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Posts posted by leicestersq

  1. Didn't get the Telegraph today so actaually read the article - your not a Daily Mail writer are you?

    No I'm not.

    1. The article is not about 'housing' foreigners it is about a small amount of people buying expensive properties in central London which actually has F**** all to do with the market at large including London. Since when was Mayfair or Maida Vale cheap and accessible? It has always been populated by wealth that is beyond the ordinary man I suspect there are zones like that in every world city. Before the Russians, it was Chinese, before that some of the up and coming African sataes, before that Arab wealth in the late 60's and 70's before that landed gentry. All groups the majority of us couldn't hope to be in.

    Every property affects every other one. If a rich person cannot buy a place in Mayfair because a rich foreigner gets the place, they buy somewhere further down the ladder, which in turn means someone else gets bumped down the ladder and so on. These markets are not isolated.

    2. He actually says they should pay the correct amount of tax

    Yes, I gave him credit for that. It makes you wonder though why these uber rich are spending so much effort ducking a trivial amount of tax.

    3. As for your penal rate of tax, does that apply to the japanese corporations and executives who have put billions into our manufacturing sector?

    Yes it would. I would like to see a progressive land value tax, with a higher rate paid by non-UK nationals. This is in recognition that there isnt enough residential land for UK citizens.

    There is a big debate to be had about unfettered immigration and the impact on the working man and woman which looks more and more like a top down conspiracy to me.

    But one oligarch buying a house you couldn't possibly afford isn't it. My personal experience of the Russians having worked with them for is they pay well, employ almost exclusively Brits and contribute a great deal to the UK economy.

    I dont mind foreign people coming here, but as the UK becomes poorer, there is a large danger that UK citizens are going to be pushed out of the housing market by richer foreigners. Sure we may get a short term kick of more money, but in the long run we end up paying far more in reduced housing space per head of population. We are all feeling the affects of that now in one way or another.

    As Boris said in the article....

    Of course it is a good thing for London if people want to come and live here, and to invest huge sums in bricks and mortar.

    Well no it isnt. The Tories are supposed to be cutting back immigration to zero net immigration. If that is the policy, then it isnt a good thing at all for people to come here. And no matter how you care to frame the issue, if someone from abroad buys a house here, someone somewhere loses. When the little one says roll over, we all roll over, down the housing chain, and someone falls out of being able to own a house all together.

  2. I don't know so much. My brother has an RBS One Account and over 60% equity, he told me last night he'd got the letter about a rise and it was applied across the board at the same rate... so they added the same number of base points to someone with 10% equity as someone with 50%+

    I guess RBS will be left with a lot of customers who have little equity, whereas those who can move, do. I would not be in the least surprised if the same thing happens to the Halifax.

    RBS would only do this if they believe that the number of people who will leave (some will) doesnt cost them more than they will gain in extra interest payments.

    They might make the odd mistake in this calculation of course. And you cant be too sure what you competitors will do.

  3. http://www.telegraph.co.uk/comment/columnists/borisjohnson/9122818/A-billion-reasons-to-close-the-stamp-duty-loophole.html

    So Boris (is his name Russian by accident) makes it clear that he wants foreigners to come here and take all of our housing. I guess you can give him a modicum of credit for wanting these foreign legions to pay a bit more tax.

    Well Boris, if you are not from the UK, you should be paying a penal rate of tax to own property in the UK, levied every year not at the point of sale.

    It shows once again that the Tories are just about getting as much money into the country so they can line their own pockets, and there is no concern at all about the affects of immigration on the masses of UK citizens struggling to find somewhere to live.

  4. OK. Theres no reason for calling this apart from that gut feeling.... Also I bought some shares and know that this is a guarantee of the FTSE breaking 6 000.

    Is someone giving a big call, or is it a tiny whisper about a gut feel the ftse might fall a smidge?

  5. Well ok and the points very well made - except that it's not entirely unheard of for common or garden insurers to try to renege on the agreement (even on a valid claim). It's the financial sector after all.

    Common or garden insurers are often reluctant to pay, not because they are ripping people off, but because they have to watch out for common or garden fraudsters that use insurance payouts as income.

    With Greece, there is less uncertainty as to whether bond holders have been paid or had their terms changed.

  6. Yes, of course, that's how governments choose to do it, which is part of the problem, but it was ever thus.


    not all government's do it that way. I think that Japan and Norway have funded schemes. Can anyone confirm this?

