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House Price Crash Forum


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About Pete

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    HPC Poster
  1. Ultra long dated UK index linked gilts (eg 2055 issue) could return hugely (up to 1000%?) over the next few years. They are very volatile but will likely perform exceptionally as negative real rates become more pronounced. Negative real rates could hit -5 or -6%, a huge distortion which will propel these massively. Smart money in them now.
  2. So you are swapping assets trading at 1997 valuations i.e. well away from bubble territory (unlike the credit markets of 07) into cash which the authorities are detemined to dilute to nothing (Ben Bernanke is a determined clever man - you would be a fool to bet against him like Bob Prechter). Presumably, like many others, you think your market timing is good. Hope for your sake you are not gambling with your entire net worth.
  3. This bloke seems to think index linked is the way to go http://ruffer.co.uk/services/review.aspx
  4. Would only pay off my debts if I thought we were headed for deflation which seemed on the cards in 2003 but not now. Having diversified all my investments out of sterling, I actually sit quite comfortably with my big mortgage knowing that the currency is now weakening. I would have thought all savers/STRs would be quite sick of their pounds being eaten by inflation - the MPC seem pretty good at compromising the currency and I imagine this will continue. Watch out savers, probably more to come.
  5. I think you totally underestimate the value of a sea view to some people. Well paid job in London, 45 mins on train then home in time for a G&T on terrace with sea view. People DO pay a fortune for this
  6. I saw it - she was excellent. I love the way the elders refused to get drawn on the housing issue specifically - pompous arses. Single biggest wealth transfer from young to old ever - no comment.
  7. Couldn't agree more. I have had my own business for 10 years, taken a shed load of risk & employed others. I am now no better off than if I had bought a bigger house and sat there unemployed for 10 years. This economy is a farce - capitalism has been replaced by something else
  8. Here's a pretty gutsy investment review from Jonathan Ruffer of Ruffer LLP (who look after my investments - so far very well). Basically predicting the demise of the credt bubble. This sort of prediction is very unusual from a firm always trying to attract new money. The 2006 vintage of Chateau Ruffer was not one to relish. The stock markets put in another barnstormer, but we were more barn owl than barnstorm. We had a good showing in both 2004 and 2005 (each of them recovery years in the stock market) but we were not able to repeat it in 2006. Why was this? This last year has seen the se
  9. Here are the thoughts from Jonathan Ruffer (v successful fund manager over the years): Jonathan Ruffer's IR thoughts Most Significant Bit "Our strong belief is that IRs will be reduced very sharply" These are not empty words, these guys invest millions based on such macro calls
  10. 2.9% in one month is massive and concurs with what I've seen on the South Coast - looks like the soft landing was never possible after all.
  11. I read a comment by Marc Faber a few months back that he believes inflation will be good for Jap equities. He reckoned the reappearance of inflation risk will cause many Japanese savers to move from cash to stocks. Rememeber, the high for the Nikei was 40,000 - 16 years ago ! He also reckons Taiwan is undervalued. So far his calls have been damn good, although bond yields don't appear to be spiking as much as he predicted.
  12. The guy has been more successful at forecasting the market than Oswald, Bootle et al - maybe he deserves a bit of credit for that. But I have never properly heard him address the low wage inflation issue i.e. have buyers confused a drop in nominal rates for a drop in real rates. I read a comment by him on his website to the effect that "Buyers accept that their mortgages will last longer than before" (paraphrased). I'm not sure the market cares about people "accepting" things. Surely this is THE difference between the time of 3.5 x earnings and now. How can their not be a very significant l
  13. So we have jittery stocks at PEs of 10 - 15, and we have property bullishness at PEs of 25 - 30. If this is not a demonstration of ridiculous sentiment swings in the markets I don't know what is. There are tech stocks out there valued at 10x earnings for gods sake. People were falling over themselves to buy at 30x earnings only 6 years ago !
  14. I emailed John Calverley, chief economist of American Express, for hist latest thoughts on house prices. Very decent of him to reply so extensively I thought - here it is: I continue to think that the UK housing market is in a bubble, that prices are very expensive and will eventually fall back significantly. Of course, as with anything else in the investment world I hold that view with less than 100% certainty, but I do put it at 80-90%. The current lift in house prices is due to the cut in interest rates last year, the slight pick-up in the British and world economy in recent months,
  15. Highly debatable figure that one, but probably achievable in shared houses etc. at a push. But then I'd want to offset the yield with higher management charges (my time) - so pushing the yield lower. Flat yields are lower than this. Fairer to compare P/E with BTL yield. You also need to consider whether or not the risk premium on each of these investments is fair. Current house prices have broadly the same risk premium as 15 years ago despite general wage disinflation over that time.
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