Tuesday, Nov 03, 2009
Fathom suggest the BoE start buying houses with QE!
Telegraph: Will the Bank soon be buying houses?
Fathom’s suggestion is that it buys actual houses and bank shares. These, it judges, are the kind of items which are most in need of support (although the recent rebound in both might argue otherwise). Others suggest it follows the Federal Reserve’s lead and buys semi-toxic stuff like mortgage backed securities.
Posted by tyrellcorporation @ 10:03 AM (2479 views) Add Comment
66 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. crunchy said...
Will the Bank soon be buying houses?
Yes, if they/we want to support these absurd prices.
I say let them do it with their own money or """toxic assets.""" Talk about oxymoron!
2. tyrellcorporation said...
With House prices in many areas now back up to their 2007 bubble peak ,one has to question the sanity of the people in charge. I don't think any of us on this site realised the radical steps that would be taken to manipulate the housing market. Base rates near 0%, printing money and now printing money to directly purchase houses (if indeed this is what they are currently planning) to bolster prices.
I really do feel like giving up folks.
3. dbc reed said...
If the guv starts buying houses ,what are they going to do with them?
4. 51ck-6-51x said...
tyrell,
It could be, but are you sure it's a direct crutch?
I feel it may simply be the typical distortion side-effect of the main aim: to prop up the banks.
No doubt I will be pooh-poohed for being blind-sided by 'them'.
5. tyrellcorporation said...
DBC. Board them up to limit supply or rent them to their cronies at a pittance. Or maybe they'll be turned into social housing. Who knows?
6. tyrellcorporation said...
The very fact this is action is being debated by economists could well mean it's going to happen.
7. timmy t said...
If we had a genuinely free market and houses were allowed to fall to their natural level, the losses in the fnancial sector would be crippling. Much as I hate the thought of it, I just don't see any government letting that happen. QE will continue, we will have massive inflation, the new minimum wage will be about £30K, average wage about £40K and house prices will stay flat but drop in real terms. I'm like TC - rapidly giving up. Ironically, the other article about the population needing to drop will probably happen as masses escape this madness to Eastern Europe. We had the biggest boom, we will have the biggest bust. Get your savings out of £. I fail to see any other route out from here.
8. letthemfall said...
Even if the Govt wanted to support house prices at current overpriced levels by artificial means, there would be a limit to how long this could continue: we would end up in the same situation as two years ago. Unless, that is, we are heading towards the position we had a 100 years ago or more in which most people rented and the housing stock was owned by a relatively small group of wealthy individuals. Or in other words, a return to a society with a large impoverished majority. Unlikely perhaps, but not to be entirely discounted when we see what is happening today.
9. Susie said...
@LTF
I agree. In the long term any measures aimed at propping up the market will come to nothing. I think we'd need to go back to the voting rights of pre1867 to enable the latter scenario - by banning those that don't own property from voting.
10. This comment has been removed as it was found to be in breach of our Blog Policies.
11. cat and canary said...
I agree with letthemfall, "Even if the Govt wanted to support house prices at current overpriced levels by artificial means, there would be a limit to how long this could continue"
But the Govt is stuck, as Timmyt says "If we had a genuinely free market and houses were allowed to fall to their natural level, the losses in the fnancial sector would be crippling."
But i disagree with Timmyt in that "... the new minimum wage will be about £30K, average wage about £40K and house prices will stay flat but drop in real terms." .. because who is able to seriously negotiate a 30% pay rise with their employer at the moment, or even in the next 5 years?
To me, the inevitable outcome is the "turning of the screw" effect, whereby the public standard of living steadily drops. They've dumped a large chunk of the banking losses on the taxpayer, but unemployment is stalking and bank losses are not finished. Tax rises or massive spending cuts are on the horizon. And when all this has finished it course, who will be able to buy a house?
12. crunchy said...
8. letthemfall
Quite! Easier to impliment carbon taxes to a survile populas perhaps. Oh the control.
I can see the public sector growing in the future not reducing, but an engineered boom and bust must be out of the question.
13. crunchy said...
By the way still no news on who brought Lehman Bros down.
