventually result in higher wage demands." Looks like the core inflation index is going to have to exclude more of these pesky volatile items.

Seeking Alpha: A Misleading Chart on Credit Default Swaps

Apologies to Harry Hill! This is about the graphics that were posted onto this site earlier this month. This jorno basically says that the CDS values are not as big because they are notional amounts not actual. A Corrorally is the S&P futures and the stock market. The stockmarket is the actual physical value of the shares were traders trade the S&P based on $250 thimes the index (used to be $500 times the index) - so the notional value of contracts traded is huge. Hes comparing the CDS value used of $45m - in effect with the notional value of the S&P futures (at least thats what i think he's saying!!).

Telegraph: UK house prices drop for fourth straight month

''..There is currently an unprecedented amount of uncertainty about future economic conditions, but if the Bank of England's central projection that the economy continues to grow is correct, conditions for the UK housing market are perhaps less gloomy than some would have us believe...''

Nationwide [pdf]: Prices -0.5% in Feb, annual rate now just +2.7%

I'm sure there'll be a zillion articles posted on these same set of figures, but here it it straight from the source. In Feb, prices fell for the 4th month in a row, by 0.5%. The average house price fell by £38 per day in Feb. The annual rate of HPI is now less than even the official govt inflation measure, at just 2.7%. The average price was £186,723 in October, but is now just £179,358.

Market Oracle: Gold Accelerating Towards Blow off Top

Current price of GLD is 95.99. He sees the top of the channel as 96.5

The Telegraph: Stiglitz: $3tn Iraq legacy to hit next President

In 16-years time, the US will face a $4bn annual bill for disabled servicemen, said Mr Stiglitz, who estimated that around 40pc of the 2m currently fighting in Iraq will return home severely disabled.

BBC News: Property prices fall in February 0.5%

The fourth consecutive monthly fall in property prices puts the cost of the average UK home at £179,358.

BBC News: Branded build-to-let plan on show

There is an "insatiable demand" for rented property in London from residents in the £20,000 to £50,000 wage bracket, the group says. It wants incentives for large companies to enter the residential rental market and build-up a recognised brands. I hope this will make all the small buy to let investors packing!!

The Australian: Iraq war 'caused slowdown in the US'

HE Iraq war has cost the US 50-60 times more than the Bush administration predicted and was a central cause of the sub-prime banking crisis threatening the world economy, according to Nobel Prize-winning economist Joseph Stiglitz. The former World Bank vice-president yesterday said the war had, so far, cost the US something like $US3trillion ($3.3 trillion) compared with the $US50-$US60-billion predicted in 2003. Australia also faced a real bill much greater than the $2.2billion in military spending reported last week by Australian Defence Force chief Angus Houston, Professor Stiglitz said, pointing to higher oil prices and other indirect costs of the wars.

Huffington Post: Bush On $4 Gas: "I Hadn't Heard That"

In the US, petrol prices are predicted to reach $4 a gallon this spring. The increases could not come at a worse time for the economy. With growth slowing, energy increases that were once easily absorbed by consumers are now more likely to act as a drag on household budgets, leaving people with less money to spend elsewhere. These costs could worsen the nation's economic woes, piling a fresh energy shock on top of the turmoil in credit and housing. When quizzed at a press conference, Bush responded: "$4 gasoline? That's interesting. I hadn't heard about that." --- Is this a 1970s-style oil shock being played out in slow motion? Or peak oil? Either way it can only lead to one thing: recession.

Times: Tax crackdown on landlords

Tough times for landlords.. AHA H AHA HAHAH HAHHA HA. Just reported mine to the IR, anonymously of course. Hope they find some problems with his tax return, who does not have issues with the taxman?!?

Times: Soaring inflation, Russia and Kazakhstan

Council tax and water bills grow at double the inflation, and "wish we could be more upbeat about the house prices, but unfortunately these are growing below inflation". "The money Brits spent on overseas property grew by 229% last year" This is a sick country!

CNN: Filthy house beyond hope

Just watch it.

Mortgagestrategy: Still no end in sight to credit meltdown

Ratings agency Standards & Poors warns there's still no end in sight to the UK's credit meltdown and that it expects life to get harder for sub-prime borrowers in 2008. With falling house prices and a widening disclocation between LIBOR and the Bank base rate, it says UK borrowers are currently in a much tougher credit environment.

Times: Bush says no recession, Wall Street disagrees

''Wall Street yesterday derided President Bush for insisting that America had not fallen into a recession just as Washington published appalling economic growth and jobless numbers.''

CNBC: Bernanke's Bank Comment Rattles Stocks

"I expect there will be some failures''

Telegraph: Northern Rock bought rugby fields three weeks before crisis

Northern Rock bought the grounds of Newcastle Falcons rugby club for almost £15m three weeks before the bank had to appeal to the Bank of England for an emergency loan. The transaction has come to light because it was recorded in the accounts of the Falcons, which sold its grounds at Kingston Park to Northern Rock on August 17 after struggling to meet its mortgage repayments to the bank. It has been seized on by critics as more evidence of the bank's increasingly desperate acts to bolster its 2007 results. The transaction - said by analysts to have been at a high price - may also raise eyebrows among the bank's investors, who face getting nothing now Northern Rock has been nationalised, and the Government, which is liable for any losses the bank incurs.

Associated Press: Bush: US is not headed into recession

WASHINGTON (AP) -- President Bush said Thursday that the country is not headed into a recession and, despite expressing concern about slowing economic growth, rejected for now any additional stimulus efforts. "We've acted robustly," he said. "We'll see the effects of this pro-growth package," Bush told reporters at a White House news conference. "I know there's a lot of, here in Washington people are trying to - stimulus package two - and all that stuff. Why don't we let stimulus package one, which seemed like a good idea at the time, have a chance to kick in?" Bush's view of the economy was decidedly rosier than that of many economists, who say the country is nearing recession territory or may already be there.

Sky News: 12,000 Jobs Cut In Work And Pensions

Massive job cuts have been announced at the Department for Work and Pensions - with some 12,000 positions to be axed over the next three years.The news came just hours after the department signalled a bigger role for the private and voluntary sectors in helping people find work.Work and Pensions Secretary James Purnell said he wanted a "step change" in the benefits system, giving the private and voluntary sectors more freedom. Unions had already expressed concern the move could lead to job losses among DWP staff.

tIMES: House sales down by a fifth

''...The number of houses sold in November last year fell by 22 per cent compared with November 2006. Figures from the Land Registry show that 90,581 properties were sold last November, down from 115,873 in the previous year. ...''

BBC NEWS: House prices still slowing down

Oh Dear!!

Boston Herald: Frank wants state to buy foreclosed homes

Barney Frank (Rep) wants Uncle Sam to loan some $5 billion to buy foreclosed homes on the cheap and turn properties into affordable housing.

Times: Redrow profits crash 35% on house sales slump

''Redrow, the Midlands-based housebuilder, became the first high-profile victim of the falling housing market as it reported a 34.5 per cent fall in first-half profits and gave warning of worse to come. ''

BBC News: Buy-to-let firm in administration

One of the biggest buy-to-let investment companies in Wales has gone into administration. Cardiff-based A & A Property had more than 250 houses and flats on its books in different areas throughout Wales.

Firstrung: UK House prices increase by 6.4% year on year - Land Registry

House prices in England and Wales have increased by 0.9 per cent according to the latest monthly figures from Land Registry. The increase takes the average house price to £186,045. However, the data shows a decline in annual house price changes, from 6.7 per cent last month to 6.4 per cent this month. London experienced annual price growth of 13.1 per cent, with the average house price for January standing at £357,976. The largest monthly growth was seen in the North West with an increase of 2.0 per cent, taking the average house price there to £139,362. The volume of transactions was down on the same period last year, with an average of 100,648 per month in the months August to November 2007, compared with 117,173 per month from August to November 2006

bigpicture blog: Why The Fed is Compelled to Lie to Congress

Opening statement of the FOMC Chair, Senate Testimony February 27, 2008: Senators, we find ourselves in a very challenging situation. Following the dot com implosion, my predecessor at the Fed slashed rates to a generational low of 1%; the FOMC then kept rates at 1% for over a year. While that re-inflated the economy, it also set off a shock wave of inflation unseen since the 1970s. Houses doubled in price, Oil is up 5 fold, food stuffs have tripled, and the dollar has collapsed. Gold is at multi-decade highs. ... The credit crunch is unprecedented, far worse than the S&:L collapse and Long Term Capital Management -- combined....

Property Week: OFT seeks injunction against estate agents Foxtons

Most people have to earn their money, except for inverstors who have to risk their own cash and use their own skill, which is sort of working for yourself. Estate Agent are the target again, nobody has any sympathy for people who just sit there and demand money for no (or very little) work. Any landlord can then avoid putting up the rent on the next annual review if the Estate Agents fees are removed.

"The OFT objects to Foxtons' letting agreements which can potentially require landlords to pay it substantial sums in commission, where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired."

MoneyWeek: Ignore the pundits – stay out of banking shares

While equity analysts are messing about, dithering over whether banks are worth buying, the rest of the world’s asset markets are screaming about the end of the world. We’ve been living through a credit bubble – banks sell credit, and so they’ve prospered. But now the bubble has burst. That means the hard times for the banks are just beginning. Just as when the tech bubble burst, people will have a hard time coming round to believing it’s all over, and will keep buying on the dips. But ignore those tasty dividend yields...

Independent: Banking gets back to normal after years of excess

The other alarmist speech came from Hector Sants, FSA CEO. "I don't think markets are ever going to return to the way they were. The idea that at some point they will go back to normal, I think, is a misnomer." The era of cheap borrowing, he added, was over. That cannot be right either – or rather it is only right if you assume that the past three or four years were normal. By historical standards they were most abnormal for two reasons. The primary cause was abnormally low real interest rates, as you can see from the first graph. This shows real short-term interest rates in the developed countries. That dip of real rates to below 1 per cent for five years was the result of flawed central banking policies. YEESSSSSSSS!!

The Telegraph: Soaring euro threatens European jobs exodus

The euro has surged to an all-time high of $1.51 against the dollar, prompting bitter complaints from European industry and setting off a sharp sell-off in sovereign bonds from southern states deemed least able to withstand a super-strong currency.

Telegraph: Alistair Darling to threaten gas firms with tax

Alistair Darling is threatening to land gas companies with a windfall tax unless they cut bills for their customers.

BBC: Wales' tallest building approved

Scroll down to the end of the article for this blinding insight ... ... Michael Jones, from Michael Jones Estate Agents in Cardiff, said the housing market in the city was slowing down. "With the development of the bay, there have been a lot of people buying and speculating, and that bubble does appear to have burst," he told BBC Wales."... We've overdeveloped certain areas and built the wrong type of properties."

FT.com: Insight: China unable to breathe easy over Olympics

While global financial markets remain focused on the ongoing credit crunch in the US, another market-rattling problem could be brewing thousands of miles away – in China.

Guardian: Huge bonuses for bankers encourage too much risk-taking, watchdog warns

The boss of the Financial Services Authority this morning launched an attack on the culture of big City bonuses, warning that they could encourage too much risk taking. Hector Sants also said the markets would never go back to "normal" following the credit crunch and that the days of easy credit for customers may be over.

The Sun: Solid foundations - viewings are on the rise.

Persimmon chairman John White said: "We are not calling the ‘turn’ but, as each week goes by, we have definitely seen an improving trend. “More people are visiting our sites each week and there are more reservations. While mortgage lending has tightened, people now understand the new criteria more clearly, and more are coming to look at our new homes.” THE SUN SAYS: This is the first piece of good news from this battered sector for a while. Longer term, prospects should be good, with demand for new homes outstripping supply.

ConspiracyPenPal: Fun with Numbers

Hey, boys and girls! Want to have some fun? With numbers? Follow along and let's see just how much fun Mom & Dad have been having with what they call "finances."

BBC: Kids plundering parents' savings

Interesting little article if you read it, includes the hidden gem revealing that 42% of Adult Kids used money from their parents to pay debts up from 22% last year! Article also expects parents to stump up cash in the coming year for house deposits as 125% deals dry up!

Realtor: Detroit housing

A bubble deflates...

Moneynet: BORROWERS LEFT HIGH & DRY AS MORTGAGES TIGHTEN

As the credit crunch tightens its grip, one of the most telling signs of what's to come can be found in the mortgage market. With lenders increasingly turning the screw and tightening their lending criteria many borrowers will be left high and dry with expensive and inflexible mortgage deals.

BBC: Fannie Mae hit by housing gloom

US mortgage giant Fannie Mae has posted a $3.55bn (£1.8bn) loss for the three months to the end of December. It blamed rising home loan defaults and set aside $2bn to cover further bad loans, warning the US housing slump could still get worse. The quarterly loss cut into full-year earnings and the firm reported a loss for 2007 of $2.05bn, compared with a profit of $4bn for the year before. It said it expects US house prices to fall between 5% and 7% in 2008.

SOTT.net: Reading the numbers

£110 billion is more than the UK government spends in one year on the entire National Health Service. So why is the UK government doing this and where is the money going? - The UK government is desperately trying to rescue a large UK mortgage lender while the Federal Reserve is secretly funding US banks to keep them afloat. The collapse of the international banking system is imminent. For the elite it will be a bonanza while for the rest of us it spells a return to servitude in a feudal society.

BBC: Bernanke hints at more rate cuts

US Federal Reserve chief Ben Bernanke has hinted that the central bank is prepared to cut interest rates further to help ease recession fears. In his semi-annual report to the US Congress, Mr Bernanke said the Fed would continue to "act in a timely manner as needed to support growth". Analysts said his comments increased the likelihood of another rate cut at the Fed's next meeting on 18 March. US interest rates are currently at 3% after two major reductions in January.

Firstrung: First time buyers priced out due to buy to let investors no reason for CML celebrations - Firstrung

As the CML proudly announced yesterday that the total buy to let mortgage number had finally passed through the one million mark Firstrung condemned firstly the insensitivity of this proclamation and secondly stated their position that (in their considered opinion) this figure actually represents one million less buying opportunities for first time buyers...

Ananova: Girl's guilt over borrowed cash

A Polish girl racked with guilt over borrowing £13 from a man on holiday in Austria travelled hundreds of miles across Europe to try and return it.

Wall Street Journal: Decline in Home Prices Accelerates

Bloomberg: Roubini Interview Video

Only 5 minutes but worth a watch. Roubini is a bearish economist who has been spot on about the housing bubble.

Tampa Bay Online: Mortgage Note Issues Help Debtors Avoid Foreclosure

Shortcuts taken in the rush to issue as many sub-prime mortgages as possible in the states have rendered homes impossible to foreclose

Guardian: Information tribunal rules that MPs should disclose details of expenses for second homes

MPs have lost a battle to block the detailed disclosure of expenses covering their second homes, power and telephone bills, and the furniture they buy... It should be released within 28 days, according to the ruling by an information appeal tribunal... The allowance - called the additional costs allowance (ACA) - entitles MPs to an additional £22,110 a year to cover the costs of setting up a second home if they live away from London... But MPs' addresses can be disclosed, unless there are specific security concerns, and the names of landlords and mortgage lenders would be released... John Spellar... said last night: "This decision is absurd and ridiculous. It will end with people writing about how much MPs are paying for a pint of milk." Does he pay ridiculous amounts for milk?!?!?

BBC: Oil hits $102 for the first time

The price of oil has hit a record high for the second day running, touching $102.08 a barrel for US sweet crude. However, the figure is still surpassed in inflation-adjusted terms by the peak of $102.53 reached in 1980, the International Energy Agency says. The oil price surge is supported by traders switching their cash out of shares and currencies and into commodities, traders say. Fears that producers' cartel Opec will cut supply have also been blamed.

Telegraph: Gordon Brown's long boom ending with recession is a real possibility

"Since then debt and house prices have inflated enormously to levels which, in relation to income, are now the most extreme in the developed world. The bubble is now bursting. Forward markets tell us that house prices are likely to fall 10pc on average this year. Serious people anticipate a 30pc to 40pc correction over the next few years." Is there a more level-headed and wise politician than Vince Cable? A breath of fresh air between the lamentable inanities coming from the Govt.

MoneyWeek: Northern Rock: a lesson in how shares go down as well as up

Private shareholders are happy to take the verdict of the market when share prices are going up. They will have to take it on the chin when things go the other way. And, if they want to be taken seriously, they will have to grow up.

The Corporation: Kids plundering parents' savings

Once it was just the magic fridge that children raided, only for it to be refilled by their parents. Now a survey claims adult youngsters are plundering their parents' savings at an increasing rate. Some 55% of parents polled had given an average of £12,610 to their children or grandchildren, according to the survey by Scottish Widows Oh to have a wealthy parent... My parents ask ME for money...!!!

Times: HBOS profits hit by downturn in credit markets

''HBOS, Britain’s biggest mortgage lender, reported broadly flat annual profits for 2007 as it struggled to maintain margins in its core retail banking business. The owner of Halifax and Bank of Scotland posted a 3 per cent increase in underlying pre-tax profits to £5.71 billion in the year to December 31, compared with £5.54 billion the previous year''

Guardian: Earthquake shakes Britain

Sorry, I couldn't resist!! I wonder how many Barrat homes were destroyed in the the quake.. I bet all the new build homes in the area are dropping to bits after last nights quake!

ThisIsMoney: BTL mortgages hit 1 million as house prices tumble

Nearly 1,000 buy-to-let mortgages were taken out every day last year, pushing the number of the loans to a record one million. The figures emerged as evidence grows that the decade-long house-price boom is over, with prices falling across the country. Britons have taken out a total of 1.04m BTL mortgages - up from fewer than 30,000 when records began in 1998. This was despite the fact that experts predict house prices have stopped climbing, and the average gross annual rental yield (rental income expressed as a percentage of a home's current value) is negative for the first time, according to ARLA.

thisismoney: Cheap credit 'gone forever' - City watchdog

The era of cheap credit may be over forever, the head of City regulator the Financial Services Authority said today. Hector Sants said he believes the financial markets will never return to the practices prevailing before the global turbulence sparked by last summer's crisis in the US sub-prime mortgage market.

Independent: What we learned from the 80s crash

Are we heading for another recession? Four experts who survived the last big crash explain why 2008 should not be the year of a similar meltdown. The estate agent, Peter Bolton King: "I'm expecting a soft landing this time, rather than a crash, with zero price growth in 2008. There is a big difference between then and now. In the early 1990s there were high interest rates, high unemployment and high inflation. We have none of those three things now. I don't think we should panic." The mortgage lender, Mark Boleat: "The turn came fairly quickly, in 1988. There were clear reasons for it - rising interest rates and soaring unemployment levels. That's the big difference between then and now."

Telegraph: Dollar's slump to $1.50 raises European alarm

The dollar tumbled through the $1.50 mark against the euro for the first time today as the US Federal Reserve made clear it will slash interest rates further to head off a severe recession. The Fed's influential vice chairman, Donald Kohn, yesterday played down the inflationary threat in America, arguing instead that "the adverse dynamics of the financial markets and the economy have presented the greater threat to economic welfare in the US."

BBC Economy: FSA sees credit squeeze on banks

FSA chief executive Hector Sants said banks will never again be able to raise as much money as cheaply as they had been doing by selling off their loans. In an exclusive interview with the BBC, he said they will have to keep more of their loans on their own books. That, in turn, may permanently push up the cost of borrowing for all of us. "Banks themselves need to give consideration to how their business models will need to adapt to the changed market circumstances they have seen," said Mr Sants

cnbc: Greenback Rebound

USD Undervalue Against The Euro And Several Major Currencies

BBC News: Fashion chain in administration

Women's fashion store chain Select Retail has gone into administration. Select blamed the move into administration on a "deteriorating trading performance" since the start of the year. Yeah that's right since the START of the YEAR! Things must be bad on the high street!

YAHOO BIZ: While Wholesale Inflation Rises at Fastest Pace in 26 Years

In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food and energy left wholesale inflation rising at the fastest pace in a quarter-century..

AP - Yahoo: Banks crises bad for hearts: British researchers

Thousands of people could die from heart attacks if there was a widespread repetition of the crisis at Britain's Northern Rock bank, according to a study published by British researchers on Tuesday. A team of sociologists at Cambridge University suggested that the stress of a system-wide banking crisis could lead to a 6.4-percent surge in heart attacks in high-income countries such as Britain and the United States

IHT.com: After subprime debacle, U.S. wrestles with question of bank bailouts

US - Over
UK - Doomed
Ireland - Finished
Spain - Buried
Australia - Down and Out

IHT.com: Credit crunch reaches picturesque resort

The effects of the worldwide credit crunch reached a remote part of Idaho this month. Four-year-old Tamarack Resort said construction of its ski village near McCall, Idaho, has ground to a halt after Société Générale pulled the plug on a $118 million loan Tamarack needed to finish the complex of shops and condominiums. Tamarack is the biggest new public ski-and-golf resort built in the United States since Deer Valley, Utah, opened in 1981. Andre Agassi and Steffi Graf, the tennis champions who are husband and wife, gave the resort a lift when they agreed in 2006 to build a Fairmont hotel there.

Harpers: The next bubble: Priming the markets for tomorrow's big crash

"That the Internet and housing hyperinflations transpired within a period of ten years, each creating trillions of dollars in fake wealth, is, I believe, only the beginning. There will and must be many more such booms, for without them the economy of the United States can no longer function. The bubble cycle has replaced the business cycle." Great article, recons the next bubble is alt energy.

