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About FalseProfit

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  1. not..... Weebl and Bob? http://www.youtube.com/watch?v=8sjiZC83dEE
  2. Ok. #1 - I apologise for being a lurker. However this is a refreshingly honest article and worth a comment. #2 - We STR in May 2008, £164K 2 bed house that we bought in late 2002, sold for £247K. We had a >£100K deposit so I figured we would rent for a year or two, make 7% on the savings until we found the eye of the perfect storm that we had rightly judged thus far - and then simply jump back on the ladder. We weren't in a rush, early 30's with two young kids - and I figured we had time to wait it out. I underestimated two things: - 1) How committed the government were to propping up this house of cards along with the financially foolish sheeple that helped to build it - to the detriment of wiser and more prudent savers. Our 7% rate soon became 2%. Our rent is £3-500 per month more than a mortgage (local demand). I cannot understand how the dead cat has not crash landed after the 2010 bounce, but regretfully believe that the plan is now to hold out for as long as possible in order to inflate our way out of the mess we are clearly in regarding national ability to repay existing mortgage debt. Whilst there are greedy VIs a-plenty wanting to see sustained prices, the damage to communities and families due to the scale of indebtedness (should prices fall and rates increase dramatically) would also not be something that I would want to see. I don't think I realised in 2008 how many people would be affected. I therefore fear prices around here (KT17) will continue to fall in real terms but stay roughly the same in terms of actual selling prices. Demand remains high, good houses go quick and rubbish stays around for months. Prices are at approximate 2007 levels, although I think some BTLers are trying to jettison houses that need a lot of work. 2) What it would feel like 4 years into renting, with now 4 kids (surprise twins) with 2 at school and a partner that doesn't feel happy or settled in a rented house any more. A house is a home for a family of 6, although I fully respect that this isn't the case or necessary for many on this forum. Thus the catch 22. Will prices fall in real-terms in the next 3 years? Probably. If I was a confident investor I would wait and see whilst making money on the side - but I'm not and I therefore have money in the bank going nowhere fast, all the while paying more rent than I feel happy with. Heading into my late 30s I feel that I have made good money on property in the past, can afford to buy now and if I lose 30% of the value I will still have a family home in a nice area, a happier wife (worth a lot) without worrying about negative equity. I do wish that the falls we all expected had materialised, but I can't see it now. Offer accepted at 2005 prices, needs work but good potential, awaiting mortgage decision hence anything could happen.
  3. is still bothered by Alistair Darling's eyebrows

  4. Oh for those ancient paths. Totally agree... Less money spent on gadgets & trivia = more money and more free time, less electricity used, less junk into landfill (ignore a few million unemployed Chinese) More money and free time = happier families with savings, more sleep and less health problems (possibly thus more sex, more children, more demand for large houses) Happier families = less divorce (in most cases) Less divorce = fewer broken households Fewer broken households = less pressure on housing = more reasonable houseprices More reasonable houseprices = less pressure for two wage earners Less pressure for two wage earners = I come home to a tidy house and dinner on the table Fire up the Quattro
  5. You're not going to sell a house at £265K now... Whilst it was always competitive this move will really put pressure on anyone wanting to sell between £250-£300K, these ceilings have always had some small effect. Two options - if this generates enough volume it may bring down houses priced just over £250K which will have a knock on effect for more expensive properties , OR those people with houses in this price bracket will give up trying to sell which will further stagnate things. IMO it's a sneaky tool to help developers shift some unsold properties, but I'm not sure the rest of the market will be much affected.
  6. Where I live isn't perfect - but it's nice. Ch4 rated it the best place to live in the UK a couple of yrs ago. I just drove past an estate agent today (Browns) in the town centre - advertising in bright yellow on their shop window rates of 0.75% across the board. I have never ever seen an agent advertise their fees like this, and 0.75% would seem competitive...
  7. Don't ignore the possibility that the slight house price "rises" in the past few months have come at the same time as the pound falling significantly against other world currencies. If these house purchases (in an incredibly low-volume market) turn out to be mainly higher value London and South East properties purchased mainly by wealthy foreign cash buyers I won't be surprised.