14. techieman said...
Sometimes i wonder if people do actually read the articles. They are basically saying that the savings rate wil rise, which will dampen further demand. Relative to HP yes there may have been upward movement but the people are paying off debt and saving:
"It anticipates inflation staying low and subdued, picking up slightly next year (as a result partly of the VAT increase) but dropping back to beneath 1pc in 2011. In short, it all sounds rather like Japan – long, subdued quasi-recovery, made worse by the “headwinds” created by fiscal tightening, falling consumer spending and an increasing savings rate. Indeed, Fathom thinks the savings ratio could hit 12pc, saying: “We found that, in order to return UK household debt to 100pc of disposable income by 2018, the saving rate would need to rise to 12pc over the next two years and remain there until 2018. This implies that, by 2010, the level of consumption would be 10pc lower than it would have been in an alternative environment where the saving rate had not risen from its average level through 2008.”
Yes there may be some inflation eventually but IF (and thats a big IF as far as im concerned) then we will be given clues soon.
If a large increase in shares and HPs doesnt result in enough of a "feel-good" factor for people to actually be unafraid to spend (apart from on "essentials" like Christmas and Holidays) then what happens when both of these evapourate? People are still scared of losing their jobs in most sectors.
As for buying housing stock that aint gonna happen. Why not? What would they buy? Where would they buy? Its more possible if Labour try it. But even if they do then by the time they work out exactly how they are gonna do this they will be out of office. And as for the tories no chance.
What they might do is actually build some houses.... now that makes more sense to simple old me.
15. techieman said...
sorry "then we will be given clues soon" should say "then we will be given clues long before it happens in the economic stats".
16. letthemfall said...
crunchy: "I can see the public sector growing in the future not reducing"
You mean we will go more continental?
(PS You really are cousin to troy (cousin to malct) aren't you?)
17. letthemfall said...
techieman
I hope we do get some clues soon. It feels like limbo at the moment
18. drewster said...
There's more than one way to skin a cat. The BoE could influence the property market through any number of means:
- buying commercial property companies' shares (e.g. British Land, Land Securities, Hammerson, Slough Estates)
- buying commercial property companies' debt
- buying existing mortgage-backed securities
- offering to buy new mortgage-backed securities
It's a terrible plan; but it might still happen.
19. crunchy said...
14. letthemfall said...crunchy: "I can see the public sector growing in the future not reducing"
You mean we will go more continental? You did'nt get that? Now I am worried.
No I mean we will get taxed to death by the NWOers army of drones. Is that any clearer.
The inability to read between the lines is why we are being robbed. Thank God some are able to do it..
20. letthemfall said...
Or perhaps you were the one who didn't understand me. Worry away.
21. crunchy said...
I understand you perfectly well. Go on facebook, or MSN chat.
22. letthemfall said...
Now I know you don't understand me
23. icarus said...
dcb reed @3 - did you see sparky's answer to that one (4th comment under the article)?
24. mander said...
BoE would do anything to prop up house prices and working against young families interests. As it has been said they would buy new mortgage-backed securities where liability is transferred to the taxpayer cause the doggy derivatives market is no longer functional.
Problem is that the taxpayer does not understand what it is being prepared.
25. techieman said...
Crunchy in alot of threads people ask what you are really saying. In my experience people either hide their lack of knowledge or their brilliance by hiding behind ambiuity.
When someone pulls you up and asks you exactly what you mean - so they dont misunderstand and can actually take part in a debate you hide even more.
To me why not openly say what you mean - do you think people can really be ar5ed to try to extract your meaning between reading between the lines.
I am not - on this occassion - actually having a go - its just you need to lighten up and let everyone join in. The last thing i had that was crunchie was some honey nut loops this morning. I wonder if you have something in common with that cereal or even the mascot.
I know "dont blame me if you cant work it out" "waste of my time" blah de blah de blah..
26. cynicalsoothsayer said...
GDP decline = Being made redundant is "random noise" apparently.
As soon as you print money, all normal money rules and attitudes get suspended. Everyone thinks they should print to buy into their pet market to protect them too. Slippery slope to ruin. BoE must be getting nervous, while government are desperate to print print print cos there's an election coming.