Independent: Buy-to-let landlords feel the strain

"According to new figures from the Council of Mortgage Lenders (CML), the number of landlords in arrears on their mortgage by more than three months rose to almost 7,600 during the final three months of last year, up from about 6,050 in the previous quarter. Year on year, the number of landlords in arrears was up more than 54 per cent." REPOSSESSIONS, WHATs IN A NAME!

BBC: Have the buy-to-let blues begun?

With a remarkable change of sentiment the BBC fingers Manchester, Leeds, Nottingham and Birmingham as New-Build Buy-To-Loose hot spots and features Manchesters up-market Beetham Tower as a particularly good example.

MoneyWeek: What silver's strength means for the gold price

Last week was a good one for precious metals. But although it is gold which has been hitting all-time highs, silver has actually risen the most so far this year. And that's a very important technical development.

Times: Don’t fall for the freebies offered by package home developers

an example of how the media tune is changing. but my favourite is the reader comment who sums up the lack of brain of typical BTL investor: "Simple principle in finance, the less you pay for a high value asset, the more risk you take on. You are then compensated for the additional risk by high returns. Warren Buffet Wannabe, London"

Telegraph Online: BoE fears largest ever peacetime liquidity crisis

The Bank of England's Deputy Governor today warned that the ongoing credit crunch had left the Monetary Policy Committee uncertain as to its next move as it and fellow central banks face up to what she described as the "largest ever peacetime liquidity crisis".

Guardian: France's Sarkozy tackles voters' inflation worries

Nicolas Sarkozy on Tuesday stated that his government was working to combat soaring food prices and was ready to do more to encourage overtime work to put more money in peoples' pockets.

FT: How super-rich can avoid lynching

"That sentiment has marked the US presidential election campaign as fears of recession grip the country. House prices are falling, over-stretched mortgage holders are losing their homes, banks have blown billions in the credit markets and yet disgraced financiers have walked away with millions in a perverse “heads-I-win, tails-you-lose” kind of capitalism. The two remaining Democratic candidates, Barack Obama and Hillary Clinton, have been feeding off such populist resentments. Mr Obama, in particular, has been attacking the “moral deficit” in the US that has led to such a wide divide between the super-rich and 37m poor Americans. “We have a deficit when CEOs are making more in 10 minutes than some workers make in 10 months,” he says."

The Associated Press: Home Prices Drop 8.9 Percent in 3 Months

NEW YORK (AP) — A closely watched study shows U.S. home prices falling 8.9 percent in the fourth quarter of 2007. That marks the largest drop in the index's 20-year history and a full year of declining values. The Standard & Poor's/Case Shiller home price indices reflect year-over-year declines in 17 metropolitan areas with double-digit declines in eight of them. Index architect Robert J. Shiller said "wherever you look things look bleak." The quarterly index tracks prices of existing-family homes nationwide compared with a year earlier.

Bloomberg: S&P/Case-Shiller Home Prices Fell 9.1% in December

Feb. 26 (Bloomberg) -- Home prices in 20 U.S. metropolitan areas fell in December by the most on record, reflecting the deepening housing recession, a private survey showed today. The S&P/Case-Shiller home-price index dropped 9.1 percent from December 2006, after a 7.7 percent decrease in November. Nationwide, home prices fell 8.9 percent in the fourth quarter from a year earlier, the biggest decline in 20 years of record keeping. Prices may fall further as would-be buyers hold out for bargains and foreclosures add to the glut of unsold properties, extending the worst housing slump in a quarter century. Shrinking home values and credit restrictions threaten to reduce consumer spending and push the economy into a recession.

BBC News Website: US foreclosures up 57% in January

This is amazing. At the moment the US problems seem to be accelerating. The UK is probably 18 months behind the US, so we have just seen the start here, but by this time nex year all will be apparent.

USA Today: US house prices drop 8.9%

Steepest drop in the 20 year history of the Standard and Poor US house index

Market Oracle: Subprime Mortgage Scam Lands US Tax Payer $739 Billion Bailout Bill

"Why on earth would the taxpayer want to buy 600,000 subprime mortgages at “current value” when housing prices are falling, inventory is soaring, sales are sagging, foreclosures are at historic highs, and millions of homeowners are expected to simply “walkaway” from their loans?"

BBC: Bank warns of more economic risks

Rachel Lomax said there was uncertainty over the full impact of "the largest ever peacetime liquidity crisis". The deputy governor believes the credit crisis will significantly reduce demand over the next two years.Inflation is also forecast to rise more sharply. Ms Lomax warned this may lead to higher interest rates than expected if prices and wages rise further.

Bloomberg: Producer Prices in U.S. Increase More Than Forecast

Prices paid to U.S. producers rose more than twice as much as forecast in January, pushed up by higher fuel, food and drug costs, signaling inflation may keep accelerating even as growth slows. The 1 percent increase followed a 0.3 percent drop in December, the Labor Department said in Washington. The median forecast in a Bloomberg News survey of economists was for a 0.4 percent gain. Excluding food and energy, so-called core wholesale prices climbed 0.4 percent, the most in almost a year. Combined with figures showing consumer prices also rose more than forecast, today's report may prompt the Federal Reserve to consider raising interest rates as soon as the economy stabilizes.

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset (Update2)

Feb. 26 (Bloomberg) -- Bank seizures of U.S. homes almost doubled in January as property owners failed to make higher payments on adjustable-rate mortgages. Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent. ``The most troubling thing is that we are seeing more and more of these properties actually going all the way through the process and going back to the banks,'' Rick Sharga, executive vice president of Irvine, California-based RealtyTrac, said in an interview.

BBC: London Scottish Bank scraps dividend as losses hit £16m

London Scottish, which has been in discussions with the City's top watchdog the Financial Services Authority (FSA) over its capital base for five months, said that it had a capital shortfall of £12.7 million on January 1. It has been ordered by the FSA to increase reserves dramatically, but said today that it has agreed a plan, which will mean selling parts of the business, reducing lending volumes, scrapping the dividend and seeking alternative funding

BBC: Buy-to-let market still thriving

"None of this is surprising, this is the most prime sort of lending," said Malcolm Harrison of the Association of Residential Letting Agents (ARLA).

BBC Evanomics: Flat Market

Excellent article showing an understanding of the lies and half-truths told by pyramid groups in collaboration with surveyors and authorities to dupe the greedy and desperate.

sky news: Iraq Cabinet Discussions To Be Revealed

The Government has been ordered to release the minutes of Cabinet meetings where military action against Iraq was discussed.

BBC: Lender moves to debt collection

Mortgage and loan firm London Scottish Bank has said it is to end its lending business to focus on debt collection.

Firstrung: The OFT has issued High Court proceedings against Foxtons estate agents

The OFT has issued High Court proceedings against Foxtons Limited seeking a declaration on the application of the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs) to certain terms in Foxtons' lettings agreements with landlords. The OFT is also seeking an injunction against Foxtons preventing it from using the terms...

FT: Buy-to-let lending up in 2007

"Michael Coogan, CML director general, commented: "Tenant demand for private rented property remains strong and buy-to-let is fulfilling an important role in helping to deliver an increased flow of high quality homes to rent. " - Waffle. what's the high quality bit got to do with it? Some are bogging. "The proportion of buy-to-let mortgages taken into possession was also smaller than in the wider market" - Only just, so far & the trend is massively up. "We expect to see a continuing healthy appetite for buy-to-let finance this year, in line with continuing expected consumer demand for private rental property." - only from naive investors with deep pockets. Risky - Rent will barely cover costs, no cushion for contingencies and why buy a capital asset at the top of the market?

The Telegraph: Anti-depressants 'no better than dummy pills'

Seeing as we already discuss corruption and fraud in financial/political areas, is this article saying that the big pharma companies have been selling us a lie for decades, or did they really not know their drugs were not necessary.

Firstrung: Buy to let investment now over as Nationwide raises deposit requirements to 25%

Nationwide has signalled the death knell to buy to let investors by announcing that is was effectively 'shutting the door' on buy to investment as it raised its deposit requirements (for its best mortgage rates) to 25%. Buy to let investors, who typically revolve their credit agreements and flex more equity out of each property with each 'new deal' to increase their portfolio will be left stunned by this development...

Dan Amerman: Turning Inflation into Wealth

Chilling dissertation about the impossible pension and healthcare liabilities of Western Governments and how they will be solved with inflation. Thought provoking for anyone who has sold to rent and is wanting to look after their stash in the mean time...

MoneyWeek: The housing slump is here to stay

The UK housing market is looking more sickly than at any point since the housing crash of the early 90s. The optimists are still clinging desperately to the hope that falling interest rates will save the market. But those hopes look like being dashed, now that one of the country’s top mortgage lenders has admitted that it would rather turn away business than dish out any more risky loans…

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset

Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent.

Times: Persimmon profits flat as order book drops 20%

Visitor levels have been increasing week by week since the start of 2008, but conversion to sales ratios remain "challenging," the company's trading statement says

Bloomberg: Goldman, Lehman May Not Have Dodged Credit Crisis

* Variable interest entities (VIEs) may contribute another $88bn in losses for banks roiled by the collapse of the housing market - CreditSights Inc. * A fire-sale of VIEs has "Always been our greatest fear," Gregory Peters - Morgan Stanley * Wall Street firms may be forced to return those assets to their books, recording the declining value as losses. * VIEs, aka conduits, had $784 billion in commercial paper outstanding as of last week - Moody's Investors Service & the Federal Reserve. * "Predictions for losses vary widely because banks aren't required to specify the type of assets being held in VIEs or how much they are worth," Tanya Azarchs - S&P

FT: Mervyn King predicts 4 years of falling house prices

In yet another blow for the housing market, Mervyn King, the Governor of the Bank of England, has issued a sober assessment of UK house prices. The Governor warned that UK house prices may fall in real terms for as long as the next four years, as prices largely stayed the same or fell. He was speaking following the release of the Bank's quarterly inflation report, in which he dampened market hopes of a series of interest rate cuts.

FT: Scot property market 'stopping to get breath'

The average price of a house in Scotland has fallen by £411 a week - or nearly £60 a day - in the last three months, according to a report by Lloyds TSB. But despite the quarterly fall, all areas of the country are still showing healthy annual price increases of up to 30 per cent, with Aberdeen remaining Scotland's top property hot spot.The latest Lloyds TSB Scotland Scottish House Price Monitor said there is no cause for panic despite the boom in prices coming to an end. The bank said that property prices in Scotland will "plateau" with the country avoiding a damaging boom-bust scenario.

Guardian: Banks are kicking away the bottom rung of the property ladder

"As a consequence of the credit crunch and sub-prime mortgage concerns, lenders have become much more careful about who they lend to, and on what terms. What we're seeing now is lenders leapfrogging each other to pull deals or raise rates, effectively chasing each other down the best-buy tables. The big mortgage lenders are in competition with each other - but this time it's to be nowhere near the top of the table"

Telegraph: Interest rate cuts are helping house prices

Persimmon, Britain's biggest housebuilder, said that the two interest rate cuts since November are slowly starting to improve consumer sentiment, although it revealed its reservations were 19pc lower than this time last year. The Persimmon chairman said that while many were still adopting a "wait and see" approach to buying a new home, Persimmon was seeing more customers come through its doors every week since the new year. However, converting those visitors into buyers "remained challenging", he said.

FT.com: Wheat prices in biggest one-day rise

Prices of top-quality wheat jumped 25 per cent to a record high on Monday in their largest one-day increase as Kazakhstan, one of the largest grain exporters, said it would impose export tariffs to curb sales. The move, which follows similar export restrictions in Russia and Argentina, is likely to put further pressure on already tight global wheat supplies, analysts said.

The Times: Ten tips to survive a property downturn

These tips seem designed to avert panic thereby preventing in the short term on run on houses. Equally they looked designed to lure in innocent first time buyers. Meanwhile the so called smart money that has been extracting itself will be given more time to get out.

Firstrung: 95% FTB mortgage

Not all mortgage companies are restricting lending, as i said the competition for business is still there...

wikipedia: Monopoly (game)

Our Banks need your help with the Credit Crunch, so do your bit by sending £1,000 notes to these distressed institutions. (Northern Rock are not accepted).

FT: UBS on a Trillion Dollar Meltdown

George Magnus was one of the first to speak of a Minsky Moment last year. Recons the US economy won't bounce back so quickly later this year. The only solution to this crisis is regulatory not liquidty. This guy seems to see things clearly, it is a pity UBS don't listen to their own advisers!

Chicago Tribune: This house was a steal

"The new buyers of a rundown graystone on the South Side showed up Jan. 9 to look at the house they won at a foreclosure auction. They took the plywood off the front door and went inside to make sure the utilities had been shut off. Then they called the police. Sitting upright in the corner of a bedroom off the kitchen was a human skeleton in a red tracksuit. Next to him lay a dead dog. Neighbors told police the corpse was almost certainly Randy Johnson, a middle-age man who lived alone in the North Kenwood house."

Times: Nationwide blow to first-time buyers

The Nationwide knows the market is on the way down and is increasing it's degree of comfort accordingly. "We have altered the tier structure for loans as part of our commitment to being a prudent and responsible lender and in response to the high cost of funding and a cooling housing market."

Bloomberg.com: Stocks in U.S. Rally After S&P Affirms AAA Credit Ratings on MBIA, Ambac

Firesale of assets averted, for now. I wonder what it took to swing S&P around?? Was the deal struck with Washington to drop any inquiry into credit rating agencies' role in the sub-prime debacle in exchange for that politically and economically very precious AAA??

Assetz: Buy to let looking bright for 2008

Buy-to-let investment in the UK is set to go from strength to strength in 2008, it has been suggested. Rental demand is increasing all the time, according to Mr Harrison of ARLA, who said the reasons behind this trend are "demographic". These factors include things such as increasing migration and rising divorce rates. "Traditionally, every time you have house price softening you get increased rental demand," Mr Harrison said. Last year saw the typical buy-to-let property rise by 10.9% to reach an average of £154,795, and Mr Harrison believes that this price will edge upwards.

chinapos: Subprime casualties surface in Britain

Europe has its own burgeoning mortgage meltdown -- in Britain. After years of watching house prices soar even faster than those in America -- modest, three-bedroom tract houses in the London suburbs were going for US$2.2 million at one point -- Britons are now weathering a sharp rise in mortgage defaults.

chinapost: Rising material and labor costs squeezing Chinese factories

Costs have climbed so much that three-quarters of businesses surveyed by the American Chamber of Commerce in Shanghai believe China is losing its competitive edge. Americans continue to want to buy at lower prices," said Kevin Burke, president and CEO of the American Apparel and Footwear Association. "They are used to going to the store during Christmas and getting something cheaper than a year ago." That's no longer a sure thing.

hemscott.: US Treasury to support IMF gold sales if linked to cost-cutting, reforms

Under Secretary for International Affairs David McCormick will lay out the details in a Washington speech later today. In a pre-address briefing for reporters, he said the Bush administration -- which had until now opposed selling IMF gold reserves -- would support a sale of the scale of roughly 8 pct of the IMF reserves or 12.9 mln ounces as part of a package of reforms which also included significant cost-cutting in IMF operations.The proceeds would be used to create an endowment from which the income would be used to finance the IMF operations.

TELEGRAPH UK: Top US businessmen prepare to quit UK

over Treasury plans to tighten tax rules on "non-domiciled" residents, it was reported today. . Alistair Darling wants some non-doms to pay £30,000 a year to the Treasury They work for investment banks like Bank of America and Bear Stearns and international companies including McDonald's

Times: Mortgage approvals spread more housing gloom

There was fresh evidence of a slowdown in the housing market today as figures revealed that mortgage approvals for new home purchases fell by a third in January compared to January 2007. remortgages which accounted for a record 49 per cent of all mortgage approvals.

New York Times: Rising Inflation Creates Unease in Middle East

Even as it enriches Arab rulers, the recent oil-price boom is helping to fuel an extraordinary rise in the cost of food and other basic goods that is squeezing this region’s middle class and setting off strikes, demonstrations and occasional riots from Morocco to the Persian Gulf.

New York Times: Ambac Rescue May Be Announced Mon Or Tues: Source

A rescue for bond insurer Ambac Financial Group Inc may be announced on Monday or Tuesday, a person familiar with the matter said on Friday.

money web: Goldman's profit magic may be fading

Goldman also faces hefty losses on some of its large equity stakes. The most brutal could come from Industrial & Commercial Bank of China Ltd., whose shares have fallen 16% on the Hong Kong Stock Exchange since the end of November. That slide could translate into a financial hit for Goldman of roughly $400 million, based on figures provided in the firm's regulatory filings. Overall valuation losses on such large corporate investments could reach $1.4 billion, according to Mr. Trone.

MoneyWeek: Investors’ Bible predicts doom

The annual Equity Gilt Study from Barclays Capital normally shows shares to be the best investment over extended time periods. But not this time. It looks like we've reached the end of an era.

You Tube: Corrupt Banking System - Cartels Robbing the Public

Corrupt Banking System - Cartels Robbing the Public

45 mintues in 5 parts - this video explains how our debt-based monetary system is flawed. Money as debt is the underlying cause of todays banking crisis

FT: Britain can no longer depend on being cool

"A house price crash would take time to unfold. Assuming a constant inflation rate of 2 per cent a year, nominal house prices would have to go down by about an unprecedented 25 per cent if the decline stretched over six years. Remember: the first stages of a housing downturn consist of denial followed by anger. A fall in actual prices is a relatively late-stage phenomenon of a housing crash." Some substance from the FT. Unlike the witterings we get from our unillustrious chancellor.

Market Oracle: Will the G-7 Nations Impose Capital Controls?

Storing bullion in Switzerland [as the Bullion Vault does for its clients] is a way to go and we would happily recommend working with them as we will do, as it is out of the reach of the G-7. The only drawback to that is that it remains in the name of the owners, who will be resident most likely inside the nations of the G-7. As such they are faced with a dilemma when they declare to their authorities that they own gold in foreign lands. It is no small step for those authorities to tell them to bring the gold home?

Citywire: House prices fall again as buyers start to warm up, says Hometrack

House prices have fallen for the fifth month in a row with prices dipping by 0.2% in February but there are tentative signs of a potential recovery with a sharp rise in new buyers registering interest with estate agents since last summer, according to Hometrack.Annual house price growth, now at 1.4%, is at its lowest level since April 2006, says the survey. But the number of properties listed with estate agents has jumped by 12.8% in February from January according to Hometrack.

Times: Video: the Bricks Chicks on the most expensive property hotspots worldwide

These chicks are really really stupid. What can I say... watch the video. They make some funny remarks on why london is so overvalued, and blame the Chancellor for applying the stamp duty.

Firstrung: Mortgage approvals for house purchase fall by 31% year on year continuing the downward trend

In its monthly analysis of the property market, the BBA has revealed that the number of mortgage approvals for house purchases was 44,288, up from 42,343 in December, which was an all time record low. January's figure is slightly better than certain analysts' expectations, which was for another low of circa 40,000 but is still below the six-month average of 50,484 and a 31.5% fall versus January 2007 figures of 64,648.

Guardian: Hefty US interest rate cuts do not seem to be arresting slide towards recession

''Economic crises go through four distinct stages. First, there is the bubble-induced mania when markets rocket skywards and the word on the street is that the good times will last for ever. After bubble comes denial. This is the period when it is obvious to any independent-minded observer that the party is over but policymakers and the financial markets can't bring themselves to admit it. We hit this phase in spring 2007, when the received wisdom was that the crisis in the US sub-prime mortgage sector was a little localised difficulty that would be comfortably contained. There were no wider implications for the rest of the US economy, let alone the stability of the financial markets or the global economy as a whole.''

Telegraph: Tighter credit means property values will suffer

''The word crash has always been misleading. A dribbling lower is what can be expected. It has started slowly but the momentum will build up as the tightening of credit conditions comes through and the labour market worsens.''

AP - Yahoo: Top Economists See Growing Signs That the Country Has Toppled Into a Recession

Job growth is faltering, consumer confidence plunging. The fallout from the worst housing slump in a quarter-century grows. Wherever you look, the signs are unmistakable that the economy is in trouble.

TELEGRAPH UK: FSA to issue new guidance on CGT sales

News of their plans comes as one of Britain's largest insurers, privately-owned Towergate, confirmed management is selling a stake to cash in part of their fortune before it is eroded by the tax hike. Towergate is the largest company so far to reveal it is planning a sale primarily to avoid the tax change from 10pc to 18pc on business assets. The £3bn group, founded by chairman Peter Cullum, is in "preliminary discussions" to sell a 25pc holding to private equity firm Candover.

Times: The dollar versus gold? No contest

Gold has retained its value, though with fluctuations, over centuries. Even now its purchasing power is not far distant from 300 years ago. Most paper currencies lost more than 98 per cent of their purchasing power in the 20th century alone. Last week gold reached $950 an ounce because the world is losing confidence in all the currencies issued by central banks, but particularly in the dollar. China and India both have a long tradition of hoarding gold, often in the form of jewellery, as a form of personal saving. The Chinese and Indian central banks already have more dollars in their reserve than they can possibly want. They know that the dollar is likely to depreciate over time. They suspect that the Americans will elect an inflationary president. Gold is a defence against inflation.

