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Everything posted by MarkG

  1. If rents go up 300%, I'll be buying an old Transit and sleeping in the company car park. In fact, I suspect it will be pretty full out there...
  2. Yes, but that interest rate will be set by the market, not by the government... and no new money will be created, it will only be lent. In societies with commodity-based money and no central bank to print money at will, prices have usually _deflated_ over time, which benefits everyone other than speculators. It's only when the government can print money (or in limited areas of the economy in crisis situations like wars, natural disasters, declining reserves of limited resources like oil etc) that you get price inflation. How will rising commodity prices cause generalised price inflation if there's no wage inflation (due to increased money supply) to pay for them?
  3. Vancouver is expensive: for one thing, there was a huge influx of immigrants from Hong Kong in '96/97, and they brought a heck of a lot of money with them. Nice city, but it doesn't seem to be much cheaper than London. Even 3 or 4 years ago when I was there the city-center flats with heroin addicts living in the streets a block away were going for 200k pounds. Nova Scotia certainly had some really nice places for sale cheap when I was there eighteen months ago, but that's because there are no jobs . I believe my girlfriend's parents place in the outskirts of Edmonton would be around that price range, but it's three bedrooms rather than four. Saskatchewan I wouldn't be surprised if you could get a four bedroom place for that price, but again there's not much work unless you're a farmer. The downside is that houses tend to be made of wood rather than brick, so there's probably a lot more maintenance to do as they get older, plus the cost of heating in the winter when temperatures hit minus forty. On the other hand, with about 20 million people and 15 billion trillion bazillion trees, wood probably won't be too expensive, and they have plenty of fossil fuel reserves. Either way, I could probably go into any estate agent near where my girlfriend lives, pick pretty much any house off the list, and say 'I'll have that one, please. here's a check. no, I don't need a mortgage'... whereas here in the UK I'd be lucky to find a decent flat I could buy for cash.
  4. British government borrowing figures seem hard to find with Google, but according to: http://www.statistics.gov.uk/cci/nugget.asp?id=277 The budget deficit in 2004 was 3.1% of GDP. And you're saying that GDP growth was _2.9%_ of GDP. So the government spent 3.1% of GDP more than it collected, and the GDP grew by 0.2% _less_ than government over-spending. And that's 'robust economic growth'? At a time when the economy is also being inflated by huge private borrowing for overpriced houses?
  5. Exactly. America is just the same: all economic growth is coming from government borrowing and spending... if the government wasn't borrowing money, the US economy would be shrinking in dollar terms, not just in real terms. What makes it even worse is that many of those new government jobs are economically harmful in themselves, and they're almost all loaded up with huge future liabilities for fat pensions at the taxpayers' expense. But just think of all the people they had to hire to run all those interviews... So how much of that is from real jobs, and how much is: 1. Estate Agents and other housing bubble fluff 2. Government contracts 3. Companies increasing profits by shipping work abroad?
  6. Which country are you talking about? I've seen no sign of rising rents spreading across the UK. So long as they last long enough to actually make a profit one day. Housing is not 'of fixed supply', and fixed supply does not mean you have a monopoly.
  7. No, I mean the BoE setting rates to 10%. That's because they're greedy scum hoping to screw the lenders out of their money through inflation. As someone with savings, 10% would sound real good to me.
  8. What robust economic growth? Ah, so it's mostly worthless government jobs and contracts for Tony's cronies. There's a big future as a 'diversity counsellor' in an economic depression, I'm sure.
  9. Neat. You get a flat over here, and with the 55k you saved you could buy a four-bedroom house in Canada...
  10. Surely that depends on who the BoE want to see win the election ? Of course the Tories are so crap these days that even 10% interest rates probably wouldn't get them elected.
  11. An increase in money supply will _always_ lead to price inflation in the long run, unless the money is burnt. But it can be hidden in the short term, as it has been for the last few years by deflating import prices and a housing bubble.
  12. Sorry, but I trust any unemployment figures about as far as I can throw a family of chavs who are scrounging on disability benefit. We know vast numbers of jobs have been outsourced, and lots of remaining low-paying jobs given to illegal immigrants: where are all these _new_ jobs coming from to replace them?
  13. I've taken some Mandarin courses, and while it's true that it's hard to learn in some respects (e.g. the use of tones and the pictograms), in others it's extremely easy compared to English: the grammar is vastly simpler, for example. Otherwise, I kind of agree with the general forecast: the current Chinese boom is primarily caused by Bush's low interest rate 'destroy the dollar' policy, and is unsustainable, and China has a lot of internal problems. But in the long term, it's the only viable candidate I can see for 'economic superpower' after the US economy collapses. Certainly when I was there a few years ago, it seemed to be the most capitalistic nation I've ever visited: they were eager to sell anything that wasn't nailed down if they could make a buck from doing so, and they'd get their mates to hurry over and rip out the nails from anything that _was_ nailed down. Around where I was staying with a friend who was teaching English there, pretty much anywhere there was space on the pavement to set up a stall, someone would be selling stuff.
  14. Yep. The destruction of the British economy by NuLab would be funny, if it wasn't going to result in so many people living on dog food.
  15. Of course they do, unless all that money is burnt. What else do you think that people are going to do with the money they borrow if they don't spend it? Stick it in their wallet so they can look at it when they're bored? Use it for wallpaper? More money chasing the same goods is always going to cause prices to rise. What complicates matters is that governments define inflation to minimise the effects of asset inflation on their numbers (in fact, asset inflation is seen as a _good_ thing!), some of the money may go abroad and not cause inflation here in the UK, at least in the short term, and over the last few years inflation in the money supply has been counter-balanced by deflation in prices due to cheap imports and the outsourcing of jobs.
