The Times: Morgan Stanley warns UK risks full-blown debt crisis

Economists from Morgan Stanley said that if next year’s elections resulted in a hung Parliament, the country could face losing its AAA debt rating as investors panicked over whether the majority party had the authority to push through the fiscal tightening needed to get the UK’s finances back on track.

Posted by devo @ 11:04 PM 20 Comments

Bloomberg: Lenders Face Sanctions for Failed Loan Modifications

The U.S. Treasury Department will begin taking action against lenders that aren’t doing enough to ease mortgage payments for troubled homeowners as part of the Obama administration’s campaign to curb foreclosures. Lenders face “consequences” that may include sanctions and monetary penalties if they fail to perform under the Home Affordable Modification Program, the Treasury said.

Reuters (Yahoo): EU Okay's US bank snooping

One day before the Lisbon Treaty is made law and this would have required more consultation and the yanks have grabbed all the info they need about your personal money under the made-up drivel that is now "international terrorism". Don't ever fly there or they will have your credit card details and all your personal data as well.

BBC News: Record fall in consumer borrowing says Bank of England

"Building societies and other deposit-takers are also facing heightened competition from institutions with a government guarantee, which is creating further distortions in the savings market."

Posted by cynicalsoothsayer @ 07:10 PM 11 Comments

Mailonline: Taxpayers pay £1,600 a week

"A Somali family are living in a luxury £1.8million five- storey house in central London funded by the taxpayer. Nasra Warsame, 40, has lived with seven of her children and her elderly mother in the six-bedroom house since October. Westminster council pays the £1,600-a-week rent for the former asylum seeker."

Posted by nomad @ 06:47 PM 14 Comments

BBC: Dubai World debt 'not guaranteed' says...err... Dubai

"[Creditors] think Dubai World is part of the government, which is not correct." "Creditors need to take part of the responsibility for their decision to lend to the companies"

Citywire: House price indices diverting attention from ‘suspect’ recovery

The recent recovery in UK house prices ‘looks suspect’ according to the conclusions of a major property report by Barclays Wealth, which includes a warning about following the conclusions of the proliferation of private sector house price indices.

Telegraph: Morgan Stanley fears UK sovereign debt crisis in 2010

The US investment bank said there is a danger Britain’s toxic mix of problems will come to a head as soon as next year, triggered by fears that Westminster may prove unable to restore fiscal credibility.

Al jazeera: Sale of Dubai property bonds frozen

"Now that a crisis has hit Dubai World, I think that many of these construction companies will have to wind up their operations in the Middle East. So it will be a big hit for them."

Independent: Lloyds to axe 410 jobs

But house prices are still rising and mortgage lending is on the up so there is nothign to worry about! Nothign to see here, move along now please ladies and gentlemen and ignore the stuff on rightmove about falling asking prices. All liess I tell you, all lies!

FT: Money supply and bank lending fall

"Key measures of money supply and bank lending both fell in October, raising further questions about the effectiveness of the Bank of England’s £200bn programme to pump cash into the economy." AND tucked away at the end of the article: "Mortgage approvals rose again, to 57,345 from 56,205. Approvals have now more than doubled since their low last November but remain well below their pre-crisis average of about 100,000 per month. Analysts have been surprised by the ability of house prices to recover in spite of the lower level of mortgage credit available, but frequently point to a shortage of homes on the market at the moment." Yes it is surprising that house prices can still rise under these conditions.

Posted by mountain goat @ 01:39 PM 20 Comments

FT: Tory treasurer expects swingeing tax cuts

Leading City figure says how important City is, and is frantically funding the Tories to ensure it stays that way.

FT: The cost of China’s excess capacity

This is one of those dry articles that attract few comments here, but strikes me as a profound subject. Since the imbalances China has caused are responsible to a large extent for our current troubles, not least overblown house prices, the question is what will happen now. China's excess capacity is growing, not shrinking. What will this mean for the future? Deflation? Protectionism?

Rightmove: Three months of price falls expected as new sellers drop asking prices by £3,744 (-1.6%)

The onset of the winter market brings what we predict will be the first of three monthly falls before asking prices resume their recovery in February of next year. Average national asking prices fell by £3,744 this month as the traditional autumn buoyancy tailed off. The 1.6% decrease compares with falls of 2.9% in November last year and 0.7% in November 2007.

Business Insider: This is what a sub-par recovery looks like

Still believe in the v-shaped recovery? Wake up. That ship has sailed says Goldman's Jan Catzius, whose latest report argues that we're settling into a sub-par recovery.From housing to labour, there's just precious little evidence of a vigorous rebound.

E1 News: UK House Prices Rise 0.2% in November – Hometrack

Hometrack – leading British housing intelligence business – has just published its house price report for November, which suggests that the value of property in England and Wales saw further increases in November, marking the 4th consecutive month of house price rises in the UK. Hometrack’s report revealed that in November 2009 an average house in Wales and England saw a 0.2% increase in value, and thus, was priced at £156,700.

E1 News: UK Estate Agents Force Buyers Into Mortgage Loans

The latest study carried out by the Times Money, published on Saturday, November 28th, showed that many UK estate agents use unfair practices to boost profit. According to the study, estate agents oftentimes force potential home buyers to use in-house mortgage services even if buyers have no need in them. Such services, however, help estate agents earn additional commissions, especially as they offer mortgage deals from certain panel of lenders and, thus, do not guarantee the most attractive mortgage offers.

BoE: Lending to Individuals, October

"The number of loan approvals for house purchase (57,345) was above the September figure (56,205) and above the previous six-month average, whereas approvals for remortgaging (24,596) were below both the September figure and the previous six-month average. The number of loans approved for other purposes (29,195) was higher than in September and higher than the previous six-month average (Table B). "

BBC News: 'Radical' Lib Dem tax plans due

The Lib Dems will outline plans later for what they are calling "the most radical tax reform in a generation". The party will pledge to scrap income tax for four million low earners - those on less than £10,000 a year - if it wins the next general election. It says it would fund the measure by introducing an annual 1% tax for those owning homes worth more than £2m. The threshold for the "mansion tax" has been raised from £1m following criticism from senior party members. The Lib Dems will say they plan to use the revenue generated from this and other tax rises for the better off to help those on lower incomes. Crucially, they say they will raise the threshold at which people start paying income tax to £10,000 and they claim this will leave poorer families about £700 a year better off.

Posted by drewster @ 09:35 AM 12 Comments

Bloomberg: UK house prices rise for fourth straight month

U.K. house prices rose for a fourth month in November, as the shortage of homes for sale sustained the property market, Hometrack said. The average cost of a home in England and Wales climbed 0.2 percent from October to 156,700 pounds, the property-research company said today. Prices are down 11 percent from the 2007 peak. A separate report showed consumer confidence fell for the first time this year. “It is easy to see how agents are beginning to feel more confident about sustainable pricing levels -- at least in the short term,” Richard Donnell, Hometrack’s director of research, said in the statement. “A decline in demand is inevitable in the run up to Christmas but there are signs that the upward pressure on prices is likely to decline in the months ahead.”

Www.marketoracle.co.uk: The Day the U.S. Dollar Collapsed

This article hyphoesises how the dollar and sterling could collapase in a matter of hours and the ramifications for stock markets and economies and of course house prices!

The Guardian: Housing fraud informants to receive rewards of up to £250

Landlords will be told to make regular audits of their tenancies, set up hotlines to enable anonymous reporting, and adopt a range of measures including taking photographs of new tenants to keep on an electronic tenancy agreement database.

Posted by devo @ 10:39 PM 20 Comments

Telegraph: Rate hike threatens existence of rural petrol stations

Hundreds of rural petrol stations face closure if an increase in business rates is pushed through next April, forecourt owners have warned. Forecourt shop owners argue that they are being placed at a potentially-fatal disadvantage against high street convenience store retailers because the rateable value of a petrol station is based on its relatively high turnover. Conversely, stand-alone convenience retailers – such as Tesco Express – have their rateable value calculated on their square footage. This means that the petrol station owners have a far higher rateable value and will face steeper potential rates increases next year. [This wouldn't happen with a sensible Land Value Tax!]

Irish Mortgage Brokers: Property Investor Report winter 2009

This is a report based upon investment property in Ireland and where valuations will need to trend towards in order to attract investors back into the market, the report shows that prices must come down on average between 20 and 50% in major cities. There are four different methods used and the analysis is published within the report (feel free to provide feedback!). The situation in Ireland is particularly bleak in the property market, the sole solution is for prices to drop until they reach market clearing levels, however, this is receiving staunch resistance from both sellers and government alike.

The Times: "British banks... at risk"

The central bank of the United Arab Emirates today attempted to head off fears of a run on banks in Dubai.

Haruspicy Finance: Is Dubai playing chicken?

Dubai made a cryptic announcement about delaying payment on a bond and then went quiet (it's Eid, a two-week local hol). Meanwhile it's Thanksgiving in the US, a low-liquidity time in markets. Is Sheikh Mo trying to spook those markets and push down the prices of Dubai's bonds so that he can buy them back at arm's length?

Independent: Foundations laid for a housing recovery

The duo will publish their house price indices this week, both forecasting a 10 per cent annual increase by February or sooner

Posted by confused76 @ 04:19 PM 19 Comments

Mailonline: "a strain on our relationship"

From the article: "We'd always played around in property privately. But then in 2003, Grant picked up the ball properly and ran with it. You have to take your hat off to him - he created a very successful company in a very short time." "Property is all about maths. In a growing market, everything works very well. Everyone had a contingency plan for a declining market, allowing for falls of about 15 per cent. But no one had plans for Armageddon, for the whole thing falling off a cliff." They "fell off a cliff" and had to move from a £10m mansion to a £6m house . . . without a swimming pool!

Posted by nomad @ 02:42 PM 6 Comments

Times: Tory Zac Goldsmith admits he is a non-dom

Zac Goldsmith, the green adviser to David Cameron and prospective Tory MP, has admitted that he claims non-domicile tax status, enabling him to avoid huge sums of tax on his estimated £200m fortune. He can legitimately escape paying tax on his inheritance, much of which is held offshore. In an unusual arrangement, some of his British properties are held offshore. Goldsmith’s 300-acre ecological farm in Devon and a £7.75m house in Richmond are both owned by companies based in the Cayman Islands. A spokesman for Goldsmith said the homes were “made available” to him by a trust set up by his father. [More analysis in the comments below].

Posted by drewster @ 12:20 PM 11 Comments

FT: A breathtaking blunder in Dubai

The Abu Dhabi authorities appear to have had no inkling Dubai was going to spring this surprise, which is already having devastating results. The cost of protecting Dubai’s paper against default has quadrupled – putting the emirate in the same league as Iceland – and the credit ratings of its leading companies have been downgraded. Yet the fallout in raising the cost of insuring sovereign debt has spread not only across the Gulf but throughout emerging markets. This is a mess.

Guardian: British banks quizzed by regulators on exposure to Dubai crisis

In the unlikely case that the FSA asks a difficult question, I wonder if the banks can phone a friend?

Observer: As Dubai crashes from wonder to blunder, who will go down with it?

A lot on Dubai in the papers today. There've been one or two articles suggesting that Dubai is an isolated case - where have we heard that one before? The pertinent quote from this article is: "Dubai has brought home the fact that, despite the relative calm of recent months, the fundamental issues that caused the crunch – excessive borrowing and global imbalances – are still there. It also shows that any country which believes it can secure prosperity on a property boom and consumer bling (sound familiar?) is pinning its hopes on a mirage."

Times: The buy-to-let industry breathes again

"Like it or not, buy-to-let is still alive." When can we get a disclosure of the property investments of this buffoon "a rise from 21,600 to 23,700 in the number of loans and an increase to just over 1.2m in the number of outstanding mortgages". How about 1.2m includes remortgaging. If I were a BTL punter I would not wait for the IR to go up or for the big mortgage reset wave of 2010 to start. Get ooouuuutttt!!

BusinessWeek: Dubai Crisis Threatens Airbus and Boeing, Too

As if Airbus and Boeing didn’t have enough to worry about already, the looming debt crisis in Dubai has cast a shadow over a backlog of aircraft orders, worth more than $60 billion, from Dubai, Inc.

Posted by devo @ 09:36 PM 8 Comments

Market oracle: How High Can the Gold Price Rise in the Short-Term?

''The I.M.F. has promised to inform us that they will tell us how much they were unable to sell and to sell that amount, if any, slowly in the 'open market' without disrupting the price. We will be surprised if there is any left. India has indicated it will buy more if given the chance. So keep your eye open for the next announcement too [Since this was published Sri Lanka has bought 10 tonnes].''

Sunday Telegraph: Tories should maintain hardline on UK economy

"Amidst ridiculous talk of Gordon Brown's "resurgence", the Tories now say they're "going for growth". In the absence of detailed policies, one can only guess what that means. I worry the Conservative leadership is having second thoughts, yielding to the siren calls of the economic illiterates " Glad this guy isn't buying my shares.

Posted by tpbeta @ 07:16 PM 15 Comments

Las vegas sun: MGM Mirage CityCenter not affected by debt woes

Casino operator MGM Mirage said Friday that its CityCenter joint venture with Dubai World, the investment arm of the Dubai government, is not affected by Dubai World's request to delay repaying billions in debt and will still open on time.

Mail online: UK banks and jobs at risk from Dubai domino effect

Meanwhile, question marks hang over the fate of thousands of Britons employed by companies under Dubai's control. The emirate's investment vehicles hold interests in Alton Towers, the London Eye, P&O, hotel chain Travelodge, and the London Stock Exchange.

Posted by waitingtobuy @ 01:07 PM 7 Comments

Times: Estate agents force buyers to use costly in-house mortgage deals

"Purchasers are losing thousands as agents use a hard sell to chase commissions. Estate agents are boosting profits by strong-arming potential buyers into using in-house mortgage services, leaving customers thousands of pounds worse off, an investigation by Times Money has discovered. Evidence has emerged that buyers are being pressured into taking additional services that earn agency staff commission payments".

Daily Mail: Kirstie Allsopp sets her sights on the House of Lords

Inspirational Quotes - "Make your man happy, the rest will fall into place". "Get married and have four children." "Women are encouraged to go off and forge their own path... That's total b******s." Yea, she would say that wouldn't she. Well, I would, if I was born with a silver spoon in my mouth.

Posted by peter_2008 @ 03:31 AM 13 Comments

FT: Abu Dhabi expected to prop up smaller brother

Will Abu Dahbi let Dubai fail?

Posted by devo @ 11:32 PM 12 Comments

Bloomberg: RBS Led Dubai World Lenders; HSBC Most at Risk in UAE

Royal Bank of Scotland Group Plc was the biggest underwriter of loans to Dubai World, the state company seeking to reschedule debt, while HSBC Holdings Plc has the most at risk in the United Arab Emirates, according to JPMorgan Chase & Co.

BBC: Recession 'worse than estimated'

"Chancellor Alistair Darling will say in his pre-Budget report that the economy performed worse in 2009 than he first predicted, Treasury sources have said."

Posted by rumble @ 08:22 PM 15 Comments

Telegraph: Record number of people leaving Britain

"The number of people leaving Britain hit a record high last year - driven by Eastern European workers returning home, new figures have revealed. "

Guardian: Boris: backsliding on housing

"Boris Johnson is calling on the government to tackle overcrowding in London – a problem which has serious implications for the health and wellbeing of hundreds of thousands of Londoners". Or we can pile in a few more new builds.

BBC: Threshers group axes 2,140 jobs

"Drinks retailer First Quench is closing a further 391 stores, resulting in 2,140 redundancies."

FT: House prices up for fifth month in a row

House prices rose 0.6 per cent in October compared with September making average home in England and Wales now worth £159,546, according to the Land Registry. However the annual house price change still stands at minus 3.4 per cent. The north west experienced the greatest monthly rise with a movement of 1.9 per cent. Wales was the region with the most significant monthly price fall with a movement of minus 2.3 per cent.

Posted by little professor @ 01:01 PM 24 Comments

The Telegraph: Dubai is just a harbinger of things to come for sovereign debt

"The fear is that threatened default in this tiny desert kingdom is just a harginger of things to come for government debt markets as a whole. According to new estimates by Moody’s, the credit rating agency, the total stock of sovereign debt worldwide will have risen by nearly 50 per cent between 2007 and 2010 to $15.3 trillion." Interest rate predictions anybody?

Posted by cheekie charlie @ 12:39 PM 6 Comments

Female First: Hilfigers Property Loss

Has the "housing slump hit Hilfiger hard"? This guy bought the property in 2005 for 18 million dollars and sold it in 2009 for 20 million, a profit of 2 million dollars so why exactly is he "counting the loss" not the gain?

Times Online: London shares fall as Dubai debt fears mount

The bubble development in Dubai seems to have been partially financed by UK banks, who are currently guaranteed by the UK taxpayer. Whether this will be the straw or the first of many straws on the overloaded camel, are we really obliging the poor indebted in the UK to pay off debts run up by speculative property development abroad, in this case, artificial islands in the shape of a palm tree offshore from a ghost town.

Posted by stillthinking @ 09:09 AM 47 Comments

E1 News: Mortgage Market to Face Even Tougher Control

On Wednesday, November 25th, the UK Treasury announced its plans on further reformation of the financial system. According to the consultation document published by the Treasury, protection for British mortgage borrowers is to be extended. In the framework of this initiative, the Financial Services Authority (FSA) is to take control over fair treatment of mortgage borrowers who have had their mortgage loans sold to 3rd parties, as well as over buy to let and second-charge mortgages.

Times: New deal for "near-prime" borrowers

"One of the biggest "sub-prime" lenders returns after two years with deal aimed at the customers with a less than perfect credit history. Kensingston, one of the largest supplier of home loans to borrowers with poor credit histories before the credit crunch, returned to the market today with a new deal. The move has sparked fresh hope of a recovery in the mortgage market".

The Telegraph: Treasury forced to reveal secret £62bn loan for banks

The Government only released details of the Bank of England's secret emergency loans to two of Britain's biggest banks because Whitehall's own spending watchdog was planning to reveal the bail-out week.

The Guardian: No one trusts bankers any more.

Bankers not only destroyed the livelihood of millions with their greed but have felt not the slightest shame about it.

Yahoo: Homepage

...in Yahoo search requests. Maybe I missed something and there is a new Reality Show in a Job Centre.

BBC News: Jesus 'may have visited England'

Quality reporting from the BBC: "Jesus Christ could have come to Britain to further his education, according to a Scottish academic." According to the count of nowhere...he probably went home again because the houses prices were too high and the rents ridiculous. The bible says "and lo, jesus was crucified"....they were probably talking about his Buy To(i) Let investments !!! Sorry if I offend any Christian with these comments, dont worry, comments next week on Ahla's plans to buy 700 over-priced houses in Ashford ( Kent ). He plans to knock them down and create a new Mecca....no bingo jokes please. I can feel a ftawha coming on.

Visual Economics: The Cost of Home Ownership (US)

"The last three years have seen a significant drop in the cost of housing in the United States, bringing prices back down from once astronomical levels.."

Times Online: Fears over Dubai send European shares tumbling

"Almost £44 billion was wiped off London’s biggest companies today amid growing fears the UK financial sector could be heavily exposed to Dubai World." I have always said Dubai was an accident waiting to happen. Why buy in a Muslim country where the locals and expats do not integrate at all. The poor construction works have their passports taken and become virtual slaves. It hits 50c and everything is artificial. So what you can ski indoors, when I go skiing I want to look at mountain ranges. I can't think of anything good about the place at all.

Smh: Brits flock to start a new life in Australia

The number of people leaving Britain has soared to a record high, with Australia the top country of choice to set up home, new statistics show.Official figures released on Thursday reveal 427,000 people emigrated from the UK in 2008, the highest number ever recorded and up 25 per cent on the previous year.

BBC News: Market Data

I've not seen that happen before. What happened to the market today 10:30-14:00? What did I miss? Software issues?

Posted by night @ 09:28 PM 6 Comments

Cnn: Option ARMs: Housing recovery killer?

25% default rate But that doesn't just spell bad news for borrowers. Some industry pessimists say the looming default problem could have the power to derail the nascent housing market recovery

Accountancy Age: R3 predicts high street 'bloodbath'

"Rising unemployment and decreased spending in the lead up to Christmas coupled with heightened creditor aggression in the New Year leaves the retail sector facing another bloodbath,"

Guardian: Price of Dubai Debt-Protection SKy-Rockets

Does it matter to UK? Should it matter? Apart from the brits who invested their hard earned cash in the sand!

Guardian: Name, shame, blame the bankers, if you like. But they're the wrong target

Who said bankers "just don't get it"? They get it absolutely. Bankers are doing what they pay themselves to do, make money. They are performing what economists from Adam Smith to Karl Marx regarded as capitalism's sacred ritual, profiting by rigging markets and shedding risk. Like all professions, their first responsibility is to their peer group and their second to their shareholders. It is not their job to run the country, only sometimes to ruin it.

Investor's Chronicle: Ready for the double dip

Overpriced property? Is the man mad? House prices only ever go up.........

City Wire: 2010 inflation prediction

So, the long long period of super low interest rates looks a bit shakey. Here's on guy predicting a half percent rise in march to a base rate of 1.0%

Telegraph: Shock news - Britain still makes things

I have lost count of the number of times I have heard the moan that "We don't make anything any more." It is the stock rejoinder whenever anyone dares suggest that Britain will be able to export its way out of this crisis...One dangerous misconception perpetuated by financial lobbyists is that without the City, we are nothing... While it is a compelling narrative, and fits nicely with the British propensity for defeatism, it is balderdash.