TELEGRAPH UK: Bankers said that UK lenders were having to access the ECB through the back door

UK lenders with no operations in Europe are particularly at risk of funding problems because they have been struggling to access central bank money.While the ECB has pumped more than $500bn (£254bn) into the wholesale funding markets, dropped its penal rate and widened the collateral it accepts as security, the Bank of England has injected just £20bn.

dailytelegraph: Rises do more harm than good

"It is harsh but you can't get a slowdown in the economy without causing some pain to some people," he said. Macquarie Bank interest rate strategist Rory Robertson said the recent succession of interest rate rises will soon begin to bite in the suburban heartlands of Sydney, Melbourne and Brisbane.

Guardian: Homebuyers told to pay 25% deposit or penal interest rate

"Nationwide will tell homebuyers today that unless they have a deposit of 25% or more of the value of a property they will face higher mortgage rates, in the latest illustration of the clampdown on lending caused by the credit crunch." I say the banks are factoring in future house price drops into their mortgage calculations. The boom is well and truly over.

Daily Mail: House prices continue to drop as boom ends

House prices have fallen for the fifth consecutive month. The average price in England and Wales has dropped to £174,400, nearly £ 2,000 lower than it was in the autumn. Hometrack said prices fell by 0.2% in Feb, taking the annual rate of house price inflation to just 1.4% The 8% rise in February in the number of new buyers registering with agents was well down on the 25% increases recorded in the same month in the previous two years. The average length of time on the market was 8 weeks, the longest since Hometrack records began in 2001.

video - google: G Edward Griffin Creature From Jekyll Island A Second Look at the Federal Reserv

The total money scam. The government can only tax it's people so much. So whatever extra money they want, they get the FED to print or ... all » create out of thin air. This devalues the dollars you hold in your hand, thus is the inflation tax. RON PAUL IS THE ONLY person in Washington that would guarantee an end to this. This is THE ISSUE OF OUR DAY and our nation hangs in the balance of a MAJOR financial meltdown. The money changers of our day are running short on tricks and we need a return to sound money. Ron Paul.

international herald tribune: High oil prices take a toll on the middle class in the Middle East

Even as it enriches Arab rulers, the recent oil-price boom is helping to propel an extraordinary rise in the cost of food and other basic goods that is squeezing this region's middle class and setting off strikes, demonstrations and occasional riots from Morocco to the Gulf.

rottenneighbor.com: A way to anonymously bitch about the jerk who lives down the block

"Rotten Neighbor is the first real estate search engine of its kind allowing you to rate and review good and bad neighbors before and after you move so you can make a smart real estate decision." This is basically an American site but already has some rotten neighbours in London already! But if you complain about your neighbour then it means your own neighbourhood gets a bad rating and makes it harder to sell your house! Slight flawed business model...

Google Video: Lyndon LaRouche Webcast - "Surviving the Greatest Financial Crash Ever"

Get the popcorn out ... 3 hours long

AUSTRALIAN: House sales hit by economics

Tony Pride of Wentworth Real Estate takes bids in South Melbourne. Picture: Richard Cisar-Wrght Real estate industry figures said clearance rates were falling in Melbourne, Sydney and Brisbane, and that rising interest rates and global uncertainly would stifle price gains this year after a strong 2007. Australian Property Monitors analyst Michael McNamara said the weekend's results revealed an increasingly nervous market that was being buffeted by the higher cost of finance, soaring petrol prices and the prospect of the US leading the world into an economic slowdown.

Firstrung: New housing sales collapse by 36% as starts fall by 39%

Housing starts were 39% lower at the start of 2008 than the previous year, figures obtained exclusively by Building have revealed. This news comes on the back of Kleinwort Dresdner's advice suggesting "It's payback time for builders" as they issued investment advice to all their institutional investment clients to 'dump' housebuilder stocks without delay. Research by the NHBC showed that there were 9,135 construction starts in January 2008, compared with 14,998 in the first month of 2007. The average number of new homes sold a day dropped to 550, 36% lower than the year before.

Youtube: subprime mortgage blues

"This is GREAT! I love it! I laughed so hard because there is so much truth to it all"

Guardian: Want to sell your house? Try setting up a home page

"we've seen a 94 per cent spike in the number of direct listings of homes for sale,' reports Gumtree's spokeswoman Sophy Silver. 'It reflects a money-saving mood among sellers, especially as house prices now show signs of dipping.'" Everyone - can I suggest that if/when prices are reasonable, and we are all able to buy a place to live, we make an extra special effort to look for houses online rather than through an estate agent. There is even one in the channel islands now - www.guernseypropertyhub.com, which is amazing because we've only just got electricity here ;-)

Firstrung: Firstrung, first time buyers, the week in focus

In order to recover and to prevent a massive 'pipeline backlog' of new builds, developers need to find new markets. There is only one new market, the priced out first time buyer. With the average price of a newbuild at 230K and the average price an FTB can afford being approx. 150K, builders need to slash and burn prices by 30-35% to achieve the level of sales they need in order to operate profitably per unit sale. Sitting the market out and keeping a 'weather eye' on the window that is new home sales could prove to be fascinating. There is no under supply of housing, this has been the outstanding perpetual urban myth peddled by the ill informed or mischievous during the house price bubble.

The Times: Recession and repossession: surviving a great fall

"In the end, the flat that they had bought for £69,000 was sold by the mortgage company for just £27,000, leaving Tommy and his sister liable to the tune of £47,000 ... Now 43, he works as the manager of a homelessness project, lives in a rented flat and has vowed never to buy a property again."

Telegraph: Council tax bills cover-up exposed

Tens of thousands of householders could have been paying too much council tax for years in a "scandal" that ministers attempted to cover up. Ministers and officials have known since at least 2005 that many homes were placed in the wrong tax bands, with householders paying more than they should. It is claimed that the miscalculations could have affected up to 400,000 homes - and it is still not known how far back the over-payments go.

This Is Money: Repossession nightmare still haunts me

The return of the scourge of house repossessions brings back painful memories for Grant Derbyshire. As debt charities urge people to take action if they are having difficulty paying their mortgage, Grant, 50, relives the nightmare of losing his home.

Hiday.net: USA PROPERTY MARKET

At the moment it seems America has a lot more to fear than falling satellite dishes. Many financial commentors agree that the US economy is in a lot more trouble than when the dot.com bubble burst a few years ago.

Times: Thousands trapped in Northern Rock loans

Tens of thousands of Northern Rock borrowers face being trapped in mortgages charging punitive rates of interest following the bank’s nationalisation last week. About 175,000 borrowers are thought to have been lured into Northern Rock’s controversial 100%-plus loans over the past few years. They are now likely to find it extremely difficult to remortgage after most lenders pulled out of the market last week. If they stay with Northern Rock, however, they face a huge “payment shock” with repayments likely to go up by as much as £2,000 a year on a typical loan of about £150,000. The nationalised bank already has one of the highest rates of repossessions of any lender, and the plight of the 100%-plus borrowers could make matters much worse.

Times: Top builders Persimmon and Barratt set to reveal market woes

TWO of Britain’s biggest housebuilders are expected to trigger fresh worries over the state of the housing market this week by confirming that reservation levels at their developments have plunged by more than 20% compared with a year ago. Persimmon and Barratt, which report financial results this week, are tipped by City analysts to caution that reservation levels have dropped by 20%-30% as buyers struggle to secure attractive home loans following a clamp-down on riskier mortgages. Barratt is offering first-time buyers the opportunity to buy 100% of a property for 75% of the purchase price through an interest-free loan under its Dreamstart scheme.

Observer: US house prices plunge into negative equity

More American homeowners are mired in negative equity than at any time since the Great Depression of the Thirties, a signal that the housing crisis has spread to the wealthier middle classes. Over 10% of homeowers owe more on their mortgage than their homes are worth. Bob Corwin bought a condo for $315,000 and spent $365,000 doing it up. It sold for just $290,000. 'Foreclosure is a good option for flippers,' Wyss says. 'If your house is in negative equity and you can't sell it, why should you go on making mortgage payments? It makes little sense. You can just walk away and hand the keys over to the bank.' The worry now is that the US market could be flooded with over 5 million foreclosed houses in the next year, deepening the crisis further.

Observer: House prices will fall 8% in 2008, and keep dropping

House prices will decline by 6% in 2008, and continue falling next year, as anxious homeowners rush to cash in their gains, analysts at JP Morgan warned this weekend. Just three months after predicting that prices would stagnate, JP Morgan's chief UK economist said the evidence now looked 'pretty bleak'. The number of new mortgages approved (a good predictor of future demand) has fallen for the seventh month in a row, to the lowest level since 1995.

Telegraph: Cleveland: ghost town created by America’s loan scandal

One particular quote caught my eye: "Many homeowners who were struggling with their loans were using equity from their rising house price to refinance their mortgages. With the housing boom over, and lenders tightening their standards, troubled borrowers could end up without the equity they need to refinance their loan or to sell their home and pay off their loans." Sound familiar?

The Times: Business Article

Very much something for after the weekend...

The Times: Germans accuse UBS of sub-prime ‘mis-selling’

"ONE of Germany’s biggest financial institutions is to sue UBS, the Swiss banking giant, claiming it was mis-sold hundreds of millions of pounds worth of sub-prime securities. The action is expected to trigger a wave of similar lawsuits across world financial centres as institutions seek recompense for losses incurred from buying complex financial instruments that are now worth a fraction of their original price." I think I can safely say that we will see more of this in future.

Rightmove house prices: Rightmove house price report Feb 2008

Am looking to buy a 400K-ish two-bed in zone 3/4 W or SW postcode in London, as baby due in 6 mths. Did one round last Nov and one last week -to discover the asking prices had indeed moved up, by nearly 5-10% BUT only bcos sellers know they have little option but to sell at (sometimes) double digit discount to asking price. So Rightmove's 3.2% headline rise in Feb is yet another 'statistical' ploy by yet another in the 'estate ecosystem' to breathe life in a falling market. In fact, tho most agents were putting on the usual brave story of good demand, bonus time etc - we saw examples of actual drops of 5-8% in asking price by time-bound sellers. And yes, even for decent period property in good locations, Draw ur own conclusions.

Evening Standard: What crisis? City workers handed £7billion bonuses

Apologies if this has been previously published. Well, you can buy a few "Bargain Buckets" with that amount. Good on them, they have earned it. ;)

Channel 4 - Fone jacker: Internet Service Providings Strange Estate Agent

I don't want to make too many generalisations here as contributions from people like HonestEA (http://www.housepricecrash.co.uk/forum/index.php?showtopic=68544) are greatly appreciated by many people on this website. However, for every prime EA there seem to be a great many sub-prime EAs. This phone wind-up captures one in action telling a call centre worker how to speak English properly and that "the customer is always right". As I said, some light entertainment! ;o)

BBC "News": January sales fever seen online

Online shoppers caught sales fever last month, spending more on the web than in any previous January, figures show.

The Times.: When it comes to seeking advice on making a fortune in business, take it from Jim Mellon

A highly successful investor worth £620million makes a remarkably bearish statement about the UK housing market predicting nominal falls of 20% in the next few MONTHS. No doubt "the world's greatest newspaper" would place him in the doomsayer rather than the expert camp.

Times: John Lewis shocks retailing with worst sales fall for year

John Lewis sent a shudder through the high street and sparked fresh fears over the health of the British economy yesterday by reporting its biggest sales decline for almost a year. John Lewis’s statement came as the AA reported that petrol prices had climbed to a record high, with unleaded petrol rising to 104.49p a litre. Motorists are now spending £500 million more a month to fill up their cars than a year ago and they face a further rise in petrol duty on April 1. George Buckley, the chief UK economist of Deutsche Bank, said: “I’m afraid that John Lewis’s figures are a sign of things to come. Debt repayments are going up, house prices are going down, taxes are at a 20-year high.

Telegraph: Citigroup facing further big write-downs

Citigroup is facing further financial write-downs after revealing it has an exposure of $4bn (£2.03bn) to the troubled bond insurance sector and has been forced to move a $10bn hedge fund on to its balance sheet after significant losses. They must be keeping their fingers cross in the hope the bond insurance companies are rescued! The banking conglomerate also warned that further deterioration in the US housing market could lead to further write-downs in its sub-prime and leveraged loan books.

Reuters: Ambac rescue may be announced Monday or Tuesday

A rescue for bond insurer Ambac may be announced. Ambac, facing billions of dollars of expected losses from guaranteeing repackaged subprime mortgages, is talking to banks and regulators about raising extra capital to keep its top credit ratings, A deal has not yet been signed, and may still fall through. Investors fear that Ambac will lose its top credit ratings forcing investors to sell billions of dollars of securities and lifting borrowing costs for consumers and city governments. The U.S. bond insurance industry, which guarantees some $2.4 trillion of debt, is broadly looking to raise new capital and reorganize as expected losses have mounted. Rescuing or restructuring bond insurers is difficult.

The Times: Misleading house price spike

With the economy teetering on the brink of recession and a massive slowdown in mortgage lending already under way, house prices jumped by an astonishing 3.2 per cent last month, according to Rightmove, the estate agency website. But what is behind this gravity-defying leap in the cost of housing?

BBC: Homes turned into 'drug factories'

"You have well-dressed, respectable people going around to local estate agents and renting property. Nothing seems particularly out of the ordinary about that." Tenants usually pay their rent up to months in advance before knocking down walls, installing heating and lighting then disappear after the harvest, leaving houses in disrepair and landlords facing unpaid electricity bills of up to thousands of pounds.

The Daily Mash: PUT UP THE PRICE OF EVERYTHING, SAYS TESCO

Sir Terry Leahy said legislation was necessary to double or treble the cost of all things in shops, except for wages which were already high enough.He said the low cost of eggs was fuelling an egg frenzy across the nation, making many town centres no-go areas at the weekend because of binge-scrambling. "No one is against the responsible use of eggs, one or two a day with meals, but we're now seeing an alarming rise in the number of young people who are making their own mayonnaise."

Reuters: US STOCKS-Dow, S&P 500 turn up on report on Ambac

Well after what can be politely described as a volatile week in the FTSE, the late grey market is showing some rises on this latest piece of news that CNBC is leaking. Have a great w/end!!!

Telegraph: Price of new build flats 'set to crash'

The price of new build flats are heading for a "full scale crash", causing misery for tens of thousands of buy-to-let landlords who gambled on an ongoing property boom, writes Paul Farrow. According to Dresdner Kleinwort Wasserstein "reckless lending and over-building of flats threatens recession because a bubble had been stoked "by highly speculative (and potentially highly suspect) development, lending and valuation practices which have led to over-supply of flats in cities across the country, most notably Leeds". Flats rose from 21 per cent of all housing starts to 49 per cent in Q3 2007. Tellingly, said Dresdner, it fell off in Q4, supporting suggestions from, among others Housepricecrash.co.uk, that a number of higher density city centre sites could be 'mothballed'.

Safe Haven: Why Inflation Will Trump Deflation (Reasons 1-2)

No limits to US tax rebate money creation.

FT: Experts claim UK is suffering 'stagflation'

The UK is now experiencing a mild form of stagflation, experts have claimed. Stagflation - a combination of a stagnant economy and high inflation - was the scourge of the global economy in the 1970s.Ross Walker, UK economist at RBS, said: "What we have now is nothing like the 1970s, but by the standards of the last decade, we have above-target inflation and slowing growth. "The output/inflation trade-off has deteriorated. For a given amount of growth in the economy, there is more inflation."Mr Walker was commenting after the Bank of England published its February Inflation Report last week.It predicted UK growth would slow sharply to less than 2 per cent by the end of the year.

Evening Standard: Lloyds TSB dodges crisis

Britain's fifth-largest bank has nailed its colours firmly to the retail market. That helped push up profits by 6% last year to £3.92 billion with a relatively modest £280 million loss on its involvement in subprime-related investments.

BBC: Question Time

Ruth Kelly in a right mess. Vince Cable murdered her. The truth is coming out about the over inflated housing bubble.

Telegraph: Humberts crisis may trigger estate agency consolidation

Humberts Group, the estate agency and surveyor that is part-owned by property tycoon Vincent Tchenguiz, has swung to a full-year loss, taking a £18.4m hit as Britain's once booming property market grinds to a halt. Executive chairman John McLean said today: "We are battening down the hatches. "The business needs to be streamlined for when the housing market improves."We expect house prices to continue to decline - as previous cycles have indicated - before reaching a plateau."

msn: win-win for landlords under new capital gains tax laws

And if the property market remains stable for the moment, some property investors will be tens of thousands of pounds better off if they decide to sell their property after April 1 2008. Even if investors decide to ride out the market uncertainty the opportunity to maximise and profit from their rental yields leaves landlords in a win-win situation.

Moneymarketing: BM Solutions last lender to quit 125% arena

BM Solutions has confirmed it will be withdrawing its Mortgage Plus product after every other lender in the 125 per cent loan to value market pulled out this week. This comes after Alliance & Leicester, Abbey, Coventry Building Society and its subsidiary Godiva Mortgages all announced their withdrawal from the market on Tuesday. Northern Rock was quick to follow with confirmation yesterday that it would be withdrawing its Together range from the end of play.

Guardian: Mortgage lenders at risk of falling into credit-rating trap

Fitch does "not expect a collapse in UK house prices." They also do not expect the sun to set this evening, adding that such predictions are overly pessimistic given the sound astronomic fundamentals and the lack of visible evidence that the world is still turning.

HMRC: HM Revenue & Customs Tax Evasion Hotline

"HMRC is committed to targeting tax evasion. We know some people don't pay their fair share of tax, which is unfair for the rest of us. Now you can help us do something about it. The Hotline can take your call on 0800 788 887 (Lines are open Monday to Friday 8am to 8pm, Saturday and Sunday 8am to 4pm)"

Guardian: Tax crackdown on buy-to-let landlords

My heart is bleeding. I wonder if there is a snitch phone number (like for benefit cheats) number to wipe out the smug dinner party boats ? "Buy-to-let investors who have not paid tax on money made from letting or selling a property are to be targeted in a major crackdown that accountants say will net millions of pounds for HM Revenue & Customs."

MoneyWeek: Does it matter if London house prices fall?

I'm sure our fan Anne Ashworth thinks it matters. I'd love to see Merryn & Anne debate this on TV; my money would be on the true expert, as opposed to the buy-to-fret hack.

MoneyWeek: Expect more government meddling with banks

We should expect even more government meddling (a la Northern Rock), begged for by the finance industry and willingly supplied by policy-makers desperate to appear decisive. And for as long as this circus keeps rolling on, you might want to keep buying gold as defence...

The Guardian: Revenue launches crackdown on buy-to-let landlords

Poor old BTL'ers must feel everybody is against them these days!

FT: Gold nears $1,000 as stagflation fears grow

Bullish gold price forecasts...

Telegraph: Severe US recession may already be underway

''...A severe recession may now be under way in the United States, according to a closely watched economic barometer. The Philadelphia Fed warned late yesterday that the manufacturing sector in the key heartland of the US is suffering its lowest output for seven years - a firm sign that the world's biggest economy is now shrinking, experts said....''

Financial Times: The Short View: Housing market momenum (sic!)

Momentum, we know, is a powerful force from politics to securities markets. But it could be at its most damaging in the housing market.

Firstrung: Northern Rock tops repossession league table

With 690 claims in the month of February alone the Northern Rock actions dwarf those of, for example, Nationwide and HBOS, who do not feature in the top twenty. This also represents an approximate 50% increase vis a vis feb 2007 when NR issued 458 possession claims. Even more worrying for UK mortgage lenders as a whole is that 17,565 possession actions were entered into court in the single month of February after a staggering 22,082 in January*. As a direct comparison, (vis a vis 2007), during the fourth quarter of 2007 a total of 35,662 mortgage possession claims were issued on a seasonally adjusted basis in that three month period. 46% of these mortgage possession orders were suspended.

Guido Fawkes: The myth of the "quality loan book"

Alistair Darling and Gordon Brown chant the same mantra, the government's investment is backed by the assets of the Northern Rock, "a high quality loan book", which they claim has been verified by the FSA - as if the FSA employs surveyors and has the competence to take a view. Anatole Kaletsky said this was a delusion. Now Guido has the numbers to prove it. In February NR had the highest rate of repossessions of any mortgage lender, averaging 40 every working day.

ABC news: Housing stress on the rise: AIHW

AIHW spokesman David Wilson says the figures show the cost of housing and the shortfall in supply is creating housing stress for many Australians, and for some of those people, the assistance is not easing any pressure. "The figures indicate there's more households facing household stress just due to the shortage of housing, rising house prices and generally difficulty in meeting rent payments by some households," he said.

Times: Northern Rock's links to Granite could increase risk for taxpayer

Spliced and diced via Granite, "if Northern Rock decided to terminate its relationship with Granite then the stricken bank would be in “very difficult waters indeed”.

Firstrung: UK house prices crash in certain areas of the UK in final quarter of 2007 - Land Registry

The latest fourth quarter Land Registry statistics have shown that house prices in certain areas of London have crashed in the last quarter of 2007. These prices could be the first indcation that the much discussed 'credit crunch' has finally begun to eat away at house prices in areas that were previously deemed to be impregnable.

smh: Skipping meals to pay rent RISING rents are forcing thousands of people to skip meals and admit they are too poor to send their children on school excursions, new figures reveal

Many home owners pay their mortgage by taking second jobs, but Professor Burke said "any economic slowdown means they could lose those jobs, and then you have thousands who are going to be in trouble. I suspect we are approaching that situation."Professor Mike Berry, an economist and urban planning expert from the RMIT University in Melbourne, told the conference that when the property boom slows, house prices in less-favoured areas will fall.

MoneyWeek: Is America heading for a Japan-style crisis?