  16. If interest rates go up a couple of percent, not only will the market be flooded with sellers, but in 18 months most of those 'interest-only' BTL 'landlords' will be bankrupt.
  17. Which 'low tax rates' and 'extraordinarily low rates of employment taxes' would that be? I sure don't see how giving 50+% of my income to the government in one tax or another is 'low'. Similarly, the idea that unemployment is low in this country is a joke: vast numbers of people have been shifted from unemployment benefits to disability benefits, and many more have been hired into worthless government jobs. NuLab learnt a lot of things from the Tories, including the fact that you could make the proles think they were better off just by lowering interest rates and redefining 'unemployment'. One immigrant with AIDS or TB who spreads the disease can cost the NHS _vastly_ more than a whole retirement home full of old farts.
  18. High oil prices don't cause inflation by themselves: increases in the money supply due to artificially low interest rates cause inflation. High oil prices may well cause _deflation_ as people reduce spending in other areas in order to keep paying for oil, and companies shift work abroad because they can't raise prices to take the oil increases into account since people can't or won't pay more... therefore they have to reduce costs instead.
  19. Sure, if you don't mind paying twice as much for competing products assembled in Britain from foreign components. The simple fact is that most unskilled and low-skilled workers in Britain are hugely over-priced compared to the competition abroad: there's no way a typical British company can compete hiring British workers. Unless you have skills that can't be bought for $5 an hour in China or India, or absolutely must have a person on the spot to perform the job (and there are far fewer of those jobs than people imagine), your job will be outsourced before long. The odd thing is that some people still think that house prices will go up when we're all on the dole or making minimum wage at Starbucks...
  20. Tell that to the Japanese. Or the people who spent years in negative equity in the last crash. Or the people whose houses were reposessed in the last crash. Or the people who saw their neighbourhood infested with chav-scum that brought the value of their property down to zero. "Property has and always will rise" is a fantasy pushed by people who want to make money selling property, not a law of nature. Why? A house is a place to live... the _less_ I have to pay for it, the better. A time of massive wage inflation, when my parents' mortage was inflated away from a large fraction of their salary to, basically, nothing. That's not likely to happen to current buyers, as much as they hope it will. Sure, provided you don't mind living in a cardboard box after you sell it. The only people who benefit from an increase in the value of their house are the ones who sell up and move to a much cheaper area. The rest suffer horribly if they want to trade up to a better house in the area where they live. What 'wealth' does a house produce?
  21. Even if that's true (and here's no reason why a house with a dozen 'asylum seekers' earning below minimum wage has to bring in more rental income than a house rented to a single professional earning 50k a year), you completely ignore the point. If there were 150k new people coming here and they were all living a dozen to a three-bedroom house, that's only 12k new houses they need to meet the entire demand. People need a place to live, but no-one 'needs' a three-bedroom house to themselves. There's plenty of spare capacity in the houses of this country if there really was a serious demand for extra housing... the fact that, for example, my parents live in a four-bedroom house by themselves and don't have fifteen 'asylum seekers' living there with them tends to imply that there is no such huge demand. Equally, there are plenty of alternatives to traditional housing: caravans, house-boats, camper vans, tents: the 'monopoly' is nowhere near as monopolistic as you make out. So you're saying that immigration increases housing pressure, yet emigration doesn't reduce it? If a couple with a four bedroom house in London sell it and retire to a granny flat in Devon, you've got room to house twenty more 'asylum seekers'. Mass immigration is retarded, but it says nothing about the future of house prices. No matter how many people are in this country, if they're all making two pounds an hour, they're not going to be paying you 10k a month in rent. Finally, the whole housing bubble is built on the ready availability of cheap credit. If interest rates go up a few percent or lenders start getting more serious about lending only to people who can afford to repay the loans, it's gone. And, of course, it's self-perpetuating: who in their right mind is going to offer interest-only loans (i.e. loans to people who, pretty much by definition, can't afford them) on houses when the prices are _dropping_ and interest rates increasing?
  22. Huh? Innovation is the only way that this country can avoid the outsourcing of almost every job that still exists. But it's not going to happen without a major change in government policy. How are those houses going to 'care for you in retirement'? Will they come around and rub your back or something? Unless it burns down, gets repossessed, falls apart, is built in an area that becomes a slum, drops 80% in value in a crash, etc, etc, etc. You will if the government run out of other things to tax. Just look at America, where people retired in their $100k house, saw it rise in 'value' to $500k and are now having to pay five times as much in property taxes on a fixed or declining income. Then the country is fscked. You can't build a 21st cenutry economy on selling increasingly overpriced houses to people flipping burgers or slinging coffee cups at Starbucks. It's precisely because of that attitude that we've gone from owning a quarter of the world to our current apparently terminal decline.
  23. Also, don't forget that the dollar is at least 25% down since then (probably more like 50% against gold). So in real terms the NASDAQ is effectively at _less_ than 1500 today. Take capital gains taxes into account, and anyone who put money in a NASDAQ index fund would be substantially worse off than they were at the dollar-price 'bottom'. Anyone who put money in at the top would have lost about 75% in real terms... anyone who sold at the top and bought gold with the profits (or even Euros) is laughing. When 'everyone' is clamouring to join the market, it's a pretty clear sign that it's about to collapse.
  24. But it _is_ Clapham Common: probably more than a few MPs who could afford 200k for a nice little 'love nest' down that way .
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