Posted by mountain goat @ 04:01 PM 7 Comments

FT Alphaville: Sterling, Dubai: a liquidation love story

International property advisers are bracing for a potential slew of instructions to revalue and sell trophy assets owned by Dubai World and its many property-owning units as the emirate struggles to shrink its $59 billion debt pile. “We do expect the Dubai government to step up efforts to raise capital via real estate sales, and sales of their UK assets in particular,”

Posted by ontheotherhand @ 03:56 PM 9 Comments

Huffington Post: Home Prices "Not Even Close" To Bottom: Barry Ritholtz (VIDEO)

"According to Ritholtz, the housing data show an "artificial move up," because the reports are largely built on seasonally adjusted numbers and because "areas that have the most foreclosures are seeing most of the activity." People buy foreclosed-on homes and then flip them, resulting in double counting and the "illusion of activity.""

BBC: Vauxhall: 354 jobs to go at Luton plant

"Job losses at Vauxhall in the UK will total 354, according to proposals outlined by owner General Motors (GM)"

BBC: Council to cut hundreds of jobs

"Bath and North East Somerset Council has admitted more than 300 jobs will have to go over the next three years. The council says it is trying to cut up to 5% per year from the annual budget because of the economic climate. "

TimesOnline: Borders teeters with 1,100 jobs at risk

"Borders UK was poised to enter administration last night as last-minute rescue talks faltered. The bookseller is understood to be likely to appoint BDO Stoy Hayward as administrator today, putting 1,100 jobs at risk. The company has been struggling to secure sufficient cash to trade through Christmas. "

Timesonline: BAE job losses rise to 2,300 with new cuts

"We have a responsibility to address a reduction in our forecast workload and manage our cost base to remain competitive", business adjusting.

Reuters: House prices set to rise gradually

House prices have probably bottomed but will only creep higher over the next couple of years as more properties come on the market and the economy makes a plodding return to growth, a Reuters poll showed. Average house prices are seen ending this year 3.4 percent higher than where they started, but will rise just 1.8 percent next year and 2.2 percent in 2011, the poll of over 30 analysts found -- a far cry from double-digit growth during boom times. The results in the poll conducted Nov 23-26 are generally more optimistic than predicted in the last Reuters UK housing market poll in September but comes after prices sank 16 percent in 2008.

Posted by jack c @ 02:21 PM 6 Comments

Evening Standard: Ban on open-plan housing ‘not suited to Asian cultural needs’

"A Town Hall is poised to ban open-plan design in new housing developments because it is unpopular with Asian families. A six-month investigation by Tower Hamlets found affordable units in the borough — aimed at key workers and people on low incomes — were vacant. But there are more than 22,000 people on its housing waiting lists. The council believes this is because many families, particularly those of Asian origin, are not interested in homes with a combined kitchen and living space. A report on the problem says: “Separate provision would be much more suited because the [Asian] lifestyle requires separate seating space for male and female visitors and also the type of food cooked, heavy in oil and spices, which can have strong odours.”..."

Posted by mark wadsworth @ 01:59 PM 9 Comments

Telegraph: Offshore accounts tax amnesty may be extended

"An extension to the offshore bank accounts tax amnesty is being considered by HM Revenue & Customs (HMRC) because of opposition from a group of foreign banks and the sheer volume of work involved."

ISPReview: UK 50p Per Phone Line Next Generation Broadband Tax to Levy VAT

"The government's plan to impose a £0.50p tax on all fixed phone lines...tax upon a tax..."

CNN: Option ARMs: Housing recovery killer?

"An explosion of foreclosures will result from option ARMs set to reset to higher payments."

BBC news: London Stock Exchange trading hit by technical glitch

Stock market has ceased trading. Is the collapse coming?

Posted by will @ 12:44 PM 14 Comments

Moneymarketing: FSA hires Nomura chairman as adviser days after £1.75m fine

The FSA has appointed Nomura chairman Colin Marshall as a senior adviser on corporate governance just two days after it fined the firm £1.75m for systems and controls failings. The appointment is one of five senior advisers the FSA has appointed to work on governance and authorisation under its new intensive supervision of significant influence functions within firms. They include an adviser to recently-fined UBS, a director of Carphone Warehouse, which was fined by the FSA in 2006, and an adviser to Morgan Stanley, which was fined earlier this year.

Sky News: Dubai Wants Billion-Dollar Debt Suspension

"Dubai is asking creditors to accept a six-month suspension on debt repayments for its severely cash-strapped conglomerate Dubai World." Dont they lock up debtors in Dubai and punish them severely ? Pay back the money you borrow. If not, suffer the consequences. Dont squeal like a rat. It's your own fault. Classic quote thoughL "This has really hit confidence. Bankers are very concerned now, they just don't know what to believe." Believe this...you are done for. Welcome to Skid row, the real recovery has begun.

Posted by thecountofnowhere @ 01:16 AM 21 Comments

Times: Bmi’s fight for survival brings job cuts and closed routes

British Midland (bmi) has announced 600 redundancies and the closure of seven routes as the struggling airline looks to cut costs. Bmi will also start returning its A330 aircraft to leasing companies, in effect ending its aspirations of rivalling British Airways as a long-haul carrier.

Telegraph blogs: Inequality in Britain is of developing world level

The richest 1pc in the UK hold 70pc of the country’s wealth. That there is this divide between rich and poor is not exactly new – but the scale of it, and the likelihood that it is not being narrowed by the financial crisis, is a big worry. Indeed, according to the report, in the US the same figure is far, far lower at 48pc, and in Australia only 34pc. The report is interesting because, unlike the traditional measure of inequality, the gini coefficient, it focuses not on income (the flow of money) but on actual substantive wealth (the stack of it that sits beneath us). [The report measures wealth stored in 'financial assets' - no indication whether that includes land & property.]

Posted by drewster @ 11:15 PM 15 Comments

Telegraph: Dubai recovery hopes hit by debt 'standstill' call

"Dubai was among the most dramatic victims of the credit crunch, with property prices halving from their highs in September 2008, leaving a huge overhang of debt". "Much of it was in the hands of government-owned companies, with Nakheel, which has been forced to slow work on show-piece developments like its artificial island chain The World, among the most prominent".

Posted by alan @ 10:39 PM 7 Comments

Cnn: Bankruptcies spike 33%

Number of bankruptcy filings in third quarter of 2009 soars to highest level since 2005. Business bankruptcies filed this year top 2008 total

Guardian: Labour's plan to dismantle Whitehall revealed

''Tens of thousands of civil servants may be moved out of London in a dramatic downscaling of Whitehall under Labour plans to cut public debts and instil a culture of "smarter government''. Leaked sections of a report to be published in a fortnight reveal that the government wants a review into the possibility of relocating some of the 132,000 civil servants and 90,000 employees of "arm's- length bodies" currently based in London and the south-east''

Posted by hpwatcher @ 08:52 PM 8 Comments

Investor's Chronicle: Italians fuel superprime London market

80 percent of superprime purchases are Italian? Mio Dio...

Posted by chrisch @ 05:32 PM 10 Comments

Global Property Guide: World's housing markets recovering unevenly

As of Q3, 2009, Latvian house prices have fallen a massive 59.7% year-on-year; Dubai 48%, Bulgaria 29%, Iceland 21% and Russia 19%. Makes our 4.3% year-on-year decline look anaemic.

Posted by little professor @ 03:43 PM 16 Comments

Reuters: Ford to raise UK prices, blaming weak pound

Ford Motor Company in Britain will raise its prices by an average of 2.7 percent because of the continued weakness of the pound. The price hike, across most of its UK range, will be the fourth this year, and will be introduced from the start of December. The rise has been "driven entirely by the continued weakness of the pound", which has fallen in value by more than 30 percent since 2007, it said. "The drop in the value of the pound ... is a fundamental business concern for all UK-based businesses whose costs are incurred in euros," Nigel Sharp, Ford of Britain managing director, said in a statement.

Posted by drewster @ 03:18 PM 21 Comments

Telegraph: Why the Supreme Court was right to stand up for beastly bankers on overdraft fees

So perhaps this is a good time for a reality check. Savers outnumber borrowers by about six to one in Britain, despite the collapse in the savings ratio which has occurred since Labour came to power in 1997. Borrowers make far more noise than savers because borrowers tend to be younger, more telegenic and better represented in the media; both in front of the camera and behind it. Many of the people who would have been hurt if the Supreme Court ruled in favour of preventing banks imposing unauthorised overdraft fees are pensioners who rely on dismal returns from deposits.

Posted by drewster @ 03:13 PM 11 Comments

Business Insider: House prices are still too high

The modest recovery in house prices over the past four months caught almost everyone by surprise, including those who are now explaining it away as an obvious byproduct of artificially low interest rates and the home-buyer tax credit. The recovery's momentum is slowing, however, and it seems likely that house prices will now resume their fall and drop another 10%-15%.Why?

E1 News: National Savings & Investments Withdraws Its Leading Savings Deals

Yesterday, on November 24th, the chief executive of Nationwide Building Society, Mr. Beale, confirmed that he was one of many others, who complained about the new savings products launched recently by Government-backed savings provider – National Savings & Investments. The complaints of Nationwide and other rival banks and building societies resulted in withdrawal of 2 extremely attractive savings deals after less than a month of their introduction onto the British market.

HIP Consultant: Interview with Steve Davies (IPSA)

In this interview Steve Davies makes allegations that the Local Authorities have been guilty of anti competitive behaviour. Does seem a little unfair towards the companies he represents.

BBC: Banks win Supreme Court case on overdraft charges

A Supreme Court judgement has struck a grievous blow to the hopes of millions of bank customers to be refunded billions of pounds in bank charges.The court has overturned earlier court rulings that allowed the Office of Fair Trading to investigate the fairness of charges for unauthorised overdrafts. The decision follows more than two years of test case litigation.

Posted by jack c @ 09:54 AM 28 Comments

Jaywiz: Armstrong Date "Today"

I have really only posted this out of respect for s2r1... I miss his insights and the polarised debates they produce.

BBC: HBOS and RBS secret bank rescue loans

What a time to break the story...just when Jordan comes back from the jungle for Pete!

Posted by alan @ 05:11 AM 9 Comments

Gold Speculator: Martin Armstrong

Very interesting article showing different periods in time when real estate prices declined. It is a common public opinion that real estate prices only go up, in this article you will realize that they go down for a long time as well.

DailyFinance: Nearly a quarter of all U.S. home mortgages are under water

There have been a number of attempts to come up with a figure about how many U.S. home mortgages are under water -- in other words, the value of the home loan is more than the value of the house. All estimates are bound to be wrong because no one has had the time or money to appraise every house in America and match it with the value of its mortgage plus any second mortgages. But The Wall Street Journal has asked First American CoreLogic, a real estate research company, to give it a try. The report, which is available free online, says that that 23% of mortgages were under water at the end of the third quarter.

Who knew about this?: The Telegraph

In a shock announcement, the Bank disclosed that it had been forced to use its lender of last resort facility last October to "buy time" for RBS and HBOS, which were "effectively... bust". It managed to keep the loans - the equivalent of almost £3,000 for every household in the UK - a complete secret to all but a handful in the City for well over a year.

Posted by devo @ 10:08 PM 10 Comments

Cnn: Bank 'problem' list climbs to 552

Despite the frenetic pace of bank failures this year, 552 lenders are still at risk of going under, according to a government report published Tuesday. The Federal Deposit Insurance Corp. said that the number of banks on its so-called problem list climbed to its highest level since the end of 1993. At that time, the agency red-flagged 575 banks. this is only just the beginning.......

Credit Writedowns: China's empty city

China's officials have been told to achieve 8% GDP growth, so they're throwing up buildings, and even cities, in order to hit that target. This video shows the new city of Ordos, in Inner Mongolia, built over the past 5 years. It's completely empty, apart from one traffic cop directing five cars a day. It's claimed that many of the houses have been sold but any purchases so far have been for investment only - nobody is actually living there (why would they? - there's no economy). But the city is said to have the second highest per capita income in China after Shanghai. Funny, that. (On the same theme, see Hugh Hendry: 'The emperor has no clothes' a clickable video on the same page.)

Posted by icarus @ 06:35 PM 8 Comments

Telegraph: Britain has run out of money, the CBI is told

And finally, there is the whole question of financial reform. On this front, Mr Strauss-Kahn was almost apocalyptic in his warnings. It was vital, he said, that the world got this right, for another banking bailout of the size just seen would be socially unacceptable for democratic societies. It would not be possible to bailout the banks again, either politically or fiscally, so if we are faced with another financial crisis five years down the line, the consequences would be catastrophic.

Posted by waitingtobuy @ 06:24 PM 7 Comments

Telegraph: Mervyn King criticises Gordon Brown over budget deficit

The Bank of England Governor has issued his harshest rebuke yet to Gordon Brown, suggesting that the Prime Minister’s plans to cut Britain’s budget deficit do not go far enough.

FT Alphaville: The upcoming UK tracker time-bomb

How can one explain the apparent contradiction of financially-damaged consumers, but benign insolvency and repossession rates? Much has to do with exceptionally low interest rates.One of the most direct mechanisms through which the BoE rate cuts have fed through to the average overindebted borrower is tracker mortgages. ..Most tracker deals have a reasonably short term on the tracker rate before moving to the bank’s often penal SVR (Standard Variable Rate).

Posted by mountain goat @ 04:46 PM 8 Comments

Guardian: Cool the cutting fisticuffs – take a long, hard look at tax

Some interesting stats in this "The tax system has become more regressive in the last 30 years, so that the poorest tenth pay 46% of their earnings in tax while the richest tenth only pay 34%.... the richest fifth of households take 51% of national income while the poorest fifth receive 3%."

Posted by letthemfall @ 03:41 PM 17 Comments

Reuters: U.S. Q3 economic growth revised down, house prices up

"The U.S. economy grew more slowly than first thought in the third quarter, but house prices rose for the fifth month in September and U.S. consumer confidence was up in November in data published on Thursday, suggesting a slow economic recovery is still intact"

Guardian: Research backs tax rises on top earners

Argues that the wealthiest 10% should be taxed more to address deficit. How many against? 14% (which presumably includes that 10%).

Bloomberg: Dubai Autonomy Fades as Crisis Strengthens Abu Dhabi

"Home prices are down more than 50 percent from their peak in the third quarter of 2008, .... Prices may drop as much as 30 percent more, ..."

BBC News: HBOS and RBS received secret bank rescue loans

I can't work out whether this is new news or old news, so much money has been shovelled at the banks.

Posted by refusetobuy @ 02:06 PM 15 Comments

BusinessInsider: How A Government Bailout Created Today's Commercial Real Estate Catastrophe

By now we all know that “the next shoe to drop” as a result of the bursting of the credit bubble in commercial real estate. A nice interactive guide through commercial real estate catastrophes that brought us here. S&L and beyond. Bubbles and solutions to bubbles causing more bubbles.

Telegraph: Most global banks are still unsafe, warns S&P

Standard & Poor's has given warning that nearly all of the world's big banks lack sufficient capital to cover trading and investment exposure, risking further downgrades over the next 18 months unless they move swiftly to beef up their defences. Every single bank in Japan, the US, Germany, Spain, and Italy included in S&P's list of 45 global lenders fails the 8pc safety level under the agency's risk-adjusted capital ratio. Most fall woefully short. The "safest" global bank is HSBC (9.2), followed by Dexia (9.0), ING (8.9) and Nordea (8.8). UK banks fare relatively well: Standard Chartered (8.1) is in the top quintile; Barclays (6.9) is in the middle. The study left out RBS and Lloyds because their status is unclear. Chinese banks – the world's largest – were excluded.

Citywire: Bank of England lent RBS and HBOS £61.6bn BEFORE bailout

The Bank of England provided emergency funding of £61.6 billion to crisis hit banks at the height of the financial crisis last year, governor Mervyn King has revealed. Giving details for the first time of emergency funding provided to HBOS prior to its takeover by Lloyds, as well as to Royal Bank of Scotland (RBS), King confirmed that the loans were made to the banks last year before being wrapped up in early 2009.

Marketwatch: China's booming car sales, falling gas usage stump analysts

One such theory goes that Beijing and its state-owned enterprises are using stimulus funds to buy up new vehicles to subsidize local car makers, with the vehicles then hidden away or turned back into scrap metal. Standard Chartered stepped into the debate with a recent research note entitled "Mysterious Gas," focusing on what is driving the nation's growing car ownership, which is on track to grow by nearly 25% this year. "Car sales in China are booming [in the third quarter], but gasoline sales seem to be stuck in the slow lane," wrote Standard Chartered analysts headed by Stephen Green in Shanghai.

Times: Mortgage approvals soar by 98% in October

Times' ramping article. But what is the impact of a 98% rise in quantity and a 20% fall in value - a lot of very much reduced mortgage approvals. This must mean less money swilling around per "sale"... Have I missed something?

Posted by growler @ 11:57 AM 12 Comments

FT: Prudential pulls out of equity release

"Prudential has confirmed it is set to pull out of the equity release market early next year, to join the ever increasing number of lenders to leave the sector over the last few months.Prudential said it would continue to serve its existing 14,000 customers but will not be writing any new business in the first quarter of 2010".

FT: Lending and mortgage approvals up again in October

New mortgage lending and the number of house purchase approvals increased again in October, according to the latest figures from the British Bankers' Association (BBA). Gross mortgage lending from the main high street banks in October was slightly greater than last month, reaching £9bn, however this was still 19.5 per cent less than it was a year ago.

Posted by jack c @ 10:51 AM 14 Comments

Sky News: Mortgage Approvals Hits Two-Year High

The number of mortgages approved for people buying a home has risen to its highest level in nearly two years, new figures show.

Times Online: Four politicians could be facing 10 years in jail for expenses fraud

Four MPs and peers involved in the expenses scandal could face jail sentences of up to 10 years after the police asked prosecutors to consider charges for fraud or false accounting.

Reuters: A speedier stimulus may mean a quicker exit

The Bank of England has raced ahead of its peers along the quantitative easing road, but it could overtake other central banks in the reverse direction when the time comes to tighten. Despite the Bank's insistence that all options remain on the table, few expect it to amass any more gilts beyond February, when the current programme will be completed

Times Online: Lloyds axes 800 jobs on Equitable contract loss

"The cuts, ... come on top of a total 12,500 jobs already axed since the bank was created by the takeover of HBOS by Lloyds TBS in January"

London Evening Standard: Property boom lands firms with £1.9bn rates bombshell

"London firms are to be hit with a £1.9billion increase in business rates over five years.."

Residential Landlord: Buy to let investors are avoiding new build properties claims letting agent

"..buy to let investors are .... avoiding new build flats more than ever.."

Guardian: Treasury hit as council housing demand grows

"Demand to build council homes is far exceeding government expectations..."

Dailypost: Empty council homes costing Flintshire thousands

He said there was no good explanation from the authority then about why it was empty... and in the intervening six years it had remained empty. Mr Williams said: “Just think about the rent they have lost. I know of four people who have tried to rent it and two people who tried to buy it. It doesn’t make sense.”

Bbc: Borders' UK bookstores look for buyer

Reports have said WHSmith walked away from a takeover deal on Friday, and that Borders UK could go into administration soon without a sale

Bbc: Mortgage rates dip to autumn low

The average interest charged on a two-year fixed-rate mortgage has fallen below 5% for the first time since June, according to Moneyfacts.

Telegraph: CBI conference: inside Britain's biggest business gathering

Gordon Brown, David Cameron and Nick Clegg have all addressed Britain’s business leaders, as the country struggles to emerge from recession and a general election looms.

Posted by cat and canary @ 04:15 PM 7 Comments

BBC News: Property market in Afghanistan capital bucks trend

Tired of terraced houses in Stoke, Merthyr Tydfil and Doncaster? Bored of the same boxy two bedroom "Luxury Apartments" in the rougher parts of Liverpool, Leeds and Manchester? Well it's time to look abroad for the hottest thing in property, yes Afghanistan. get in while the going is good. Why not drop into your local Government Back High street bank and ask to borrow a few million to get into the new big thing in property, I'm sure Gordon will be more than willing to lend you some of our money.

Posted by bruce mcaaw @ 01:08 PM 16 Comments

Mortgagestrategy: Number of empty private homes rises above 300,000

The latest annual Halifax Empty Homes survey shows that the number of long-term empty private homes - homes that have been vacant for more than six months exceeded 300,000 in 2008 for the first time in five years. There were 303,285 long-term empty private homes in England in April 2008, a rise of 9% from 279,281 in April 2007. The number of long-term empty private homes is at its highest since April 2003 (308,438), accounting for 1.6% of all privately owned properties. The total number of empty private homes in England stood at 613,270 in April 2008.

Posted by jack c @ 12:42 PM 6 Comments

BBC Business: House prices 'raised by good primary schools'

Homes near the best performing primary schools in England can cost £19,500 more than identical properties elsewhere, research has found. A 10% increase in the local primary's Sats pass rate can add an average of £5,860 to the value of nearby homes, Nationwide Building Society said. The biggest premium was seen in Yorkshire and Humberside. However, a loft conversion or extra bedroom would still add far more value to the typical home, the lender said.

Guardian: Britain to lose jobs to US

OK, I am old and old-fashioned and a bit left so I don't do this "free market" nonsense, but what is the point of boosting public spending to revitalise the economy if the economy you revitalise is someone else's?

Posted by chrisch @ 10:21 AM 15 Comments

PressAssociation: Brown: China can drive UK recovery

Brown wants thousands of Chinese companies in Britain, and thousands of British companies in China.

Posted by stillthinking @ 10:17 AM 10 Comments

Telegraph: 'ethics' MP faces call to step down over use of £65,000 allowances

"A second member of the Commons committee that governs the conduct of MPs is facing a call to step down over his use of £65,000 in parliamentary allowances". These people have so much invested in property that they will do their best to keep prices going up. (Ethics - you gottabe having a larf).

