Friday, Apr 17, 2009
Kate Barker defends her housing report
Spectator: Kate Barker responds to the Spectator Inquiry
What went wrong with the British housing market? Fraser Nelson interviews Kate Barker as part of The Spectator’s ongoing inquiry into the causes of the recession. Fraser concludes: She missed the elephant in the room: the problem of house prices wasn’t lack of supply, it was that there was that there was a asset bubble going on
Posted by daisyb @ 10:18 AM (768 views) Add Comment
9 Comments
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1. denzil said...
Missed the elephant in the room is being incredibly polite. There were a herd of elephants in the room defecating and spraying water around just like there was no tomorrow.
Barker's reply to this question just about sums it up:
>Inflation targeting is not enough. “It happens that in the early years of inflation targeting, it did produce a stable economy. But I think it’s now clear that it can’t, by itself, produce a stable economy ... Do I think we should have perhaps looked a bit more at some of the money indicators?’ Yes, possibly that’s true.”<
Yes, possibly that's true, FFS. Lets make her a Dame for services to stupidity.
2. mark wadsworth said...
Well, two-thirds of a cheer for Fraser for that blinding insight, but seeing as demand for houses is fairly price inelastic, even small increases in supply tend to have a disproportionate effect on prices, i.e. a 5% increase in supply (a million homes, let's say) would probably reduce house prices by 25% (or whatever the figures are).
NIMBYs know this instinctively.
3. paul said...
The Spectator did a comprehensive hatchet job on her housing report as being unfit for purpose basically because it was getting the right answers to the wrong questions.
Like most central banksters, she doesn't admit she got it wrong, she just retrospectively changes the terms of reference, for example:
4. Her remit never allowed her to look at the causes of the demand for housing – just supply. "When I wrote the report I didn’t believe – and I certainly didn’t believe so for the last couple of years - that the whole reason that house prices were rising was because housing was undersupplied ... I’ve always thought it stemmed much more from demand factors. Particularly from mortgage and finance factors."
But the report never mentioned that, did it?
4. alan said...
Thanks daisyb, the article was a good find!
Sooner or later there was bound to be a "drains up" on what went wrong. I suspect that as time passes, members of the MPC will be altering their perspective on the past. Maybe write a book!
For some it will be attempting to clear their conciences, for others, they will tell their version of the truth, highlighting others mistakes.
But, for the people in negative equity, well...what would they want right now?
5. doomwatch said...
I've always kind of liked Fraser, even though he's a Tory Maggie lover and try's to speak posh.
Thing is, all these political hacks are now looking for spicks to beat Gordon with FAR TOO LATE, and
clearly are only NOW pointing out a housing bubble as a politital weapon, as opposed to for social good,
which most of us have been doing here for years.
6. george monsoon said...
Does anyone else liken this defence tactic of Kate Barkers to that of school playground tactics..
"it wasn't me Sir, it was his fault, I wasn't there" said the kid with the catapult in his hand and chocolate round his face..
7. another alan said...
Stephen Nickell is someone I'd like to hear from regarding the housing market... 10xsalary in 2020... (needs checking but it is something like that) ho ho ho
8. another alan said...
Some HPC threads about Stephen Nickell:
http://www.housepricecrash.co.uk/forum/index.php?showtopic=80429&st=15&p=1183063&#entry1183063
http://www.housepricecrash.co.uk/forum/index.php?showtopic=48894&mode=linearplus
http://www.housepricecrash.co.uk/forum/index.php?showtopic=61688&mode=threaded
9. 51ck-6-51x said...
We should not aim for economic stability, that is what got us in this mess. Change is what makes things work. A stable economy leads to complacency, which leads to sudden, postponed instability... let the market do what it does best!