    The trouble is those funded schemes are often a worse idea than paying for pensions out of directo taxation. The state then has to invest the money somewhere, and the state isnt a good guardian of other people's money or a good investor of it. Norway has lost loads I think to US investment banks getting them to buy rubbish. In Japan I think that the scheme ended up with loads of Japanese bonds, which begs the question, why bother, when they just pay out of taxation anyway?

  7. BB asked you a straight question, re. the money he had SAVED for his old age, which is being eroded by the policy of QE. You deflected to the issue of state pensions.

    You fail to understand what saved money is.

    If it is in a bank, then it is actually invested in an asset somewhere, a loan normally. If the value of those assets fall enough through deflation, all the savings get wiped out. QE is probably defending his saved money by keeping the financial system and the productive system working. The cost is that real interest rates go negative for savers, but it ensures assets paid for with loans remain profitable.

    So you either lose money slowly thanks to qe, or lose it quickly to deflation. It is far better to make savers pay a little to allow the productive part of our economy gain.

    There is no free lunch.

  8. I dont think thats anything more than state propoganda, but it works because nobody reading history books, the industrial revolution spent just as much time in deflation as inflation, the problem with deflation is a state concept, hence their propoganda and their liking for platitudes with no historical basis, the problem is the state cant tax it and the modern econmy is very much based on everexpanding state debt hidden by an indicator that is nonsense known as GDP, i was still in nappies 30 years ago but you often get posters highlighting how economic indicators of health have changed over time the state has purposefully distributed propoganda that everyone now states as fact because history is about 5 minutes.

    Two off the lowest inflation countries in the world over the last 30 years are Germany including pre euro and Switz, the idea that you cant produce in low inflation / deflation is laughable, switzerland is in deflation right now, youre still buying state propoganda, it is far more likely that the stealth inflation over the last 30 years has been the destroyer of productivity, inflation rewards rent seekers predominantly, the biggest rent seeker on the block being the State and the guardians of FIAT known as banks

    Maybe I should have stated my definition of deflation here. It means destruction of the money supply.

    Bankers are able to hold a gun to the head of the government, because if they collapse, the deposits held by depositors can get wiped out. It is great holding they keys to a bank. Which is why the government should get its own gun and make sure that all banks have a healthy amount of capital and properly marked loans.

    When you have crooks or fearful people overseeing the banks, they will go renegade, steal the money, and leave the financial system on the brink. A deflationary collapse here is very different to a deflation of prices that the Swiss may have seen now and again. When deposits go, people get what cash they can, and cease to trade with anyone not knowing who they can trust. Without trade, there is no production and all wealth generation ceases. It is possible that this nightmare can occur.

  9. Pensioners are ex-producers. If workers now see that their wealth will be stolen later why bother working now?

    They are. But there are two components to their income.

    Some have saved and invested in various things. For example if you spend some of your working time making a phone line. When you are retired you rent it out, and you make money because for the young person the cost of renting it is less than building a new one. You are able to derive income from that.

    This sort of income is a good income, everyone benefits from the work you did, and you benefit to. This should be protected and the goal of creating similar investments which will in turn be protected by the state incentivises current workers to do the same thing.

    That portion of pensioner income, which is a direct transfer of what is produced by a worker, to a pensioner, is a bit more dubious. It still has merit of course, because that worker would like some of the same if they make it to retirement. However, because it is a tax, you have to be careful not to tax too much or else it disincentivises the worker too much. It is these transfer payments I have my concerns about, not the wealth that has been stored up in assets produced by the hard work of the retired generaton.

  10. you were making a laughable assertation, clearly the policy isnt acheiving that though, workers continue to get poorer, this policy with the current UK setup is simply redistributing the money to different rentiers be they land owner, state, or FIAT trader, clearly some pensioners will be in this Group and the benefit will offset against their perceived savings which arent actually savings reducing in real terms but the idea its transferring wealth to producers is laughable, its impossible for it to flow into production under the UKs current economic setup, its been flowing out of production for more than 30 years, youd have to be living on the moon to not notice that, interest rates have been trending down for 30 years, QE is simply a continuation of that policy to reduce them below zero and ensure the continuation of non production due to excessive external costs , particularly excessive opportunity costs when compared to other forms of investment

    I do wonder what the affect of the current monetary policy is on output. It looks to me as if without some sort of QE we would be in a deflationary environment, and because of our laws and policies, the economy would find it difficult to go gracefully into deflation. Employment contracts and benefit contracts cannot easily be adjusted downwards.