E1 News: Stamp Duty Holiday Abolition to Affect Property Market Recovery – RICS

World’s leading body for standards in property, land, and construction – the Royal Institution of Chartered Surveyors (RICS) – recently expressed its concern over the possible consequences of stamp duty holiday abolition at the end of December 2009. In the opinion of RICS experts, the housing market in problematic areas of the United Kingdom that are already suffering from house price declines might collapse once the temporary stamp duty holiday is over.

E1 News: Government-backed Lenders Raise Mortgage Interest Rates

According to an article published in the Sunday Times, most of the British taxpayer-owned banks increased mortgage interest rates and toughened lending criteria last week. Royal Bank of Scotland, RBS, has raised the deposit for its best-buy mortgage deal – 2-year tracker offered at a pay rate of 2.89%, a fee of £1,499 and no penalties for switching – to 25%, up from 20%.

Mail: What happened when I tried to live on £65 a week

How many other 50 somethings are also like Liz who is hopeless at living within her means, and despite a hefty salary is £150,000 in debt (not including her 'horrendous', interest-only mortgage) and doesn't even have a pension. The other unsung crisis is the many businesses that rely on the profligate spending of credit by people like Liz who live and 'work' in the SE.

Posted by enuii @ 11:20 PM 10 Comments

Hugh Hendry via Market Oracle: United States Economy At Zero Hour To Service Debt Mountain

A long letter but well worth the read. China building massive industrial capacity for what? Interest rates have to stay low, if they go up the world's economy is toast. Inflation? look at Japan: "Japan has championed both Friedman and Keynes. They have built bridges to nowhere and dropped Yen notes from helicopters for twenty years and still they have nothing to show for it. Clearly the additional return from Yen debt in Japan is close to zero and it exposes the nightmare of interventionists everywhere: it may just be that there are no policy remedies for a debt deflation."

Posted by mountain goat @ 10:53 PM 17 Comments

The Telegraph: Greece tests the limit of sovereign debt as it grinds towards slump

"As far as the bond vigilantes are concerned, the Bat-Signal is up for Greece," said Francesco Garzarelli in a Goldman Sachs client note, Tremors at the EMU Periphery.

Posted by devo @ 10:10 PM 7 Comments

GlobalEurope Anticipation Bulletin: Global systemic crisis – States faced with three brutal options in 2010: inflation, high taxation or default

"In 2010, as protectionism and the economic and social depression will gain momentum, a large number of States will be compelled to choose between three brutal options: inflation, high taxation or defaulting on their debt. A growing number of countries (USA, United Kingdom, Euroland , Japan, China ,…) have used all their budgetary and monetary cartridges in the 2008/2009 financial crisis and are now left with no other alternative. Nevertheless, out of ideological reflex or in an attempt to avoid by any means having to make such painful choices, they will try to launch new stimulus plans (under different names) even though it is now clear that the huge public effort made in the past months to boost the economy is having no impact on the private sector."

Posted by quiet guy @ 06:54 PM 12 Comments

Offical Website: Nationwide 90% Mortgage

Nationwide: For a limited period only, we're offering 90% mortgages exclusively to our main FlexAccount holders. Grab em while you can. When will the 100% be a limited time, get it quick mortagage. Are Building Societies any better than Banks?

ThisWasMoney: Will stamp duty return hit house prices?

'With the government's plummeting stamp duty revenues, the golden goose of stamp duty now seems somewhat of a dead duck.

Investment Postcards: Words from the (investment) wise for the week that was (November 16 – 22, 2009)

Stock markets succumbed to a bout of profit-taking last week, sparked by concerns that the rally has overshot the pace of economic recovery. Riskier assets were showing signs of fatigue as the US dollar – the catalyst of many recent moves – stabilized and was perceived to be near its trough (if only short-term in the books of ardent dollar bears). Read all about this, together with some thought-provoking news items and quotes from market commentators during the past week, in the weekly “Words from the Wise” review: http://www.investmentpostcards.com/2009/11/22/words-from-the-investment-wise-for-the-week-that-was-november-16-%E2%80%93-22-2009/

The Times: The nutters can relax – but only for a while

Nutter is being used here not to refer to people who go nut-hunting in the woods, still less those with mental conditions. A better expression might be silly bloggers... those who fear hyperinflation is lurking round every corner. There is no need to worry about inflation over the next few months. There may be more cause to worry in the long run.

Observer: Property market hasn't collapsed because banks can't face the truth

Lenders are still extending credit to commercial developers because they simply can't afford to crystallise their losses

Times: Mortgage rates up ahead of 'double dip'

Government-backed banks have raised mortgage rates and introduced stricter lending criteria, amid concerns that this year’s house-price recovery is not sustainable. Northern Rock increased its market-leading five year fix by 0.4%, and withdrew its three and four year fixes, in an attempt to stem new business. Royal Bank of Scotland, 84% owned by the government, surprised brokers by increasing the minimum deposit on its best deals to 25%. Industry sources confirmed most of the big mortgage lenders were anticipating a “double dip” in house prices next year.

The Times: Treasury hits at hysteria

Treasury officials have dismissed what they describe as hysteria over government borrowing...

Posted by devo @ 10:32 PM 12 Comments

Telegraph: An inflationary spike is not just hot air - it's a very real threat

Part 94 of Liam Halligan ranting on in the Telegraph about how we're going to be Zimbabwe in 6 months time on account of Quantitative Easing. This week, unusually, he raises an interesting point. Is the so called 'output gap' as defence against inflation any more than an economist's fantasy? I've yet to hear an adequate explanation for it, even though it's a key part of the deflation argument many have bought into. Maybe he's right after all.

BBC News Scotland: Vacant properties top 100,000 - a four-year high

The number of vacant properties in Scotland has soared to a four-year high of 103,000, (4.2% of the total), a Bank of Scotland survey has shown.

This is Money: What will happen to house prices in 2010?

Today on This is Money, we launch our annual poll of house prices. In 2008 readers were bang on the money, although we suspect there was a large influx of bearish voters from housepricecrash.co.uk. We had more than 26,000 votes.

Posted by Webmaster @ 07:16 PM 10 Comments

Timesonline: Court adjourns hearing for son of maxwell

kevin maxwell it appears has never worked for a company that makes a profit(please correct me if wrong) and yet has run up huge debts in his 'business career'....is this not an example of why we are in this stupid debt bubble..I noted recently that BT had £11 billion of debt and vodafone and astonishing £32 billion of debt,yet both apparently make a profit

E1 News: UK Buy to Let Landlords to Be Wary of High Income Tenants

According to the research conducted by UK’s largest tenant eviction and rent collection service bureau – Landlord Assist – residential buy to let landlords with property portfolios consisting of expensive flats are more likely to face arrears. Despite the fact that it seems more logical that tenants with lower household income are more prone to falling into arrears, the research of Landlord Assist showed that tenants with high income have been hit hard by the economic downturn and, as a consequence, oftentimes fall into arrears on rent payments.

Lettingzone: London buy-to-let property 'attracting overseas investors

Some rare stats for the London market: Some two-thirds of the 5,500 new houses and flats sold in London during the first three quarters of 2009 were purchased as buy-to-let properties, according to property research group MoliorLondon. So the banks have funds for the buy to let but not enough funds for credit worthy families who need a home in London.

Posted by mander @ 01:32 PM 9 Comments

Guardian: House prices -a safe haven for investors

Forget the stockmarket and high-interest savings accounts – the best place for your investment cash during the noughties was in bricks and mortar. House prices have doubled between the start of the decade and now, even taking into account the property crash of 2007-2009.

YouTube: LANDOCRACY FOR PEASANTS

I'm not a supporter of political parties but this gave me real hope.... ;-]

Marketthoughtsandanalysis.blogspot: Predictions for minor B

In the source link is the chart of how the Elliott wave "generally" sees things going forward. I.e. we are at or close to a P[rimary]2 second wave of 5 of the C wave - at cycle degree . STR2007said that he thought the next wave was supposed to be the most severe. It is but in terms of price not necessary slope. That then shows the end of the whole bear market at 2015 - 2016. http://3.bp.blogspot.com/_OpWmYZm7O8I/SpbPUKkmKWI/AAAAAAAAAKw/POZLC_SPSBc/s1600-h/0binve-Dow-80-years-long-count.jpg for the big picture http://3.bp.blogspot.com/_OpWmYZm7O8I/SwcAqtU7H2I/AAAAAAAABQE/n8P5_H2QC_8/s1600/0binve-001-202.png for a zoom in and http://marketthoughtsandanalysis.blogspot.com/ for an explanation. The point is IF this theory is correct (and it might not be) then all assets will fall in value

Posted by techieman @ 09:19 AM 16 Comments

Moneyweek: Don't jump aboard new property funds

This article is for subscribers only, (not a subscriber), are they talking about rmbs? Will lenders be able to raise money on the wholesale markets to fuel this bubble?

UK Debt Clock: Money Money Money

Nice graphs and debt progress over time to chew on. Yum, green shoots taste good!

Debt Bombshell: UK National Debt Clock

There are many of these available but I haven't seen one posted. Skynews (argghh) have one on their website and I think the times did not too long ago. Anyway, enjoy and remember, its all yours!

Ft.com: Asleep at the wheel?

It is often wrongly claimed that Gordon Brown failed to spot the housing bubble. In fact, he called the bubble as early as 2005. The trouble was he believed he had addressed it. Brown thought he had successfully managed a boom without a bust.

Posted by waitingtobuy @ 10:06 PM 7 Comments

Yahoo: Paul O'Grady's dog Buster dies

I am not being a callous barsteward or mocking someone losing a loved companion and, before I receive a tirade of abuse, I accept there is absolutely no connection with house prices. However, IMO it highlights the mentality and priorities of the sheeple who are in cloud cuckoo land and unaware of how bad things could get. Even though the economy is going down the pan and we face years of austerity, this is headline news. Yet another example of the meja aka establishment, practising the Roman theory of keeping the masses in control by providing bread and circuses only today it’s Big Macs and Eastenders. I'm off for a few pints of Taylor's Landlord now.

Posted by mr g @ 09:35 PM 13 Comments

The Guardian: Time for banks to wean themselves off cheap money, ECB president says

Jean-Claude Trichet said it was time to unwind some of the measures that propped up the banking system during the financial crisis.

Bloomberg: ECB Tightens Collateral to Ensure ‘High’ Standards

"The European Central Bank tightened the rules for the collateral it accepts against loans as it tries to restore the “proper functioning” of markets and prepares the ground to unwind emergency liquidity measures. The bank “will require at least two ratings from an accepted external credit assessment institution for all ” asset- backed securities" issued from March 1, 2010, the Frankfurt-based central bank said today in an e-mailed statement". "Trichet...has indicated the ECB won’t renew its 12-month auctions of unlimited cash, one of its flagship policies in the crisis, after a third tranche is handed out next month".

Rightmove: Better than "Unexpectedly Reavailable"? Probably not!

I really can't stop laughing at this on so many levels. Priceless!

Zero Hedge: Fed Balance Sheet Hits Record $2.2 Trillion In Assets On $71 Billion Weekly Increase In MBS

This week it was reported that a record number of Americans are behind on their mortgage payments (won't pay rather than can't pay in many cases, endless debt forgiveness leading to extreme moral hazard). And guess who is holding the rotten MBS? $1 Trillion, 50% of the Feds assets are now mortgage backed securities and accelarating. Little wonder investors are fleeing to gold and Short-term US T-bills as rates turned negative again this week on the 3 month T-bills, the first time since the panic of 2008.

Posted by mountain goat @ 06:33 PM 9 Comments

Guardian: Nationwide complains to regulators about state-backed bank's savings rates

A follow up to the post earlier today about Nationwide profits being down. Mostly the same information as the FT article but I know some people have problems reading those.

The Mortgage Blog: Ideas for a Mortgage Rescue Scheme

Article about the potential shape of a Mortgage Rescue Scheme in Ireland, currently there is no scheme in place but many politicians are calling for a solution as latest figures show that over 77,000 families are in arrears in Ireland.

Citywire: Want to know where next for top end London property? Look to the currency markets

Central London property prices are expected to rise between 20% and 30% over the next three years on historical exchange rate trends, research suggests. The study, for sector specialist D&G Asset Management, found that out of a series of indicators, currency had the largest pricing correlation to prime London property.

Posted by jack c @ 04:44 PM 6 Comments

Bloomberg: U.S. Housing Recovery Delayed to 2010 as Market Wanes

"A recovery in U.S. housing will have to wait at least until next year. The outlook for the home market dimmed this week as residential construction and mortgage applications fell and loan delinquencies reached a record".

BBC News: Decline in car output rate smallest this year

It's still a negative downslide, and when you're making nearly nothing, there's not much further you can fall is there ? UK car production fell by 6.7% in October compared with a year earlier - the smallest annual decline of the year, industry figures have shown. There were 106,400 cars made last month, the Society of Motor Manufacturers and Traders (SMMT) said. The continuing impact of the government's scrappage scheme and a recovery in global markets is helping to drive production, the SMMT said. Earlier, employers' group CBI called on the government to extend the scheme.

Daily Mail: House prices 'will fall up to 10% next year and take years to recover to pre-recession levels'

House prices will fall by up to 10 per cent next year and then take many years to return to the peak seen in 2007, according to leading economists. A survey found nine of 14 economists and estate agent groups are expecting price falls against a background of rising unemployment and home loan rationing by the banks.

Telegraph: Surprise rally in house prices will falter

The surprise rally in house prices this year has been largely driven by a lack of properties for sale and faces serious hurdles in 2010, Nationwide warned.

Kent Onlin: Property Tycoon Fergus Wilson denies arrears claims

Property tycoon Fergus Wilson has denied claims in the Daily Mail that he is in mortgage arrears. The 61-year-old, with a personal fortune of about £70 million, denies claims that he is £350,000 behind on mortgage payments, and that three of his properties are now worth only £160,000. “The long and the short of it is someone has got the wrong end of the stick,” he said.He claimes the £350,000 figure refers to the money he would have saved if 30 of his properties had not been on fixed mortgage rates. “It doesn’t do the residents of Ashford any favours either because it’s saying all their properties have gone down." He offered to give £5000 to charity if anyone could fine a 3 bed detached property in Park Farm for £160,000, as the newspaper claimed.

Posted by little professor @ 01:02 PM 12 Comments

E1 News: UK Lenders Are Back With 125% LTV Mortgage Loans

Coventry Building Society, the third largest British building societies, has recently announced launch of a new mortgage offer, which has caused controversial reaction among mortgage brokers. From now on, existing customers of Coventry Building Society who have a perfect credit history, but yet are trapped in negative equity, can enjoy 125% loan to value mortgage loans from the lender in case they wish to move homes. The new deal, which was supposedly launched to compete with a similar offer from Nationwide Building Society, another leading UK mortgage lender, allows existing borrows to “transfer” the existing loan to the new property of their choice without additional borrowing.

E1 News: UK Commercial Property Market Recovers – IPD

The latest report on commercial property values published in the UK suggests that the market of commercial property started to recover slowly. As we have already reported, local and international property investors showed increased interest in British commercial property lately, causing positive growth in capital values in the 3rd quarter of 2009. The 3rd quarter marked the first growth in UK commercial property values since the year of 2007. According to the report on commercial property values, published by the IPD UK Quarterly Property Index, the 3rd quarter of 2009 resulted in a 1.5% rise in capital values, marking a 5.6% improvement on the 2nd quarter of this year.

BBC: Nationwide gives gloomy forecast to match profit slump

Nationwide Building Society has reported a big slump in profits and delivered a gloomy forecast for the UK economy and the housing market. Pre-tax profits for the six months to the end of September were £143m, down 62% on the £374m reported a year ago. The company blamed low interest rates and the "dramatic fall" in commercial property prices for the slump. It also said the recovery would be slow and rising unemployment would put downward pressure on house prices.

Posted by jack c @ 09:00 AM 9 Comments

Daily mail: Revealed: 50 oil tankers loitering off British coast as they lie in wait for fuel price hikes

More than 50 oil tankers are anchored off Britain - pieces in a game in which the only winners are market speculators.

Posted by happy mondays @ 08:31 AM 33 Comments

Bloomberg: Overvalued UK market may not recover peak till 2014

U.K. house prices will probably fall next year, and it may take until 2014 to return to the levels at the 2007 peak of the country’s biggest housing boom, according to a Bloomberg survey. “The market is still overvalued, whichever measure you use,” said Seema Shah, a housing economist at Capital Economics. At the market’s height, banks were financing loans as large as five times a borrower’s salary. That lifted the average price to a record 6.2 times earnings, compared with the long-term average of 3.7 times income. The average price of an American home is 2.4 times income

Posted by little professor @ 12:43 AM 33 Comments

Bloomberg: FHA, Prime Mortgage Defaults at Records on Job Losses

"Foreclosures on prime mortgages and home loans insured by the Federal Housing Administration rose to three-decade highs in the third quarter, driven by the biggest job losses since the Great Depression"

Telegraph: OECD warns Britain risks 'debt spiral'

OECD warns that even if Britain reduces its deficit in line with other leading nations, it will still have the rich world's biggest deficit until 2017 and potentially beyond, casting serious doubt on its economic credibility on the same day that public borrowing in October was revealed to be 88 times what it was in the same month last year.

Rightmove: 7 Bed House for sale

But property prices are going up are they not? Actually, across the country, no. This evidence is effectively anecdotal, but I can tell you, there are properties galore in this area slowly slowly drifting downwards in price.

Posted by brickormortis @ 07:23 PM 7 Comments

Cnn: Interest on U.S. debt: $4,800,000,000,000

Unless lawmakers make big changes, the interest Americans will have to pay to keep the country running over the next decade will reach unheard of levels.

Associated Press via Yahoo: Mortgage delinquencies hit record-high in 3Q

More than 14 percent of American homeowners with a mortgage were either behind on their payments or in foreclosure at the end of September.

Telegraph: UK banks in worse trouble than others, Experian warns

Britain's banks are in a worse state that those anywhere else in the developed world and show no signs of recovery, according to the world's largest credit-checking company.

Posted by teeth @ 01:18 PM 7 Comments

Market Oracle: Deflationists Are WRONG, Prepare for the INFLATION Mega-Trend

Recently, there have been some arguments expressed on this blog that quantitative easing is a harmless accounting excercise that is not inflationary. I think it's time to put forward an opposing view. Despite the regrettable use of capitalisation, Wayalat's recent article puts an inflationary argument across quite well. So, will the central banks stop quantitative easing and what will the effect on (property) assets be?

Posted by quiet guy @ 01:00 PM 40 Comments

E1 News: Savills Reports Constant Increases in Farmland Prices

Latest figures revealed by Savills show that UK prices of farmland remain strong as the level of supply is falling steadily, while consumer demand is holding firm. Supply of farmland in Great Britain this year has been so far 10% lower than in the 10 months to October 2008. Areas experiencing the most lack land supply are Scotland and the east of England, says Savills.

Northampton Chronicle and Echo: Homeless set up camp near busy roundabout

" A GROUP of jobless and homeless men from eastern Europe have set up a camp for the winter in a patch of woods just yards from one of the busiest roundabouts in Northamptonshire." Shocking. Says it all really. Please go home, you're making the place look untidy.

BBC: Rise in public sector borrowing

The UK's public sector net borrowing reached £11.42bn last month, official figures have shown.The figure was the highest for the month of October since records began in 1993 was much higher economists had expected. The ONS said public sector net debt as a percentage of GDP totalled 59.2% in October, also the highest since records began.

Posted by jack c @ 10:17 AM 8 Comments

Citywire: Is a mortgage broker really necessary?

The answer seems to be yes.,.. brokers get all the good deals, so whatever your qualms about all of the fines, bans etc, you are pretty much held to ransom here!

BBC: Seasonal rise in mortgage lending

"UK mortgage lending rose by 5% in October compared with the previous month, according to a lenders' group.However, the £13.5bn of gross mortgage lending recorded by the Council of Mortgage Lenders was down 27% compared with the same month a year ago. The group said that the month-on-month rise in lending was typical seasonal activity."

E1 News: UK Lenders Announce Mortgage Rate Cuts

The latest announcement by Lloyds Banking Group is good news for borrowers waiting for a further decrease in mortgage interest rates. Lender’s mortgage arm, Cheltenham & Gloucester, reported a 0.5% cut in mortgage interest rates on 2-year fixed and tracker mortgage deals that are offered through mortgage brokers. Moreover, Cheltenham & Gloucester launched a new best buy mortgage deal. Lender’s borrowers with deposits of 40% or more are now offered to benefit from a 2-year tracker deal available at 2.29% above the base rate (a pay rate of 2.79%) and a fee of £995.

FNArean.com: Soc Gen sounds the alarm, again.

Further take on Society Generale's global collapse warning. Follows on from Devo's post last night.

Daily Express: CHEAPER MORTGAGES SET TO BOOST HOUSE PRICES

HOUSE prices are set to rise throughout next year as buyers enjoy a greater choice of mortgages, experts predict. A five per cent increase in prices will add £9,000 to the current £180,000 average cost of a three-bedroom semi. Stuart Law, chief executive of property investment firm Assetz, which forecast this year’s housing market revival, said: “2009 is well on its way to ending with positive growth of about five per cent and the next 12 months are likely to bring further growth.” He said Government pressure on banks and building societies to reduce profits and increase lending would force them to offer cheaper home loans.

Posted by little professor @ 01:15 AM 21 Comments

The Telegraph: Société Générale tells clients how to prepare for 'global collapse'

Société Générale has advised clients to be ready for a possible "global economic collapse" over the next two years, mapping a strategy of defensive investments to avoid wealth destruction.

Posted by devo @ 10:52 PM 11 Comments

Telegraph: Bad debt threatens to hamper economic recovery

This was a major problem in the last recession but not much about it this time. The problem, not stated clearly here, is to maintain cash flow businesses attempt to pay as late as possible, but when all businesses attempt to do this simultaneously it has an effect akin to a liquidity crunch. Businesses end up going under despite being profitable solely because of payment delays.