In the 1990s, Japan struggled with a burst credit bubble, fast-falling asset prices and a near-bankrupt financial sector. Now the US is heading in the same direction. And Britain’s economy is also in more trouble than most...

BBC News: Migrants go home

...And away from the labour market, think about house prices! At a time when they are falling, a reduction in migrant numbers might intensify the difficulties faced by buy-to-let investors, and the market as a whole.

BBC: Northern Rock halts 125% mortgage

"The flagship offer from the bank will be closed from 2000 GMT. The deal lets customers borrow up to 125% of the value of their homes and has been criticised for encouraging people to take on large debts".

Evening News: Slump won't hit city says estate agent

Summary of Article; Journalist; Will property go up forever and ever? EA; Of course it will. Some papers are scraping the bottom to keep the bubble inflated

Greenbay: lease back scheme

i went to a landlord meeting yesterday concerning a lease back scheme being offered to landlords, they basically offer landlords a five year contract where they guarantee rent upfront every month without any void periods regardless if the property is tenanted, they guarantee any damage is covered etc etc and deal with all tenants basically totally handsfree for the landlord plus there is get out clause with six months notice if i required any of the properties back. The rents are very good in terms of property prices around the newport area for example a 3 bed terrace they will give a net value of £525 per month and they range from 80000 upwards. so i must say im looking to purchase a few more and likewise the feeling im getting is many other landlords are doing the same....

BBC: Government suffers Rock defeats

The government has suffered defeats in the House of Lords over parts of its plans to nationalise Northern Rock. Peers have voted for an independent audit of the bank's books within three months, followed by annual checks. They also voted against plans to exempt the bank from Freedom of Information laws. Once peers finish debating the bill it will return to the Commons. Ministers will have to decide to accept any changes peers make - or reject them and send the bill back to the Lords.

Times Online: Government defeated over NR nationalisation plan

Darling and Brown's cunning plan foiled by dastardly ermine-clad aristos... who would have thought inherited wealth would have come to the rescue of hard-working taxpayers and savers??? This is getting interesting...

Bloomberg: Auction-Rate Debt Succumbs to Bid-Rig Taint as Citigroup Flees

The collapse of the auction-rate bond market, where state and local governments go to raise cash, demonstrates that regulators are no match for Wall Street. Hundreds of auctions have failed this month, sending borrowing costs as high as 20 percent because dealers from Goldman Sachs Group Inc. to Citigroup Inc., UBS AG and Merrill Lynch & Co. stopped using their own capital to support the sales. Regulators, who allowed the manipulation of bids and lack of information to persist even after two probes in the past 15 years, are now watching a $342 billion market evaporate at the expense of taxpayers.

Mortgagesolutions: A&L to scale back mortgage offering

Alliance & Leicester (A&L) is retreating from the mortgage market after revealing it had suffered £185m losses in the wake of the credit crunch, knocking 30% off last year’s profits. Following the news of the losses, shares slumped to a record low of 428p yesterday and were 472p at the time of going to press. The problems have forced the bank to cut back its lending, with Chris Rhodes, acting finance director, revealing A&L would concentrate on keeping its existing customers during the coming year rather than seek out new borrowers by offering market-leading mortgage rates. In yesterday’s trading statement, Rhodes commented: “We expect net new mortgage lending to be negative this year. We expect to concentrate on customer retention."

MoneyWeek: House building stocks get demolished

It’s refreshing when you see an analyst really laying into something. And that’s exactly what Dresdner Kleinwort’s Alastair Stewart did to the housebuilders' stocks yesterday. Forget about a soft landing for property. Housing demand has been entirely a function of the amount of money available to borrow to pump into property. That availability isn’t diminishing slowly – it’s been pole-axed by the belated realization – stemming initially from the US - that borrowed money has to be paid back sometime. And that means demand will collapse.

Times: Apartment walls will come tumbling down

There just aren’t enough affluent young urbanites to buy or rent all this new space without big price falls. Ipswich, bluntly, is not Manhattan. Moreover, the boom of the past few years has been fuelled not only by reckless bank lending but also by a “conspiracy of acquiescence” between developers and valuers at best and, in many cases, downright fraud. That is likely to make the ensuing bust all the more painful.

Safe Haven: Gold & Whirlwind of Crisis

The gold & silver prices will rise from the cheap money, low interest rates, stimulus packages to ward off recession, rescues to banking, and lower USDollar. But the USEconomy desperately needs the next ‘Policy Bubble’ in order to come back to life, to produce jobs, to change national psychology, to revive hope. Without a plan to puff a new bubble, which will buy some years of time, the nation will morph into chaos. A military dictatorship would be the only alternative. The urgent next step is leaders with some vision, rather than a plan for private profiteering, founded upon fear. Hope pays off more than fear, unless fascism is the end game.

The Sun: I'm going Batty for Wembley

JONATHAN WOODGATE is being driven Batty because he cannot find a decent-priced house to buy in London. The Spurs millionaire centre-back's only problem so far has been finding a pad for himself and his girlfriend. He said: “I’m still living in an hotel. We have looked at houses and it’s a lot more expensive than it is up north. “House prices are a joke, it’s unbelievable. But that’s London. Hopefully, I can find a house and get settled. You just want the right place. “It’s expensive for everyone. You don’t want to be blowing stupid money on a house.”

Telegraph: Biggest brain drain from UK in 50 years

No other nation is losing so many qualified people, it points out. Britain has now lost more than one in 10 of its most skilled citizens, while overall only Mexico has had more people emigrate.

Citywire: Property: The diversity and detail beyond the property headlines

Hysterical media claims of a looming recession tend to tar the entire UK property market with the same brush. An economic low, yes, but different regions have seen contrasting fortunes that cannot be lumped together, argues Richard Sexton of e.surv. Those with a need to understand their particular area of the market appreciate that it is highly granular, with significant variety across small geographical distances. Those who doubt this should consider that valuers and agents operate in areas which can be less than three square miles. This is the level at which predictions become useful.

Torygraph: Landlords, not retailers, kill communities

Of the commercial, rather than residential type, but considering that most people never get past the headlines it just adds to the drip, drip, drip of sentiment change.

Guardian: A&L to reel in mortgages after 30% drop in profits

Acting chief executive Chris Rhodes issued a stark warning to consumers that the cost of mortgages is going to rise – regardless of any official cuts to the Bank of England base rate – and that they needed to keep a clean credit record if they wanted to be granted a loan in 2008.

Times Online: UK housing market close to collapse, analyst says

Britain’s housing market is a “house of cards” that is set to implode after years of reckless mortgage lending, chronic oversupply of new flats and widespread fraud, a leading analyst said yesterday.

MSE: Recap of last 24 hours news

A mortgage advisor writes: "Just to add to an absolutely horrific day.. I'm sick of it, every day I get a redundancy email, a lenders gone bust email, or we are not doing high LTV/self certs/BTL's anymore email. Makes my job an absolute nightmare. If lenders retract much further we will only be lending to super clean prime full status clients and there will be a lot of people looking to rent!" In the past day: Alliance and Leicester and Abbey pull all their 100%+ LTV deals, followed shortly afterwards by Coventry and B&M, leaving only NR. Picture Loans closes to new business ("temporarily") LMS mortgage packagers goes into receivership And Platform mortgages, the sub-prime arm of Britannia, sacks 20% of its workforce.

CNN: Loans failing pre reset

Unbelievable situation where banks knew they were taking on bad debt but could 'securitize' it so they didn't care. Deeply perverse.

MortgageSolutions: Assetz results reveal extent of house price slowdown

The extent of the recent house price slowdown has been reflected in the latest results of the Assetz House Price Watch, revealing a marked decrease on this time last year.

BBC: China inflation hits 11-year high

Chinese inflation hit an 11-year high in January after rising price pressures were exacerbated by fierce snow storms, official figures show. Soaring food prices were largely blamed for pushing consumer inflation up to 7.1% last month, from 6.5% in December.

icWales.co.uk: Dilapidated shed on market at £150,000

"IT'S partially covered in plastic sheeting and even the estate agent trying to sell it admits it's 'dilapidated'. But this rundown shed in a top Welsh property hotspot has gone on the market for £150,000.Though based in the plush beach resort of Abersoch, in Gwynedd, the shed does not boast the kind of dramatic sea views that have seen similar properties marketed for up to £500,000. But estate agents Beresford Adams say that despite the absence of a stunning panorama, the shed has already attracted three bids in excess of the £150,000 asking price. A spokesperson even hinted a bidding war could drive up the price to around £175,000 before a deal is reached.The building's dimensions are just 18ft by 15ft, though it does have water and electricity supplies."

BBC "News": Taxpayers to get Rock rubbish

Yes, its that word again whose name they dare not speak. When does an asset cease to be prime and start to be subprime exactly??

CNN: Prices jump more than forecast - Report shows inflation remains persistent, with annual rise of 4.3%.

The pace of inflation rose in January, according to a closely watched government report Wednesday that showed price pressures were higher than Wall Street expectations. The Consumer Price Index, the government's key inflation reading, rose 0.4% in the month after a 0.4% jump in December. Economists surveyed by Briefing.com had forecast a 0.3% rise in January. BBC Headline for this "US inflation AT 0.4% in January."

BBC: Death knell for 125% mortgages?

Wot? They're phrasing that as a question?

guardian: Three lenders scrap 125% mortgage deals as criticism increases

Three mortgage lenders yesterday pulled the plug on deals that allow home buyers to borrow as much as 125% of a property's value - the day after Northern Rock came under fire for offering similar deals.

FT: America’s economy risks mother of all meltdowns

This article discusses Prof Nouriel Roubinis '12 steps to financial disaster', which describes the sequence of events that he thinks will lead from 'Step 1: the worst housing recession in US history' to 'Step 12: a vicious circle of losses, capital reduction, credit contraction, forced liquidation and fire sales of assets at below fundamental prices'...

financemarkets.co.uk: House prices fall 1.57% in January

"During January house price actually recorded a 1.57% fall across the whole market. ... Mr Amlôt believes that February’s further rate cut is unlikely to have any real impact on the weakening housing market."

Telegraph: BoE's housing expert warns of shock rise in mortgage bills

''Many homeowners are facing a "significant" shock in the coming months as they experience a sudden leap in their mortgage bills, the Bank of England's housing expert has warned.''

MoneyWeek: The best contrarian indicator of all: the Labour government

The Labour government is fast becoming one of the great contrarian indicators in the history of markets. After selling gold at the bottom of the market, they buy an insolvent mortgage lender at the top of the housing market. Are they really this incompetent?

MSN Money Investing Article: House Prices Enjoy Boost

House prices surged ahead by 3.2% during the past month as the market enjoyed an exaggerated seasonal bounce, new figures show. The average cost of a home in England and Wales rose by more than £7,400 during the four weeks to February 9 to stand at £237,856, according to property website Rightmove. But the group cautioned against reading too much into the survey, saying that while there were signs of renewed optimism among sellers, the figure was likely to have been distorted by the final rollout of the Government's controversial Home Information Packs.

BBC: Mortgage lending lift in January

Gross mortgage lending rose in January despite an unsettled housing market, according to the Council for Mortgage Lenders (CML). The CML said lending increased to an estimated £26.5bn in January, up 11% from £23.9bn in December, but still lower than most months in 2007. Yet the CML warned gross lending volumes were expected to be lower in the coming months, following a fall in mortgage approvals towards the end of last year.

BBC News: House prices drop as boom slows

"The end of 2007 saw prices drop so that the average house was worth £230,000 compared with a peak last summer of £250,000." Prices in Belfast - currently less affordable than London or Sydney and in the list of 10 least unaffordable cities on the planet - have dropped by about 13% in a quarter, but apparently there's no crash. The reason? Well apparently (according to the author of this survey on the radio) a drop of a few more % - no doubt bringing Belfast on a par with London and Sydney - will make property 'affordable' again for buyers. Also, it's those 'strong fundamentals' again - the world economy has no effect on us - hadn't you heard that Belfast is the new Monaco?

BBC: Bank voted 8-1 for cut to 5.25%

''The Bank of England's rate-setting Monetary Policy Committee (MPC) voted by 8-1 to cut interest rates to 5.25% earlier this month, minutes have shown.''

Times Online: Alliance & Leicester profits drop by almost third

''Alliance & Leicester reported a 30 per cent fall in profit last year after being hit by a £185 million writedown on its investments in the credit market. ''

FT: America's economy risks the mother of all meltdowns

Martin Wolf of the FT has a look at the case for a economic meltdown. He considers the work of Nouriel Roubini of New York University's Stern School of Business who correctly predicted a hpc led recession. Roubini laid out "12 - steps to financial disaster" many of which are already well underway. I have put a Yahoo hosting of this article link here because the FT one is only available to subscribers.

Telegraph: Northern Rock borrowers told to go away

Northern Crock has told independent financial advisers to encourage homeowners who are remortgaging to obtain loans with other banks. Melanie Bien, director of mortgage broker Savills Private Finance, said: "Northern Rock is encouraging existing clients to go elsewhere. We have had them come to us, saying that for people at the end of their deals they do not want the business any more. They just want to be a savings bank." In the past few weeks that Rock has written to existing borrowers whose deals are due to expire, offering no new competitive loans to renew borrowings and instead advising them to speak to an IFA about mortgages elsewhere. Well better late than never. Although I am not sure what the other banks will say if the Crock nicks all there savings customers!

Telegtaph: Alistair Darling accused of Northern Rock Freedom of Information cover-up

The Chancellor took the unusual move of introducing small print into emergency legislation yesterday to prevent public scrutiny of the bank, which has been nationalised, MPs were forced to vote on the nationalisation yesterday, despite being kept in the dark over what public ownership will entail. George Osborne, the shadow chancellor, said last night: "The public is now paying for this bank, so we are entitled to know what it is doing with our money. The legislation allows the Government to nationalise any financial institution - raising fears that ministers may know that other banks are in trouble. Just what are the government trying to cover up?

The Times: Borrowers on 125% mortgage deals face big jump in repayments

Thousands of borrowers on 125% mortgage deals will be forced to pay hundreds of pounds more in monthly repayment bills after most of the lenders offering these loans withdrew from the market yesterday. The credit crunch and stalling house prices have forced four leading lenders (A&L, Abbey, Coventry BS and Godiva) to stop offering 125% mortgage deals. Another lender said that its deals were under review, which could leave Northern Rock as the only lender still offering this type of loan. The mortgages typically offered 95% of the value of a home as a traditional mortgage, plus another 30% as an unsecured personal loan. There are fears that some home-owners will be unable to find a similar offering when their current deal ends.

Telegraph: The state of Northern Rock: anything but unusual

"At Northern Rock's heart is Granite, a £45bn securtisation vehicle though which mortgages are parcelled up and sold to investors. Under "substitution clauses" in Granite, investors can call in their loans if maturing mortgages are not replaced with new ones. Should the clauses be triggered, investors could demand their funding back - potentially leaving the Government with an immediate £45bn bill."

Guardian: Economic confidence plummeting, poll shows

A sharp drop in economic confidence is hitting poorest people hardest, according to a Guardian/ICM poll. The poll shows that economic optimism has fallen away since the start of 2008, with a majority of voters (51%, up from 45%) now worried about their financial circumstances and the cost of living.

sky news: Insider trading rife Australian stock market

New research has found insider trading in the Australian stock market is so rife that it is weakening the reputation of the local bourse. The Australian Securities Exchange is under pressure to boost resources to crack down on the practice, which could include $1 million insider trading fines and bans. Senior executives at two investment banks say insider trading has become part of the system, with regular lifts in the share price of takeover targets in the days before any official announcement. The revelations are the latest blow to the ASX which is already reeling from wildly volatile trading, following the collapse of stockbroker Tricom and questions over risky investments such as CFDs.

CreditFlux: Cohen CDO hits event of default

Moody's announced yesterday that it has downgraded ratings of seven classes of notes issued by Kleros Real Estate CDO III, and left on review for possible further downgrade ratings of three of these classes of notes. Moody's said the rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence on 31 January 2008, of an event of default. Among the tranches downgraded were the class A1b notes, which went from Aaa to Caa2. Kleros Real Estate CDO III is backed primarily by a portfolio of structured finance securities. The transaction is managed by Cohen & Company's Strategos Capital Management.

streetwise: Care to Dance the Contango?

Care to Dance the Contango? Any time that commodity prices reach highs or lows, speculators are invariably the culprits. Today’s energy market is no exception. Many commodity market commentators have been quite upfront in their assertions that current high energy prices (and metals prices too) are due to speculative excess, rather than supply and demand conditions. Now the Senate Permanent Subcommittee on Investigations has endorsed these views (and given them substantial credibility) in a just released a report claiming that fundamental supply and demand conditions cannot explain current high oil prices, and asserting that speculative activity is to blame instead.

FT.com: The $280bn question: where are the rest of the subprime bodies?

When finance ministers from the Group of Seven nations gathered in Tokyo last weekend, the mood was distinctly gloomy. With credit stresses spreading, policymakers agreed that the financial outlook looked distinctly “uncertain”.

BBC: House price 'threat' to economy

Kate Barker, a member of the Bank of England's Monetary Policy Committee, warned that the bank would not be able to stop this in the short term. Therefore, she said, the MPC would be paying particularly careful attention to the financial and property markets. But rate cuts would be hard to justify in the face of inflationary pressures. p.s. Great! Dispatches documentary last night.

The FT: US banks borrow $50bn via new Fed facility

"The TAF ... allows the banks to borrow money against all sort of dodgy collateral,” says Christopher Wood, analyst at CLSA. “The banks are increasingly giving the Fed the garbage collateral nobody else wants to take ... [this] suggests a perilous condition for America’s banking system.”

Bloomberg: Hedge funds pocket 'easy' gains on Northern Rock nationalisation

Small shareholders demand a 'fair' price of 425p/share. "Is he having a laugh". The only way to make money out of The Crock is to bet against it.

BBC: Rock bill going before Parliament

MPs have begun debating the nationalisation of the Northern Rock, as it emerged the bank's new chief executive is a non-dom. Ministers want to put the troubled bank into "temporary public ownership" in the hope of finding a long-term buyer. This has prompted Tory calls for Chancellor Alistair Darling to resign. Meanwhile the BBC's Robert Peston said Ron Sandler, the Rock's new boss, is a non-domiciled South African who pays tax in the UK only on his UK earnings.

BBC News: Mortgage rate rise 'shock' fades

FSA says 1.4 million mortgage holders will see their teaser rate deals expire this year, but CML argues they will all get great new fixed rate or tracker deals. So that's OK then! How this argument that everyone will get good new deals matches up with the expectation that Northern Rock is to put up rates to get rid of half of its 800,000 mortgage customers I don't know.

Mortgagestrategy: Standard &Poorss puts Bradford & Bingley on credit watch

Standard & Poor's has put Bradford & Bingley on credit watch with negative implications. The ratings agency says the credit watch on B&B’s A-1 short-term counterparty rating is due to rising impairments, potential margin pressure and further markdowns as well as continuing funding constraints. Nick Hill, credit analyst at S&P’s, says these factors “may not be consistent with the current rating”. Standard & Poor's has put Bradford & Bingley on credit watch with negative implications.

Market Oracle: Northern Rock Bank Nationalised- Which Bank will be Next?

Which other banks will follow Northern Rock? There will be further failures as the credit crisis is deepening. The US monoline insurers face failure thus magnify the original estimates of bank losses potentially ten fold ! The prospects for the UK mortgage sector looks dire, with the UK housing market having barely begun to feel the impact from the credit crisis (see graph in article). Mortgage banks such as Bradford and Bingley, Alliance and Leicester and even the mighty HBOS will feel the pain from a forecast of a 15% drop over 2 years. The Government has increased the national debt by £50 billion, the impact of which has been felt in the foreign exchange markets with the pound plunging on fears that that further bailouts will lead to a surge in bond issues resulting in higher IR!

The Scotsman: Taxman set to target buy-to-let landlords over undeclared profits

PROPERTY owners are facing a new tax investigation by the taxman, a leading accountancy body warned yesterday. Anyone who does not declare income from renting out property risks being investigated by Her Majesty's Custom's and Revenue (HMRC), according to the Association of Chartered Certified Accountants (ACCA). The warning came as the accountants body revealed that HMRC's compliance unit is this week issuing 500 letters to self-assessment taxpayers who it believes may be making money from buy-to-let.

Timesonline: A&L, Abbey, Coventry, and Godiva to pull 125% mortgages

Those coming off fixed rates needing 100%+ loans will have nowhere to go. Cleveland Ohio style defaults coming to British estates in the not too distant future. A very significant milestone on the HPC journey.

Channel4: Dispatches: How The Banks Bet Your Money

Very good documentary on Channel 4 going into detail on the credit crunch, sub prime, cdo etc etc. Installing 4oD is slow and clumsy because it needs microsoft programs. But it does work well.

Mortgage Strategy: A&L pulls PlusMortgage

Alliance & Leicester is withdrawing its PlusMortgage range from close of business today. The product combined a mortgage of up to 95% LTV and an additional unsecured loan of either 5% or 30%, bringing the maximum allowable LTV up to 130%.The product launched in April last year to compete with other high LTV deals such as Northern Rock's Together range and similar deals from Coventry and BM Solutions.Stephen Leonard, director of mortgages at A&L, says: "We are a prudent and responsible lender with PlusMortgage successfully targeting high quality applicants. "However, we keep our product range under constant review and given current market conditions, we will be withdrawing our PlusMortgage products at this time."

