MississippiJohnHurt

+1.7% is my prediction. Need more supply to feed through for it to go negative again. Seeing some early signs of that, but not enough as yet.

I like Buiter. He's called a lot of this correctly and is generally sensible. Sometimes he just likes to put a straw man out there for discussion . What I think he's saying here is that the only two ways out are to let nature take its course, or to forgive the debts...he think the current steps are halfway houses that don't sort the problem out

but they're still 2 entirely different things, one's about how much profit/loss is being made, one's about total value of guaranteed liabilities. Andy linked the 2 as if to say £500m was ok or good because it wasn't £100bn, and I was just pointing out that they're in no way comparable

wow, that really would be manly. Grrrrrrrrr. (for the record, I'm on the side of free debate, although in your case "debate" perhaps overstates it a little)

Yeah I wondered why the credit card front was so quiet. Meredith Whitney has been predicting this for ages, sees it as the cause of the next leg down

this £500m is to do with profit/loss at the bank in a given period, and the £100 billion was to do with total (potential) taxpayer liability, two completely different things. So not really a cause for celebration after all

that is fair actually. Forgot about that. It was unedifying to see.

But this site is one of the biggest forums around, and has a huge bias towards bearish opinion. You could hardly argue that a few lone voices are going to influence people to buy property. There is the argument that if someone decides to make the biggest financial committment of their life because of some internet random's opinion, then perhaps they deserve it.... In any case, to be influenced by Rinoa's ultra microeconomic take, Hamish's overcomplicated remixes of classic bull arguments, or London To Manchester's childlike faith would take a really special kind of person. I think we'd soon have their village on the phone asking what we'd done with their idiot.

some of em are - Valerius and Sibley in particular have no arguments and just like to rile people. I think Rinoa believes what (s)he says, and Hamish too - at least both of them can engage in discussion and don't (usually) get personal. But anyway it seems they haven't been banned, just tarred with the troll brush. Personally I don't agree with that, I'd prefer people to make their own judgements and ignore if they want, but at least the notorious bulls can still post here. Agree that the main test will be whether they stick around when they're proved wrong - although if they don't , it might just be cos they hate being wrong rather than that they were on a wind up!

Great, now we can all sit here agreeing on how right we are. I liked a bit of debate, and people always have the option of the ignore function if they find Hamish et al tiresome. If this is true (and I saw Andy's new avatar earlier, very fetching) then it's disappointing really. Surely we can be grown up enough to accept some different opinions!

Your attempted wind-ups are getting far less subtle Sibley. More effort required.

In this market, quite possibly right. That doesn't mean the market is efficient though. Again, check out the graph in my sig. It clearly shows that the house price inflation of last 8ish years was not supported by wage inflation. It doesn't take a genius to work out what it was fuelled by.....

So some people you know earn a lot more than average, and that makes the stats wrong? Perhaps subconciously, you only hang around with people on a similar "level" to yourself? (also , I'd hate to be at a party with you if you know so exactly what your mates earn )

Yep, this is shown graphically in the graph in my sig. Incidentally, I have often invited bulls on this site to comment on that graph , and aside from a few half hearted "demand/supply" diversions, none have even attempted to come up with a plausible reason for the disparity.

Unless your friend wants a large industrial job done, he's just found a plumber who doesn't want to do the job. I'm sure if he shopped around he could probably find a better deal

Yeah it's funny how vast swathes of people didn't leave their jobs, even in boom years, to become train drivers. But FortuneFTB was talking about their wages in the context of affording a house. I dunno about you but if I was a train driver who had to declare salary for a mortgage or loan, I'd write down gross basic plus any extra cash payments ie shift allowance. Not the pension and the cash equivalent of free train travel.

So you're saying that the average homebuyer's salary, in your opinion, is 50k? ahahahahahahahahahahahaha. Good one. Putting your japery aside though, you're missing the point somewhat when you run your "average wage isn't average homebuyers wage" argument. It doesn't matter in the slightest what the average wage is, as long as there is enough data to see what a long term trend is and therefore where in the cycle we are. As far as I know, the reason that Nationwide's figures tend to be used is that they have longer historic series. But as above, it doesn't make any difference what the wage figure is really - if you overlaid the CML data of wages to ave prices with the Nationwide's, and rebased, you'd find exactly the same peaks and troughs in exactly the same places.

and that's the crux of it, right there.

so why are the major banks putting rates up? Couldn't be trying to price themselves out of the market, could they? (shock, horror)

What is your point here Andy? The point of comparing wages to house prices is to gauge where we are in a cycle. All this talk of the "average wage not buying the average house" is meaningless, as I think you know. Some people use the Nationwide ratios of wages to prices, which use average wage figures which you may dispute. However, it doesn't matter a jot what average wage figures are used, as long as people are comparing like with like, and have enough data to build a reliable historic series (both of which I believe the Nationwide data set provides). So when people such as yourself argue variations of the "average wage for home owners is higher", it doesn't mean that much really. The point is to use a long term reliable data to try and see where we are in that cycle today. Or you could look at it all this another way, and try and explain the graph that's linked in my sig....

Go on then, enlighten me....why will house prices only go down by 25-30% in this cycle?

what do you think the average price vs wages will be over the next 10 years?

"In the end, it wasn't just net rents that couldn't cover a 100% home loan – some landlords found that gross rents (before all costs, voids, etc) wouldn't even cover loans that were well short of 100%. Such warning signs went unnoticed by far too many people" Minsky would have noticed...

I've noticed the same in my area (Essex/E London). V positive for anyone hoping for further price falls, esp if people put them on at 07 prices.

don't you usually talk about figures compared with previous month ? Strange that you've switched to comparing with same month in a previous year now. Why could that be?