Posted by stillthinking @ 08:59 PM 6 Comments

Bloomberg: FHA-Backed Lending Is a ‘Train Wreck,’ Toll Says

"The Federal Housing Administration, the agency that insures home purchases made with down payments as small as 3.5 percent, may create another lending crisis, Toll Brothers Inc. CEO Robert Toll said. “Yesterday’s subprime is today’s FHA,” Toll said today at a New York conference for builders sponsored by UBS AG". The FHA said 456,000 of its loans, or 8.2 percent, were in default as of September 09. That was up from 5.6 percent in September 2008.

TIMES: Coventry offers 125 per cent loans to homemovers

"Mortgage brokers have welcomed moves by Coventry Building Society to offer 125 per cent loan-to-value mortgages to existing customers who need to move house. The UK's third largest mutual is to offer the controversial loans to customers in negative equity" with an "excellent credit history". (Nationwide allows existing customers to take out a home loan with a loan-to-value ratio of up to 95 per cent on a three-year fixed rate of 6.73 per cent or a five-year fix at 7.48 per cent. It then allows customers to borrow an additional 30 per cent at a rate of 7.23 per cent and 7.98 per cent).

Posted by alan @ 04:23 PM 11 Comments

Bloomberg: Housing Starts in U.S. Unexpectedly Plunge 11%

"Builders in October unexpectedly broke ground on fewer U.S. houses as the sales outlook darkened with the looming expiration of a government tax credit and mounting joblessness. "

Posted by rumble @ 02:10 PM 12 Comments

Adam Smith Institute: Fiscal Responsibility Bill

The idea of this government locking in Fiscal Responsibility with a new law would be laughable if their current irresponsibility wasn’t mortgaging our future. At the moment, Britain has the second highest structural deficit in the developed world. The OECD estimates that, to put our debt back on a sustainable basis, we would need a fiscal tightening of 12.8 per cent of our national income. That is a nearly unthinkable £150 billion of spending cuts or tax rises just to get debt as a percentage of GDP down to 60 per cent, still much higher than just a few years ago.

Bloomberg: Builders Probably Broke Ground on Most U.S. Houses in 11 Months

"We’re not going to return to the peak for quite some time to come." Somebody actually bothered to type that.

Cnn: Forget $100 oil $80 oil is a problem

This year's runup pales in comparison to the one that peaked last summer above $145 a barrel. Even so, some researchers warn we could once again be approaching the point at which rising energy costs will squeeze consumers. That could complicate recovery in an economy that, despite the tumult of the past two years, remains as consumer-driven as ever. "If you had to ask me what is the safe driving speed, I'd say $80 a barrel," said Steven Kopits, managing director at energy market forecaster Douglas-Westwood in New York. "We have bigger problems right now, but we shouldn't forget we're still vulnerable to rising oil prices."

Reuters: Bank's Barker sees no turn in unemployment soon

"The recession will not really have ended until unemployment starts to fall, which is unlikely to be soon, Bank of England policymaker Kate Barker said"

Wales Online: End of stamp duty exemption ‘could have detrimental effect’ on housing market

"Mr Filice, also a partner at Kelvin Francis & Company, Cardiff, told the Western Mail: “It is quite disappointing this is coming to an end, as it is the only assistance that the housing market has had from the Government." Erm, yeah.

Money Central: Five experts make their house price predictions for 2010

As per title...

Posted by rumble @ 12:55 PM 8 Comments

Your Mortgage: New flats lose popularity

"Prior to the credit crunch, property developers built too many brand new apartment blocks, particularly in city centres in the North of England. Many of these now lie unsold or empty and unrented, in many cases worth less than the mortgages lent on them to homeowners and buy-to-let investors. In some instances apartments have lost 50% of their value over the course of the past two years."

Telegraph: Next Government's sentence: tax rises, spending cuts and social unrest

The report, from right-leaning think tank the Policy Exchange, said that the lesson from history is that the next Government should slash its deficit with a combination of 80pc spending cuts and 20pc tax increases.

Mirror: House prices starting to rise, say Persimmon

"One of Britain's biggest builders has seen a dramatic leap in sales, and claims prices are starting to rise."

The Register: The Dunning Kruger effect explains all.....

Interesting viewpoint on how those in positions of power over the economy aren't necessarily the best for the job...

Investment Postcards: Picture du Jour: Plunging dollar erodes non-US investors' returns

With the US dollar falling down a precipice, spare a thought for non-US investors invested in US stocks and bonds. Looking at the erosion of returns for euro investors, it is understandable that they are not ecstatic about the greenback’s slide and will keep having reservations about committing funds to US assets until they see signs of the dollar forming a bottom. The link is: http://www.investmentpostcards.com/2009/11/18/picture-du-jour-plunging-dollar-erodes-non-us-investors%E2%80%99-returns/

Posted by prieur du plessis @ 11:42 AM 6 Comments

FT: Grim truths Obama should have told Hu

The fundamental problem of Chinese surplus and US deficit remains. Trade wars may be in the offing

BBC: Bank split over stimulus package

Bank of England rate-setters were split three ways about the decision taken earlier this month to pump £25bn more into the economy, meeting notes show. Seven of the nine members of the Monetary Policy Committee (MPC) voted for the £25bn extension, one voted for a higher amount and one for no change.

Posted by phdinbubbles @ 10:27 AM 11 Comments

Yahoo: LandSecs dampens property cheer

"We are prepared to be patient for the best opportunities and we will not rush our investment programme, as we expect a broader range of opportunities to emerge once banks begin to take action on their property loan portfolios," he added.

Telegraph: Devaluation: plenty of pain, not much gain

Is today’s rise in inflation a harbinger of doom, a sign that interest rates will soon rise or merely a flash in the pan?

Lovemoney.com: House prices have bottomed, says Sarah Beeny

"The housing market is in a pretty stable state compared to the rest of the economy". mmm.

Posted by doomwatch @ 10:55 PM 19 Comments

FT: A growing alternative to direct residential property purchase

If investing in residential property has so many problems, why are we seeing so many fund launches in the asset class? One possible answer is that these perceived risks are controllable - and are outweighed by the potential rewards. If we analyse these risks, we can perhaps see why residential property is coming back into favour.

Telegraph: UK house prices: peak for affordability 'now over'

Housing affordability peaked in the second quarter of the year and is now deteriorating as property prices rise, according to Lombard Street Research (LSR). The consultancy's housing affordability index, produced in conjunction with The Daily Telegraph, shows that in the second quarter of the year house prices were at their most undervalued level since the mid-1990s. The finding underlines suspicions that the bargain-hunting period for UK homes is now over, with prices having bounced back much faster than expected.

Posted by little professor @ 06:26 PM 15 Comments

E1 News: UK Savings Providers Delay the Release of Savers’ Funds

According to the report published by The Times, a large number of UK savers have faced problems with banks and building societies they trusted. Many Brits accuse their savings providers of delaying the release of their bonds. The Times says that several UK savings providers that once offered best-buy savings deals paying as much as 7% have now tied up the funds of savers whose deals are maturing. Many letters were sent by the readers, who complain that the delays of banks and building societies cost them a lot as they are unable to transfer to other top-rate fixed deals.

E1 News: Mortgage Rescue Scheme Proven Ineffective

It appeared recently that the mortgage rescue scheme, aimed at helping struggling UK borrowers avoid repossession of their homes, only helped 92 families across the country since its launch 11 months ago. The UK Government faced severe criticism for failing to help borrowers. Let us remind that the £285 million mortgage rescue scheme, initially announced in September 2008, but launched in January 2009, was designed by the British Government to assist UK borrowers facing property repossession as a result of defaults in mortgage payments.

Detroit via cnn: Silverdome sells for ... less than a house

Unidentified Toronto-based real estate company buys Pontiac stadium for $583,000 - a fraction of the $55.7 million it cost to build.

Bank of England Report: Banking on the State

This BoE report argues that over the decades the state's support for banks has simply encouraged greater risk-taking by the latter. The banks have learned that their gains will be privatised, and losses socialised, so they have adapted their strategies accordingly. They have learned that greater risk means a greater upside and a greater downside, but with the state at their backs they know they can harvest the upside (an Alice in Wonderland world where "everybody wins, everybody gets a prize") and export the downside to the state. High leverage (risk) fully accounts for banks' return on equity to 2007, and for the subsequent collapse of those returns..

Telegraph: Britain slips to new low in ranking of most corrupt countries

The UK should be aspiring to a CPI score which puts it in the top ten – not struggling to make the top 20. It should demonstrate that its own house is in order before exhorting developing countries to improve their governance.

Posted by crash n burn @ 03:06 PM 13 Comments

Yahoo: Tax Haven-On-Thames: Toll Bridge Up For Sale

The Swinford Toll bridge in Oxfordshire was built 240 years ago and an old Act of Parliament rules that its owner can collect a toll from those crossing the river - without being subject to tax. What's more, the bridge owner enjoys something of a monopoly as the Act also states that no other river crossing can be constructed for three miles in either direction.

Posted by mark @ 02:29 PM 8 Comments

HIP Consultant: Non HIP Compliant Local Authority Searches

The Association of Independent Personal Search Agents (IPSA) claim 18 councils are not producing legal searches. There are some big councils named. Be interesting to see what happens to them.

Metro: Warning over stamp duty 'holiday'

"The end of the Government's stamp duty holiday [for properties selling for £175,000 or less] will hit the housing market hardest in regions that are already failing to benefit from the recovery, the Royal Institution of Chartered Surveyors (RICS) has warned... It said surveyors in the West Midlands, East Midlands, Wales and Scotland were all expecting there to be a drop in activity in the market when the level at which the tax kicks in returns to £125,000 at the end of this year." Yeah, but ending the holiday will do wonders for the sale of properties priced at £125,000 or less!

Independent: Gold prices are a dead giveaway

"The unfortunate reality is that unconventional policies are unconventional because no one really understands how they work. Whisper it quietly, but these policies may be no more than the ultimate economic placebo."

Posted by letthemfall @ 12:44 PM 26 Comments

Telegraph: UK inflation rises for first time in eight months: economists react

The Bank of England has indicated that it will look through the near time spike up in inflation .... Further Quantitative Easing remains possible Remember, after all, that headline inflation went above 5pc back in 2008, with no real “second round effects” on wages and inflation expectations ... In short, no need to panic we can't control near term inflation' but what they can control is medium term inflation

Thisismoney: Pound jumps as inflation signals end to QE

he pound rose a quarter of a cent against the dollar to hit $1.6809 – its highest level since early August. Against the euro the pound was higher at €1.1282, the highest level for two months.

Evening Standard: Enterprise Inns boss worries that UK has ‘too many pubs’

Suggestion that unsustainable debt flowed into unsustainable drinking holes.

BBC News: UK Inflation starts to rise

UK inflation has risen, official figures have shown. The core Consumer Prices Index (CPI) climbed to 1.5% in October, up from 1.1% in September. Meanwhile, Retail Prices Index (RPI) inflation, which includes housing costs, rose from -1.4% to 0.8%

Posted by little professor @ 10:01 AM 30 Comments

E1 News: Cost of Mortgages Might Increase Soon – BSA

Mr. Graham Beale, chief executive of the Building Society Association (BSA), in his speech at the annual meeting of the BSA, expressed his concern with the possible rise in the cost of mortgages for UK borrowers, which might well be caused by intentions of the FSA to tighten regulation of the British mortgage market as well as by increased competition among lenders.

Times: UK recession is over, says MPC man Andrew Sentance

A member of the Bank of England’s rate-setting committee said last night that the economy had emerged from recession during July-September, meanwhile Paul Tucker, the Bank of England’s Deputy Governor for Financial Stability urged investors to consider purchasing contingent convertibles, or so-called CoCos, the newly created form of hybrid debt that converts into shares if a bank runs into trouble.

Posted by enuii @ 11:38 PM 18 Comments

FT: Jupiter issues gilts warnings

Fund managers are warning of an "almighty shake-out" on the gilt market amid mounting fears the Bank of England will lose control of inflation and send interest rates rocketing. Jupiter income star Tony Nutt said: "There is an unprecedented amount of Weimar Republic wheelbarrow money being thrown at the system. "The Bank of England will think 'I'm in control, I'm in control - oh, whoops, no I'm not'. We will wake up one morning and find interest rates are already higher than we were anticipating the day before."

Posted by jack c @ 09:25 PM 19 Comments

Cnn: 1 in 6 Americans goes hungry

The Department of Agriculture report, which has been released annually since 1995, said the number of Americans that were hungry rose to 14.6%. In 2007, 13 million households or 11.1% of Americans had trouble getting enough food.

Posted by mark @ 07:46 PM 8 Comments

Bbc: UK public 'favours spending cuts'

The survey found 59% of the 1,005 people polled believed there should be benefit or tax credit cuts - rather than tax hikes - to lower the deficit. Almost half of those surveyed (48%) also thought there should be a one-year pay freeze for the public sector. The UK, which now has overall debt of £825bn, is set to borrow a record £175bn over the next two years.

Posted by mark @ 07:34 PM 10 Comments

Right Move: Asking Prices fall 1.6% m.o.m.

Three months of price falls expected as new sellers drop asking prices by £3,744 (-1.6%). Low stock and improvement in mortgage availability fail to buck seasonal price-fall trend. No rush to beat stamp duty deadline as lenders’ high deposit requirements make the incentive almost irrelevant

Rightmove: House prices to fall over the next three months

House prices are expected to fall for the next three months in a row, according to Rightmove, as the average house price fell by £3,744 in October, a decrease of 1.6 per cent.

Guardian: TESCO saves the day!

So it is true, looks like you can run an economy on TESCOs. We all work for 'em and spend our money there and so the economy goes round. WE shall rename the UK TESCOland. Simples!

Colombia Reports: Cartagena, the world's biggest real estate bubble

To see a good example of this underground economy, one need only look at Colombia's "Riviera" and charming UNESCO city, Cartagena. Of all the real estate bubbles I have studied in the world, this one could be the biggest. And when it pops, there is very little visibility as to where the floor is. Cartagena could see price declines in excess of 50% in its "new Miami" - Boca Grande, and far greater in the old city of El Centro where prices have risen beyond the most insane logic. The concept of return on investment or cap-rates have been thrown out the window and mania has taken on new meaning - all in a city where unemployment is far higher than most parts of Colombia and, as a resort area, offers little beauty in its beaches. To say the market is artificial is an understatement.

HIP Consultant: Search Agents massive bad debt burden

Massive debts from liquidations and failed property companies leave a tricky position for consumer.

Greg Pytel: Curbing City pay will give it competitive advantage

"Interfering with bankers' contracts is a 'dangerous route to go down', a former chairman of Royal Bank of Scotland has told the BBC. Sir George Mathewson said that he thought the Financial Services Authority (FSA) already had enough powers to regulate bonuses." (http://news.bbc.co.uk/1/hi/business/8362000.stm) This is a pretty much silly comment that could have been just dismissed if it were not “dangerous”. It also shows Sir George’s substandard intellect of being unable to comprehend the obvious. Read Pytel’s article. He explains why it is the case.

Posted by ant @ 03:17 PM 9 Comments

BBC News: 'Half UK firms' plan pay freeze

"Half of all UK employers plan to freeze pay altogether despite signs of economic recovery, a survey suggests." So what signs of economic recovery would that be ? Could it be the £25bn more QE last week.. or the 0.4% contraction in the economy last quarter.. or could it be the 1,000,000 people forced into part time work that want full time work ?

Persimmon PLC: Interim Management Statement

"The improvement in average selling price is largely the result of a change in sales mix...We have sold a greater proportion of private houses and fewer apartments" "We expect to legally complete c. 9,000 homes for the year ending 31 December 2009...recently the 1,000th Persimmon home was reserved with [Government Homebuy Direct Scheme] since its launch in March this year."

Wikipedia: Fergus and Judith Wilson

A fine compendium of Wilsons-based news and articles, right up to last week's arrears story.

Posted by mark wadsworth @ 12:04 PM 32 Comments

Scotsman: Shock as city house prices fall 12%

Fallen by 12%. Previously Edinburgh had held up quite well. Not mentioned in this article but certainly connected, Edinburgh had previously been a banking hub, being the base for RBS and another (forgot which). HQ and staffing requirements have moved down to London. So banker bonuses no longer exist to support above median prices. High prices at the top end of the market are a strong driver of prices below. Given the dependency on Scotland on state money, Barnett formula etc, and the need for cuts in the future, it is hard to see anything other than a continuation of falls as we go into fiscal tightening, and with the targeted loss of finance jobs probably worse overall than the UK generally.

Posted by stillthinking @ 09:57 AM 12 Comments

Financial Times: Candy brothers turn sour on Qatari royals over dropped Chelsea project

"Nick and Christian Candy, the developers of apartments for the super-rich, are heading for a high court clash with the Qatari royal family following the withdrawal of plans for the UK's most expensive residential scheme at Chelsea Barracks. [They have] lodged a claim against Qatari Diar Real Estate Investment, the property company backed by the emirate of Qatar, a long-time business partner of the UK developers. The pair were planning to develop the former 12.8-acre Chelsea Barracks site near Sloane Square in west London into a £3bn luxury apartment complex designed by Lord Rogers. Project Blue, the former joint venture between CPC and Qatari Diar, acquired the site in 2007 for close to £1bn." NB, £1 billion ÷ 12.8 acres = £16,141 per square yard land value!

The Telegraph: Queen's Speech: Consumers will get lessons in finance, funded by banks

Any increase in the financial education levy will be resisted by banks. The British Bankers' Association said: banks already put money into financial education and capability schemes and support including financial education in the national curriculum."

Posted by devo @ 11:30 PM 14 Comments

Businessinsider.com: Roubini Is Wrong About The Giant Dollar Carry Trade Going Bust

This is lifted from a hedge fund traders blog, arguing that credit conditions are too tight for the dollar carry trade to pose a true threat to the market as a whole. "When the current trends reverse, there will be much volatility, pain, hand wringing, and gnashing of teeth, for sure. But it is much more likely that we are going to die from ice, not fire, and of boredom, not from cardiac arrest." Personally I think he's wrong, but then I also have an irrational love of disaster scenarios, and let's face it. Roubini has predicted ten of the last three recessions. So maybe he's right.

Times Online: House prices slip as owners aim to sell by end of year

Worth considering previous RM quotes : August, "Future price and transaction growth is now controlled by the bottleneck of mortgage availability. This is unlikely to change for years to come". September, "Many aspiring sellers could face years trapped in their homes until values rise enough for them to join the equity-rich club, and even then they will be heavily dependent on the number of bottom of-the-chain first-time-buyers." October, "Finance greases the wheels of the property market, and it is anybody’s guess when we might see the necessary level of competitive funding return. Frustrated homehunters should note the expected ten year timetable to wind up Lehman Brothers, giving a clear indication of the time required to rebuild the banking system.” W SHAPED DO YOU THINK?

Posted by sybil13 @ 10:27 PM 9 Comments

FT: China says Fed policy threatens global recovery

The US Federal Reserve is fueling “speculative investments” and endangering global recovery through loose monetary policy, a senior Chinese official warned. The combination of a weak dollar and low interest rates had encouraged a “huge carry trade” that was having a “massive impact on global asset prices”. [Japan's carry trade wasn't a problem for the rest of the world, because the Yen was never a global reserve currency. A dollar carry trade is blowing bubbles everywhere - credit markets, stock markets, oil, gold, even house prices. How long can it last?]

Daily KOS: How Republicans Killed Capitalism

Japan's lost decade is perhaps the best we can hope for, for the American Economy. An interesting view on the political ideology of the housing boom in America

Posted by the number cruncher @ 08:45 PM 8 Comments

Telegraph: China has now become the biggest risk to the world economy

332,000 properties were foreclosed in October alone. More Americans have lost their homes this year than during the entire decade of the Great Depression. A backlog of 7m homes is awaiting likely seizure by lenders. If you are not paying attention to this political time-bomb, perhaps you should.

Posted by devo @ 08:03 PM 6 Comments

The Times: We’ve come a long way

Does contain some interesting housing futures stats, maybe worth a punt.

Greg Pytel: A new (old) model of the largest heist in history

As Pytel predicted on his blog long time another liquidity crunch happened again. This time it went almost unreported. RBS got £26 bn from the government and BoE extended QE another £25bn. Pytel has been warning that the financial system is turning into loansharks’ business model. The banks are loansharks and taxpayers are their victims. Whatever they pay the banks their debt will increase and the banks will come back for more.

Observer: TUC calls for £5bn tax on empty homes

"The TUC wants the chancellor to charge five times the usual council tax – an average of £5,875 – on homes standing empty to persuade owners to sell or let them."

Posted by letthemfall @ 10:35 AM 17 Comments

Timesonline: The 10 richest Tories in the shadow cabinet

It woud be interesting to do the same thing with the 10 richest labour ministers, and see how mnay of those have conflicts of interest, especially in the property world. Just a thought.

The Times: Bank says let's party like it's 1994 again

Though the Bank is enough of a tease not to give us precise numbers, a reading of its charts suggest its new forecasts are for growth of a little over 2% next year, rising to 4% in 2011. I think we have been recovering for four to five months, if not longer, and that in the fullness of time the figures will show this to be the case.

The Guardian: Fake payslips in mortgage fraud scam

Fake pay documents available for 35 quid. Quite why anyone would wish to fake their salary in order to saddle themselves with debt they can't afford it beyond me.

Guardian: Have prices risen too much, too soon?

Everywhere the story is the same. Gold: at a record high. Shares: 50% up since March. Oil: back up to $80 a barrel. Bonds yields at a record low. Average UK house prices: up £11,000 this year. Around the world, asset prices are booming. The question is: are policymakers trying to solve the problems caused by one of the biggest bubbles in history by pumping up another speculative frenzy?

