Gravity's Rainbow

RBS internal memo "On occasion the Consumer Credit Agreement cannot be found quickly and in the past this led to the debt being written off. On identifying this problem Jane Fraser introduced a new process whereby if the CCA cannot be found quickly Jane is able to create a 'true copy' using the data keyed at the time the loan was granted and the 'style' of agreement used at that time - this can go back a number of years. 65 agreements have been recreated so far involving circa £250k of debt - a classic example of thinking under pressure and adding real value to the bottom line." Forgery and deception are obviously the way to get ahead if you work for the RBS. Perhaps Jerome Kervial could get a second chance in the banking sector with the RBS?

Nope, you retire at 65 as normal and housing benefit covers your rent.

Now that the tightening cycle has started, how fast will it progress and where will it end?. And is there anyone out there who seriously believes the next move will be down?

Also, by concentrating Conservative votes in rural electorates, the Tories will kept out of office for years to come. The way the current distribution of votes is skewed, Labour could get fewer overall votes than the Cons and still win the next election. The Tories will need a huge swing just to get into the driving seat in a hung parliament, let alone governing outright. I wonder when the penny drops with Cameron that the demographic trends encouraged by Tory local authorities blocking house building is actually keeping him out of national office?

That's only half of it -- RB thinks Gordon had the hawk on the MPC poisoned in order to keep rates low! The MPC is independent of Gordon Brown, these guys are all real-world economists and civil servants with distinguished careers, not anonymous yes men picked from a list of GB cronies. As a senior figure at the BoE, King has seen chancellors come and go, I don't see why he would want to show Gordon any favours. However, the Committee does suffer from a Whitehall/City groupthink mentality -- currently on display as paralysis in the face of conflicting evidence. A one man decides system like the US would better allow for pre-emptive rate moves. Like RB, I think the current MPC will wake up to today's inflationary danger too late to contain it, but I blame groupthink for this, not Gordon Brown. Although I agree with RB's analysis 75% of the time, his hatred of the chancellor sometimes brands him as an armchair crank. He should realise that dispassionate analysis of the facts, unclouded by prejudice, is his best strength.

Good comment. On Saturday I read the first story I have seen that acknowledges a link between foreign investment in the UK and house prices. An article about Indian call centres in the Guardian ends with the comment: "ICICI OneSource, a Mumbai-based outsourcing company, said it was building a new 1,000-person call centre in Belfast. ICICI said it was attracted to Northern Ireland because of its highly skilled workforce and relatively cheap property prices." The message is clear: high house prices are an impediment to inward investment in England.

Realist bear is very selective in which news stories/data he posts. It's only those that support his bearish narrative about the economy. His main contention: 1) that interest rates are on the brink of a rapid hike upwards 2) the underlying economy is much weaker than it appears Nothing wrong with this -- apart from the obvious point is that the two are mutually exclusive! If the UK economy really does emerge as the basket case he suggests it is, then the MPC won't be raising rates, they will be lowering them. What's actually happening is that both the UK and world economy is in more robust health than anyone could have predicted when oil prices started shooting up a few years ago, which is a good thing since it makes interest rate rises more likely.

Much like Christian fundamentalists we do tend to greet signs of the forthcoming apocalypse with unconstrained glee. Record mortgage repossessions are our equivalent of earthquakes. Factory closures and mass lay-offs are our floods. Interest rate hikes are plagues of locust afflicting the damned (or in this case over-leveraged owner-occupiers). Out of control borrowing is the equivalent of the descent in sinfulness that the scriptures predict will happen in the endtimes. Finally there is the beast, plotting in his lair. He hath a name and it is Gordon!

Commuters won't be affected by this as they are not eligible for cheap one day return fares in any case. Increases in train fares are regulated by the govt. I think the last rise was around 4% year-on-year. Of course by changing the discounting structure for cheaper fares the Train Companies have been able to increase their revenue beyond this. However there are ways around it. Britain's train fares are absurdly complicated, and loopholes abound. To get around the increase proposed here you could buy a two stage ticket. Ticket one is a cheap day return to a station that the train you want to board stops at before getting to London, ticket two is the full price ticket for the second leg of the journey. See this guardian story Trains into London are still a better bet than cars when you consider congestion charges and parking costs. But still, it's one more reason not to visit the capital. London = Rip Off

Pharma jobs are very well paid too, with excellent benefits. They won't be easily replaced. Let's see if this has an effect on the Basingstoke property market. Vodafone recently announced 400+ job losses up the road in Newbury, yet last week's Newbury local paper reported local agents saying the staff cull was having no effect on the local property market. (Vodafone is by far the largest employer in Newbury). I suspect it takes time for even quite large scale redundancies to percolate through to the housing market.

I vote Lib Dem with some reluctance (mainly because I am in favour of proportional representation). One of their policies that is very poorly thought out is the local income tax. With this in place you can look forward to asset rich retired home owners being subsidised by young working people who rent their homes. Many landlords would end up paying less council tax than their tenants do, since they can divert their rental income to make their taxable personal income look low. It's a crap policy designed to appeal to the votes of the elderly. As for the OP, focusing your anger on Gordon is well and good, but remember that it is easy to overstate his importance in the day-to-day functioning of the economy. We live in an age of consenus politics where all the main parties subscribe to the same fundamental economic programme. And apart from politicians there are plenty of other vested interests out there looking to screw you over.

Whole parts of the countryside are becoming god's waiting room, populated by well-off retired people. With planning decisions made by local authorities that serve the interests of aging owner occupiers growing fat on exponential HPI, don't expect planners to look after the interests of young people who don't have housing. It's time for central government to assign new homes targets to every local authority in England and dock money from centrally funded grants to those councils that don't comply. Residents would have a simple choice, put up with more housebuilding or pay higher council tax.