  8. Data below only valid until 2007, but validates your point nicely. My dad used to say the same as Sibley until he looked at the data, then he admitted he hadn't realised how far things had changed, largely driven by availability of credit. If we do get further falls then the first graph shows land should become more attractive. Anyone know any Construction firms with a lot of land on their books? Source
  9. Be interested to know what you made of the article I posted about yesterday LINK - really interesting seeing as it was written in 2006, but it is the issue of inflation/deflation that this may ultimately lead to that seems very pertinent... aside from the unthinkable carnage. FP
  10. Taken from "the proposed Iranian Oil Bourse will accelerate the fall of the American Empire.." Krassimir Petrov, Ph.D. January 15, 2006 "When in 1970-1971 foreigners demanded payment for their dollars in gold, The U.S. Government defaulted on its payment on August 15, 1971. While the popular spin told the story of "severing the link between the dollar and gold", in reality the denial to pay back in gold was an act of bankruptcy by the U.S. Government. Essentially, the U.S. declared itself an Empire. It had extracted an enormous amount of economic goods from the rest of the world, with no intention or ability to return those goods, and the world was powerless to respond- the world was taxed and it could not do anything about it. From that point on, to sustain the American Empire and to continue to tax the rest of the world, the United States had to force the world to continue to accept ever-depreciating dollars in exchange for economic goods and to have the world hold more and more of those depreciating dollars. It had to give the world an economic reason to hold them, and that reason was oil. In 1971, as it became clearer and clearer that the U.S Government would not be able to buy back its dollars in gold, it made in 1972-73 an iron-clad arrangement with Saudi Arabia to support the power of the House of Saud in exchange for accepting only U.S. dollars for its oil. The rest of OPEC was to follow suit and also accept only dollars. Because the world had to buy oil from the Arab oil countries, it had the reason to hold dollars as payment for oil. Because the world needed ever increasing quantities of oil at ever increasing oil prices, the world's demand for dollars could only increase. Even though dollars could no longer be exchanged for gold, they were now exchangeable for oil. The economic essence of this arrangement was that the dollar was now backed by oil. As long as that was the case, the world had to accumulate increasing amounts of dollars, because they needed those dollars to buy oil. As long as the dollar was the only acceptable payment for oil, its dominance in the world was assured, and the American Empire could continue to tax the rest of the world. If, for any reason, the dollar lost its oil backing, the American Empire would cease to exist. Thus, Imperial survival dictated that oil be sold only for dollars. It also dictated that oil reserves were spread around various sovereign states that weren't strong enough, politically or militarily, to demand payment for oil in something else. If someone demanded a different payment, he had to be convinced, either by political pressure or military means, to change his mind. The man that actually did demand Euro for his oil was Saddam Hussein in 2000. At first, his demand was met with ridicule, later with neglect, but as it became clearer that he meant business, political pressure was exerted to change his mind. When other countries, like Iran, wanted payment in other currencies, most notably Euro and Yen, the danger to the dollar was clear and present, and a punitive action was in order. Bush's Shock-and-Awe in Iraq was not about Saddam's nuclear capabilities, about defending human rights, about spreading democracy, or even about seizing oil fields; it was about defending the dollar, ergo the American Empire. It was about setting an example that anyone who demanded payment in currencies other than U.S. Dollars would be likewise punished. Many have criticized Bush for staging the war in Iraq in order to seize Iraqi oil fields. However, those critics can't explain why Bush would want to seize those fields-he could simply print dollars for nothing and use them to get all the oil in the world that he needs. He must have had some other reason to invade Iraq. History teaches that an empire should go to war for one of two reasons: (1) to defend itself or (2) benefit from war; if not, as Paul Kennedy illustrates in his magisterial The Rise and Fall of the Great Powers, a military overstretch will drain its economic resources and precipitate its collapse. Economically speaking, in order for an empire to initiate and conduct a war, its benefits must outweigh its military and social costs. Benefits from Iraqi oil fields are hardly worth the long-term, multi-year military cost. Instead, Bush must have gone into Iraq to defend his Empire. Indeed, this is the case: two months after the United States invaded Iraq, the Oil for Food Program was terminated, the Iraqi Euro accounts were switched back to dollars, and oil was sold once again only for U.S. dollars. No longer could the world buy oil from Iraq with Euro. Global dollar supremacy was once again restored. Bush descended victoriously from a fighter jet and declared the mission accomplished-he had successfully defended the U.S. dollar, and thus the American Empire." (Full article - see here - written in 2006, see also the conclusions at the end regarding INFLATION) September 12th 2009 : Iran's President Mahmoud Ahmadinejad orders the replacement of the US dollar by the euro in the country's foreign exchange accounts - link. This was in the press 20th-22nd Sept, hardly got a mention in our press. Iran has been increasingly trading in Euros for their oil since 2006 - but this seems a carefully timed announcement. September 24th 2009 : Continued political noise about urgent nuclear proliferation between US, Russia, China, UK - with focus on Iran and N Korea as the only bad guys. link. Much talk of sanctions against Iran as US tries to get Russia on board. Is this really about nukes or dollars? "Whatever the strategic choice, from a purely economic point of view, should the Iranian Oil Bourse gain momentum, it will be eagerly embraced by major economic powers and will precipitate the demise of the dollar. The collapsing dollar will dramatically accelerate U.S. inflation and will pressure upward U.S. long-term interest rates. At this point, the Fed will find itself between Scylla and Charybdis-between deflation and hyperinflation-it will be forced fast either to take its "classical medicine" by deflating, whereby it raises interest rates, thus inducing a major economic depression, a collapse in real estate, and an implosion in bond, stock, and derivative markets, with a total financial collapse, or alternatively, to take the Weimar way out by inflating, whereby it pegs the long-bond yield, raises the Helicopters and drowns the financial system in liquidity, bailing out numerous LTCMs and hyperinflating the economy." Discuss...
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