Posted by little professor @ 02:12 AM 6 Comments

The Times: Bosses’ pay rises defy downturn

The pay of chief executives has carried on rising despite soaring unemployment and widespread pay freezes for rank-and-file workers. The average five-year pay package of a FTSE 100 boss is £9.6m, according to research compiled by Patterson Associates, a remuneration adviser. The figure, which is rising annually at 7.9%, or seven times the rate of inflation, includes salary, bonuses and long-term incentives.

Posted by devo @ 12:00 AM 8 Comments

Telegraph: Civil servants share £105 million in bonuses

Greedy gluttonous pigs look after themselves and stuff the rest. Even those senior officials that deserve it should do the honourable thing and hand it back, considering the financial and economic state of the country.

The Telegraph: Barclay's John Varley admits banks have 'much to be sorry for'

One of Britain's leading banking executives has admitted that the banking industry has 'much to be sorry for' and needs to show that it is grateful to the British public for the multi-billion pound support taxpayers have provided.

Telegraph: Now State takes over bankers’ contracts

Bankers who are paid “unjustifiable” multi-million-pound bonuses face having their contracts ripped up and their banks fined, under new legislation to be unveiled this week. Stable door! I can almost smell the horse-sh1t from here. Lip-service I fear.

Times online: Why can’t I sell my home?

More than two years after putting her home up for sale (and four agents and price cuts of £170,000 later), Ms Donaldson is struggling to sell for the £625,000 that she needs to settle a “substantial” boomtime mortgage. She says: “When we bought it, there was us and another couple fighting over it. Now, despite all the work we have done, I can’t find one person to buy it.”

Posted by sold out @ 05:10 PM 20 Comments

Sky News: Bank ATMs Hit By Computer Failure

All Halifax and Royal Bank of Scotland ATM machines have gone down because of a computer failure.

Posted by devo @ 11:48 AM 10 Comments

Spectator: The Perfect Storm

Article on debt concludes that we end up in a forced position of borrowing from abroad. However, borrowing from abroad damages exports.

Independant: Britain the economic 'sick man of Europe'

Germany and France recovering. It will be very interesting to see what happens with Spain and particularly Ireland, as we are faced with similar situations but Ireland has taken the hard decision to cut state costs dramatically and face deflationary forces full on. Which IMO is a better long term plan that ours. To a certain extent, a recovery in Ireland will be a warning sign of a disastrous UK policy response.

BBC: High-risk mortgage lending rapped

Both the FSAs and CMLs sides of the story on Self Cert mortgages. The CML must think a 60% arrears rate is acceptable.

Daily mail: Mortgage arrears of couple who rode the buy-to-let boom estimated at £350,000

Earlier this week, it emerged that the Wilsons are not the only members of Britain's army of landlords who may be struggling, with the number of buy-to-let repossessions doubling to 1,600 between July and September compared with the same period last year. Just weeks ago Mr Wilson issued a bleak warning to his fellow landlords: 'We are reasonably safe, I think. If we go under, then everyone's going under.'

Posted by sold out @ 02:26 AM 44 Comments

Telegraph: Speaker John Bercow's official residence refurbished for £45,000

Astounding! ".....Mr Bercow ordered the makeover, covering work from child-friendly redecorating to new televisions and furniture, within weeks of his election as Speaker in June. His wife, Sally, oversaw most of the work and the couple pushed ahead with the overhaul despite being warned by Parliamentary officials that the costs may be seen as excessive. ...... ....The new disclosures about Mr Bercow's spending are likely to prove embarrassing for the new Speaker who was elected on a promise to restore trust in Parliament in the wake of the MPs' expenses scandal. During his campaign to become speaker, he said: “It is high time the House (of Commons) was run by professionals on a transparent basis, ensuring that we are accountable to the people who put us here.”

IFAonline: Last lender ditches self-cert

Sub-prime lender Beacon Homeloans is to stop issuing mortgage offers in two weeks. The news comes hard on the heels of Platform's exit from self-cert announced on 4 November, and means that there are now no lenders in the UK offering self-certification mortgages. Self-certification mortgages allowed customers to confirm their own income, rather than have to go through checks by the lender. But self-cert mortgages had also made a reputation for giving some consumers access to more cash than they could afford to pay back, leading the FSA to propose scrapping them altogether.

Telegraph: Property TV shows, switched-on youngsters

The girls I met at my former school in Dorset last week are avid watchers of property programmes. They race to finish their homework in time for Location Location Location. Is it not slightly worrying that we are cultivating a generation of property addicts? Not according to Sarah Beeny, presenter of Property Ladder. “It’s good to give people aspirations,” she says. “It’s more positive than going out drinking vodka.” Michael de Pelet of Knight Frank agrees that the younger generation’s enthusiasm for property television programmes can only be seen as a good thing. “Everyone should strive to own their own house rather than blowing all their money on holidays,” he says. These programmes have brought people to the market who wouldn’t otherwise have bothered.

Posted by little professor @ 08:00 PM 8 Comments

Monstersandcritics/dpa: US banks asked to save government guarantor from insolvency

Running out of money after the year's devastating financial crisis, the government's guarantor of US bank deposits on Thursday asked that banks help to keep it afloat.

The Press Association: FSA 'sees lenders as drug dealers'

Matthew Wyles the Chairman of the Council of Mortgage Lenders today accused the Financial Services Authority (FSA) of viewing mortgage lenders as being like "drug dealers at the school gates" and consumers as "wanton children" who did not know what was good for them. Wyles added that through the proposed reforms to the mortgage market the regulator was attempting to wrap customers in cotton wool and make borrowing risk free.

Guardian: House price drop indicates 'double-dip' for property market

"Many leading forecasters are now expecting 2010 to be a tougher year for the property market than 2009. Savills says price falls next year will be driven by the lack of mortgage products, erosion of pent-up demand constraints, gradually increasing supply and the overhang of unemployment. It forecasts a slow "extended W-shape recovery" starting in 2011......the Communities and Local Government department confirmed that the number of first-time buyers last year had fallen to an all-time low.The figures show that in 1999 there were nearly 600,000 first time buyers. This fell to below 400,000 when prices peaked in 2007 and were down even further last year – to just 193,600" Can you have a W shaped recovery without another 20% fall?

Posted by sybil13 @ 03:59 PM 12 Comments

Times: Mortgage rescue programme helps only 92 families

"The rescue programme was set up to bail out vulnerable families who faced repossession after defaulting on mortgage repayments. Figures out yesterday showed that while 11,000 householders had received free advice about their mortgage predicament since the beginning of the year, only 92 accepted a rescue offer. While the scheme was officially launched in January, it was announced in September last year". Doh!

MoneyMarketing: Sub-prime lender in legally binding repo forbearance

Blemain Finance, a sub-prime lender, has agreed to not repossess Peter Bentley, a carpenter from Bridgend, for at least six years, through a legally binding deal. Bentley had fallen into arrears as a result of caring for his sick father after his mother died. Blemain initially sought an order to repossess him and Bentley, represented by Cartel Client Review, tried to counter sue but once the lender became aware of his situation it sought an alternative deal. Blemain will not charge interest on the £40,000 mortgage and has cut monthly payments from £549 to £150 until the capital has been paid off.

Posted by mountain goat @ 01:51 PM 10 Comments

FT: Data suggests worst is over for UK housing market

This jurno abviosly doesnt use the same crystal ball as our own leader JD. Just because all the data including halifax, nationwide and land registry indicates that prices have risen I for one still dont belive it!!

Citywire: Held hostage to the letting market

Its not just estate agents that are applying the pressure - bid wars are in lettings as well. the blog is written from a tenant's perspective, but as a landlord i have seen this increase as well.

Thisismoney: Property market 'wobbles' as asking prices fall

Asking prices for properties went into reverse after seven months of rises, according to one of the UK's largest property websites. More than £1,000 was knocked off marketing prices in just one month, according to Findaproperty.com. The company said it was 'the first sign that the housing market recovery could be starting to wobble'.

Posted by houses_burning @ 10:46 AM 17 Comments

Telegraph: Kenmore Property collapse leaves Lloyds with a £700m hangover

Lloyds Banking Group was chasing debts and investments of more than £700 million last night after the collapse of a property developer that it has been bankrolling.

Posted by tyrellcorporation @ 09:59 AM 14 Comments

RIghtmove: 3 bed house for sale

This is the funniest phrase I have come across in ages and I thought I just had to post it. I must also say that looking in this region it would appear that asking prices continue to fall or are stagnant with a good number of properties listed as subject to contract or under offer being relisted as for sale even in desirable areas such as ironbridge. Most recent IB sales include a house down from £370,000 initially to £290,000 to secure a sale.

Posted by brickormortis @ 06:57 AM 11 Comments

New York Times: The Jobless Rate for People Like You

In the US, the unemployment rate varies significantly by social groups. White female college graduate aged 25-44? Your unemployment rate is a barely-noticeable 3.6%. Black male high-school drop-out aged 16-24? Your unemployment rate is 48.5%. In general, more education = less likely to be unemployed. Women fare slightly better than men. Young people fare far worse than other age groups. [I expect there are huge regional variations too. It would be interesting to see similar figures for the UK too - anybody know of a source?]

The age: House Prices Jump Again

Those intending to tunnel out of Browns Britain - be aware house price madness is alive and well down under. Rises of 4.7% quarterly! in Melbourne. The same ingrained attitudes on prices - to infinity and beyond.

The Express: WORKSHY BRITAIN: BENEFITS OUT OF CONTROL

THE SHOCKING truth of workshy Britain was laid bare today as figures revealed the number of households receiving benefits worth more than £15,000 a year has doubled under Labour. Welfare Reform Minister Jim Knight said 1.2 million households were given state handouts in excess of £15,000-a-year in 2007-08, compared with 600,000 a decade before. And households receiving more than £20,000-a-year trebled from 100,000 in 1997-98 to 300,000 ten years later.

Posted by devo @ 10:57 PM 35 Comments

Home.co.uk: Winter Blues Stall Market Recovery

The mix-adjusted average Asking Price for homes on the market in England and Wales falls back by 0.7% this month. Market house prices fell this month in all English regions except the North East. Welsh and Scottish market house prices also fell.

This Is Money: Why Britain's house price crash is far from finished

'In Britain house prices remain 170% higher than they were in 1997, but average earnings have risen by only 55% in the same period.'

The Real News - youtube: Anatomy of casino capitalism

Economist, Jane D'Arista gives an insight into the 'propriety trading' scam perpetrated by investment banks. This is when banks are borrowing money from each other and speculate with it - inflating the bubble in the giant ponzi scheme to end all ponzi schemes. Mortgages where used as the collateral on which to borrow the money.

BBC News: Top BBC bosses' salaries revealed

No wonder house prices are going ( sort of ) going up this bloke must be buying them all with out cash. £834K for a safe public sector job. Are these people taking the **** I'll do it for half that. It's time these people realised where this monry comes from, Us.

Cnn: Cash cushion shrivels - U.S. housing agency

As banks have clamped down on mortgage lending, the FHA program has emerged as one of the few ways people can buy a home. Banks are more willing to make FHA loans because they come with a federal guarantee to cover losses if the borrower defaults. And borrowers can more easily qualify for FHA loans because they only need 3.5% down and can have lower credit scores. As a result, demand for FHA loans has exploded. The agency guaranteed more than $360 billion in single-family mortgages in fiscal 2009, which ended Sept. 30, more than four times the volume in fiscal 2007.

Citywire: Property has become a matter of inheritance not an aspiration for many

What the Council of Mortgage Lenders figures on first-time buyers, repossessions and a recovery in buy-to-let lending tell us about the housing market.

Thisismoney: Crackdown on repossessions loophole

The Government is working to close off a legal loophole through which lenders can bypass the courts to force people out of their homes.

E1 News: UK Savers Offered Higher Introductory Bonuses

In an attempt to attract new and lock in existing savers, more and more British banks and building societies start to offer introductory bonuses to savers, says the research carried out an online financial comparison source, MoneyExpert. The research showed that an average introductory bonus now reaches 0.9%, which is 0.2% higher than an average instant access rate. The number of banks and building societies offering introductory bonuses has risen from 16% a year ago to 21% these days; savings accounts’ providers have increased the size of introductory bonuses by 0.2% in the past year, while they have cut instant access savings rate by as much as 2%.

Daily Mail: House sales set to crash to lowest level since World War II as fewer homes hit the market

"The CML said it expects around 48,000 people will be repossessed this year, the highest number of evictions for 14 years." "The biggest losers in the rising tide of repossessions are Britain's army of buy-to-let landlords who are losing the battle with mortgage payments."

Posted by letthemfall @ 03:28 PM 15 Comments

This Is Money: Bonds that invest in rising house prices

Abbey and Britannia Building Society have launched new bonds, offering 50% of the growth in the Halifax house price index over the next five years. Investors have until Saturday to invest in the Guaranteed Growth Plan Issue 26 from Abbey, which offers 50% growth in the index over five years or a guaranteed minimum payment of 11%, whichever is larger. The Britannia product is available until 24 November and offers 50% growth in the index or a 10% payment over five years.

Posted by little professor @ 02:14 PM 13 Comments

Bloomberg.com: U.S. Foreclosure Filings Surpass 300,000 for 8th Straight Month

The U.S. never do anything by halves. Not only are their food portions sizes massive, so is their HPC. We could learn a lesson from these people. Drive houses prices down and start again. I'm loving it....

BBC News: Lenders cut repossession forecast

The Council of Mortgage Lenders (CML) has cut its forecast for the number of homes likely to be repossessed this year to 48,000.

Telegraph: State of the Economy Under Labour

Very nice summary charts (1997-2009) tracking the change in Sterling, public borrowing, gilt yield, employment, interest rates, CPI, consumer spending and FTSE under Labour.

Metro: Home repossessions up 3 per cent

"The number of people who lost their homes rose by only 3% during the third quarter of the year despite rising unemployment. Around 11,700 people had their homes repossessed during the three months to the end of September, up from 11,400 in the second quarter, but down on 12,700 during the first three months of the year, the Council of Mortgage Lenders said. The group said it was slashing its forecast for repossessions during 2009 to 48,000, due to a combination of increased lender forbearance, Government schemes to help people stay in their homes and the impact of low interest rates. It had originally predicted 75,000 people would lose their homes this year, although it revised the figure down to 65,000 in June..."

City Wire: Irresponsible lending continues

Borrow now. The UK needs you.....

Telegraph: Record number trapped in part-time work, unemployment figures show

A record one million people are trapped in part-time work, masking the true extent of the unemployment crisis, official figures suggest. Just under one million – 997,000 -- are trapped in a part-time job despite wanting a full-time one, the figures suggest, a record number and an increase of 40 per cent on a year ago.

E1 News: New Mortgage Lenders to Enter the UK Market

British mortgage brokers believe that entrance of new mortgage lenders on the British market will result in increased competition. GE Money Home Lending, which was one of the most popular British mortgage lenders in 2007, announced that this week it will re-enter the UK mortgage market, which it left last year. GE Money Home Lending has already revealed one of the mortgage deals it will offer to its customers: the best buy mortgage offer available for 70% loan-to-value ratio will have an interest rate of 4.99% and a fee of £995.

Reading Post: Average home costs 10 times your wages

According to the National Housing Federation (NHF), the average house price in Reading is £221,459 while the average individual salary is £22,506. It is an even bleaker picture for homebuyers in West Berkshire where the average house price (£281,255) stands at nearly 12 times the median income (£23,920). Gary Waite, head of Woodley estate agents Whiteknights, said “I don’t think affordability is much of a problem,” he said. “We get lots of young couples buying houses, although we don’t get many single people buying these days. “To be fair, it isn’t the property prices, it’s the mortgage market. We do need more flexibility."

Posted by nohpc @ 09:07 AM 21 Comments

Cnn: 10 states face financial peril

The same economic pressures that pushed California to the brink of insolvency are wreaking havoc on other states, a new report has found. And how state officials deal with their fiscal problems could reverberate across the United States, according to the Pew Center on the States' analysis released Wednesday. The 10 most troubled states are: Arizona, California, Florida, Illinois, Michigan, Nevada, New Jersey, Oregon, Rhode Island and Wisconsin. Other states -- including Colorado, Georgia, Kentucky, New York and Hawaii -- were not far behind.

Reuters: Bank bailout channels Irish anger

"There is huge fury among ordinary people, who sense that the taxpayer is being made the patsy for what went wrong," said Richard Bruton, finance spokesman for Fine Gael, the main opposition party.

City Wire: Uk set for inflation

Self explanatory

Posted by chrisch @ 08:40 AM 7 Comments

Citywire: The UK set for big inflation shock, warns Schroders bond manager

Gartside is Schroders’ head of global fixed income and manager of the Schroder ISF Global Bond and ISF Strategic Bond funds, which he took over late last year. He believes politicians have set out to produce inflationary conditions as a way of reducing government debt.

Business Week: Yanks unhappy with Fed intervention

Bad news for those who see housing as a "home". I'm sure the UK market will look the same after the crash with the bargain hunters looking to make a killing.

Daily Express: Britian on the mend

BRITAIN is bouncing back from the brink of economic ruin, an upbeat Bank of England revealed yesterday. Governor Mervyn King predicted economic growth would hit a brisk 4 per cent next year with “a more buoyant picture ahead”.

Telegraph: Estate agents 'regularly lie to homebuyers'

Estate agents frequently misdescribe the homes they are selling, such as by modifying promotional photos or falsely claiming they have central heating. In one particularly audacious pretence the advert for a fisherman's cottage in Dungeness, Kent, failed to mention the two nuclear power stations just 100 yards away.

Telegraph: 5.7m and climbing: the real unemployment toll

Ignore the unemployment figures released by the nu labour spin machine,The latest figures show that this is now closer to 5.7m, (over 15pc of the working age workforce) and is reaching the peaks it hit in the early 1990s.

CNBC/Reuters: China Signals That It May Allow Currency to Rise Against Dollar

"China sent its clearest signal yet that it was ready to allow yuan appreciation after an 18-month hiatus, saying on Wednesday it would consider major currencies, not just the dollar, in guiding the exchange rate." This will work wonders for Gordon's interest rate policy.

Argus: Sussex residents can't afford to buy a hous

People in Sussex are turning to council housing because they can no longer afford to buy their own home. Figures released today show families are struggling to cope with the recession with property prices outstripping income. A report by the National Housing Federation showed the average cost of a house is almost 13 times the average annual salary of people living in Brighton and Hove. The average house in the city costs £268,246, which is 12.6 times the average income of £21,278. Even the cheapest quarter of the city's homes cost roughly £175,000.

The Times: Bmi struggles to get sale of landing slots off the ground

If this did happen, the snow ball effect would not only right off 4,600 jobs but could affect all the ancillary posts like cleaners, caterers, baggage handlers, all of whom will either have a mortgage or rent...etcetera etcetera, etcetera.....BA are looking to cut staff also so no chance of alternative airlines hiring!

The Times: Financial crisis could force bmi out of business in under a year

Could ask Merv or Mandy for a loan I suppose

Guardian: Debt levels leave low paid at risk of homelessness

Research shows low-income households – with an average of £15,800 at their disposal – are walking an increasingly precarious financial tightrope. Some 24% of low-wage households spend more than a quarter of their monthly income on debt [that appears to include mortgage debt] – twice the number from three years ago. Nearly 33% of low-income households have high loan-to-value mortgages and are in negative equity [no they aren't - see my comments below], making them vulnerable to homelessness if they lose their job.

BBC News: Russian bank to cut 67,000 jobs

Russia recovering well.....hopefully house prices will be shooting up there too

The Guardian: Guardian Media Group to Make 100 new Job Cuts

.....can't see that going on for much longer. And how many other "newspaperes" are suffering? It's going from sour to curdled!

Posted by magnaman @ 05:12 PM 6 Comments

Guardian: Rude awakening for former commie states

"We had unlimited belief in the capacity of the markets to regulate themselves. Most believed that property prices cannot fall, that it was a law of physics," said a Latvian economist working at one of the big Scandinavian banks in Riga.

FreshInfo: UK produce industry struggles on

A possible explanation for the lack of food inflation is the existence of food production matching demand at a certain price point. This price point has collapsed with the economy. Accordingly fresh produce producers(!) have struggled on making a loss. Over the New Year will be a shakeout as these losses become unsustainable. This will reduce competition amongst the survivors. As competition is reduced prices will again reflect the costs of production and not the current over-supply. Probably this will be reflected in many sectors of the global economy, the days of global over-supply masking the dramatic fall of sterling may well be coming to an end.

Telegraph: The Council of Mortgage Lenders predicts gloomy future for mortgage borrowers

Great article shame the press didn't run it instead of RAMPING HPI .....Nothing new but good to see it in print "Lenders, as a whole, do not have enough funding for mortgages to help promote the economic activity that will help lift the UK out of recession.....Mortgage costs have risen, and will remain higher than before the credit crunch. And with higher taxes coming through from 2010 onwards, and higher interest rates in due course, consumers’ capacity to borrow will be further constrained. ....." etc etc Certainly NOT BULLISH

Posted by sybil13 @ 02:49 PM 13 Comments

Timesonline: Bank talks up hopes of strong recovery

Sorry chaps, Good News!

Posted by smugdog @ 12:58 PM 6 Comments

Bloomberg: Bear Managers’ Acquittal May Hamper U.S. Fraud Prosecutions

The jurors said after the verdict that the evidence presented wasn’t enough to convince them of guilt. “Everything contradicted,” said Jenny McCaughey, the jury forewoman. “The e-mails went both ways. They say one thing one time and another thing another time. The government didn’t give us enough to go on.”... “There is reason to believe that the funds weren’t going to tank, that’s what they believed,” the lawyer told jurors.