Citywire: Government launches anti-mortgage-fraud initiative

Alarm bells should start ringing for lenders and buyers when a property deal has to go through a specific broker or solicitor, warned Tom O’Neill, director of buy-to-let specialist Fuel Investment. One broker he knew talked a client into taking out mortgages of 12 times her salary. Then she was advised to take out £100,000 in loans to meet the mortgage payments on two buy-to-let properties. They were later repossessed

BBC: Credit Suisse 'suspends' traders

Credit Suisse has suspended a "small number" of traders suspected of inflating the value of mortgage-backed bond investments.

BBC: Robert Preston

This made me smile, if only it could pan out like this! Increase in Mortgage rates on the bcards I hope!!

MoneyWeek: Why inflation is still a problem

Inflation is probably the last thing you're worrying about right now. After all, the coming slump will force retailers to cut prices and consumers to slash spending, won't it? Think again, says John Stepek.

London evening Standard: Stand by for a plunge in house prices as global picture changes

"The prop under the housing market has been removed and prices must fall. Bond highlights how people had only been able to enter this world of unreal pricing because of the exceptional conditions in world markets - the def lationary pressure from China, the glut of world savings and the willingness of central banks to cut interest rates at any sign of an economic slowdown. This has allowed the huge rise in personal debt that has driven the surge in house prices."

Times Online: The 20 most expensive streets, 2008

Recent housing market statistics may show that property prices are stagnating or even falling in some areas. But according to new research by the property information website, mouseprice.net, the credit crunch has not caused values at the very top end of the market to topple. The 20 most expensive streets in England and Wales have average property values ranging from more than £4.5m to just under £7m.

LA Times: Loans go bad as British housing bubble pops

When Shirley Hale's husband dumped her for a younger woman she didn't get mad. She got a new house. By last year, Hale had fallen behind on the payments on her "gorgeous little place" and was looking at foreclosure -- until a mortgage "rescue" company stepped in. Hale signed over her house for $50,000 less than what it was worth, and was told that in return she could continue living there as long as she liked for $600/month. Six months later, the mortgage was transferred to Britain's major sub-prime lenders and Hale was given 28 days to get out. Sub-prime loans account for more than 6% of all the mortgages in Britain. [I thought there was no sub-prime in Britain ;p - LP]

mail: Aged 76 and in handcuffs: The council tax rebel jailed for refusing to pay £1,483.51

Mr Fitzmaurice, who spent 22 years in the Royal Army Ordnance Corps, had declared in court: "I am here on a matter of principle. The way old age pensioners are being treated is shameful."

BBC News: Sale and rent back rip-off claim

Interesting article calling for tighter regulation of sale and rent back schemes. Shock, horror, in some case people entering such schemes only get paid 50% of what a valuer may say the property is worth. But given what we all know perhaps that is actually the fair price! I'd like to know if these StRB figures get included in the land registry? We all saw Panorama and how the land registry figures got fiddled, is this another fiddle to keep the index high?

Wall Street Journal: U.K.'s Northern Rock Move

Worldwide we are seeing bailouts by SWF and governments. "Financial institutions have been pretty good at taking governments hostage," said Charles Wyplosz, an economics professor at the Graduate Institute in Geneva. "The taxpayer is likely to face a huge bill." EU regulation may force NR to be downsized for competitive reasons. "the bank's mortgage book to be reduced by around 50% to 60%, so that the ratio of the mortgage loans it has made against the deposits it has taken in is more in line with its U.K. peers." A lot of bad PR ahead for the gov owners - sacking NR workers, forced evictions for distressed mortgage holders, huge losses when hpc happens...

The Times: Business Article

Any takers? What about going to Northern Rock?

sky news: Recession warning

Geoff Wilson from WAM told Sky Business Channel that Australians are in for a tough six to nine months, with the current earnings outlook upsetting investor confidence.I think there is a high probability that we will have a recession in '09 and mainly as a result of the increase in interest rates and keeping inflation under control,' he said.Mr Wilson says it won't be until the next reporting season that we will see how companies have weathered the current market turmoil, especially the major banks such as ANZ. 'What we had back in the early 90's...you had provisions for bad, doubtful debts running on average at six per cent, now last year I think

Independent: Hamish McRae: The nationalisation of Northern Rock is no big deal (unlike the state of public finances)

"The economics of Northern Rock look better than the politics. The "n" word may still be toxic politically, but nationalisation is not only the least bad outcome to this sorry tale. It is just possible, with one huge caveat, that the taxpayer might end up making a profit on the deal. The real charge against the Government is not the mishandling of Northern Rock, though it has not covered itself with glory. It is the much bigger issue of its mishandling of public finances more generally."

Telegraph: Northern Rock deal could cost us each £3,500

The cost of the Northern Rock crisis has reached the equivalent of £3,500 for every taxpayer as experts warned that the nationalisation rescue of the bank was bound to fail. Fears are also growing that other banks may be in trouble after the Treasury unveiled 'draconian' plans to allow the Government to take any financial institution into public ownership over the next year.

FT: Default insurance cost hits record low

"The cost of insuring European junk-rated companies against default broke through a psychologically important level on Thursday as bullish investors continued to push risk premiums to new record lows in the credit derivatives market. The sustained rally – which was under way in the last few months of 2006 and has accelerated in the new year – illustrates the extremely positive outlook surrounding the debt markets in spite of concerns over increased borrowings and the potential for leveraged buy-outs." Oh how it has all turned to tears and ashes... Its so incredible how this always happens, we are such a sad bunch, next everyone will be out on strike and the rubbish will be piling up in the streets. Will we never learn?

AUSTRALIAN: Banks at risk from default swaps

A spokesman for NAB, which is Australia's second-largest lender after the Commonweath, refused to confirm whether the bank had monoline exposure.

Daily Express: House Prices Hit New High

A Massive bounce in the housing market has pushed up values by £7,500 in just one month, figures show today. Stuart Law, chief executive of property investment firm Assetz, said: “Confidence is returning to the market. This latest rise in prices, combined with February’s interest rate cut, should fuel further optimism among both buyers and sellers.“I expect to see further house price rises this spring, but the Bank of England can’t afford to take its foot off the pedal.

NY Times: Arcane Market Is Next to Face Big Credit Test

Credit default insurance markets ballooned out of obscurity in 2000. Mortgage debt only totals $7 trillion and pales by comparison to this CDS bubble.

The Telegraph: Wait a year before you panic about inflation

Roger Bootle see CPI hitting 2.8pc by Autumn 2008 and then falling to 1.5pc by summer 2009

Times Online: Devil is in the detail of financial announcements

“The purpose of nationalisation should not have been - and in the end will not be - what the Chancellor and the Rock’s new chairman, Ron Sandler, promised yesterday: to continue “business as usual” at the bank and eventually to return it to the private sector, maybe even securing a nice profit for taxpayers in the process. The purpose of nationalisation should have been - and in the end will be - to recoup £100 billion of taxpayers’ money as quickly as possible ..." and to slice and dice it ASAP ... please.

The Onion: Rotation Of Earth Plunges Entire North American Continent Into Darkness

NEW YORK—Millions of eyewitnesses watched in stunned horror Tuesday as light emptied from the sky, plunging the U.S. and neighboring countries into darkness. As the hours progressed, conditions only worsened. Very good spoof story, cleverly put - a massive "crisis" that was as predictable as night following day and experts "suddenly realising" what everyone knew all along, a throwaway reference to a economist, and the media-generated "fear factor" with tales of brave "real people. Sounds like the BBC reporting on HPC..

Downing St Petitions: Carefully consider the fate of the many small shareholders in Northern Rock (and any future companies in peril) rather than writing them off in any plans for the stricken banks future. Small shareholders should be given some protection too!

"In dealing with this crisis, brought on by poor management by both the company directors themselves AND The Government and its agencies, it now only seems keen to: 1. Protect taxpayers; 2. To promote financial stability; and 3. To protect consumers. This clearly leaves out entirely from aims any kind of protection or even consideration for small shareholders. Why? Most small shareholders are not rich people & do not deserve to be written off ENTIRELY, while at the same time all small savers are saved from ANY loss AND the Government also make a profit from its support (or at least hopes to)...."

The Register: HMRC blows £1.4m on two-word slogan

Her Maj's Revenue and Customs apparently blew nearly £1.4m in 2006 while brainstorming its way to a new slogan which simply reads "HMRC Ambition".

REUTERS: Bank shares rise on NR nationalisation

This snippet makes the point that the lack of competition with the withdrawal of NR from the public sector is beneficial to the other banks. Although, competition backed by the government isn't beneficial. Perhaps the shares have risen because NR will continue to trade as usual, whereas the other banks are certainly not trading as usual, and are making their mortgage deals less and less attractive. The unwanted mortgages finally have a home away from the private sector banks in NR. The proof of the pudding would be an increase in the NR book as they take more risky mortgages on.

Firstrung: Record numbers petition for their own bankruptcy

A record number of people in England and Wales asked to go bankrupt during 2007, the latest official Government figures have shown...53,114 people petitioned to bankrupt themselves after being unable to keep up with their debts, as opposed to having their creditors call for them to go bankrupt, according to the latest statistics available from the Ministry of Justice.

The Telegraph: Basket case Britain must rebuild its credibility

Britons cling to a comforting notion that overpopulated islands with a shortage of land can never suffer a sharp fall in house prices. Such illusions are often at the root of the most extreme asset bubbles.

MoneyWeek: Why Northern Rock shareholders can’t expect to get their money back

It's business as usual at Northern Rock: the bank's still bankrupt, and the government is still the only thing keeping it afloat – only now it’s official. It makes a big difference to shareholders, though.

Daily Mail: Unsold homes swamp property market as owners sell now to avoid big losses

''Soaring numbers of people are putting their homes up for sale, but may struggle to find a buyer, research warns today. On average, each estate agent has 64 properties for sale, the highest number ever recorded at this time of year. This is nearly 20 per cent higher than the same month last year, a sign of the dramatic property downturn over the last few months. But the glut of properties means they are staying for sale much longer than during the boom of the last few years. ''

Daily Express: House Prices hit new high

Nice image of FTB's looking at a wall of unattainable housing. Now apparently even more unattainable

Times online: Clouds hover over the housing market

''The asking price for houses moved up last month but property is taking far longer to sell, according to new figures out today. Homes are lingering on the market for 93 days, 15 days longer than last year, and agents have an average of 64 properties on their books, up from 54 last February, according to Rightmove, the property website. The company's latest survey for the month to February 9 shows that asking prices rose 3.2 per cent to £237,856. The rise, averaging £7,428, pushed the annual rate of growth up to 5.8 per cent, from 3.4 per cent in January. ''

Economist: Still here

THE credit crunch is simply not going away. Every week another arcane area of the bond market seems to be dragged into the crisis. The underlying problem is as old as finance itself—borrowing short to lend long. As a strategy it can be extremely profitable but it is very vulnerable to crisis. Three things can go wrong: the costs of borrowing can go up, access to borrowing can dry up, or the assets bought with borrowed money can fall in value. All three have happened at various stages over the last six months. When credit booms unravel, another problem tends to emerge. Lax lending standards apply during booms; we have already seen that in the case of subprime mortgages. The same may have applied to corporate lending

The Times: Basket case Britain must rebuild its credibility

Britons cling to a comforting notion that overpopulated islands with a shortage of land can never suffer a sharp fall in house prices. Such illusions are often at the root of the most extreme asset bubbles.

NYTimes: Arcane Market Is Next to Face Big Credit Test

Credit default swaps form a large but obscure market that will be put to its first big test as a looming economic downturn strains companies’ finances. Like a homeowner’s policy that insures against a flood or fire, these instruments are intended to cover losses to banks and bondholders when companies fail to pay their debts. As with other securities that trade privately and by appointment, assigning values to credit default swaps is highly subjective. So some on Wall Street wonder how much of the paper gains generated in these instruments by firms and hedge funds last year will turn out to be illusory when they try to cash them in. “The insurance business is very difficult to quantify risk in,” said Mr. Farrell of Annaly Capital Management.

stuff oc.nz: Receivership for the Jones

Please shed a tear for the demise of a NZ estate agent chain.Last week we also had a major property investment company called Blue Chip also going bust (it bought and managed properties in Auckland). The sh@t is hitting the fan here and the crash has only just started!

The Times: Absolutely, incredibly, utterly wrong!

"Why should a Government that has consistently refused to offer public funding for potentially viable commercial projects of real national importance - aerospace, public transport, nuclear power - now be spending tens of billions on supporting a bust mortgage bank?"

Metro: Rightmove prices up 3.2% in Jan

Thanks to Metro for breaking the embargo, albeit only by an hour. Righmove shows prices rose by 3.2% in Jan. However the figures were distorted by the rush of cheaper 1 and 2 bed properties being placed on the market in December to avoid the HIPs deadline. Without this effect, prices would have risen by 1.5-2%, in line with the traditional February bounce. From June 07 to Feb 08, prices have fallen by 0.6%

FT.com: How Monolines Work

Monolines, companies that insure against the risk of a bond or other security defaulting, have in the past weeks come under fire from ratings agencies, after concerns grew over their ability to meet the obligations to the bond issuers they insure. Some, such as ACA, Ambac and SCA, were recently downgraded, raising fears of a domino effect resulting in further downgrades and market losses for the securities they – and other monolines – guarantee. In late January New York insurance regulator, Eric Dinallo, urged major banks to provide up to $15bn (£7.6bn) to support the monoline industry in an effort to stem the threat of additional losses for banks and other financial institutions with exposure to some of the over $2,400bn of debt guaranteed by bond insurers.

The Times: MPs in commuter belt scam

MPs are given £20,000 of taxpayer's money per annum as "Housing Allowance" to spend on a mortgage on a London pad. But they don't have to hand back any of the capital gains they accrue.

So all MPs have a direct vested interest in pumping house prices.

(Even MPs who live in London BTW)

Citywire: Northern Rock: What happens next?

The Government's formal announcement to nationalise Northern Rock may have been long coming but it will trigger a swift response across the City. The first step needed will be for shares in the Bank to be suspended before trading opens on Monday morning. Shareholders may therefore seek to use the Bank's closing share price on Friday, of 90p, as the basis for calculating their compensation.

Citywire: Government may offer Northern Rock shareholders nothing

The fine print of the Government's promise to have Northern Rock shares 'independently valued' when it nationalises the bank could in fact lead to the conclusion that the shares have little or no value. In a statement to the House of Commons on 21 January chancellor Alistair Darling said that the legislation he was preparing to nationalise the bank would seek to compensate Northern Rock shareholders based on the value of their shares if the Government's support was withdrawn.

Private: First time buyer calculator

I created this to see how much could be gained/lost over a period of time on a property depending on your circumstances.. Aimed mostly at FTBers thinking of taking out an interest only mortgage http://www.filefactory.com/file/d2bfb8

Monevator: Northern Rock nationalised: A nation now in hock to a housing bubble

The authorities responsible for dealing with the Northern Rock’s collapse have been making poor precedent-setting decisions since day one of this pantomime. None are so significant as nationalisation, however. And unfortunately, even housing bears have now got a vested interest in the housing market not collapsing.

SKY: Breaking News: NR

Sky reports that the government has taken NR into public ownership.

FT Adviser: Prisoner gets "approval" for 9 mortgages

A serving prisoner has been able to obtain multiple buy-to-let mortgages from a well-known crisis-ridden mortgage bank despite using the prison as his official address, it can be revealed. The man, who is believed to be a mortgage broker directly regulated by the FSA, but is also affiliated to one of Britain's best-known IFA firms, applied on nine separate occasions for mortgages from the troubled bank and on each occasion was given a loan. Buy-to-let mortgages are not regulated by the FSA as they are considered to be commercial arrangements. The City of London police will be publishing a report on mortgage fraud at the end of February.

Guardian: Barratt's borrowing causes concern

Barratt Developments, Britain's biggest housebuilder, is at risk of breaching its banking covenants. With debt approaching £2bn the builder, responsible for one in eight new homes built in the UK, needs to reduce its debt by £100m. As things stand it would break its contractual obligations with the banks.But there is nothing to suggest Barratt's banks would unduly penalise the company if it fails to reduce its debt levels, and the company is confident that it will meet its targets. Barratt borrowed heavily after it bought rival builder Wilson Bowden for £2.2bn last year, before the credit crunch precipitated a fall in house prices.The firm's shares have fallen alarmingly and some City insiders believe the company will have to go cap-in-hand to the City and raise money via a rights issue.

Independent: The debt advice that adds to the problem

Figures from the Council of Mortgage Lenders show that about 130,000 people in the UK are three months or more behind with their mortgage repayments. Spooked that a US-style debt crisis is playing itself out here, lenders are busy urging homeowners to contact them as soon as they find they can no longer cope with the bills. But even if they act responsibly and seek help with their debts, overstretched borrowers could still find themselves in for a shock, through the imposition of fees for a debt or arrears counselling service.

Independent: Merchants of Misery: Debt collection is one of the UK's fastest-growing industries

Debt collection agencies and bailiffs are raking in unprecedented sums from Britain's growing mountain of personal finance misery, an Independent on Sunday investigation has found. Last year the agencies and bailiffs pursued no fewer than 20 million cases and the methods they used to squeeze money from people are so aggressive that experts ranging from the Citizens' Advice Bureau (CAB) to members of the House of Lords are now calling for legislation to curb these excesses. A growing army of thousands of "debt chasers" is making millions from the misery of Britons who have spent years spending above their means, in what campaigners have slammed as "legalised profiteering".

Observer: What happens behind the locked doors of property seminars

This is how these shabby businesses operate. We've already heard about Inside Track before on HPC. This outfit will disappear soon enough, although likely to rise again in another money-making guise. Also see the link to the story about Chloe, 'mugged' by a similar bunch, Choices Acquisitions. Boom-time parasites.

Observer: Sell-to-rent boom as buyers back off

People selling and renting, instead of buying again for silly money. Who thinks this is a bad idea? Why, estate agents of course. One says it's a high risk strategy. More high risk than borrowing up to the hilt and sinking that and every bit of your savings into a single asset? Sounds like a no-brainer to me. Which, incidentally, rather aptly describes estate agents.

aboutproperty.co.uk: Sellers grab kitchen sink

"...curtains, dishwashers and even garden sheds – are being transferred to new property as compensation..." Some will realize they've got pretty expensive garden sheds very soon...

Times: Don’t cave in to bankers who plead for more

“PLEASE, SIR, can I have some more,” whinge the Oliver Twists on Wall Street. More interest-rate cuts from the Federal Reserve Board, a bigger portion of stimulus from the president and Congress, more direct relief for the housing market, a bail-out of bond insurers – you name it, and investors and bankers want more of it. Except for write-downs: the increased recognition of losses that nervous auditors are demanding is the one thing the bankers don’t want any more of piled onto their plates.

Observer: Property doom: Fears of an exodus

Apparently the "gifted wealth-creators are already reaching for their passports". Or are they gifted pocket-liners? Always bemused me that one. I suspect most work in the financial sector, which seems pretty good at relieving people of their wealth, more so than creating it. If it all helps house prices drop then I think that in itself will return a bit of wealth to us Doms. I for one won't mourn their flight - they haven't put any wealth my way so far as I can see - but no doubt some wealth creator could tell me why they are valuable.

Telegraph: 1,000 emergency workers a week assaulted

Doctors, nurses, ambulance crews, health visitors and firefighters across Britain are being subjected to frightening assaults as they go about helping the public. The latest figures show there were at least 57,205 attacks on health and emergency workers last year, although the true figure is thought to be much higher as many cases go unreported. Communities are breaking down, society fragmenting, we are seriously thinking of going to Oz or NZ - if they'll have us.

Scoop: Significant Increase in No. of Homes for Sale in NZ

35% MORE RESIDENTIAL PROPERTY LISTINGS THAN THIS TIME LAST YEAR Statistics released by the real estate industry’s official website show record numbers of houses for sale across the country indicating there may be more homes on the market now than ever before in NZ’s history.

Fortune Magazine: Will subprime foreclosures spark an arson boom?

"As homeowners get more desperate, the insurance industry is bracing for an increase in arson. 31-year-old Christina Snyder of Russellville, Indiana, allegedly offered to pay a neighbor $5,000 to help her burn down her house and make it look like a botched rape attempt - all in order to claim $80,000 in insurance money. The neighbor demurred, instead reporting Snyder to police. With the national foreclosure rate zooming and the real estate market in a two-year funk, the insurance industry fears more homeowners will see arson as a way out of their financial woes. Fraud fighters are watching closely for a spike in arsons by desperate homeowners who can no longer afford their home payments. It may already be happening: In California, the number of questionable residential fires is up 76%."

Telegraph: Fame and fortune: Dexter Fletcher

I was doing a lot of work by then and I guess I was under the impression I had more money than I did. But I was very wasteful – I bought a brand new Land Rover for £13,000 having gone to the showroom looking for a second hand car. When the salesman didn't take me seriously I decided to show off and prove I could buy something new and expensive, just to see the look on his face. Then along came the 1990s property crash. All the equity I thought I had in the house disappeared. My credit cards had racked up and I owed money to friends. Having defaulted on my mortgage I was a month away from being repossessed, so I put up a 'For Sale' sign and a couple knocked on the door who had just been gazumped on a house nearby.