This looks like an unlawful eviction. Regardless of the landlord's arrears, the mortgage company is required to serve notice on the tenants, then seek a court order if they do not leave. The stuff about the buildings insurance not covering tenants is completely irrelevant. Unlawful eviction is a criminal offence and I hope the EA and mortgage company here are prosecuted.

Stories like this lady's one are good at illuminating what is going on at the micro level in the economy. But the important thing how it is all panning out at the macro level. For this reason I find it completely pointless to go around passing moral judgement on people who are sliding off the edge of the financial cliff. The debt problem is now so widespread in the UK that it has ceased to be about individual failures of judgement but is now a systemic problem that affects everyone. Lending is simply too loose, banks have pumped liquidity into the system without regard for the consequences and the policy makers have (The BoE and Govt) have taken a hands-off approach knowing that rampant consumer spending has shored up UK economic performance despite the economy's major structural problems. In a few years we'll all look back and wonder at the craziness of the easy credit culture of the early 2000s, just as now we look back at the madness of hyperinflation in 1920s Germany.

If it were not for the froth in the market caused by the BTL component, I'm sure we would have had the correction by now. I think that the correct respsonse is to increase the regulatory burden on landlords, and make AST agreements open-ended by removing the landlord's ability to terminate the agreement without the tenant's consent. Banks only started lending for BTLs once the AST regime was introduced in the 80s. Before that if the owner defaulted they may have got the keys to the house but also got sitting tenants they couldn't chuck out. The AST is completely one-sided in favouring the rights of landlords over tenants and has distorted the housing market by encouraging many thousands of undercapitalised ignorant amateurs to become landlords. The provision of housing, a social good, is too important to be left in the hands of these numpties. The neglect of social housing since the early 80s is also criminal. The right to buy has been a disaster by removing houses from public stock much faster than they have been replaced. A return to an era of plentiful social housing (as in the 1970s) would mean that low earners could have their own homes and large parts of the country would not be so dependent on migrant labour to fill the poorly paid jobs. No government has treated housing seriously since the mind 70s. Thanks to the rise of the BNP this may now change.

I notice that the Guardian's business page has put a different spin on this to the BBC. Mortgage lending hits April record. And: So that's it then, the crash is postponed and the lenders are going to continue shovelling cash into the market with gay abandon.

Also worth mentioning is that Oxford City Council has an objective going back years to reduce the number of HMOs in the city and is one of the few local authorities in England that will be enforcing the new HMO legislation to the letter. For example, have you budgeted for plumbing handbasins into every room? This is one of the new rules that our resident Landlord TTRR is complaining about on another thread...

Have to disagree here, any regulation that increases costs to landlords is good by me. For the housing market to return to sanity landlordism should be actively discouraged. HMOs are notorious for offering the poorest quality housing in the UK and it is no surprise that the government wants to discourage them. If you haven't got the resources to comply with the law you are undercapitalised for this business and should get out of the game.

One of the questions that should be a matter of urgent public debate is the desirability of our public health system making the promotion of longevity as its number one goal. This goal has been pursued with increasing vigour over the last 50 years but has never seriously been questioned. What good is it to society having people live longer and longer if there is no willingness to pay for it? Shouldn't we instead see the current public health bugbears of smoking, drinking, and junk food as having important roles to play in keeping the overall demographic distribution healthy? It sounds daft but I'm serious. Is a public health system unrationed and free at the point of use sustainable once a tipping point is reached where the bulge demographic cohorts pass from being net contributors to the public purse to net beneficiaries of it and high public health users to boot? The answer is not without huge tax rises and not without shifting the tax burden further onto the shoulders of our screwed generation that has been loaded up with education debt, priced out of the housing market and locked out of decent pensions.

Yep, the government is behind the drought. I hear that Gordon Brown is seeding the clouds so that they dump their moisture offshore rather than on land! The government deserves stick for a lot of things but it's just absurd to blame them for the weather. Is there anything that goes wrong in modern Britain that the right-wing cranks on this board wouldn't blame Labour for?

What get me is these kind of ridiculous law suits are funded by the tax payer in the form of legal aid. It's the government paying to sue itself. The only winners in the end are the lawyers. Some, like Cherie Blair, have made a small fortune on these kind of cases. I'm in favour of getting rid of legal aid and replace it with an office of public defenders for criminal cases like they do in the US. If you want better representation then stump up for it yourself or take out a litigation insurance policy. Since all of the main parties are stuffed full of lawyers, the chances of this happening are zilch.

The OP states that we are about four years behind where the US is currently. Last year, after intensive lobbying from the credit card insdustry, the US passed a law making bankruptcy harder. So I guess the answer to your question is three years!

The big vote for the BNP in last week's local elections is a sign that the poorly educated white working class is feeling squeezed by migrant workers and unaffordable housing. In London, Labour MPs revealed that housing was the number one issue on the door step. The one good thing that the BNP vote has achieved is to make housing a political priority again.

Oxford City Council has being trying to crack down on HMOs for some years. It's a major problem in the town due to the high student population. (Personally speaking, when I lived thre I thought the large ramshackle old Victorian houses packed with students gave the place a bit of character). Many other towns in the UK will not be enforcing the new legislation with anything like the same vigour, since HMOs are not perceived as such a big problem.

I can't agree. Making bankruptcy harder will only encourage the banks to lend more. What we need is easier bankruptcy laws. That might make the banks pay more attention to who they are lending too. How on earth does one couple accumulate 40 credit cards and £155K of unsecured debt unless the lenders are being negligent?