E1 News: Colliers Reports Improvements on UK Commercial Property Market

Colliers CRE – a leading British property consultant – published a report revealing that the UK commercial property market has seen the fastest recovery of property values in the past months. According to the Colliers CRE report, commercial property prices are very likely to compensate for the declines seen in the first 6 months of 2009 as the increased demand of UK property investors, coupled by low property supply, bring property values back on the pre-recession level. Colliers experts, however, are concerned with the possibility of another price correction, which might occur as a result of the property rally.

MoneyWeek: There's plenty more pain to come for British banks

After HSBC and Barclays' recent results, Britain's bank bosses are starting to sound bullish. But their optimism is misplaced. It's nowhere near business as usual for the banking sector.

The Times: Recovery hopes rise on surprise unemployment figures

"British unemployment is rising at a far slower rate than expected, official figures revealed today". "The number of people out of work increased by 30,000 to 2.46 million in the three months to September while the number of people in work rose for the first time in more than a year". Not everyone is convinced either - read the comments section....

Bloomberg: Bank of England Lifts Forecasts for Inflation, Growth

Nov. 11 (Bloomberg) -- The Bank of England raised its forecast for economic growth and said inflation may exceed the 2 percent target in 2012 even if policy makers start increasing interest rates from a record low. However we won't be raising interest rates as we'd like inflation to be way above the 2% target and we'll keep coming up with various reasons why we need to continue QE and keeping interest rates low.

Posted by str 2007 @ 11:23 AM 9 Comments

Times: Mortgage rates fall but loan restrictions tighten

Woolwich.. "which is the UK’s fourth biggest mortgage lender, is cutting the cost of its popular base-rate tracker deals and will introduce new deals for borrowers with a 25 per cent deposit today. It will offer a market-leading lifetime tracker at 2.44 percentage points above base, a pay rate of 2.94 per cent, available up to 75 per cent of a property's value. It has a £999 fee. However, Woolwich is also raising the interest rate that it uses to assess affordability, making it harder for borrowers to secure any new deal."

BBC NEWS: Rise in UK unemployment slowing

"At the same time, the number of people in work increased by 6,000 to 29 million, the first quarterly rise since the summer of 2008. " "Ross Walker, UK economist at RBS Financial Markets, said the latest official figures were "better than expected". " "the 30,000 increase was the smallest since May 2008."

BBC: Home loans level off, lenders say

The recent rise in mortgage lending to house buyers has levelled off, the Council of Mortgage Lenders (CML) says. In September, 51,000 mortgages were agreed for house purchase, up from 50,000 in August but lower than the 53,000 recorded in July. "Although the recent bounce-back in house purchase activity is holding up, we remain some way below what might be called 'normal' levels of transactions," said CML economist Paul Samter. The UK property market has staged a recovery since the spring with sales and prices picking up again after the dramatic slump caused by the credit crisis.

Posted by jack c @ 10:24 AM 20 Comments

Yahoo news/PA: Youth unemployment hits record high (yes even higher than under the big bad Thatch)

The inactivity rate is now over 21% of the working age population and the total is the highest since records began in 1971. So who's buying all the houses then?

Telegraph: Selling houses: when the price is not right

Much foot stamping becuase those wicked surveyors won't support the silly prices that some would like to pay. A sure sign that when cash rich buyers run out prices will come down further.

FT: Prime suspects in the great equity buy up

The rebound seen this year in stockmarkets around the world has defied the anaemic economic recovery that is emerging in some western economies, while latest figures have shown that the UK is still in recession, although those figures will probably be revised favourably. So what has fuelled the recent rises stock markets have experienced? The first thing to note is that trading levels on markets has actually been very thin, so an excess of buyers or sellers can cause disproportionate movements in prices.

The Telegraph: Bank bad debts seem finally to have peaked

Much of money is being earned on the back of super cheap central and government funding. Neither Barclays nor HSBC have taken money directly from the UK Government, but both have availed themselves generously of government funding support through the the Special Liquidity Scheme and Credit Guarantee Scheme. They’ve borrowed the money cheaply and lent it more expensively. In investment banking the story is much the same. The spread between what the bank pays and what it sells to the client at has been hugely increased. It’s like a tax on savers, grudgingly tolerated by the Government because the alternative would be financial system collapse.

E1 News: New Woolwich Mortgage Deals Come Along With Stricter Lending Criteria

The latest announcement by Woolwich – Barclays’ mortgage branch – suggests that the lender is tightening affordability criteria for borrowers, while introducing new attractive mortgage deals. Being the 4rth biggest lender in the United Kingdom, Woolwich launches several new deals for borrowers with small deposits, and cuts the cost of its best buy tracker mortgage deal starting November 11th. From now on, Woolwich popular tracker mortgage deal will be available for borrowers with as little as 25% deposit at 2.94% (or 2.44% above the base rate) and a fee of £999.

Cnn: There are still too many houses

Part of the glut comes from a rash of foreclosures as strapped borrowers fall behind on their mortgages. But rental apartments are emptying out at a record clip as well, as a spike in the jobless rate and a decade of subpar wage growth have sent many Americans back home to live with Mom and Da

The Independent: The mystery of rising house prices

The conundrum is this. Unemployment is close to 2.5 million and will go higher. Pay rises are rare. People fear debt. The credit crunch has hardly gone away, meaning that mortgage finance, especially for first-time buyers with slim deposits, and movers with little equity, is expensive, if available at all. Mortgage approvals may be up on last year, but the new money going into the market isn't sufficient to secure rising prices. Values are steep by long-term historical standards in relation to earnings, especially in London. So prices ought to be tanking. And yet ...

Posted by apophis @ 06:13 PM 26 Comments

BBC: Pension fund deficits 'slashed'

Pension fund deficit has been slashed by 34% in one month as rules have been changed "anyone seeking a guaranteed return to pay pensions, for many years in the future, does not have to put quite as much aside to cover the cost. " This is due to corporate bond prices falling, and yields increasing.

MoneyWeek: What the Cadbury's deal tells us about the wider economy

The Kraft-Cadbury takeover saga says a lot about the market's psychology right now. And it shows just how out of touch with reality the market is.

Associated Press via Yahoo: Median home prices fell nationwide in 3Q

A real estate group says home prices fell in eight out of every 10 U.S. cities in the third quarter of this year as heavily discounted distressed sales made up 30 percent of all deals.

Times: House prices grow for sixth month in a row

House prices rose by 1.2 per cent in September from August, the sixth increase in a row, further bolstering evidence that Britain's battered property market is over the worst. The rise pushed the average cost of a UK home to £199,303 — a level not seen since November 2008, according to figures from the Department of Communities and Local Government (DCLG). The annual rate at which prices are falling also slowed to 4.1 per cent in September from 5.6 per cent in August and a peak of 13.6 per cent in March. The DCLG survey is the latest to suggest an upturn in the housing market. A recent survey from the Royal Institution of Chartered Surveyors found that house prices rose in October despite more properties coming on to the market.

Posted by little professor @ 04:01 PM 100 Comments

Yahoo: Telecoms Giant Ericsson To Axe 700 Jobs

Telecoms giant Ericsson says it is to close a site in Coventry with the loss of 700 jobs.

Posted by mark @ 03:38 PM 12 Comments

Thisislondon: Let’s hope that the Bank of England finally gets it right

Posted by mken @ 02:04 PM 14 Comments

Bbc: Games maker EA to cut 1,500 jobs

The cuts, in addition to the 1,100 jobs already shed this year, came even as EA bought social gaming company Playfish for $275m (£170m).

MarketWatch: Ratings remarks pressure British pound, gilts

The house price bulls will get what they are asking for. And what they are asking for is a complete collapse in the purchasing power of sterling in a bid to maintain nominal house prices. They will only realise this of course ex-post when the carnage begins to consume both the feckless and the prudent (they are way too selfish to care that the prudent saver is already burning). It is their only hope that the prudent can take enough pain, and have enough savings and earnings capacity to keep their debt-driven phoney wealth levels in tact. My only consolation now, is that when the fires of inflation start consume all in the UK, the house price bulls will finally be consumed along with everyone else.

Posted by jackas @ 12:14 PM 21 Comments

This is money: RICS: House prices running at boom levels

RICS suvey show pries have pretty much recovered to boom levels. So Gordon Brown has prevented a housing bust, but how will he now deal with the bubble?

Posted by will @ 12:05 PM 34 Comments

BBC: Lloyds announces 5,000 job cuts

Lloyds Banking Group is cutting 5,000 jobs

Posted by doomwatch @ 11:15 AM 11 Comments

BBC News: UK trade gap widens in September

The UK trade deficit widened more than expected in September, led by a jump in car imports as Britain's scrappage scheme helped foreign carmakers. Cheers Gordon, now our tax is propping up other countries too. And wasn't the weak pound intended to help us export our way out of this mess? But the trade gap is widening, because manufacturing has been in decline because all our potential scientists and engineers work in banks. Clot!

Bloomberg: Pound Falls After Fitch Says U.K.’s Credit Rating Most at Risk

This is not directly about HPC but is germane in the recent atmosphere of despondency and metaphysical anguish for HPC bears. UK house prices can only be nominally raised by policies that devalue sterling. Even assuming that UK house prices are at 2007 levels in sterling terms, they are down around 20% when measured vs the Euro or USD, or 40% when measured vs the JPY. The discussion is warped by exclusively considering what's happening in terms of sterling. The answer for those saving for a deposit seems pretty obvious...

Telegraph: Britain's public sector faces the Geddes axe

And that is why anyone thinking that from now to the election is a reasonable indicator of trend will be surprised. Sure, gold and equities are soaring - but one thing is for sure: when the cuts come, interest rates rise and the economy sheds jobs - house prices will tumble.

Posted by growler @ 09:38 AM 31 Comments

Business Insider: IMF: Dollar Carry-Trade Creating Bubbles Around The World

The International Monetary Fund (IMF) highlighted the fact that low interest rates in the U.S., plus an apparent "one-way" bet against the dollar has created a global dollar carry-trade that is driving capital flows into emerging markets. If not handled properly, this will lead to emerging market asset bubbles, which arguably have already begun to inflate. We've highlighted before how places like Hong Kong are seeing property prices go through the roof due to low U.S. interest rates.

Posted by mountain goat @ 08:56 AM 10 Comments

E1 News: Self-Cert Mortgage Deals Disappear From the Market

Following the release of mortgage review by the Financial Services Authority in October, Co-operative lending branch – Platform bank – announced that it will withdraw its self-certification mortgage deal by the end of the week. Let us remind that the FSA proposed that all lenders verify borrowers’ income sources and carry out affordability checks. Meanwhile, self-certification mortgages that have been extremely popular with borrowers earlier, especially with self-employed mortgage applicants, mean that income sources cannot be verified and that is why lenders are quickly withdrawing this type of mortgage deals, even though the new rules of the FSA will only come into force in 2010.

BBC: Recession 'fuels UK shoplifting'

Shoplifting has surged to record levels in the UK, fuelled by the recession, according to a study. The UK had the highest amount in value of shoplifted goods in Europe and was third behind the US and Japan globally, data from 1,069 retailers suggests. The recent uprising of the middle-class shoplifter, someone who has turned to theft to sustain their standard of living.

Posted by cat and canary @ 08:13 AM 20 Comments

BBC News: House prices 'to keep on rising'

Overall, a bullish article and some of the arguments given in favour of rising prices seem quite reasonable. This bit caught my eye, however: "Cheap money remains a critical prop for the market and this is being reflected in the continuing appetite for finance from first-time buyers despite the large deposits still being demanded by lenders" said Jeremy Leaf of Royal Institution of Chartered Surveyors. Will we ever be able to raise interest rates?

Posted by quiet guy @ 01:07 AM 21 Comments

Bloomberg: Goldman Sachs Said to Manage Sale of Commercial Debt

As credit markets have stabilized and financial institutions make bets the worst has passed, signs are emerging that some banks are willing to take on the risk. During the past two weeks, JPMorgan Chase & Co. began quoting loans to commercial borrowers with the intent of pooling them to be sold as bonds, though no loans have been closed yet, according to a person familiar with the program. “This is a very positive sign for the market,” Hoeffel said. “While it’s only a toe in the water, banks are actually taking the execution risk of a securitized exit.”

BusinessWeek: The GDP mirage

We've all read that the 10% unemployment in the US could really be 20% and that one-off gov't stimulus, rather than truly recovered economic activity, is behind recent GDP growth. Well, here's another cause for concern - big cutbacks in intangible investments in R&D, product development, design and worker training - companies robbing the future to pay for short-term profits. These cutbacks are intangible also in the sense that they aren't picked up in GDP stats, so GDP looks higher than it really is. Such reductions also compromise future competitiveness and economic activity.

Posted by icarus @ 06:57 PM 8 Comments

The Sunday Times: I'm doing 'God's work'. Meet Mr Goldman Sachs

"We’re very important," he says, abandoning self-flagellation. "We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. It’s a virtuous cycle." To drive home his point, he makes a remarkably bold claim. "We have a social purpose."

Posted by shipbuilder @ 06:17 PM 11 Comments

E1 News: Savills Forecasts a 6.6% Fall in House Prices

According to experts at Savills, a British UK estate agency, house prices in the country might see another decline next year as a result of increased property supply and decreased demand from cash-rich buyers. Savills expects up to 6.6% fall in house prices to be registered by mid-summer 2010, with larger declines in the North than in the South that can easily be explained by already existing differences in London property and the Midlands property. As for more long-term perspectives, Savills property experts believe that house prices will stabilise and grow by 2011, with faster progress seen in the South rather than in the North. In the time period between 2012 and 2015 house prices are expected to skyrocket by as much as 27% as a consequence of continuous shortage of property supply.

Dilbert: The Topper

Every office has one!

Citywire: House prices should fall more than 30%, says Blanchflower

Be wary of those who claim house prices are recovering, says David Blanchflower, professor of economics at Dartmouth College and a former member of the Bank of England's monetary policy committee. If we base our expectations on the house price to earnings ratio, we are likely to see a peak to trough drop of 30%, he warns - though in fact the correction typically overshoots.

Posted by jack c @ 04:47 PM 37 Comments

FT Alphaville: David Einhorn vs the bloggers on credit default swaps

David Einhorn the boy-genius founder of Greenlight Capital thinks the instruments which have served him so profitably ought to be banned outright. As he put it: I think that trying to make safer credit default swaps is like trying to make safer asbestos. The FT story prompted some of the bigger guns in the econo-blogosphere to take a position on either side of the CDS divide.

Daily Mail: £17bn, the true cost of house inflation

This article contains something of a non-sequitor since house prices and rents are not always in synch. I agree that the housing bubble needs deflating but surely the housing benefit problem is a separate issue? Perhaps housing benefit should be capped at the average rent for a 4-bedroom house in the UK (averaged over the whole country) so that claimants will have to switch "to a much cheaper and less convenient area" as the article points out most people have to.

Posted by tenant super @ 04:22 PM 11 Comments

BBC News: City Diaries

From the third contributor, Stephen: "Focus on positive "growth" in headline figures means that growth of any kind and any quality will do. No need to understand exactly what that growth involves. Just keep the numbers climbing and throw money at it if we have to. When growth is not positive, we believe we are being deprived. So if the numbers stop climbing, then we just print money to make the fandango continue ... In the West, growth in the mid-part of this decade was increasingly removed from the basic underpinnings of life. It was more about house prices than house quantities and more about the "service economy" and consumption than making hard goods."

The Motley Fool: The Coming Bubble of 2010 and How to Avoid It

This might excite a few contributors to HPC!

Posted by mr g @ 03:52 PM 6 Comments

The Economic Voice: Savills predict 27% increase in house prices over five years.

As has been reported in the press, buyers are outnumbering sellers five to one which may be creating a mini bubble after the deflation of the major bubble that reached its peak in 2007.

Posted by titaniccaptain @ 02:10 PM 22 Comments

Adam Smith Institute: It's new business, not business, which is important

Short article on unemployment as a fixed measure being misleading, there are jobs lost and there are jobs gained. Job attrition is usually steady(ish), and what we consider to be rising unemployment is really the absence of new jobs from new businesses. Suggests that the unemployment in the US and UK is mainly due to unaddressed drop in new businesses , not the attrition rate.

Citywire: House prices should fall more than 30%, says Blanchflower

well worth watching this vid - blanchflower is incredulous that house prices arent already falling

Zero Hedge: The Fed's Nemesis: Exter's $2 Quadrillion Of "Liquidity"

Another representation of what will likely become a prevalent topic in upcoming days: the Exter pyramid. When the system works, the various layers are in equilibrium. When the system is broken, like it is now, the Fed and all Central Banks try to refill the pyramid from the bottom-up with every single dollar they print. The current temporary calm is all Bernanke can hope to achieve before $2 quadrillion of liquidity collapses onto whatever truly tangible assets exist. They don't call it a pyramid scheme for nothing.

Posted by devo @ 12:25 PM 18 Comments

Tobin tax would destroy London without making the world safer: City AM

Towards the end of a reasonably well-informed article about the "Tobin Tax" and financial instability in general is this blinding insight: "... the housing bubble itself cannot be separated from policy decisions, as strict planning regulations make the supply of housing more inelastic and mean changes in demand are almost entirely reflected in prices" Yup. That's why no politician complained about the credit bubble - because it is a prerequisite for a house price bubble which creates the illusion of wealth in voters' minds and helps you get re-elected.

Posted by mark wadsworth @ 10:41 AM 9 Comments

Money Morning Australia: Britain and its Near Death Economy

In 1976, the UK government went begging to the International Monetary Fund (IMF) for £2.3 billion. In today’s money that’s the equivalent of around £12.4 billion. At the time it was labeled as an embarrassment for the UK, with claims it made the UK technically insolvent. Well, in practical terms apart from the much bigger number, there is little difference between the £2.3 billion bailout in 1976 and yesterday’s announcement that the Bank of England will increase its money printing programme to £200 billion

E1 News: Most Flexible UK Mortgage Lenders Listed

Despite the fact that the UK mortgage market has been considered extremely challenging in the past 2 years, most borrowers simply do not realise that different lenders offer flexible approaches to mortgages loans; borrowers just need to decide what they are looking for, and carefully research the market, just as the Times did.

Telegraph: Credit card rates set to rise

Lenders' current business models are ''unsustainable'' due to increasing bad debts, funding constraints and the toughest economic conditions for a generation, PricewaterhouseCoopers said. It said large scale change within the sector was inevitable during the coming few years, with credit cards likely to be transformed from borrowing tools into payment ones.

Posted by tyrellcorporation @ 08:09 AM 7 Comments

The Wall Street Journal: The Man Who Predicted the Depression

Ludwig von Mises was snubbed by economists world-wide as he warned of a credit crisis in the 1920s. We ignore the great Austrian at our peril today.

Posted by devo @ 12:47 AM 36 Comments

Telegraph: A glimpse at the scary world post-Quantitative Easing

Debt Management Office at a Treasury Select Committee transcript. The DMO is at pains to show that they will do anything to maintain a stable and gradually adjusting increase in yields. Presumably because any panic or even a sniff of it will take the form of an "ipso facto permanent" jump in yields i.e. yields jump unnecessarily from panic, government position looks real shaky due to higher servicing costs, shaky governments have to up yields on debt and so forth. A collapse in confidence.

Posted by stillthinking @ 08:17 PM 16 Comments

Spectator: Failing to address the banking crisis is hampering recovery

Good explanation of the bad effects of zombie banks. Over the last year by maintaining high mortgage charges over the base rate to cover defaults, the banks sucked out an additional 30 billion from the economy to cover their losses, aside from cutting credit availability generally. Plus charts depicting lending collapse.

Timesonline: Home Office covered up immigration risk

Labour's “open door” immigration policy knowingly risked allowing dangerous people to settle in Britain unchecked, according to documents seen by The Sunday Times. The Whitehall correspondence, which was illegally withheld by the Home Office for four years, shows how ministers were told by the country’s most senior immigration official that his staff were to be “encouraged to take risks” when granting visas, work permits and extended residency to hundreds of thousands of new migrants.

Posted by nopensionnohouse @ 06:55 PM 14 Comments

Telegraph: Biggest rise in car sales in 10 years

Unusual acceleration in car sales given that people make perfectly serious comparisons between our economy now and the great depression. Scrappage scheme and also VAT rise at Christmas bringing demand forward, also possibly fear of future inflation.

Telegraph: Bank of England says financiers are fuelling an economic 'doom loop'

The banking sector must be overhauled as profoundly as in the wake of the Great Depression or financiers will "game the state" over and over again, the head of the Bank of England's financial stability arm has warned. The banks have capitalised on the implicit state guarantee for the financial system. This is the latest incarnation of efforts by the banking system to boost shareholder returns and, whether by accident or design, game the state. The fact that governments repeatedly bail out economies and banks following crises also undermines their pledges of "never again". What is now required is "a financial sector reform effort every bit as radical as followed the Great Depression."

The Times: Secret £165bn loan keeping Lloyds alive

Lloyds is being kept afloat with £165 billion of loans and guarantees from the Bank of England and other central banks around the world.

Posted by devo @ 11:01 AM 33 Comments

Greg Pytel: Even more uncomfortable truth

The recent bail out of RBS to the tune of £25.5 bn went barely noticed. Last year it would have been massive news. There was additional QE, of £25, announced that "covered" that news and QE is not seen as government debt. However like a share split QE dilutes the national wealth. We, as the nation, seem to have got used to sinking into ever more massive debt. Pytel’s predictions appear to materialise. Although we all, I guess, wish that he is wrong. (Note the comment of Stephen Herring, Senior Tax Partner at BDO, below the article.)