CalculatedRisk: CRE: More on Macklowe

This is a story we've been following because it appears Macklowe bought at the top, and he has a large bill coming due next month for a highly leveraged transaction: [Macklowe] has a $6.4 billion debt payment coming due next month in connection with his purchase of seven ... Midtown Manhattan office buildings a year ago. When he bought those buildings from Equity Office Properties, he ... used only $50 million of his own money to do so; he borrowed $7 billion to finance the rest of the purchase. According to the WSJ, Macklowe paid $6.8 billion for these seven properties, and borrowed a total of $7.6 billion! The NY Times also mentions a couple of other deals in possible trouble:

Reuters: Macklowe reaches extension agreements with lenders

Macklowe's strategy was to buy the Equity Office buildings whose long-term leases were about to expire and boost rents to market levels. According to several sources with knowledge of the properties, Macklowe already has increased the value of the largest of the properties, Worldwide Plaza on Eighth Avenue between 49th and 50th, which now commands rents of more than $100 per square foot.

Assetz: Winner of 2007 house price prediction

Based on official DCLG, Assetz were the most accurate of all major forecasters, predicting growth of 8-10% in 2007 against the eventual 9.1% rise. Cue lots of self-congratulations by Ztuart Lawz. "All I can say is consider buying now whilst the opportunities exist and sentiment is negative enough (whether you are an investor or a first-time buyer) as you won't see these price opportunities around later in the year" Assetz predicts growth of 5% in 2008.

Homemove: Homeowners stripping houses of fixtures and fittings

A study by online conveyancers, Convex.net, has established that homeowners are increasingly stripping their houses of fixtures and fittings when they sell up, as fears of a moderation in prices grow.

The Scotsman: Security is simply a way to cut out risk of mortgage fraud

"the FSA looks like it will come down hard on consumers who commit any kind of mortgage fraud." Erghh... a bit late surely? I'd like to see all those fake self certification mortgages punished but that won't help the economy now.

Guardian: Welcome to negative equity street

More about Manchester's sorry buy to let flat scene. And the advice, if you are renting: While the estate agents in the city had clearly given up for now on property sales, many were still keen to talk up the rental market as "strong". But even that proved to be something of a fallacy, if you are the landlord, that is. While the demand for flats to rent remains buoyant, a chat with some of the army of young office workers that rent many of the city centre flats soon revealed that the prices quoted were just a guide. "If a flat's rental is advertised for £700 a month, you offer £600, you'll almost certainly get it for that. It's a buyers' market, no mistake," I was advised.

East London & West Essex Guardian: Homes & Property Section

A local estate agent advertised twenty properties for sale in this week's property section, all under the heading "Chain free properties" I rang to check and the lass was very friendly (probably not much else to do) and confirmed that yes, all twenty of them were chain free. I tried to wheedle out of her what the mix of sell-to-renters, panicking BTLers and repossessions was but either she didn't know or wouldn't tell me. Is this normal? Aren't chain-free properties usually only a small minority?

order-order: B&B caption contest

B&B has been the first bank to report in 2008 and unveiled writedowns of £225.6m, which halved its 2007 profits.The company’s shares fell 23 per cent on the news from 243p to 187p and after a further slide yesterday are now at 177p, their lowest ever price since it floated eight years ago at 248p.

times: Tide turns as Poles end great migration

The Times has established that, for the first time since they began arriving en masse four years ago, more UK-based Poles are returning to their homeland than are entering Britain.

Guardian: Safe as houses? I lost £350,000

Self-employed vet Tamsin Barks knew her life needed new direction. A mailshot from Inside Track said she "could give up work and be a property millionaire." She now has a £1.1m portfolio of 7 BTL properties, but has made a loss after costs of £350,000. "My monthly rental income falls £1500 short of the cost of borrowing the money, and that's before essential expenses. I am running out of money - I'm worried I could lose my home and have to live in a small flat or even a caravan." "I was told I could make money within two years by a process called 'flipping'. I would buy off the architect's drawing [off-plan] by paying a deposit, then sell the property at a substantial profit to another investor just before the keys were due to be handed over. I was told the sky was the limit"

Guardian: Pop goes the property boom

Prices for new-build flats are in freefall, with some buyers who paid top-of-the-market prices as recently as 2005 now seeing the values of their homes down 40%. We focused on Manchester and found flats selling for £50,000 less than the owner paid for them. Repossessed flats are being dumped on the market for prices that would have seemed unimaginable a few years ago. Meanwhile buyers are reluctant to enter the market in case they end up over-paying. Estate agents windows marked up with "price corrections", and one saying: "Make me an offer - I may say yes."

The Street: Flashback: MBIA Shrugs Off Subprime

Mortgage insurance firm MBIA says it has very little exposure to the subprime slime that has shaken up Wall Street. The Armonk, N.Y.-based bond insurer held a two-hour conference call to explain how loans provided to borrowers with unsavory credit quality are affecting it. MBIA outlined its portfolio composition and underwriting criteria in a bid to quell investor fears that have sent its shares on a tailspin this week. CFO Edward Chaplin said that although the financial firm insures some deals tied to subprime in pools of structured securities, including so-called collateralized loan obligations and residential mortgage-backed securities, its overall portfolio has fared well.

Breitbart: US subprime crisis costs global 7.7 trillion dollars: bank

The meltdown in the US subprime real-estate market has led to a global loss of 7.7 trillion dollars in stock-market value since October, a report by Bank of America showed Thursday. The crisis, which has spread beyond US shores to banks and other sectors worldwide, is "one of the most vicious in financial history," according to Bank of America chief market strategist Joseph Quinlan. Quinlan said in the report that the losses are worse than any in the past few decades, including Wall Street's Black Monday of 1987, the 1999 Brazilian real currency crisis and the collapse of hedge fund Long Term Capital Management (LTCM) in 1998.

Glasgow Evening Times: House prices fall by £60 a day

Yes, I know the Lloyds TSB Scotland figures have been posted a bazillion times already today, but thought it was worth posting this story just for the headline and the naively smug comment from reader "Mekon"

The Times: Business News

And which economist was it who said that the Credit Crunch was only at the stage of the National Anthems having just been played?

The Times: Business Article

And this of course is not a Commercial Property Fund? Are no Hedge Funds sacred?

NY Times: A Crisis of Faith

Good article on Auction-rate securities failure that happened earlier this week. "The Port Authority, which had a failed auction last week, just saw the interest rate it pays leap from 4.3 percent to 20 percent." "I like to think of what’s happening as a sort of minor-key reprise of the banking crisis that swept America in 1930 and 1931. Frustrated investors who can’t get their money out of auction-rate securities aren’t as photogenic as angry mobs milling outside closed banks, but the principle is the same."

Guardian: Treasury debt is twice Chancellor's 'sustainable' figure, says think-tank

By knowing what Gordon Brown has signed us all up for - we can each make plans and try to look after our families as best we can. Alternatively, some of us can bury our heads in the sand and hope it all goes away... "Gordon Brown has hidden liabilities worth more than £500bn, and the true size of the public debt is up to 87 per cent of GDP, more than twice the Treasury's 'sustainable' limit, according to the Institute for Fiscal Studies. Using the government's calculations for the cost of public sector pensions, private finance initiative schemes, and Network Rail's debt, which the Treasury guarantees, the think-tank has reached a total figure of more than £1,100bn - twice what the Treasury admits to."

USA Today: Repo lots overflow with reclaimed cars

Good job Tony had all those new bailiff laws passed just before he left. Wonder why eh ? "The rise of bad loans, however, has meant busy times for "repo men," whose work can involve seizing cars from driveways in the dead of the night."

Press Association: House prices boost rental returns

Buy-to-let investors made average returns of more than 16% during 2007 on the back of rising property prices and increasing rents, figures show. The average landlord made returns of 16.3% on their property during the year, excluding the cost of mortgage interest and fees, up from returns of 13.5% in 2006, according to Birmingham Midshires. The rise was partly driven by a 10.7% jump in house prices last year, but the group said most of the gains were seen during the first half of 2007. Rents also rose by 13% over the year.

The Times: An essential guide to what the housing market surveys really mean

A VERY useful article to show that no matter who measures the stats, there is not a uniform way of doing it. Notably, the Nationwide do NOT include BTL in their numbers.

thepriceofeverything blog: The modern banker as ‘Typhoid Mary’. Discuss.

"‘Typhoid Mary’ managed to infect 47 people during the course of her career as a cook. Her fame “is in part due to her vehement denial of her own role in causing the disease, together with her refusal to cease working”. Nobody, of course, suggests that modern banks are virulent and destructive plague carriers. They are a lot more dangerous than that."

FT Alphaville: When Dinallo met Buffett: the monoline breakup plan

NY Insurance superintendent Eric Dinallo elucidates: "We have been actively discussing all of the options with the bond insurers..It was to ensure a safety net for the municipal bonds that over the Martin Luther King Day weekend in January we asked Berkshire Hathaway to price the entire municipal bond portfolio of the three largest bond insurers. Earlier this month, Berkshire sent its proposal to the three companies. I believe that there may be other investors who would be interested in investing in the municipal side of the business."

Firstrung: Scottish house prices fall by 1.3% in last three months

The boom in Scottish house prices has come to an end according to the latest Scottish House Price Monitor from Lloyds TSB Scotland, with the first quarterly fall in the all Scotland average house price for seven years. In the three months to 31 January 2008, the quarterly price index for the average domestic property in Scotland fell by 1.6 per cent to give an average mix adjusted Scottish house price of £163,211. On an annual basis, Scottish house prices have risen by 14 per cent.

Mortgagestrategy: CAB renews call for tighter regulation

The Citizens Advice Bureau has renewed its call for tighter regulation of the mortgage market following the Council of Mortgage Lenders’ repossession figures.The CAB warns that the at 27,100, total repossessions in 2007 were up 21% on the previous year and were nearly twice as high as the figure seen two year’s ago in 2005. “We want to see all lenders being reasonable when dealing with customers who do get into trouble, and taking court action for possession only as a last resort.”

FT.com: Natixis plunges on €1bn writedowns

Goodbye ClubMed! The Euro is a SHAM

Having got to know the French mentality over 12 years or so, stand by for more of the same..... Et, comprenez-moi bien, j'adore absolument mes potes francais. J'habitais la-bas en fait.

Wall Street Journal: Debt Crisis Hits a Dynasty

When M. Brian and Basil Maher sold their family's shipping business last July for more than $1 billion, they quickly put the money in a safe place. Or so they thought. The two brothers handed much of it to Lehman Brothers Holdings Inc. with marching orders to make only the most conservative, cashlike investments. Within weeks, however, they had lost access to more than a quarter-billion dollars. "We didn't think we were taking risks," says Brian Maher, 61 years old. "We read about all the troubles in the credit markets and said, 'I'm glad we're not invested in that stuff.' It turns out, we were."

MoneyWeek: The most recession-proof asset class

Higher food prices are encouraging farms to expand, pushing the price of UK farmland to new highs. And that has fuelled pure investment demand - but is the land itself the best way to take advantage?

Wall Street Journal: The Rise of the Mortgage 'Walkers'

Borrowers in the USA are walking away from mortgage debt, leaving the the mortgage-securities investors stuck with the property. This is the letter of the law in some states and simply common practice in others. Even prime borrowers are tempted to walk away if they are in negative equity as there is no financial penalty for doing so, only a hit to their credit rating. Essentially, mortgage-bond investors unwittingly sold homebuyers a put option without properly pricing it, and now homeowners are exercising that option. Nobody is going to debtors' prison. It's beginning to dawn on lenders and their agents that they could be stuck owning hundreds of thousands of depreciating properties. ----- NOTE that this is not the case in the UK, where borrowers can't just walk away.

The Telegraph: Recession would threaten borrowing rules

The report said a major downturn in the coming months, with the economy shrinking by 1pc, "could see public borrowing rise as high as £100bn or even £150bn per annum, blowing the fiscal framework to smithereens and perhaps even leading to some rise in the Government's relative cost of borrowing".

The Telegraph: Vladimir Putin's nuclear threat to the West

Although he did not elaborate, Mr Putin gave warning of retaliation once Kosovo broke away - a threat likely to chill Western leaders. "We have a ready-made plan and we know what we are going to do," he said.

Any ideas on this?

BBC News: Property Boom "Over in Scotland"

This was one of their 'most read' stories this morning - the reality will slowly hitting home to people if govt-controlled outlets like the BBC are carrying these stories. Remember though, Scotland is exceptional. There's never been a house price crash in Scotland so there won't ever be one. Prices are only falling in England, Wales, Northern Ireland, Ireland, the US and Spain - but they won't fall in Scotland because it's a unique market.

Firstrung: First time buyers returning marks a significant change in fortunes of housing market - NAEA

Are first time buyers returning in droves as the NAEA would have us believe? Is the UK housing market gaining momentum? The problem with claims such as the NAEA make is that they must be backed up with fact...Given the falling mortgage approval numbers over the past four months how can this support their claim of a re-vitalised housing market? Moreover, if as they claim prices are holding up why would first time buyers suddenly rush in given they found the housing market at its most unaffordable in the last six months of 2007? If up to 75% of 'riskier' mortgage product has been stripped from the mortgage market where would the 'mortgage tools' to climb onto the first-rung come from?

Redrow Homes: House Price Protection

Only up to 10% mind! I heard an advert for this on the radio yesterday... "It's all about giving confidence in uncertain times: it is not about Redrow believing matters will get worse. We are confident in the long term value of our homes, and the benefits associated with buying a brand new Redrow home. Our promise to you is simple: If you buy a new Redrow home and sell it within 3 years, and can't get what you paid for it, Redrow will refund the difference up to 10% of the price paid."

nebusiness: Jobs go as housebuilders feel downtown in market

At least two major housebuilders are looking for redundancies in the North East as the slowdown in the housing market starts to bite. Newcastle-based Bellway has sent out redundancy consultation notices to its hundreds of site staff and is considering 66 job cuts, while Taylor Wimpey is understood to be looking for 35 redundancies. Other major players, including industry number two Persimmon, are also reported to be aiming to cut back on front line jobs. Andrew Miller, head of Barclays Wealth stockbrokers in Newcastle said "There has definitely been a weakness of late, particularly in new-build property. For instance, with so many flats being built, I know there have been problems in Leeds and Manchester on that"

times online: Bonus rich bankers to reignite UK housing market

''Spring house buying will be revitalised by bankers who expect City bonuses to match or outweigh last year's. Signs of life are re-emerging in the property market as it prepares to enter the spring buying season, as agents herald the return of bargain-hunting first-time buyers and City professionals with bonus cash to spend.''

The Times: Halifax 'rations' mortgages

'The move is seen as part of a wider trend of "leap-frogging" among lenders, who are competing to avoid business rather than to bring in new customers. Ray Boulger, of John Charcol, another broker, said: "Lenders like Halifax are effectively rationing loans. They are generating the amount of business they want and then rejecting it when they can no longer cope with demand. Lenders are leap-frogging each other to the bottom of the best-buy tables. They are no longer competing for business, they are competing to avoid it."'

MSN Money: Getting started in buy-to-let

I hope they are trying to be funny. "The high cost of mortgages has in many cases required some contribution from the landlord towards covering the mortgage. However, if you are in it for the long term and have picked out a prime location with good rental demand, you will benefit in the long run." I suppose it depends how you define benefit.

Marginal Revolution: Was there a housing bubble?

Alex Tabarrok has created a lot of buzz with this post, arguing that because house prices have risen so much, it's not conceivable that they will drop back down to the long-term average. He argues that we are in for a reset to a new higher equilibrium for house prices, such as that which occurred after WWII. There's been a huge reaction to the piece in the blogosphere (ugh, hate that term) with heavyweights such as Paul Krugman criticizing it, although noone has yet put forth a convincing counter-argument. Well worth a read.

The Herald: House price fall signals end of boom

Average house prices in Scotland have experienced a quarterly fall for the first time in seven years, signalling a possible end to the recent boom. Between November 2007 and the end of January the cost of an average property fell by 1.6% to £163,211, figures published by Lloyds TSB Scotland yesterday showed. Experts at the bank have said this points to the end of the country's property price boom, as the housing market "pauses for breath" and prices begin to level out.

Times: Credit card spend sounds credit crunch alarm

Consumers spent a record sum on credit and debit cards in the final three months of last year as borrowers increasingly used plastic to pay their household expenses. Credit and debit card spending rose to £91.5 billion, up from £86.6 billion in the three months to last September. The Association of Payment Clearing Services (Apacs), the body that represents lenders and credit card companies, says that £32.4 billion was spent on credit cards between October and December last year, the second-highest sum in history. "Retail figures were down over Christmas, yet credit card debt is still rising. "This indicates that we are seeing people shifting spending on to credit cards as household expenses mount up.

CB Richard Ellis: Monthly Survey

Not much more to add - the survey is short and includes the staggering statistic that the annualised fall over the last three months is 36% (thirty six percent). Rather bizarrely, London freesheet 'City AM' span this as "Commercial property now through the worst" (not available onlin), as the monthly fall in January of 2.1% was only half the fall in December.

This Is Money: House prices may fall, warns Mervyn King

Homeowners have been warned their properties could fall in value in real terms over the next four years by the Bank of England governor Mervyn King.

London Evening Standard: Mavis, 83, has luxury block of 30 flats to herself

Divorced Mavis spent £300,000 on a two-bed apartment in the block of flats in Newquay, Cornwall, six months ago. But within days she realised the remaining 29 of its 30 flats are used by second home owners - mostly well-heeled professionals from London. Because they are only used as holiday flats a few weekends a year, mum-of-three Mavis has free run of the block and all its facilities. In Cornwall, it is thought up to 10 per cent of residential properties are second homes.

BBC News: Fed boss warns of weaker economy

I believe Paulson & Bernanke really do know just how bad things are going to get, but have to drip-feed the bad news to avoid a general panic... "I believe our economy will continue to grow, although its pace in coming quarters will be slower than what we have seen in recent years" Of course you do...

Mortgagesolutions: Market gaining momentum

The property market is gaining momentum, according a preview of figures from the National Association of Estate Agents (NAEA) monthly housing market survey. Buyers on books, housing stock and sales all increased in January. The overall number of house buyers went up 11% in January.First time buyers accounted for 14.5% of all sales, a rise of over 3% for the same period last year. Peter Bolton King, chief executive at the NAEA, said: “I am confident that we have just started to see the benefit of first interest rate cut in December and the latest quarter percent decrease in February will further help boost the confidence of all buyers and particularly first time buyers.

The Times: Business Article

Says it all really. I can definetely tell David Smith that inflation is more like 6% and that people are buying essentails and not luxuries on their cards.

CNN Money: Home prices in steepest quarterly drop

NEW YORK (CNNMoney.com) -- Home prices continued their plunge during the last three months of 2007, setting a real estate trade group's record for the biggest-ever quarterly drop. . The national median price drop of 5.8%, to $206,200 from $219,300, was the steepest ever recorded by the National Association of Realtors (NAR), which has been compiling the report since 1979. NAR officials blamed the liquidity squeeze that began last summer for much of the drop. Home buyers had trouble obtaining mortgage financing, especially for more expensive properties. Fewer expensive homes were sold, bringing down median prices. "California, south Florida, D.C., many of the high-cost markets are reflecting that," said Walter Molony, a spokesman for NAR.

Ray Boulger's blog (Charcol): Repossessions in 2007 not as bad as expected

There is likely to be a sharp increase in the number of repossessions of heavy adverse sub prime borrowers who are unable to remortgage as a result of lenders tightening their criteria. Some deals which could have been done with several lenders 6 months ago are now just not doable. On the other hand most people other than recent First Time Buyers now have a reasonable amount of equity in their property and also it is hard to estimate the impact of the new breed of sale and leaseback operators which have sprung up in the last couple of years.

daily mail: home alone

what does this mean, same old story in every tasty seaside village, empty for most of the year and all the young uns living in the nearest big city. !

Association of British Insurers: Unsaleable, Uninsurable, Uninhabitable – Tougher Planning Controls Needed for New Homes says the ABI

Tougher planning controls are needed if flood insurance is to remain widely available for new homes the ABI (Association of British Insurers) said today (14 February). Of the three million new homes the Government plan to be built by 2010, a third will be on the floodplain.

Safe Haven: Bullion or Mining Stocks - Do You Have the Right Mix?

Many investors believe their portfolios have exposure to precious metals because they hold stocks in mining companies. But as a safe haven, no gold or silver or platinum stock (or even an ETF) compares with physical bullion.

Safe Haven: Asset Deflation 13: Sell Your Real Estate Immediately!

Given my grave doubts that a combined Fannie Mae, Freddie Mac crisis plus credit-derivatives-nightmare can be averted as asset deflation intensifies, I now expect a frightening systemic event in the U.S. at some point, possibly within the next few years, which will take property values out at the knees and cause transactions to come to an utter standstill for a time. At that point I expect loans to become almost impossible to get and buying psychology to be so damaged, a generation of people will tell you "you should never buy real estate." Regardless, the economy will be shaken by these unfolding events to the extent that the mere thought of buying real estate (absent a massive cash discount) will be considered by most a preposterous notion.

BBC: Government like 'demonic beast'

The Bishop of Carlisle has compared Gordon Brown's government with a "demonic beast" from the Bible. The Rt Rev Graham Dow accused the government of behaving like a seven-headed beast in "imposing its morality" on the nation.

RICS: Podcast for January Survey

click on the "Listen to the ...podcast". It will be interesting to listen to this going forward.