It's hard to see savings rates reaching 12pc, but this mess must resolve somehow, and that means either wage inflation or house price deflation or both.
27. crunchy said...
14. letthemfall said...
No, but it seems that we have reached a basic common conclusion. Let me elaborate with some validation.
Anyone is welcome to explain to the contary.
http://www.youtube.com/watch?v=7WYdAJQV100
http://www.youtube.com/watch?v=ltP2t9nq9fI&feature=related
A deathy silence! We were never conspiraloons. I was and still am just a truth seeker.
28. techieman said...
...and the relationship between WTC7 "being pulled" and the current thread? Or are you gonna post Larry on every thread when someone asks a question of your view??
Relevance Mr Crunch?
29. letthemfall said...
techieman
I agree. The truth is in there, as crunchy might say.
(In a whisper - I do actually think it is troy)
30. timmy t said...
Sorry Crunchy but I'm inclined to agree with Techieman... I reckon youtube is best left for watching fat Japanese kids body-popping and the like...
31. crunchy said...
The relevance should not be an issue to you over the deaths of 3000plus humans, but as you have asked I have just cleared up a
misunderstanding with 14. letthemfall.
Sorry to rock your little world tech and others. Human life is more important than house prices to me and I would not have posted those
two links had I not been pushed to.
32. techieman said...
cynicalsoothsayer
"In the second quarter of 2009, the UK savings rate rose to its highest level for several years after hitting a low in the first quarter of 2008. That said, there are striking differences between the savings rates of the UK and the Eurozone. The second quarter high in the UK rate is a relatively moderate 5.6 per cent". http://www.cityam.com/markets-and-investments/xrdj3qr4ui.html
We now save more of our income than the Japanese. Yes 12% may be high but we will have to wait and see.
33. techieman said...
And i actually thought this was housepricecrash.co.uk but clearly its NWO.com 2012.com or conspiraloon.com etc.
And Le Crunch i actually knew a couple of people that died in those towers, so however valid your point is - and i am not saying it isnt - this really isnt the time or the place to discuss it. If you dont want to discuss HPC then the question is whether you should be here.
Sorry if i have now started a "i knew someone too" list.
34. letthemfall said...
What's a "world tech"?
Or how about supercilious.com?
35. crunchy said...
31. techieman if you want to call me a conspiraloon, "Prove it." go on just try and I will wipe the floor with you.
The two are inseparable and the sooner people realise that the better. House prices are not an issue that stands alone.
There will be times to talk purely about them and other times to talk about the bigger picture. This threat is not about house price charts.
Don't be so precious.
36. techieman said...
Wipe the floor with me? Oh dooo behave... Blimey you really do need to lighten up!!
I dont need to prove anything your posts provide all the proof needed.
37. letthemfall said...
... wipethefloor.com
precious.com, perhaps... gettingneedlesslycross.com
These are only suggestions
38. letthemfall said...
Actually techieman doesn't need to prove it. He just knows. In fact we all do.
39. crunchy said...
34. techieman The invitation still stands.
Feel free to talk about the houses you have been cheated out of for so long but don't ask any questions.
40. techieman said...
I have a feeling that Le Crunch will always try to have the last word. There is some personality flaw in that actually but still...
You know what and who you are the crunch. Its not really important what the rest of us think or know is it?
The problem with questions is as follows:
http://www.youtube.com/watch?v=d2GtGy0zXC0
You could carry on forever and even if you get an answer it wont be the "right" answer. You wont find any solace doing that my friend.
As i said re the WTC i actually have an open mind as to whether its a "false flag" operation etc etc. But i persist in my view that there is no relevance here - if you want to prove me wrong go ahead!! :-).
41. Anon said...
now now children
42. crunchy said...
36. braindeed said...The young need to stop playing the game, and find some nuts. Old soft middle-aged geezers will take every advantage they can - the rise in houseprices crushes the young’s expectations most.
So the old bring in coolies to dampen down the young’s ardour and elbow room....and all the time they're getting pissed up until their thirties in damp rented basements (and seemingly telling themselves 'they're 'aving it large') - when will they get some spirit of 81?