Posted by ant @ 10:09 AM 10 Comments

Investment Postcards from Cape Town: Words from the (investment) wise for the week that was (November 2 – 8, 2009)

“A hesitant economic recovery, tame inflation and severe credit headwinds suggest that monetary policy will need to stay very easy for at least another year. Liquidity trends will not be a constraint on higher prices for risk assets for a while,” said BCA Research. Read more about this, together with some thought-provoking news items and quotes from market commentators during the past week, in the weekly “Words from the Wise” review: http://www.investmentpostcards.com/2009/11/08/words-from-the-investment-wise-for-the-week-that-was-november-2-%E2%80%93-8-2009/

Times: The great bank hold-up

Jason Strong wakes up at 7am every morning in his Taylor Wimpey home, swinging his legs out of bed on to his Carpetright carpet. His wife Jill is already showering in their Twyfords bathroom suite.

Telegraph: This financial mess isn't even the end of the beginning for UK wealth

Depressing and weird to be watching such economic suicide by Labour. The media are not parroting the return to growth line, just the reality that the UK is going to be a really bleak place to live and work for the next decade or more. New Labour won't even manage to drag things out to the election.

Posted by stillthinking @ 09:17 PM 8 Comments

FT: Bank landscape is still tainted by greed and hubris

Some choice quotes from this article: "With hindsight, it is clear that hubris and stupidity by senior British bankers played an important role in the current crisis." "A bigger issue is that banker greed and hubris will stunt UK growth for a generation. Bankers destroyed millions of retirement nest-eggs and will cause taxes to rise as well. These are high prices for the population to pay." "The sense of entitlement communicated by the Lloyds action defines the problem that the UK public still faces."

Posted by letthemfall @ 02:14 PM 7 Comments

Cnn: Five more banks fail - 120 for the year

Five banks failed late Friday, bringing the 2009 tally to 120. The biggest to fall was United Commercial Bank of San Francisco, which had 63 U.S. branches as well as operations in Hong Kong and Shanghai. The bank held deposits totaling $7.5 billion.

Guardian: Christine Lagarde: French model on the world stage

Largarde on the French approach to the crisis. Makes more sense to me than ours.

CNBC - Airtime 4th November: Prechter's Predictions

ok. So we have the following: 1. Might not be the top [but probably is] 2. Stay safe - stay in "cash" 3. Not at the "V" bottom yet 4. Make sure you are in "safe" institutions. 5. Markets are paradoxical - "sneaky" markets. 6. "Super" bullish on the dollar. My interpretation of what he says [i would underline what he says if i knew how to do it!] 1. Sell all longs - dont lose a fortune waiting for the last penny of the up move. 2. Only short futures and/or write puts / buy calls if you are willing to take a risk, and understand the riks involved. 3. Possibly buy some greenbacks - or trade the Dollar index or individual crosses. 4. Get out of commodities - oil in particular is toppy.

Posted by techieman @ 10:01 AM 12 Comments

CNBC- Airtime 3rd November: Charting the Aussie Dollar

Yes yes she is a chartist... infact she wrote the main text book on the icky moko thingy cloud (as opposed to cloud computing). Some of you may find this of interest some not. If not then ..... dont read it! [and you thought i was going to apologise]. Will also put in one of Bob Ps interview [November 4th] on another post. Why am i posting now? Well personally i think its a high probability that we have had the high - since the March lows. If not then a break of the high will give us the final suck in. Natural FTSE support around the 5k level, so this so far is a bounce..... I wont bore you with my specific areas to look for nor my positions.

Guardian: BRitish Airways Makes record loss

Now that is how to run a business. BA are losing £1.6 million pounds a day!!!! Mr Walsh, as I understand, has a basic salary in teh region of £750,000 and apparently is sh@t at his job. I mean, if my company lost twice my salary every day would I still be in a job?

Times: How to get a mortgage that is six times your salary

"Homeowners have seen the mortgage market change seemingly irredeemably in the past two years, as lenders batten down the hatches and restrict the availability of deals. However, banks and building societies are more flexible than many borrowers realise. It is still possible to secure a loan worth up to six times your income, to have your entire bonus considered as part of your salary and to have your application fast-tracked ".

The Telegraph: When economists get nasty

This is war. Usually relations between City economists are pretty clement. They disagree on most things, but that’s par for the course for a profession where, as they say, if you put four of its practitioners in a room and ask their opinion, you come out with five different answers. But the knives have come out in an unusually vicious way between two of the City’s leading forecasters: Goldman Sachs and Fathom Financial Consulting.

Posted by devo @ 10:42 PM 16 Comments

UK Property Auctions: Is now a good time to buy?

At a time like now, with the economy in a bit of a mess, potential homebuyers may be wondering if now is a good time to buy. Well, as I discovered myself, the answer isn’t a simple yes or no, and buying a house now has a few advantages and disadvantages you should take a look at before you consider making a move.

Newsweek: Boom and Gloom, New Market Bubble is Brewing

"An echo bubble. It's a term economists use to describe the smaller bubbles that follow on the heels of major ones, usually after the authorities helicopter in loads of cash to patch up the first round of damage, setting the stage for a second round of easy-money-driven speculation ... On average, they reach about 30 to 40 percent of the size of the original before bursting and sending market values back down to where they should have been all along ...This rally is not driven by giddy investors convinced they are grabbing a piece of the future, but by wary buyers trying to make back their losses, hoping to profit from a government-subsidized gravy train that they know will come to a halt sooner rather than later."

Bloomberg: Reed Apologizes for Glass Steagall Repeal, Building Citigroup

“I’m sorry,” Reed, 70, said in an interview yesterday. “These are people I love and care about. You could imagine emotionally it’s not easy to see what’s happened.” “I would compartmentalize the industry for the same reason you compartmentalize ships,” Reed said in the interview in his office on Park Avenue in New York. “If you have a leak, the leak doesn’t spread and sink the whole vessel. So generally speaking you’d have consumer banking separate from trading bonds and equity.”

Posted by tyrellcorporation @ 02:17 PM 10 Comments

Bloomberg: Unemployment in U.S. Jumps to 10.2%, Payrolls Fall

The unemployment rate in the U.S. soared to a 26-year high of 10.2 percent in October and employers cut more jobs than forecast, underscoring why Federal Reserve policy makers say interest rates will remain near zero

Posted by tyrellcorporation @ 02:10 PM 6 Comments

Telegraph: Everything you need to know about the economy in four pictures

As we all know, the Bank of England is creating money (it doesn’t like to call it “printing” but the net result is the same) like gangbusters. This morning it committed to creating a further £200bn of the stuff. Now, what alarms many of you, and rightly so, is the fact that it is using this money to buy Government debt.

Guardian: UK producer input price inflation jumps in Oct

The Office for National Statistics said input prices rose 0.1 percent on the year after a 6.2 percent annual fall in September, confounding analysts' expectation for a decline of 1.3 percent. The figures suggest pressures are building up at the start of the inflation pipeline. The Bank of England expanded its quantitative easing programme on Thursday but said it expected inflation to pick up sharply in the near term. The pick-up in input price inflation was driven by a 0.8 percent annual rise in crude oil prices, the biggest increase since October 2008.

Posted by cat and canary @ 12:46 PM 9 Comments

Spectator: Printing money is not the solution

"With another £40bn disappearing down the black hole known as the British Banking sector, the financial cost of the economic and banking collapse is now only rivaled by the two World Wars in it’s cost to the UK taxpayer"

Posted by mken @ 12:03 PM 23 Comments

Yahoo: BA To Slash 1,200 Jobs After £292m Loss

He said the struggling company was now planning to axe an extra 1,200 positions as it rides "along the bottom" of the recession. The airline had already revealed plans to cut 3,700 positions by next March. The new figure, which the airline said had come as a result a high response from staff wanting to work part-time or take voluntary redundancy, will take that total to 4,900.

BBC: Personal insolvency rises by 28%

A record number of people were declared insolvent in England and Wales in the third quarter of 2009, according to figures from the Insolvency Service. There were 35,242 personal insolvencies, up 28% from the same period last year and an increase of 6.6% on the previous three months. This extended the record number recorded earlier this year................businesses going bust in the third quarter of the year was still 14.6% higher than the same period a year ago.

Metro: Five buyers chase every home on sale

"There are five potential buyers chasing every property on the market as demand continues to outstrip supply. But that high level of demand has not translated into increased sales during October. Estate agents are selling an average of 7.7 properties each, down from 8.5 in September, figures from the National Association of Estate Agents show. But the rate at which new buyers are entering the market may be slowing. There are few signs of more properties coming on to the market during October, with estate agents seeing their average stock levels dip to 57 per branch. It is the lowest level since July 2007 and down from 62 in September. 'It is now up to the government and the banks to do more to keep the momentum of market recovery going,' said Gary Smith, president of the NAEA."

Posted by mark wadsworth @ 09:53 AM 47 Comments

FT: Short View: Yield curves

Concise article on how QE is holding down long gilts, but worries on inflation and smaller than expected increase to QE is pushing them up. More expensive mortgages down the track.

Marketoracle.co.uk: Telegraph UK House Price 55% Crash Forecast Revisited

Back in March if this year the Telegraph and other mainstream media ran with a scare story that UK house prices could crash by a FURTHER 55%, this was after UK house prices had already fallen by 22% and whilst house prices had yet to bottom the Telegraph story at the time seemed to be a completely ridiculous scare mongering purely for the purpose of sensational headline grabbing rather than presenting something that their readership could utilise to their advantage.

E1 News: Buy to Let Landlords to Face More Arrears – Landlord Assist

n the opinion of experts from Landlord Assist, British organisation for tenant eviction, landlords should not expect any improvements on the buy to let market in 2010. Landlord Assist predicted that an average of 150,000 tenants will face court actions by the end of 2009, meaning that the market of rental property still has a lot to live through before it stabilises. Landlord Assist’s forecast comes right after the report published by the National Landlords Association, which revealed that almost 75% of UK landlords have had tenants in arrears, with 43% of respondents admitting that they faced arrears in the past 12 months.

E1 News: Northern Rock Activity Picks Up in the 3rd Quarter

A report suggesting that Northern Rock’s business picked up followed formal government’s order to split the bank in two parts and sell its “good” assets. Bank’s management claimed that the restructuring proposed by the government is on the way and will be completed by the end of this year.

BBC: More house price falls forecast

"The Savills' report suggests that there is a 50% probability of prices falling 6.6% next year, followed by a return to price rises thereafter. Prices will rise by 2.7% in 2011, 5.5% in 2012, and 8% in 2013, according to the forecast. " I'd love to know how their model works given that it can give something a accurate as 8% rise in prices in 2012. Anyway, doesn't the fact that Savills think prices are going to fall slightly mean they're actually about to fall off a cliff?

Phdinbubbles: RBS bank reports losses of £2.2bn

"Royal Bank of Scotland Group, which is 70%-owned by taxpayers, has reported a pre-tax loss of £2.2bn for the three months to the end of September."

Posted by phdinbubbles @ 07:27 AM 6 Comments

Bloomberg: World’s Central Banks Signal End to Emergency Policy ‘Largesse’

A brief description of the obvious outcome of the next 6 months. Classic GS Jim O'Neill quote, i.e. I haven't got a clue but they will have to do something sometime and it might not be right but I think it will be good.

Harvard Blogs: The Coming Collapse of the Municipal Bond Market

Without bankruptcy protection, a city that couldn’t pay bondholders would be forced to raise taxes until it could. This happened to West Palm Beach, Florida in the Depression and property tax rates rose to 42.5 percent of assessed value. [Of interest to the LVT crowd!] Potentially bondholders might demand that the city hand over real estate to satisfy its debts. With bankruptcy protection, it is unclear what happens. If cities can walk away from debt they’ll have every incentive to declare bankruptcy and start afresh. There are no shareholders in a city to wipe out and therefore the only negative consequence of a bankruptcy filing would possibly be having to pay higher interest rates for future borrowing.

Irish Times: That 40% drop - it's already happened

Economists have predicted that house prices have to fall by at least 40 per cent from their peak of 2006 but house builders say that’s already a reality..in Ireland, so whats to stop it happening here, are we different or are the Irish just ahead of us?

You Tube - sorry!: Peter Schiff: Americans must prepare for deepening unemployment, inflation and possible breadlines

Actually i think the interviewer is quite cute. Dont agree with everything he says but he is interesting.

Posted by techieman @ 10:00 PM 6 Comments

Guardian: Zombie economy promises frights in store for us all

Neither alive nor dead, the UK economy staggering along courtesy of taxpayer billions, low interest rates and a short-term VAT cut is in Zombie Limbo Land. Artifical resuscitation has got little more than a twitch out of the corpse and even if Frankenstein's monster comes twitching back to life in the final three months of 2009, the outlook for 2010 is not good

Posted by enuii @ 09:16 PM 6 Comments

London Evening Standard: Quintain back in profit but warns of trouble ahead for the property market

London-focused developer Quintain Estates today swung back into the black, but warned there could be “trouble ahead” for the commercial property market. It came as Quintain joined the property sector's dash for cash, announcing plans to raise £191.2 million. Chief executive Adrian Wyatt said the cash call means it is now prepared for the possibility of a double-dip recession. “In any recession, there are always late problems such as bankruptcies, but we now have enough firepower to withstand any further problems,” he said.

This is Money: Why house price bears shouldn't worry about immigration

"I've been asked several times if I'm concerned about last month's 'forecasts' from the Office of National Statistics that the UK population will grow from 61m to 72m by 2033. Surely this rise, a result of Brits having more babies but mainly due to immigration, would drive demand for property, especially in the south-east of England, where these migrants are most likely to find well-paid work. Here's two reasons why you should treat this assumption with suspicion."

Telegraph: Bank of England expands money printing program to £200bn to fight downturn

Article giving bizarre justifications for expanding QE such as 'we don't know if it's working so lets continue anyway'. Is the UK run by the muppets or being destroyed from within by a load of cryptomarxists?

Russian Evening Standard: Buy Now Sell in 2015

Lucian Cook hang your head in shame.

Telegraph: Joe Swash of I'm a Celebrity made bankrupt as personal insolvencies set to 'break all records'

Shocking rise in number of personal insolvencies after decade under 'prudence' Brown. Wait for next year when TSreallyHTF.

Posted by chrisa @ 12:41 PM 6 Comments

MoneyWeek: Watch out: the housing market is about to turn back down

House prices are rising once again, bullishness is back, estate agents are running low on stock, and the practice of gazumping has returned. In other words, 'normal' practice has been resumed. Look at the main stages of a bubble above and see what happens shortly after things 'return to normal'.

Posted by rob moore @ 12:38 PM 15 Comments

FT Alphaville: The US debt to GDP balance, and China

"It is worth noting that in order for USA to keep the debt at 100% of GDP while still increasing it at the 2010 rate of 9% per year, it is necessary to grow the GDP at 9% per year in current dollar terms. This means that if the GDP grows at 3% per year in real terms, prices have to inflate at 6% or else the debt will grow as a fraction of GDP." - What can China do? "a) Do nothing; b) Change the degree of linkage of the yuan and the dollar c) Buy gold instead of dollars d) Go someplace else, purchasing the debt of other countries. – Which leads Ross to conclude: China cannot solve its balance of trade surplus by purchasing debt instruments in quantities much out of line with the surpluses themselves. The only sure way China can move away from US debt purchases is to .... "

Mail: Bank throws another £25bn at recession

Never would have thought moving a few electrons would make such a difference - if only they had to print the stuff at least some jobs would be created

Posted by matt_the_hat @ 12:05 PM 25 Comments

BBC: Extra £25bn to stimulate economy

The Bank of England's rate-setters have decided to pump an extra £25bn into the economy in their quantitative easing (QE) programme. They also kept interest rates unchanged at 0.5% for an eighth month. The Bank has already spent £175bn on QE, which involves printing money to buy assets from banks and other companies to stimulate the economy.

Posted by jack c @ 12:03 PM 9 Comments

MoneyWeek: Watch out: the housing market is about to turn back down

Normal practice has resumed - that's cause for concern So any former housing bears who are considering throwing in the towel at the strength of this rally in housing should refer once again to Jean-Paul Rodrigue's 'Main stages in a bubble' chart (see below). In fact, every investor should blow this chart up and put it on their wall.

Moneyweek: Watch out: the housing market is about to turn back down

Moneyweek chappie explains why the housing market could be about to resume downtrend.

Business Insider: The Homebuyer Tax Credit Is Officially Extended And Expanded

This gift of $8,000 used to be for first time buyers only, now it's extended to everyone. The problem is that those that would have bought anyway get some free money too. Of the 1.4m claimants so far of $8,000 credit, only 400,000 bought because of the credit. Therefore each of these 400,000 homes cost the taxpayer $28,000 to get sold. The UK would love to do this too I'm sure, but hopefull can't afford it.

Telegraph: Bank of England expected to expand money-printing programme to £225bn

Should the MPC today vote to expand the money-printing programme, the increase would mean the Bank would soon be holding bonds worth more than 15pc of Britain's entire economy in its balance sheet – unknown territory for any developed world central bank in modern history. Gilt traders and foreign-exchange traders will be watching closely when the decision is announced at noon.

City AM: Bubblenomics is back with a vengeance

"Earlier this year, I wrote a column in this space arguing that the housing market in the UK was no longer over-valued, based on historic price to earnings ratios and a range of other evidence, including the fact that yields on rented flats were higher than mortgage payments again. I spoke too soon. Since then, house prices have jumped by about five per cent, taking the trough-to-peak rise this year to around seven per cent, which is ridiculous and cannot be justified by the fundamentals. Unfortunately, this means that house prices are now clearly over-valued again, with home owners and investors convincing themselves that property is once more a one-way bet (a deeply dangerous conceit)...."

Times: Northern Rock 'bad bank’ will make thousands of home loan borrowers financial prisoners

Many thousands of Northern Rock mortgage borrowers will become financial “prisoners”, dumped into the rump of the lender’s so-called bad bank, it emerged yesterday. Giving evidence at the House of Commons Treasury Select Committee yesterday, Keith Morgan, head of wholly owned investments for UKFI, the body set up to manage government stakes in Britain’s state-controlled banks, said that the process to carve up Northern Rock before a private sale would leave about 85 per cent of mortgage borrowers trapped within a business that was being run down.

Posted by jack c @ 09:19 AM 8 Comments

Telegraph: RBS bankers threaten exodus over bonus policy

His defence of bonuses echoes comments made by John Varley, chief executive of Barclays, who insisted “profit is not satanic” in a speech at a Westminster church on Tuesday night. “Talent is highly mobile,” he said. “If we are constrained from paying competitive rates then talent will move to another employer.” ...Disgusting abuse of power. -------- Yep, all those brainy young graduates that you and your cronies pollute John "Lucifer" Varley might even go move to a socially useful employer, like a science, engineering, teaching, law, IT employer?

Posted by cat and canary @ 08:10 AM 9 Comments

E1 News: Northern Rock Mortgage Borrowers Should Not Expect Government’s Support

According to the statement made yesterday by the House of Commons Treasury Select Committee, thousands of mortgage borrowers of the Northern Rock bank will have few or no financial options left as they will stay with the “bad bank” – Northern Rock Asset Management. An average of 85% of Northern Rock borrowers, or 476,000 people, will stay with the bank that is slowly collapsing. There mortgage borrowers will be transferred to the “bad bank” as they will be unlikely to remortgage with any other lender. Meanwhile, Northern Rock Asset Management is not expected to offer any new mortgage deals to its existing borrowers.

Telegraph: MPC’s 'feeble six’ need to do their jobs before the economy falls off a cliff

"For some reason the rest – the "feeble six", as I have called them – voted to not follow their remit. In the next two meetings the MPC voted unanimously to do nothing. As a result, the pound has fallen and the yield curve has dropped a little a year or two out.

Posted by cat and canary @ 07:58 AM 9 Comments

Daily Express: FIRST-TIME BUYERS HELP TO BOOST HOUSE PRICES

FIRST-TIME buyers are flocking back to the property market, boosting prices and sales, it emerged yesterday. More than a year after they ­virtually disappeared – accelerating a slump in values and transactions – they have been tempted back by record low interest rates and falling costs of moving. News that first-time buyers are re-entering the market is a sure sign of ­market recovery and reflects the pent-up demand from people waiting for the right time to take that first step on to the property ladder. With property prices no longer falling, many have decided to buy their first home before they rise again. And with official interest rates at just 0.5%, money does not earn much in the average savings account, so investing in bricks and mortar looks like a better bet once again.

Posted by little professor @ 01:59 AM 12 Comments

Wall Street Journal: Crisis Compels Economists To Reach for New Paradigm

When banks set margins very low, lending more against a given amount of collateral, they have a powerful effect. Using large amounts of borrowed money, or leverage, buyers push up prices to extreme levels. Because those prices are far above what would make sense for investors using less borrowed money, they violate the idea of efficient markets. But if a jolt of bad news makes lenders uncertain about the immediate future, they raise margins, forcing the leveraged optimists to sell. That triggers a downward spiral as falling prices and rising margins reinforce one another. Banks can stifle the economy as they become wary of lending under any circumstances. [There's a nice graph in the article too.]

Guardian: Tories "castrate" UK

Le Rosbifs sont toujours bizarre. Est-qu'il-y-a le maladie des vaches fous?

Posted by chrisch @ 10:19 PM 21 Comments

Cnbc.com: 'Mother of Carry Trades' Leading to 'Asset Bust':

"It's going to eventually occur but it's going to be six months from now, a year from now," Roubini said. "In the meanwhile the bubble's going to become bigger globally and the bigger the bubble the bigger is going to be the crash."

BBC: GM plans to cut 10,000 Opel jobs

General Motors (GM) has confirmed that it plans to cut 10,000 jobs across its European car unit Opel, which includes the Vauxhall brand in the UK.

Posted by rumble @ 08:12 PM 7 Comments

Investors.com: Commercial Real Estate Loans A Growing Problem For Banks

In an Oct. 28 report that has attracted the attention of several government agencies, Parkus predicted that "many hundreds" of banks will fail due to their exposure to commercial real estate. On Friday, billionaire Wilbur Ross lent his voice to those predicting a "huge crash in commercial real estate," Bloomberg reported. Fellow megainvestor George Soros predicted a "bloodletting."