FT Alphaville: Let it fail, Mitteleuropa edition

Thus whereas Northern Rock was a casualty of an interbank liquidity crisis, IKB was both casualty and cause." (simply bad investments in US subprime excreta). Why the bailout? "a collapse of IKB… would trigger a guarantee mechanism designed to spread the burden of a bank failure across the sector. A trigger of which would cost German banks €24bn,"

FT Alphaville: Will the UK housing market follow the US?

We’ve been told that the UK housing market is in worse potential shape than its messy US counterpart. And here is the graph to prove it, courtesy of Merrill Lynch. UK house prices - both in terms of absolute values and relative to income - have risen further in the UK than in the US over the past decade.

Investment and Business News: The great exodus: owner-occupiers become renters in biggest change ever seen

"And finally, and surely the answer to this riddle will determine the ultimate course of house prices, if house prices are too expensive for would-be owner occupiers, how can it be viable for investors to buy those properties and rent them to the very same people who can’t afford to buy them?"

Telegraph: UBS posts $13.7bn sub-prime write-down

UBS has reported the biggest ever fourth quarter loss by a bank after it made a $13.7bn (£7bn) write-down on positions related to the US sub-prime mortgage market. The write-down at the Swiss bank caused a net loss of SFr12.5bn (£5.7bn) in the quarter, compared with a SFr3.4bn net profit in the same period last year. UBS chief executive Marcel Rohner described last years as "one of the most difficult in our history" and warned that 2008 would be "another difficult year." The bank has already announced that 1,500 jobs will go as a result of the problems, and has warned that more could follow.

WSJ: Worried Bankers Seek to Shift Risk to Uncle Sam

Nice business move, take the profits when times are good and ask the tax payers to carry the can when it goes bad, the win win business model.

MoneyWeek: How to get poor quick – invest in buy-to-let today

Britain's second-largest buy-to-let lender, Bradford & Bingley, is to raise interest rates and deposits in response to tougher conditions. So it looks like buy-to-let is now a rich man's game. But would even a rich man want to buy into this market?

Telegraph: Bleak outlook for economy echoes 1970s

Barclays Capital strategist Tim Bond predicted a period of painful retrenchment from today's "unsustainable" levels of household debt, and said the bursting of credit and housing bubbles was inevitable.

House Price drop: House Price drop steals HPC content

I had the same problem in 2002 with a gambling website I ran. Not really a big issue but the screen scraping may cause the website speed to perform badly

Channel 4: How the banks bet your money

I hate banks, Thomas Jefferson said they would take are freedom an wealth!!

CNN: Rust and Sun Belt cities lead '07 foreclosures

"Most of the metro areas with the highest foreclosure rates were either cities like Stockton and Las Vegas, which experienced meteoric growth and unsustainable price appreciation over the past few years, or cities like Detroit, which are undergoing a more widespread economic downturn along with higher unemployment rates," We have loads of rust belt north of London but where is the UK equivalent of the Sun Belt?

Sydney Morning Herald: Welcome to the new Struggle Street

Welcome to the new Struggle Street - the middle class, suburban Sydney road where four houses in a row of six have been repossessed within 10 months of each other. One expert warned that a combination of rising interest rates, stagnating house prices and irresponsible lending had created a "time bomb of loans that is probably going to implode".

BBC: Bursting the House Price Bubble

This report details how Barrett have been giving incorrect sale prices to land registery, there was me thinking this would be classed as fraud?

Telegraph: Standard of living will fall, warns Mervyn King

Families have been warned to expect a decline in their standard of living as rising food and fuel prices place household finances under severe strain. Would UK economic policy be better served by following the ideas in random late night HPC blog comments (probably after coming back from the pub) rather than professional economic advisers? Yes - probably, the evidence emerging seems to suggest so.

Bloomberg: Morgan Stanley to Cut 1,000 U.S., U.K. Mortgage Jobs

Morgan Stanley, the second-biggest U.S. securities firm, will eliminate 1,000 jobs by scaling back its U.S. residential mortgage business and closing the Advantage Home Loans unit in the U.K. Morgan Stanley bought Advantage in December 2005.

CBS News: "Jingle mail:" The Awful Sound Of "Voluntary" Foreclosure

As the foreclosure crisis deepens, banks and lenders are talking openly about one of their worst fears: "jingle mail" – the phrase that describes what happens when a borrower gives up on a house and a mortgage, and simply mails the keys back to the lender and walks away from the mortgage. What did we just see Egg do? that's right, penalise good customers. What makes you think a bank won't start selling homes where the mortgage payer is bang-up-to-date, simply because a "repossessed property" due to default fetches less at auction. Wait and see. Stranger things have and yet will happen.

Brighton Argus: Make use of empty homes to ease crisis

This article seems reasonably mild, but that doesn't stop a sense of panic in the responses. Some of the residents of Brighton worried that their second homes might be 'nationalised' perhaps?

Bloomberg: Americans Selling Homes See Prices Go Below Mortgage

America learns all about negative equity, although they don't seem to use that phrase yet. "Thirty-nine percent of people who purchased a home two years ago already owe more than they can sell it for" ``It comes to the point where you have to decide: Do I want to take a big loss now or an even bigger loss later?''

BBC: Home ownership dips to decade low

"Home ownership in England fell for the second year in a row last year, sliding to its lowest level since 1998, according to government statistics". "Critics complain that many buy-to-let landlords have been able to obtain bigger mortgages, financing more expensive house purchases, than other ordinary buyers could normally afford".

Telegraph: Squatters rights for mortgagee who didn't pay

I wonder how many poor stretched home-owners contemplated life as a squatter when they read this, before they realised that this court ruling probably means they won't even get that option...

DavidCharlatanSmith: Inflation report: Rates to fall not plunge

This is pure transvesting the truth for the benefit of VIs. King never said "said that house prices should be in for a long period of stability"!!! But in the opening remarks (link posted in Smith's blog) King said: "The impact of tighter credit conditions is apparent in property markets, and is particularly likely to affect investment in commercial and residential property and perhaps business investment more generally"

Citywire: New-build property scam worse than feared, FSA warns

The new-build property fraud carried out by criminal gangs is more serious than originally feared, the regulator admitted today, with more than 200 cases already under investigation and more appearing every day. The scams appeared to be run by ‘organised rings, using mortgage and property fraud to make significant profits', FSA crime director Philip Robinson told a Council of Mortgage Lender’s fraud seminar.

BBC: Sweden surprises with rate rise

"Sweden's central bank has raised interest rates by a quarter of a percentage point to 4.25%". "The Riksbank said the move will help bring down inflation, which is running at 3.5%, well above the target of 2%".

Times: Bank of England Governor, Mervyn King, admits inflation will trigger new Alistair Darling letter

"The prospect of an immediate interest rate cut receded further today as Mervyn King, the Governor of the Bank of England, conceded it was “odds-on” he wouldhave to write an explanatory letter to the Chancellor as inflation heads towards 3 per cent" so let us summarize: no IR cuts, further slowdown, recession, then cuts, then the pound falls to 1.5 against dollar, more inflation, rates go up again, immigration stops, lots of empty city flats. Could all of this been prevented? YEEEEESS! keeping rates up in the first place and regulating BTL mortgage lending. Brown + Darling --> Dustbin of history

MoneyWeek: Warren Buffett gives the bond insurers a good kicking

Warren Buffett has offered to relieve the ailing monoline insurers of their best assets, leaving them the subprime rubbish. You've got to admire his ruthlessness. But are the monolines desperate enough to accept?

Market Oracle: Gold Price Out of Synch With US Dollar Index, Expect Sharp Decline

I am not sure where gold will correct to (maybe 800-850) but this correction is necessary for the final surge up in Elliott wave 5. This kind of gold blow-off last happened in May 2006.

Firstrung: Bad debts up threefold, profit halved, mortgage arrears nearly double at buy to let specialist Bradford & Bingley

Bradford & Bingley, the UK's biggest buy-to-let lender, has seen its mortgage arrears leap by a huge 42 per cent in 2007. Their bad debts trebled as more homeowners struggle to keep up with repayments. Pressure on borrowers contributed to a threefold increase in bad debt charges to £22.5 million, from £7.4 million in 2006. Writedowns have reduced the lender's statutory pre-tax profit by 49 per cent to £126 million in the full year to 31 December...

Firstrung: Over one in five adults of working age economically inactive

The trend in the employment rate is increasing but the trends in the unemployment and inactivity rates are falling. There has been a further fall in the number of people claiming Jobseeker's Allowance benefit. The number of job vacancies has increased. Growth in average earnings, excluding bonuses, has increased, but earnings growth including bonuses has fallen...

Safe Haven: The Plague of the Witch Doctors

Many of us in Bear Country don't insist that a Great Depression is coming. In fact we insist that what is coming is NOT going to be a depression as we have known such a phenomenon in the past. This time, it will be different because our political and monetary authorities have learned some things from their last escapade in economic humbuggery during the 1930s. In fact Bernanke is a devout student of that period and his Fed has acquired several new ways to shore up the Keynesian system. So things will be extended this time. Not healed, or solved, just extended. And in the process, exacerbated. We bears see Bernanke and the Fed as nothing but gussied up monetary witch doctors with an array of fiscal gimmickry and crypto agencies which they can draw upon to defend their paper paradigm

BBC "News": Sub-prime dominates repossessions

"Sub-prime lenders are bringing more than half of UK repossession orders, despite accounting for just 6% of total mortgages, a BBC report has found."

As well a BBC report might find that to be the case.

The reality is somewhat different - "Non-conforming" lending – including buy-to-let, self certificated mortgages, equity release and subprime – represents 30 per cent of the market according to the Intermediary Mortgage Lenders Association (IMLA).

FTAlphaville: Markets LIVE, Numis report quote

"Buy-to-Let (BTL) bubble: BTL has supported the UK property market, for the first time allowing property to fund property purchases. In Q1 1999 there were 11,100 BTL mortgages against 119,300 first time buyers (FTB). By Q3 2007 BTL volumes were up 750% with FTB numbers down 19%. For property prices to have tracked income growth over the past 25 years house prices would need to fall by over 44%. The OECD and IMF also believe that the UK property market is at least 40% overvalued. B&B is the most exposed stock we cover to the property market. If BTL is deemed to have been mis-sold (we can not see how it is appropriate to hold 1000% of your net worth in one asset class) B&B is bankrupt."

The Times: Business News Article

A similar article to that elsewhere. I remember 1992 with some affection actually.

MoneyWeek: Why thousands of people have overpaid for property

Every bubble has its predators. During the property bubble, it was the developers and buy-to-let clubs who offered new-builds 'below market value'. Get ready for a wave of repossessions across the nation's city centres...

CityWire: Higher than forecast write offs knock Bradford & Bingley for six

After Victoria Mortgages, Kensington, Northern Rubbish and Para-gone, it is the turn of kissing BB ByeBye

ft.com: ft

Property stock exchange closes By Daniel Thomas Published: February 13 2008 02:00 | Last updated: February 13 2008 02:00 The UK’s only residential property stock exchange has been forced to close after failing to raise sufficient funds to meet European financial regulations. The Property Investment Market was an innovative attempt to encourage widespread residential investment in the UK. It would find and then list residential properties on its online exchange, in which investors could buy shares for as little as £1 ($1.9).

BBC "News": Surveyors' "gloom" at house prices

"A lack of demand and confidence in the housing market is clearly behind the recent price slowdown," said Rics spokesman Jeremy Leaf.

But ... but .. immigrants and overcrowding and erm ... small island and Olympics and umm ... immigrants ... ?

MoneyWeek: Why a recession won't push down the cost of living

Worried about inflation...? Oh stop your carping and set an extra place at dinner for the fast-looming recession instead. Your cost of living can NEVER go up during a recession, right...? But remember, that near-perfect connection between money-supply growth and consumer-price inflation is one of the few clearly established facts in economics. Over a 30-year horizon, they match each other almost exactly. Which is to say they won't necessarily move together this week or next.

The Telegraph: US credit crisis escalates as defaults spread

US house prices have fallen by 7.7pc over the past year, according to the Case-Shiller index of the 20 biggest cities. The slide is likely to gather pace as 2.2m mortgages taken out at the height of the credit bubble adjust upwards by 250-300 basis points. Goldman Sachs says house prices may fall by as much as 25pc from peak to trough - creating the worst slump since the Great Depression.

Times: Crisis at Pickfords puts 1,300 jobs at risk

Pickfords, Britain's oldest and largest removals company, is on the verge of a fire sale to avoid a financial crisis that would put up to 1,300 jobs at risk, The Times has learnt. The loss-making company is trying to sell some or all of its business as it seeks to secure additional funding to help to pay staff and creditors. If it failed, Pickfords would become the first high-profile British casualty from the slowdown in the UK housing market and the collapse of the American property sector.

Citywire: Mortgages: Waiting for the big liquidity freeze to thaw

Mortgage lenders are becoming increasingly concerned about the looming shortfall in funding. The Council of Mortgage Lenders (CML) is lobbying the Treasury and Bank of England to help solve the liquidity problem in the hope that the securitisation market, on which many lenders rely, can be reopened. The freeze has already taken out buy-to-let lender Paragon and there are fears that the continuing shortage of funds will create problems, not just for homebuyers (and sub-prime borrowers in particular), but for everyone as it spills over into the wider economy, precipitating a general slowdown if not recession

BBC News: Bradford & Bingley profits slide

"Lender Bradford & Bingley (B&B) has reported a sharp fall in profits after cutting the value of risky assets following the recent market turmoil. Pre-tax profit almost halved to £126m in 2007 from £246.7m the year before." - Then there is a good bit of spin here "B&B said that if it stripped out what it termed "unusual and extreme external events" then underlying profits rose 5% to £351.6m". So that's alright then!? - "There is no denying that today's market circumstances present the mortgage industry with a unique set of challenges and opportunities," B&B said. "We believe the fundamentals that drive our specialist markets remain strong, and expect the buy-to-let market to continue to grow at a faster rate than the mainstream mortgage market," it added."

The Times: Business News Article

It would seem that even the US are owning up to the fact that they have simply spent too much and that they will have to readjust...

Daily Telegraph: Simply absurd in our mad, mad, mad, mad world

"The credit crunch (and its genesis in the sub-prime mortgage swamp) reflects monolithic madness. Lending enormous sums to people whose main source of income is a welfare cheque was bizarre enough. But pouring their obligations into a cocktail shaker and expecting it to produce triple-A securities is bonkers"

Times: House prices set to fall by 7% in next two years as credit squeeze bites

"Goldman Sachs said it expected house prices to fall by 5 per cent this year and a further 2 per cent in 2009. The bank had originally predicted a decline of 3 per cent in 2008 and no further change the year after, but became more pessimistic after economic warning signs." They should know, they've looked at the Northern Rock for quite some time. Surely noone (apart from the Express) is going to disagree?

TELEGRAPH UK: Defaults in the US housing market are spreading from sub-prime to the much larger stock of top-grade housing debt, threatening to set off a wave of even bigger losses for banks and investment funds.

The Mortgage Bankers Association says default rates on all outstanding home loans in the US have reached 7.3pc, the highest level since modern records began in the 1970s. Arrears on "prime" mortgages have reached a record 4pc, confounding expectations that middle-class Americans with good credit records would be able to weather the storm. While sub-prime and close kin "Alt A" total $2,000bn (£1,019bn) of debt, the prime market in all its forms is roughly $8,000bn. If prime default rates rise on their current trajectory, they could ultimately cause huge financial damage.

RICS: RICS UK Housing Market Survey January 2008

Please don't post thousands of articles citing this same source - these are the source figures from RICS, there is nothing that the BBC or Guardian or Times can add to it. Bold text is as per the source article. "The balance of surveyors reporting house price falls increased again in January. The RICS house price balance dropped for the sixth month in succession signalling half a year of negative market sentiment. The decline in demand picked up speed as new buyer enquiries fell at the fastest pace since October. The stock of unsold property on surveyors’ books jumped by more than 10 percent and has increased by in excess of 40 percent since September 2007. Currently the average level of unsold property per surveyor is at the highest level since February 1999."

NZ Herald: Residential property "Buyers' market"

NZ prices over the edge as reality bites. National median price down from $345,000 to $340,000. Auckland City prices plummet from $510,000 in Dec 07 to $433,000 in January 08 - more than 15% in one month. Vested interest, the Real Estate Institute of NZ, tries valiantly to put the figures down to holiday factors and focus attention on annual figures, which are still positive for the country as a whole (3% since Jan 07). Number of sales in Jan 08 5,186 compared with 7,566 in Jan 07. Days to sell has blown out 49, the highest figure since 2002. Number of $1m plus properties sold nationally dropped from 186 in December to 119 in January.

Daily Mail: First time buyers spend 35% of take home pay on mortgage

First-time buyers are spending more than a third of their take-home pay on their mortgage, official figures revealed yesterday. In a deeply worrying sign, it is the highest level since the last property crash in 1991. Financial advisers warned that massive mortgages are "a disaster waiting to happen". The situation may be even more serious than it was in 1991 because so many other costs are soaring.

Euro2day: Spanish banks' reliance on ECB surges with €44bn borrowing

The European Central Bank has effectively funded new lending in Spain in recent months, replacing banks' use of wholesale capital markets, which have been strangled by the global credit crunch. Spanish banks doubled their share of the ECB's weekly funding auctions in the final quarter of last year, taking their borrowing up to €44bn in December from a running average of about €20bn over the previous 15 months, according to the most recent data from the Bank of Spain.

gata: Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East.

The Tokyo bourse has crumbled, suffering the worst start to the year since the Second World War. The Nikkei index is down 17 per cent since Christmas, and the shares of Japanese banks are leading the slide. Mizuho Financial, Mitsubishi UFJ and Sumitomo Mitsui have all been punished as hard or even harder than those US banks at the epicentre of the sub-prime debacle.

BBC: Savers 'escape' recent rate cuts

The Alliance and Leicester are currently advertising 12% for a year on TV to entice new regular deposits which beats all the figures in this BBC article. After years of stingy saving rates this is all starting to sound a little desperate.

Times: Darling backtracks on 'non-dom' charge

Alistair Darling has dropped key parts of his controversial plans to tax non-domiciled foreigners living in Britain in the face of unprecedented opposition from business and the City. The Chancellor, faced with a growing political storm over his so-called "non-dom" tax proposals, outlined his u-turn in a letter sent today to tax lawyers and specialist accountants, a copy of which has been passed to The Times.

BBC News: UK House Prices

The BBC today (12 Feb.) updated their "UK House Prices" data based on figures provided by the Land Registry of England and Wales. The figures show a 5.7% drop in the average house price in Greater London from Q3 to Q4 2007, based on over 32,000 sales. The City of London leading the way with a drop of 17.5% (yes 17.5%). Merton (down 13.1%). City of Westminster (down 11.1%). Lambeth (down 10.7%). Camden (9.7%). Hamersmith and Fulham (down 7.5%). Richmond upon Thames (down 7.1%). Enough said!!!!!

BBC: Trade deficit worse than expected

Foreigners are turning away from UK products as they realise that 75% of the cost is nothing to do with what they are buying, but goes directly to public sector workers in Scunthorpe. Apparently Johnny foreigner even wants more cash back for their own goods due to something to do with interest rates and a Labour government.

CNN.com: Treasurys sell off on Buffett muni offer

Buffet offers to Reinsure $800 bn of munis, they think its all over?!?!? Big up the FTSE.

Daily Mail: Man who refused to pay mortgage for 15 years is granted 'squatters' rights'

"However, banks have warned the decision by top judges to wipe out Djabar Babai's arrears could lead to tougher early action by lenders. An increased number of vulnerable home owners could be forced onto the streets by banks fearing they will lose their money."

Key worker scheme: Free from the rat race!

Well guys,. crazyness. I just bagged me a self contained studio flat in zone 1 for £90/week on the key worker scheme. 5yr tennancy. House prices would need to go down about 90% now to make it worthwhile for me to buy, so I no longer give a s%^t!! :-) I would hate to be a buy-to-let person competing with this type of deal, yer, a small part of the market, but there are some good deals out there!! Hopefully I'll have enough cash saved at the end of the 5yrs to buy a flat out right, once house prices are bottomed up. So, there are ways to insulate yourself, if you look hard enough. Maybe others have some tips on how to protect our wealth against the housing market and the high inflation that is here and on the way? Any stories from the coal face?

NY Times: Mortgage Crisis Spreads Past Subprime Loans

It's not just subprime anymore and it's not contained: "Until recently, people with good credit, who tend to pay their bills on time and manage their finances well, were viewed as a bulwark against the economic strains posed by rising defaults among borrowers with subprime credit." Now, however, the collapse in home values is sucking in borrowers of all classes. Why? Because "banks are responding to the rise in delinquencies by capping home equity lines of credit in areas with falling real estate prices." The easy money is gone.

Charcol Home & Money News: Petrol drives inflation up to 2.2%

The Office for National Statistics (ONS) says that Consumer Price Index (CPI) inflation increased by 0.1% for the 12 months to January, compared to December's figure of 2.1%. It attributes much of the increase to the rising prices of fuel and food.

CNN: UK house prices seen down 5 pct this year as economic outlook weakens

This is like a death sentence. "The broker has lowered its house price growth assumption down from its November consensus forecast of a 3 pct fall for this year and 0 pct in 2009, and has also become more bearish on volumes. It now expects a 16 pct fall in volumes this year, compared to 11 pct before, following recent trading updates from UK housebuilders showing forward order books down by over 10 pct with the key Spring selling season still to come. Over the next month, it expects housebuilders to report a fall in buyer activity during the Spring selling season as tighter credit, falling house price growth expectations and falling mortgage approvals feed through to weaker demand" YIIIEPPPEEEEEEEE

Mortgagestrategy: EXCLUSIVE: FSA probes 200 brokers for fraud

Some 200 brokers are under investigation by the Financial Services Authority in connection with mortgage fraud. In an exclusive interview with Mortgage Strategy, Philip Robinson, director of financial crime and intelligence at the FSA, revealed this morning that the regulator plans to release the names and enforcement action for those involved in fraudulent dealings next week. Robinson says that repercussions for brokers under investigation will vary depending on the severity of their involvement in the crime. They could range from regulatory reviews to criminal charges.