    What would happen say, if the government announced a cut in the state pension of 10% to match a fall in the price level of 10%, there would be uproar? What would the court say about it?

    And in deflation, even if interest rates fall to zero, the real value of the debt accelerates upwards to a rate at which the burden becomes unsustainable. The paradox of thrift kicks in, and soon your economy collapses because no one can spend due to the uncertainty of not knowing if there is any work or money tomorrow.

    Pumping in new money, whilst at the same time restraining the banks by forcing them to hold a much higher percentage of capital, seems like a good way of rebalancing the debt to money ratio in the economy.

    As for returns on savings, well banks can only offer you a rate of interest that is based on what they can lend at, minus costs including bad loans. If banks cannot find safe places to lend at good rates of interest, the market isnt going to offer the saver a great rate. Mind you, getting poorer slowly by having your savings in the bank, is probably a better result than having them wiped out by a deflationary collapse.

  11. Except you are diverting resources to inflating property (or stop it from deflating) itself a non productive asset. If it was diverting resources into "making stuff, exporting it and employing people" I'd agree with you, but it ain't.

    The effect of QE is a little bit uncertain. I believe that the basic idea of it is sound though. If you can use it to replace debt money with non-debt money, then that makes the economy more stable without having to go through deflation to achieve it. I think Steve Keen puts forward similar ideas.

    As for diverting resources into producing stuff people want, most of the responsibility for that rests with Parliament, not the BofE. I am sad to say I see a lot of schemes and scams going on that divert resources away from producers.

  12. Thanks for that, your agenda is now crystal clear... http://www.swp.org.uk/

    Huh? I thought I was calling for less wealth to be transferred away from the producers?

    From what I remember of the Socialist workers party, they actually want free money from other people. I oppose that. My basic agenda is that each person should receive in income an amount closely equivalent to what they produce.

    Is your agenda to take as much as possible from those who produce to give to pensioners?

  13. So the money I didn't spend over my working life, ie saved to spend later, should be taken from me and given to you?

    On the contrary. Money that you have wisely invested in assets shouldnt be taken from you.

    It is the size of the fiscal transfers from the working to the pensioners that concerns me. Make that transfer too large, and working ceases to be worthwhile, and investing in a business ceases to become a sound decision.

    The huge increase in pensioner numbers is driving economies into treacherous waters. It is no surprise that the European countries that are in the most trouble are the ones of Southern Europe, with the worst demographics (not sure about Greece but that is just a basked case that would fail no matter what its demographics looked like).

    When you tax the working people, you should be careful not to overtax as it drives people onto benefits, and causes businesses to move overseas or to shut down. And yet it is that very same productive capacity that we all rely on for the things we need and want.

    When Pensioners campaign for higher pensions, and have little regard for the burden they are placing upon others should their policy be enacted, they should be careful what they wish for. One day the state may be unable to make any transfer payments at all.

    We would all like a pension. I recognise though that the size of that pension must be in line with what can be afforded.

  14. Werent the Irish given a chance to do something about the situation last time? I thought that Sinn Fein gave them a choice of defaulting on their dubious debt obligations?

    Previous to that, the will of the Irish people, through the democractically elected Parliament, had decided to guarantee savings in their banks, which meant a bailout and a lot more tax for the Irishman.

    All along when it has come down to it, the Irish people have chosen to go along with the bankers game, and only a few voices dissent. If that is what they want, fair enough.

    This vote clearly means nothing, but I expect that the Irish people will vote Yes anyway.

  15. I do think that perceptions of these kinds of frauds have been altered by the bank bailouts though. Advertisers talk about the anchoring effect of large price tags on cheaper products- and will often have a very expensive product on display to create the sense that the other prices are good value.

    Applying the same anchoring effect to crime- the ongoing spectacle of impunity at the top is having the effect of devaluing the crime 'value' of those lower down the social scale- so things that might have been seen as quite serious in the past are now seen as more trivial.

    So when I see a headline that someone defrauded a couple of hundred thousand my reaction is often 'is that all'? The Bankers have walked away with billions.'

    Apparently the anchoring effect works because we are bad at absolute valuations but good at relative one's. So the corrosive effect of both banker bailouts and absurd CEO pay is to recalibrate the scale of moral outrage in the direction of apathy.

    Spot on.

    This is why as many crimes as possible should be punished.

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