Times: Taylor Wimpey ready to raise house prices

Taylor Wimpey, the housebuilder, said market conditions had improved so much that it had already sold all of its stock of homes for 2009 and was looking forward to raising prices on houses to be sold next year. The upbeat statement mirrored rival, Redrow, which said that it expected its average prices to start increasing soon. Yesterday, Halifax said that house prices rose by 1.2 per cent in October to an average £165,528. Taylor Wimpey said: "Our sales focus remains on achieving price increases as we build our 2010 order book." The company's selling price for private homes rose 9 per cent from the £163,000 price achieved in the first half, helped by deliberately raising the proportion of houses to flats it sells as well as price inflation.

Posted by mark wadsworth @ 04:44 PM 16 Comments

Telegraph: Gold prices hit new high on Indian deal with IMF

India buys 200 tonnes of gold from the IMF. Or India sells dollars worth 200 tonnes of gold. But why does India get this and not China? India has potential inflation problems specifically hitting food prices, not assets, and a culture of physical gold holding. Food inflation is a killer for currency confidence, which is why I think Merv is pumping assets instead. Browns gold sale would be worth today 8 billion sterling. He got 2 billion. I still think gold collapses next year along with everything else, but if everybody gets gold fever then, I suppose not.

The Market Oracle: Nouriel Roubini's 2009 Stock Market Calls Track Record

Nouriel Roubini, Dr Doom the academic economist who has repeatedly peddled the stocks bear market case to a captured audience of naive investors has again come out with another in a series of Doom stories to scare investors away from the market.

The Economic Voice: Property millionaires take a pounding

Zoopla , a property market website, has conducted a survey that indicates that the number of residential properties worth more than £1m has decreased from 1 in 97 before the crunch to about 1 in 150 today. Zoopla estimates this to mean that 35% fewer properties are worth more than £1m than before Nov 2007.

The Real News - youtube: How Goldman secretly bet on the U.S. housing crash

Goldman Sachs first securitized sub prime morgages, then sold them. during 2007 they sold off their exposure and took out a 20 billion dollar hedge with AIG that they would fall. Heads they win, tails we loose... Now there is a conspiracy theory I can agree with crunchy on

Posted by the number cruncher @ 01:46 PM 6 Comments

The Economic Voice: A confused housing market

We seem to have reached an uneasy equilibrium between those that wish or need to sell and those that want and can afford to buy.

Posted by titaniccaptain @ 12:36 PM 31 Comments

Telegraph: MPs expenses: MPs banned from taxpayer-funded property deals

Members will no longer be able to claim for their mortgage interest payments as part of the expenses crackdown, and the controversial practice of "flipping" properties should no longer be allowed.

E1 News: Halifax Reports a 1.2% Rise in UK House Prices

UK mortgage lender – Halifax – has just published its latest overview of UK house prices for October 2009, which marked the 4th successive month of house price rises. Moreover, the research of the market showed that the increase registered in October was almost twice as expected. Let us remind that UK house prices increased by 2.9% since January 2009; market analysts expected to see a 0.7% rise in house prices last month; however, house prices jumped by 1.2%, leaving an average British house priced at £165,528.

E1 News: Mortgage Lender Fined £10.5 Million by the FSA

The Financial Services Authority (FSA) recently fined one of the mortgage largest lenders that came onto the UK mortgage market in 1998, GMAC-RFC, part of General Motors. The lender was ordered to pay £7.7 million plus interest to its borrowers and a fine of £2.8 million for unfair treatment of 46,000 of mortgage borrowers in arrears.

FT: Private behaviour will shape our path to fiscal stability

Technical article on the make up of the deficit and how to get out of it. Wolf not optimistic. (To view article delete FT cookies. If that doesn't work go to FT home page and click article link in banner)

Market Oracle: Trillion Dollar Ticking Derivatives Time Bomb to Explode Under Bankrupt Banks

The current notional value of derivatives on US commercial banks’ balance sheets is $203 trillion. 97% of these ($196 trillion) sit on FIVE banks’ balance sheets. If 4% of derivatives are “at risk” and 10% of those bets go bad, you’ve wiped out ALL OF THEIR EQUITY and they go to ZERO.

Posted by sold 2 rent 1 @ 09:59 AM 21 Comments

Grauniad: Northern Rock trading better despite rise in mortgage defaults

"Northern Rock claimed today that its financial performance is improving despite another rise in the number of customers failing to repay their mortgages. The nationalised bank, which is to be split up, announced that trading since the start of July was considerably better than in the first half of the year – when it suffered a £724m pre-tax loss."

Telegraph: UK interest costs 'equal to entire Transport bill'

"The surprising bluntness of the warning... will be seen as a direct rebuke to Gordon Brown, who repeatedly ignored IMF advice in previous years to cut the deficit and leave the UK better-placed for future downturns." "In 2007 the proportion of tax revenues devoted to paying debt interest was just 4.2pc. This will increase to 8.3pc by 2014."

New York Times: Gold Eases After Records Hit - $1080 an ounce

'Gold eased on Wednesday as investors took profits a day after it hit record highs despite the dollar's strength, but sentiment improved on bullion's growing status as a destination for a diversifying official reserves.'

Posted by hpwatcher @ 08:37 AM 52 Comments

Marketoracle: Telegraph UK House Price 55% Crash Forecast Revisited

Not sure how he gets from £210000 to £130000 with only an overall 21% fall ? Its more like 35% isn't it? Certainly he's depression graph looks fairly impressive, but then what would a bear of little brain know

Posted by sybil13 @ 07:40 AM 8 Comments

The Times: House prices go up again, but fears grow that economy cannot sustain rise

Hopefully not another thread of 80 youcopy posts coming, it would be interesting to see where we think (in the real world, not the Armageddon world) the next months will go - and why. I can see the tidal wave of insolvencies getting hold and the laying off of staff growing to eventually swamp all these green shoots.

Posted by growler @ 07:36 AM 19 Comments

The Telegraph: Lisbon Treaty: more of Britain's powers surrendered to Brussels

“Europe can now move forward. The Treaty will allow effective European action in areas where solutions are urgent, such as the financial and economic crisis, climate change and energy”

Posted by devo @ 07:06 AM 7 Comments

Telegraph: £4,350 per family to bail out Britain's banks

As the new bail-out will have to be funded by government borrowing it can only be repaid through cuts to public spending or substantial tax rises over the coming years and despite consumers picking up the bill for yet more billions for the banks, experts said that the money would still not be enough to get them to increase lending to struggling home owners and businesses. So why is lending money to struggling home owners the answer to all our problems?

Posted by enuii @ 10:49 PM 7 Comments

BBC: HSBC to cut 1,700 jobs in the UK

The job losses will come from retail banking, but will come from support services rather than branches, an HSBC spokesman told the BBC.

Record number of Britons to be declared insolvent: Telegraph

Mark Sands, personal insolvency experts Tenon Recovery's national head of bankruptcy, said: “I expected this year to be the worst on record but even I have been stunned by the level of personal insolvencies - we are sailing past the previous record and still have more than two months of the year to go. At this rate we expect to see as many as 130,000 personal insolvencies over the whole of 2009, an increase of 22 per cent on the levels seen in 2008. Even with interest rates close to zero, the effects of the downturn combined with the massive build up of consumer debt in the good years have created ‘a perfect storm’ that is sweeping more people into personal insolvency than ever before."

Posted by wanderinman @ 07:01 PM 14 Comments

Guardian: A high price for hiding the truth

Behind this complex restructuring of Lloyds and RBS, the British taxpayer will still pick up the tab for bankers' failure

Counterpunch: Why the crisis isn't going away

Capital flows into paper assets trigger debt-based speculative booms and bubbles. When the debts cannot be paid or rolled over the bubbles crumple, leading to a credit crunch, asset-prices plunges, market crashes and unemployment. But wait, governments have found ways to fix all that - except the unemployment bit. US Fed support has enabled the financial sector to maintain its debt level at $16.5 trillion while giving the appearance of deleveraging (by enabling the sector to expand its equity base). This debt level keeps asset prices artificially high so that 1) finance can maximise its profits via risky investments (normally a correction would dampen such investments) and 2) consumers' 'wealth effect' remains largely intact. Oh, and the real economy goes down the toilet.

Lloyds HBoS: Lloyds HBoS Oct 09

Up 1.2% MoM

BBC: House prices 'rise another 1.2%'

UK house prices rose by another 1.2% in October, which was the fourth monthly increase in a row according to the Halifax. The bank said that at £165,528 the average price of a UK house was still 4.7% lower than a year ago. Since the spring house prices have been recovering from the sudden slump caused by the international credit crisis. The Halifax said prices were rising because of a combination of increased demand and fewer houses for sale.

Posted by jack c @ 01:21 PM 27 Comments

Halifax: +1.2MoM -4.7YoY

Commenting, Martin Ellis, housing economist, said: "House prices increased by 1.2% in October, marking the fourth consecutive monthly increase. Nationally, house prices have risen by 2.9% since the end of 2008. They are now 7.1% higher than six months ago when prices reached a trough in April."

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 64 Comments

E1 News: Future Changes for RBS, Lloyds and Northern Rock to be Announced

Today, on November 3rd, the Government will reveal the final details of the future of 3 UK banks that received state aid earlier this year: Northern Rock, Lloyds Banking Group, and Royal Bank of Scotland. Let us remind that the state aid to these banks, which amounted to £585 billion in insurance policy, was granted on a condition that UK banks commit themselves to a number of changes to improve competition.

E1 News: UK Commercial Property Market Flooded by Foreign Investors

Property and investment experts are determined that the sector of UK commercial property might soon face fierce competition from funds looking to buy prime properties, which are expected to come onto the market in the next couple of years. In particular, the British market of commercial property seems attractive to foreign investors. Mr. James Thornton, Mayfair Capital Investment Management’s founder, explains that the UK commercial property market became extremely liquid for overseas investors not only because property values dropped by as much as 45%, but also because sterling pound fell against the euro, the US dollar, and the yen.

The Australian: RBA lifts interest rates by 25 basis points to 3.5pc

THE Reserve Bank has delivered a second interest rate rise in as many months, as it attempts to moderate the economic recovery. The decision to lift the official cash rate by 25 basis points to 3.5 per cent is expected to add about $50 a month to the repayments of an average home mortgage. The increase, which followed the RBA's move to raise rates in October, was widely expected by financial markets and economists, especially after house prices rose by 4.2 per cent in the September quarter.

Posted by monty @ 07:20 AM 7 Comments

HousingExpert: September numbers

Here's the regular summary of the housing market that takes the reports from Rightmove, HMRC, Land Registry and Halifax. Ignore what you heard from the Nationwide last week, there is still much pain in the market and clearly there is much uncertainty to come. This guy seems to have a clear and unbiased view. Useful info.

The Times: Restructure of banking sector set to cost taxpayer an extra £40 billion

The Government will today announce plans to inject a further £40 billion of taxpayers’ money into Royal Bank of Scotland and Lloyds Banking Group as part of a fresh, wide-ranging restructuring of the UK banking sector.

Posted by quiet guy @ 01:45 AM 8 Comments

Times Online: UK population must fall to 30m, says Porritt

JONATHON PORRITT, one of Gordon Brown’s leading green advisers, is to warn that Britain must drastically reduce its population if it is to build a sustainable society.

Posted by crunchy @ 12:48 AM 66 Comments

Telegraph: A property is repossessed every 11 minutes, according to Credit Action

Striking Numbers: * 9,300 - number of new debt problems dealt with by CAB each day. * £58,340 average household debt (including mortgages). * £182m interest paid in UK daily. * Every 11.5 minutes a property is repossessed. * 2,553 people made redundant every day. * 1 person every 3.97 minutes declared bankrupt or insolvent. * £4,110 a second increase in Government national debt.

Www.BBC.co.uk: Lenders ease mortgage rationing

'lenders have lost some of their fear of losing ever larger sums of their money '. Could that be because there is little or no accountability for those responsible for irresponsible lending??? Have they not learnt anything???

Posted by markj69 str05 @ 10:18 PM 6 Comments

Guardian: Northern Rock - Why should taxpayers be paying to inflate the housing market?

"Whatever all those bankers are putting in the tea over at HM Treasury, it must be pretty strong stuff. How else can you explain the bizarre decision today to spend £8bn of taxpayers money on re-inflating the housing market? I thought I was having a hallucination myself when I first saw the announcement this morning, but no, this is exactly what it seems: the government is proposing to invest yet more of our money in the infamously over-extended Northern Rock to allow it to lend guess what? - yes, more mortgages. Chief executive Gary Hoffman was very clear when I asked him about it too: the aim is to support the housing market, which he says is weaker than it looks, and make the bank more valuable when time comes to sell it."

Posted by wanderinman @ 07:14 PM 11 Comments

Guardian: House prices, It's not just a British thing

A property bubble is hitting cities across the world. But is it here to stay, or are we on the cusp of a double dip? To the dismay of virtually everyone except estate agents, buy-to-let merchants and Kirstie Allsopp, house prices in Britain are defying economic reality and marching up again. And, sadly, we are not alone. In cities across the world (and it's nearly always cities rather than their hinterlands) property speculation is once again rife. The one positive spin-off from the global credit crunch – that family houses might once again become affordable – is disappearing fast.

Telegraph: Royal Bank of Scotland to cut 3,700 branch jobs

Royal Bank of Scotland, the bank rescued by the taxpayer, is to cut 3,700 jobs among its branch staff.

Posted by flintster1994 @ 05:41 PM 8 Comments

BBC: School place cheating 'folklore'

Dear School Master: May I kind remind you that we are the liar loan generation. If we can lie about our mortgage, what makes you think that we won't lie about other stuff? So get used to it.

MoneyWeek: Taxpayer-owned banks still look a bad bet

Banks that were rescued by the taxpayer must now be broken up and sold off, say EU competition authorities. But what does it all mean for bank shareholders?

BBC Radio 4: Repossessions in the Sun

Ray Furlong visits Spain's Mediterranean resorts to hear how members of the country's one million-strong British expatriate community are weathering the recession. High unemployment in the construction and tourist sectors means that boom-time on the Costas is over, translating into increased home repossessions and divorce rates.

FT: Mother of all carry trades faces an inevitable bust

Roubini says that the dollar carry trade is forming bubbles in all assets and expects a big collapse in the lot.

Posted by letthemfall @ 03:42 PM 8 Comments

BBC: Lenders ease mortgage rationing

"Lenders have been making it slightly easier for borrowers to take out a mortgage, according to the financial information service Moneyfacts. The number of mortgages requiring a minimum 15% deposit has risen from 189 in the past month to 226, the highest number for more than a year. At the same time the number of mortgages requiring a 20% down-payment has fallen, from 136 to 117. However 66% of mortgages still need at least a 25% deposit."

Las Vegas Sun: The new faces of day labor

In the latest sign of the Las Vegas Valley’s economic free fall, U.S. citizens are starting to show up in the early mornings outside home improvement stores and plant nurseries across the Las Vegas Valley, jostling with illegal immigrants for a shot at a few hours of work. Experts say the slow-starting but seemingly inexorable trend is occurring nationwide.

MorningStar UK: 8 reasons why you shouldn't buy a house

If you have been trying to decide whether to buy or rent, you know there is no easy answer. The decision depends on a variety of personal factors, including your finances, geographic location, and life situation. Before it became obvious we were in the midst of a housing bubble in 2007, conventional wisdom portrayed home-ownership as a sure-fire investment. Home values that were widely expected to continue rising and loose, plentiful credit clearly attracted many who were not really in a position to buy.

Posted by ellipse @ 09:45 AM 9 Comments

Reuters: House prices down 4.2 percent

House prices fell at their slowest annual rate since June 2008 in October, dropping 4.2 percent

Citywire: Yet another house price survey suggests more pain ahead

FT article today also said re Hometrack: 'Richard Donnell, director of research, said recent surveys showed a marked slowdown in the rate of growth in the volume of new buyers registering with agents. "This suggests that the pent up demand that has boosted the market in recent months is starting to fade in the face of firmer pricing and fewer clear bargains." Price rises have been concentrated in just 16 per cent of the market, primarily in London, with prices remaining static across the remaining 84 per cent of the country' Are the cash rich dwindling and the others just waiting for property to actually become AFFORDABLE? I am wondering if this could be the week that sentiment really starts to reverse

Posted by sybil13 @ 07:48 AM 22 Comments

E1 News: Nationwide Urges Mortgage Borrowers to Act Quickly

n its latest statement, one of the leading British building societies – Nationwide – reminded its potential borrowers and mortgage brokers that the deadline of the Stamp Duty Holiday is approaching, which means that those who still wish to benefit from this tax break should apply for a mortgage shortly. Let us remind that the British government increased the stamp duty threshold to £175,000, up from £125,000, last September; the stamp duty tax holiday will, however, end on the last day of this year, December 31st unless the UK government extends it, which it might do this month.

Telegraph: It is Japan we should be worrying about, not America

Japan is drifting helplessly towards a dramatic fiscal crisis. For 20 years the world's second-largest economy has been able to borrow cheaply from a captive bond market, feeding its addiction to Keynesian deficit spending, and allowing it to push public debt beyond the point of no return. The IMF expects Japan's gross public debt to reach 218% of GDP this year. This has been manageable so far only because Japanese savers have been coerced into lending for almost nothing. "The debt situation is irrecoverable, I don't see any orderly way out of this. They will not be able to fund their deficit. There will be a fiscal shutdown, a pension haircut, and bank failures that will rock the world. It is criminally negligent that rating agencies are not blowing the whistle on this."

Posted by drewster @ 11:57 PM 11 Comments

Times Online: Britain needs ‘£350bn of tax rises and spending cuts’

Roger Bootle, economic adviser to Deloitte, will say that Britain’s public finances are in the “worst shape for at least half a century” and warn that the country faces “the tightest squeeze on public spending for a generation”. "Most of this would need to come from a squeeze on public spending, with the remainder from higher taxes."

Posted by tim miller @ 11:46 PM 6 Comments

BBC: Five-year block on repossession

Welsh carpenter wins a 5 year stay on repossesion and his house can only be repossessed by the secured lender if he is more than 12 months in arrears after that period in exchange for withdrawing his argument that there had been an unfair relationship under the 1974 Consumer Credit Act, and in exchange for agreeing not to pursue that legal argument against the company the finance firm agreed.

Posted by enuii @ 11:16 PM 12 Comments

Associated Press: CIT files for Chapter 11 bankruptcy protection

For anyone who thinks the problems for the economy and housing market are over, think again. This is a big story.

Reuters: CIT failure to leave small businesses floundering

CIT filed for bankruptcy protection on Sunday, and said its creditors have already approved the century-old commercial lender's reorganization plan. But the company's long-term prospects are uncertain and the bankruptcy could leave more than one million small and medium-sized businesses looking for another source of funding, lawyers said.

Forbes: Be Prepared for the Worst

As the housing market fails to return to any sense of normalcy, commercial real estate begins to collapse and manufacturers produce goods that cannot be purchased by debt-strapped consumers, the economy will falter. That will go on until we come to our senses and end this wasteful government spending.

Posted by devo @ 08:31 PM 7 Comments

Yahoo Finance: 6 morbid careers with devilish incomes

This article would appear to suggest that £27500 is a high salary. If so, what is the national average salary, what does that say about the ability to repay a mortgage and therefore what are realistic house prices?

The Guardian: National Savings bond set to spark rate war

National Savings has launched a one-year fixed-rate savings bond paying a table-topping 3.95%, which is likely to prompt a pre-Christmas rate war.....Surely this will mean borrowers will see rates rise?

Posted by magnaman @ 01:27 PM 9 Comments

The Times: Bank of England should release £30bn more in quantitative easing

David Miles, who joined in June, said recently: “I believe the evidence is that QE is having an impact and that it is relevant to economic conditions right across the country. And not just in financial markets in London, but in high streets and factories and homes throughout the UK.” Kate Barker, another MPC member, said a few days ago that it had helped ease the recession in the housing market, thus supporting house prices.

Posted by devo @ 11:10 AM 55 Comments

Greg Pytel: How to make money? (revisited)

As governments injected trillions of dollars into the banking system it is not really a rocket science to find a way to take out billions out of it (1/1000, order level). Are banks' profit really a profit or simply taxpayers' money taken out by the banks and booked as banks' profit and, in fact, it is a loot? This article should give you an idea about an answer.

The Times: Gordon Brown plans new spending splurge

GORDON BROWN is planning a final public spending spree to help pull the economy out of recession and put pressure on the Conservatives over their plans for deep cuts. The prime minister is keen to use the autumn pre-budget statement to announce a new “fiscal stimulus”, with billions of pounds of extra money for housing, infrastructure projects and training. Recent figures showing that Britain is still in recession have convinced Brown that more spending will be required next year to support any faltering recovery

Posted by devo @ 08:51 AM 64 Comments

Money week: The US recession isn't over

In a nutshell, for the US, this 'recovery' looks like a false dawn. And that's not likely to prove good news for Wall Street. US shares have enjoyed a big rally recently – and jumped up sharply on yesterday's news. But that could prove to be the last chance to sell. Andrew Smithers, who runs his own research house, has no time for "those who claim that US equities are cheap", says the FT. His conclusion, after looking at both earnings and asset valuations, is very clear indeed – "US equities are 40% overvalued".

Times: Halifax rate row: do you stay or do you go?

Customers of Halifax, owned by taxpayer-backed Lloyds Banking Group, are staging a revolt as the banking giant slashes rates on its current and savings accounts and drives out mortgage borrowers from Intelligent Finance, its online arm. The protest comes as the European Commission prepares to impose penalties on Lloyds (and Royal Bank of Scotland) for receiving billions in state aid.