David Smith's Economicsuck.com: CPI 2.2%, RPI 4.1%

With the growing barrage of criticism at his shortsightedness and lack of analytical rigour, David Smith has had a hissyfit and closed the comments facility on his site. On the one hand I think its good, although he still has his job at The Sunday Times to spout claptrap regarding his ill-conceived skip index. On the other hand it's a shame really. I enjoyed having a look every once in a while, not so much for his inane posts but to relish the hammering he always used to get in the comments section from his readers.

NY Times: A Psychological Bubble for Homeowners

Denial can be a powerful psychological force. According to a survey released earlier this week by Zillow.com, the real estate Website that calculates home values, denial is precisely what appears to be at work in the minds of many homeowners across the United States. They have managed to convince themselves that, despite ample evidence to the contrary, their homes actually increased in value in 2007, or remained the same.

FT.com: UK inflation growth weaker than expected

Classic use of a framing device, make out that the measure was not as bad as expected..... ''Consumer price inflation rose less than expected in January, but edged farther above the Bank of England’s 2 per cent target as higher food and petrol prices took effect, official data showed on Tuesday. ''

BBC: Home loans drop 35%, lenders say

The number of new mortgages granted to home buyers slumped to just 62,000 in December 2007, according to the Council of Mortgage Lenders (CML).

nytimes: “This collapse in housing value is sucking in all borrowers,” said Mark Zandi, chief economist at Moody’s Economy.com.

. As home prices fall and banks tighten lending standards, people with good, or prime, credit histories are falling behind on their payments for home loans, auto loans and credit cards at a quickening pace, according to industry data and economists The rise in prime delinquencies, while less severe than the one in the subprime market, nonetheless poses a threat to the battered housing market and weakening economy, which some specialists say is in a recession or headed for one.

FT.com: Table: Subprime-related losses at major banks

This is a moving target, but gives some insight. Where are all the rest of the bodies buried?

Firstrung: Rising inflation dampens hopes for further interest rate cuts in 2008

Figures from the Office for National Statistics today show that consumer prices index (CPI) annual inflation - the Government's target measure - was 2.2 per cent in January, up from 2.1 per cent in December... The largest upward pressure came from an increase in the price of road fuels. Average petrol prices rose by 1.3p in January to stand at 103.9p per litre, compared with a fall of 0.8p a year ago. There was also a large upward effect from food, particularly fruit, such as grapes and grapefruit, where prices fell by less than last year. There was a further large upward contribution from furniture where, overall, price reductions in the January sales were less than in the previous year.

The Telegraph: Families hit with £1,300 rise in cost of living

Families are having to pay an extra £1,300 a year in household bills as food and fuel prices rise at their fastest rate for 17 years.

Firstrung: Mortgage approvals for January down 38% vis a vis January 2007

This is what Connels say: "Mortgage approvals for house purchase rose 3 per cent in January according to the latest data from Connells Survey & Valuation. Mortgage approvals rose to 75,300 in January from their December low of 73,000 representing the first increase in mortgage approvals since May 2007" This is the reality: However, approvals have fallen 38% compared with January 2007, when almost 125,000 mortgage were approved, while approvals have reached their worst January level since Bank of England records began in 1994. and the mainstream 'meeja' wonder why some folk are suspicious (at best)

MoneyWeek: The grim truth about inflation: it just won't go away

Despite the impending global slowdown, inflation is still very much a threat. And it's about more than rising food and energy prices too - import prices are also on the rise. It looks like interest rates won't be falling as fast as the City had hoped.

Freemarket Gold & Money Report: The Confiscation Threat

This is a very interesting article indeed. An exert: Greenspan then goes on to say: "The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard." Also read: http://www.fgmr.com/whatgold.htm "What Is Happening to America's Gold?"

Guardian: Auctioneers bring down hammer on America's broken dreams

"California is at the very heart of America's property slump. The California Association of Realtors reported that home sales dropped by a third last year and the average house price was down by 16.5%." Thankgoodness all of our UK BTL subprime are in it for the long term, eh? Otherwise the possibility of this kind of event happening in UK would really frighten me.

Daily Express: FOOD PRICE RISES ARE BIGGEST EVER

FOOD prices are soaring at their fastest rate since records began, threatening fresh misery for millions of hard-pressed families. No doubt that supports their earlier theory on house prices 'rallying'.

BBC: UK inflation picks up in January: 2.2%, up from 2.1% in December

Last month's Consumer Prices Index (CPI) figure - the government's preferred measurement - rose to 2.2%, up from 2.1% in December. The biggest inflationary pressure was rising transport costs, the Office for National Statistics (ONS) said. The Retail Price Index (RPI) inflation measurement, which includes mortgage interest payments, rose to 4.1% from 4% in December.

BBC: UK inflation picks up in January

Last month's Consumer Prices Index (CPI) figure - the government's preferred measurement - rose to 2.2%, up from 2.1% in December

Primelocation: House price index January 2008

Price data show a pretty grim picture. Sale and rental prices are still below the pre-credit crunch levels, and the so much heralded "reduction of inventory" may just be an effect of the Christmas break. Inventories are still 60 to 70% higher than any month pre-credit crunch. but we know that London sales volumes have collapsed (Land registry) so where did the stock go? "due to market uncertainties vendors are using a cautious approach pulling properties from the market".... aaaaaa... so we will find a larger stock of properties to rent!!! With "corporate rentals on the vane" expect the BTL nightmare to begin!! AHGAHHA AHHAH AHAH

Telegraph: No let-up for buy-to-let

Anxiety over the state of the property market in Britain shows no signs of letting up. As the major auction houses gear up for their February sales, there are worrying signs. Savills says it has seen an increase in the number of repossessed properties - and it expects this trend to continue over the coming months.

Home.co.uk [pdf]: House prices fall in all regions

The home.co.uk asking price for properties in England and Wales dropped sharply this month by 1.5%, equivalent to an average reduction of £3,870. The year on year figure has fallen to just 3.7%. After six months of hopeful stagnation, it is evident that asking prices are now being cut by increasingly desperate sellers. Moreover, market sentiment continues to deteriorate as buyers play a waiting game in the knowledge that prices are falling. A nightmarish scenario for sellers: Waiting for an elusive buyer as £000s of pounds are wiped off the value of the property for sale every month. This is the psychology of a house price crash.

TELEGRAPH UK: The worst of all possible worlds is when inflation rears its ugly head even as growth slows. Stagflation holds a special place in the dark corners of economists' minds because it renders a central banker's monetary armoury powerless to fight a uniquely de

invented a new index yesterday. From 2003 to 2007 it ran like this: 600, 1057, 1592, 1588, 1822. To be known as Stevenson's Stagflation index (SSI), it measures the number of articles in which my press cuttings database finds a mention of that unholy combination of sluggish growth and rising prices. As you can see, the SSI has been in a serious uptrend

TELEGRAPH UK: AIG's $4.88bn hit knocks insurance shares

American International Group, the world's largest insurer by assets, is to take a $4.88bn (£2.5bn) writedown as it became the latest victim to fall prey to the credit crisis

dandodiary: There are also concerns that problems in the subprime mortgage industry could spread to auto and truck loans.

There are also concerns that problems in the subprime mortgage industry could spread to auto and truck loans. As discussed in a November 20, 2007 Associated Press article entitled "Analysts Fear Auto Loans Next Problem" (here), the major auto and truck lenders are already experiencing rising delinquency levels. One analyst is quoted as saying that there is no question that the mortgage woes will spill into car and truck financing. "The only question is how big a worry it is."

The Guardian: The central bankers can't all be right

So who has got it wrong? The honest answer is we don't know and are unlikely to know for some time. In the short-term, the Fed would consider it a job well done if lower short-term interest rates helped stabilise the housing market; it would, though, be a pyrrhic victory if cheaper money simply led to another episode of the bubble economy.

FT: Retail data to damp UK rate cut prospects

Expectations that the Bank of England will embark on a raft of interest rate cuts are to be undermined by figures on Tuesday showing high street sales were stronger than expected in January.

Daily Express (of course): SHOCK RISE IN HOUSE PRICES

Home owners were given much-needed cheer last night with the news that the average price of a house went up by almost £1000 to £219,591 in December. The 0.4% surprise rally defies the “doomsayers” who had been predicting a big slump. Stuart Law, chief executive of property investment company Assetz, said: “Here is yet another piece of evidence that property prices are firming up, ready for the annual spring rise, which flies in the face of doomsayers. There is plenty of hard evidence that the market is, in fact, starting to grow again. There is no evidence of a house price crash whatsoever.”

Telegraph: Bank of England likely to miss Inflation target

The Bank (BOE), which last week cut interest rates by a quarter percentage point to 5.25pc, is expected to raise its near term projection for the Consumer Price Index, implying a significant chance that it will rise above 3pc, forcing the Governor to write a letter of explanation to the Chancellor. It follows news that the majority of Britain's major gas and electricity suppliers have raised their prices by an average of 15pc and 12pc respectively." So why bother collecting data, why bother meeting, why bother cutting rates, indeed why bother at all. We are all on our own, its actually worse. BOE clowns are steering UK onto rocks

My Finances: House prices down 0.3%

UK property prices fell by 0.3 per cent in January, but fears of a market collapse are groundless, according to the latest housing survey. Chesterton's Poll of Polls conducted by the Centre for Economics and Business Research (CEBR) found the average price of a property was £146,662 last month, compared to £140,276 in January 2007 - revealing prices have increased over the year.

In The News: 2008 – the year of the house price crash?

The UK housing market is bracing itself for its worst 12 months for more than a decade. So says the Royal Institute of Chartered Surveyors (Rics), which claims market conditions have not been so adverse since the early 1990s. In January house price indices reported falls and static growth across the board, continuing the faltering trends of the autumn and winter of last year. Despite the bleak picture, property experts have been emphasising the positives, however scarce they may be, as for every worried homeowner there is a very eager first-time buyer eyeing the house price falls with glee.

Hiday.net: The French Property Market

With the unpredictable down turns of the global stock market and the uncertainty regarding the major world property markets ( in particular the USA and the UK) investors are becoming more cautious about buying a second home. However despite this some countries around the world are still experiencing steady growth - places like Brazil, Turkey, Greece, Germany, China, Bulgaria and France. Of this list France can arguably be described as having the most stable property market at the moment.

Telegraph: Standard Chartered's SIV forced into receivership

Whoopsie

Standard Chartered has been forced to place Whistlejacket, the structured investment vehicle (SIV) it manages, into receivership after credit market problems slashed the value of the SIV's assets in half. The specialist Asian lender was preparing to bail out Whistlejacket with a $7.15bn funding line before a sudden collapse in the value of the assets triggered today's "enforcement event". Under the rules governing the SIV, a receiver has now had to be called in.The action will be a severe embarrassment for Standard Chartered, which has had months to address the problems at Whistlejacket - the first UK SIV to go into receivership. It first took a cautious approach last year by slicing the assets up between investors, taking $3.3bn itself for its own 25pc equity stake.

The Press Association: Being rich is more expensive - bank

A study of the spending habits of 14,000 holders of the bank's exclusive World Card - those with a minimum of £5 million in property and savings - found inflation on premium goods and services running at 9.5% in the past year. This is more than four times higher than the official Consumer Prices Index inflation, which currently stands at 2.1%.

Mortgagestrategy: MPs remortgaged homes for cash, say reports

MPs remortgaged their homes, even though their mortgages are paid by the taxpayer, to take out cash in hand, say reports. The Times says Andrew Walker, the director of finance and administration in the House of Commons, has admitted that until 2006, MPs were able to remortgage their properties to release cash, even though their mortgages were paid for by the taxpayer.

Assetz: When is a positive a negative? When it's a house price story

There isn't any more blatant evidence of the press attempting to talk down the market than this. The FT at the weekend managed to convert a rise in property prices in January to a fall in property prices instead by a strange use of wording. "House prices see second monthly fall" was the headline and yet they then say house prices fell in November/December but rose in January. Then we get the BBC today saying the property market continues to fall, choosing to quote the annual rate of growth in order to make sure they can show a declining trend of house price growth, and yet the figures from the DCLG state that prices rose 0.4% in December. From my research it does appear there is an unusually large percentage of journalists that rent rather than own their own homes.

GMTV: Buy-to-Let Show

"...may be ready to jump at a months notice". Wouldn't really call it impartial advice ?!!!!

Telegraph: Over 2m foreigners are now working in Britain

Official figures from the Labour Force Survey show that the number of foreigners in the UK workforce increased between 2001 and last year by 864,000 - to just over two million people. This is equivalent to one in 14 of a total working population. By contrast the number of UK-born nationals in the workforce fell, between 2001 and 2007, down by 500,000 from 24.4 million in 2001 to 23.9 million last year. This could be a serious downward pressure on prices when the recession really starts to bite and most of them head off home.

FT video interview: Peter Bernstein

Venerable historian Peter Bernstein speaks on the causes of the subprime. We went through a period of low risk. When risk is low so are returns. So people started taking more risks. This effects the whole financial system. The ratings agencies were part of this delusion that there was low risk. The delusion was based on the assumption that house prices don't fall. Video in three parts the third ends with a comment on gold (apologies if we are not allowed to mention gold on this blog anymore!).

YouTube: Bird & Fortune - The Sub-Prime Market explained

This is a frightening insightful and hilariously funny satire. Bird & Fortune cut straight to the heart of the subprime market and the dodgy decision making of the banks and tell it how it is. Wonderful!

Times: Inflation rise puts rate cut hopes in jeopardy

David Smith is fast at work... curious to see how he will be able to turn a basket case into a plea for another rate cut "Halifax, the country's largest mortgage lender, has pencilled in at least another quarter-point cut in interest rates this year. Martin Ellis, its chief economist, said that further rate cuts depended, however, on whether the Bank believed that it could keep inflation under control." MAU AH HAHAHH AHHAHAH pencil pencil

thepropertygrower.com: Buy to Let

Speechless on this one folks.

BBC News: Property market continues to cool

The UK property market is still cooling despite a slight rise in prices in December, government figures reveal.

MoneyWeek: Why house repossessions could double this year

Repossessions jumped by 20% to 27,100 last year. And worryingly, those numbers don't include the knock-on effects of the credit crunch - expect this year's to be much worse.

MortgageSolutions: Mortgage approvals rise in January

Mortgage approvals for house purchase rose in January from their December low, according to the latest data from Connells Survey & Valuation. The change represents the first increase in mortgage approvals since May 2007. Approvals increased by 3% in January to 75,300 from 73,000 in December. Connells has seen a rise in housing stock coming onto the market and renewed interest from househunters.

telegraph: HSBC seeks to shed French retail division

officially its to dispose of a non-strategic asset.... but wouldnt it rather HSBC trying to raise cash ??? it looks as a strange move to sell a profitable retail banking in this environment

BBC: Producer prices at 16 year high

Do BoE know what they are doing? I think not. ''Price inflation of goods leaving UK factories has reached its highest rate in 16 years, driven higher by petrol and food costs, official figures show. Annual output price inflation reached 5.7% in January, up from 5.0% the previous month, according to the Office for National Statistics (ONS).''

Telegraph: Bank of England likely to miss inflation target

The Bank of England will use this week's closely-watched Inflation Report to warn of a high probability that it could miss its inflation target in the coming months. The Bank, which last week cut interest rates by a quarter percentage point to 5.25pc, is expected to raise its near term projection for the Consumer Price Index, implying a significant chance that it will rise above 3pc, forcing the Governor to write a letter of explanation to the Chancellor.

ThisIsMoney: Northern Rock row over 125% loans

Beleaguered Northern Rock faces growing criticism for continuing to offer mortgages worth more than the value of borrowers' homes. The bank, which kept afloat only because it is underwritten by the taxpayer, still markets its Together mortgage deal, where homebuyers can borrow up to 125% of a property's price. Borrowers signing up to such loans instantly fall into negative equity. A Rock spokesman said: 'The Together mortgage is a legitimate product that performs well and helps people on to the housing ladder.'

Bloomberg: New Zealand House Prices Increase the Least in a Year

"New Zealand's house prices rose at the slowest pace in 12 months as record-high interest rates and rising living costs curbed demand for property". "In December, the interest rate on a two-year fixed mortgage was 9.38 percent, up from 8.18 percent a year earlier".

times: Darling: a menace to Britain

Global businesses look at the present Labour Government and think about moving away from London The City of London is the jewel in the crown of the British economy. In terms of other economic factors, Britain may only be a second-class power, in manufacturing, invisible trade or in research. As a European economic power, Britain ranks above Italy and about level with France. Yet in finance the City of London meets Tokyo or New York on level terms as a major player. The City of London earns the living of the United Kingdom. Without the City's earning power,

TELEGRAPH UK: Americans and Europeans have so far confessed to $130bn of the estimated $400bn to $500bn of wealth that has vanished into the sub-prime hole.

Japan is the next sub-prime flashpoint There is still $300bn of bad debt out there, and Japan could be hiding most of it. Ambrose Evans-Pritchard reports Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East. Somebody, somewhere, must be sitting on a vast nexus of undisclosed losses. We may find out soon enough whether the hold-outs are in Japan. The banks have to come clean under the country's strict new audit codes by the end of the tax year in March.

Times: Alistair Darling's confidence seems misplaced

After last week's speech on economic prospects from Mr Darling, I can, however, make one modest proposal for a contribution to Britain's economic revival: less complacency from the Treasury and fewer ludicrous boasts from the Chancellor.

The Times: Lifestyle Article

Mmmmmmmmmmmm.... I wonder how much of this is really that people can't afford to get hithced and have kids. Welcome to a lonely old age, Buy to Letters....

Me myself: Banks offering even higher interest rates

Even after the BOE has reduced interest rates twice the best saving account return has been around 6.9%. And has not reduced even after .50 point cut in interest rates. The reason is simple: The problem that these banks have is that they have a lot of loans on their books which is of poor quality and is getting poorer as time goes on. Hence they need money to put up for the losses. ECB gave $502 BILLION dollars in liquidity (2 week loans) in Dec-Jan. This was taken up by not only european banks but also American banks via subsidary/partner banks. And now its time to pay back. The chances of ECB giving the same money back again is next to impossible. So the sage continues and the banks need money even at higher rates from us as they will not lend to each other.

Independent: Britain's battered banks pray for deliverance

Bradford & Bingley kicks off the banks reporting season this week; seven of the UK's biggest lending institutions will deliver full-year numbers by 3 March.

FT: Subprime losses could rise to $400bn

Senior global policymakers have raised projections for the size of subprime-related credit losses in a move that implies financial institutions will have to increase write-offs.Speaking after the meeting of Group of Seven finance leaders, Peer Steinbrück, German finance minister, said the G7 now feared that write-offs of losses on securities linked to US subprime mortgages could reach $400bn. This is sharply higher than the $120bn credit losses that Wall Street banks and other institutions have revealed in recent weeks – and also far bigger than the US Federal Reserve’s estimates for subprime losses last year of $100bn-$150bn.

Guardian/Observer: Atlantic drift: will UK housing market follow America into a slump?

We all know there are no fundamentals underpinning UK house prices, just psychology and greed."growing evidence that UK housing market is already slowing sharply. Prices have slipped for 3 consecutive months and repossessions were already at a 14-year high in 2007. In the US, early in 2007, analysts were puzzled that the fallout from sliding prices did not appear to be hitting consumer spending or jobs, and Ben Bernanke remarked in the spring that he thought the problem was 'largely contained'. Less than 6 months later mortgage defaults sparked a financial crisis; by the end of the year, joblessness was rising. In other words, a housing market downturn can itself sow the seeds of a broader economic downturn - especially if it has been pepped up by an outbreak of profligate lending"

Telegraph: Countryside abandoned as schools close daily

Schools are being shut at the rate of almost one a day, with hundreds axed in rural areas in the past five years. The full extent of the closures is revealed for the first time in new government figures which show that a total of 1,704 schools have been shut in England since 2002 - an average of 6.6 a week. *** So much for the governments commitment to keeping village schools open - another labour lie.

Rense.com: Can't Pay Your Mortgage? Trash Your House And Leave

"We just estimated a trashout yesterday where we're going to have to drain the pool," one Fontana , CA resident posted on AgentsOnline.Net, a resource and idea site for realtors, "and the stench from it when you enter the backyard is overwhelming. Then, of course there are mosquitoes all over the top and it's been sitting so long without chemicals that it's green on top and murky black on the bottom. We've already had to refuse one pool because of its really creepy condition and I'm not so sure about this one either. [I] just hope we don't find the previous homeowner at the bottom when we drain it."

FT.com: UK on a tightrope

Mr Darling should resist the alternative: a UK equivalent to Fannie Mae of the US to buy up and guarantee mortgages. A simultaneous bailout of bankers and overstretched homeowners may be tempting. But if house prices are too high – and they almost certainly are – subsidising them will only delay, not prevent, their ultimate decline. Gentle house price falls, and a slowdown without recession, would be an excellent outcome.