Tuesday, November 3, 2009 02:12PM Report Comment
37. crunchy said...I've asked the question time and time again
Why is there so little of a moment
Oh, what is life, how do we live
What should we take and how much should we give
That is the point..... But you can have the last word tech, or shall we leave it the wise old spirit of braindeed.
Tuesday, November 3, 2009 03:12PM Report Comment
38. crunchy said...Are you there tech 36. and 37 lad. TOO SLOW!!
Sorry to confuse your little head!
Tuesday, November 3, 2009 03:17PM
Too late, too late will be the cry when all that's gone has past you by. You really have to speed up tech, myopia is not the answer.
43. techieman said...
res ispa locitur. Or I rest my case!
44. Si said...
Techieman et al, it's really rather simple. Crunchy is a troll. Let him prove he isn't by showing some self regulation of his posts.
On a completely unrelated note I found this quote: "Don't argue with an idiot. People watching may not be able to tell the difference."
Sorry this has no relevance to HPC, but this is all getting rather tedious for us casual readers.
45. crunchy said...
40. res ispa locitur. Or I rest my case!
Like HPC, this could go on forever tech. lol, Ever played Bridge. Don't answer. (A Deathly Silence.)
46. braindeed said...
ab abusu ad usum non valet consequentia
Let's hope my old latin Master has better things to do
To the young: multis e gentibus vires et natura nihil frustra facit
47. timmy t said...
Whadtha fuckis hapnin tathis sitte taday?
48. crunchy said...
42. Quite. : )
49. braindeed said...
Timmy
ne sutor ultra crepidam
50. crunchy said...
LOL, Munchy.
...now for tea!
51. timmy t said...
Braindeed - cobblers!
52. growler said...
I think we should introduce a "comment to original post" ratio limit. I had hoped that the records set by S2R1 would not be repeated.
53. braindeed said...
Ah Timmy ....Mater semper certa est
54. braindeed said...
Dear old Growler...memento vivere
55. timmy t said...
pater nunquam
56. braindeed said...
mortuum flagellas equus, Del
57. crunchy said...
51. timmy t
Draco Dormiens Nunquam Titillandus.
58. braindeed said...
I think enough is enough.....perhaps we could get round to Timmys and crack open a bottle of his best Beaujolais Nouveau 92, and let byegonrs be byegones.
59. 51ck-6-51x said...
*sigh*
That was a waste of time.
60. crunchy said...
55. 51ck-6-51x
I disagree.
http://www.youtube.com/watch?v=7WYdAJQV100
http://www.youtube.com/watch?v=ltP2t9nq9fI&feature=related
Best out of the dark thread in a long time. : )
A weapon of mass destruction indeed!
I need say no more on this now.
61. shipbuilder said...
Crunchy - I'm curious as to why you think that the BBC would have prior information about WTC 7 collapsing as part of any conspiracy? Surely the less people know the better - why not just let them report it as normal?
62. letthemfall said...
So this is the subject of crunchy's bone. Those videos have been doing the rounds for ages. The idea seems to be that the US govt, Google, BBC and no doubt assorted other institutions were all in it together. Chances of that? Negligible. Not even worth arguing about.
63. This comment has been removed as it was found to be in breach of our Blog Policies.
64. crunchy said...
http://www.youtube.com/watch?v=7WYdAJQV100
http://www.youtube.com/watch?v=ltP2t9nq9fI&feature=related
WARNING- A SPINAL COLUMN IS NEEDED FOR THESE LINKS TO BE OF USE TO ANYONE!!!!
65. 51ck-6-51x said...
Crunchy
- I meant reading this very thread was a waste of time. I didn't even bother watching any videos, furthermore you cannot disagree, my time is mine, and the waste is subjective - if I feel it was a waste of my time it was "a waste of time". And, no, I am not watching the new videos you posted, I have not got the inclination - I've seen such videos before and they generally are not evidence based, although they often make out that they are; end of subject.
66. crunchy said...
65. 51ck-6-51x
My point precisely.