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Everything posted by dgul

  1. A debt jubilee needn't support the rich at all, other than stopping default in their customers. It wouldn't support the majority here, but it would support the majority in the country. If they were to say 'here's a note that'll give everyone £20k off their debt, to compensate for the imminent rise in interest rates' that would have a massive impact on the country, but would have a net negative effect on the BTL empires (the interest rate rise bit). But without another crisis (and it's unlikely even with) a debt jubilee just isn't going to happen... were taking the other solution of ultra low interest rates for the next few decades. This is actually worse than the debt jubilee solution, as it helps most the ultra leveraged, and hurts most the ones without debt.
  2. Sorry -- I was considering the raft of low emissions cars that have sprung up. So a £40 pa car is £100 better than an otherwise identical £140 pa car. Anyway, an average newish car costs £15k (just made that up -- I've no idea what people pay these days), and is worth £5k after 4 years -- so £2.5k per year. The old one costs £1k, is shagged after 4 years (say), so £250 per year, plus a few evenings under the bonnet bodging repairs. That £2250 (plus financing costs) is the cost of a 10 year old car vs a new one, not the £40 vs £140. But at 10 years (say), that £100 starts to be a significant proportion of the total cost of ownership.
  3. Funny thing is that (for most) the impact of road tax is negligible considering the other costs of owning a new car -- mainly depreciation, but also most new car owners put quite a few miles on, so also fuel (taxes). But for an older car (often on lower annual mileage) road tax can be a fair whack of the running costs. I predict precious little impact now, but in 10 years time 2nd hand car buyers will be valuing the pre 2017 car much more highly.
  4. About 5 years ago they really were quite keen to lend to SE, albeit with the demands of 3 years accounts (only). Not sure what it's like now, though.
  5. I agree. Those are the two options. Well, I see a long drawn out currency crisis, getting deeper every year, people getting poorer (in international terms) every year, but the leaders not having any traction in solving it (you're right -- it would take rate rises to solve it, but they'll forever be behind the curve, trying to 'help' the debtors). I see it ending in about 2030-2040, by which point a vibrant new economy has started to emerge. Or a war. This needn't be a WWII type affair -- the occasional actual conflict but lots of trade disruption and limited scope for travel. And expensive oil (again). [and now I've gone and depressed myself. I've got to get back to work...]
  6. I hate what they've done to the UK economy. They've decimated the incentives to actually invest in the economy, in employment, in having a place in the future. Instead we've got government employment (and some other similar jobs, like railways), a benefits culture and the finsec in London providing the illusion of GDP, but actually only driving the inequality ever deeper. And they don't seem to want to solve it, to make the majority in the UK have a stake in a vibrant and healthy economic future. Instead they seem to want to have a sort of feudal rentier system, with everyone just buying imported sh1t because everyone else does. It is my opinion that this state can't actually be maintained for that long, because eventually the currency collapses because there isn't anything in the UK to invest in anymore... but it'll be a long slog.
  7. The best way to get prices to drop would be to make it much more difficult to get a mortgage, not less difficult.
  8. Well, none of use know what the future will bring. Me, I assume that the UK moves to a institutional landlord system, with changes to the law to enable security of tenure. This isn't what I want, but how I see TPTB getting themselves out of the mess they've got themselves into. I see them introducing all sorts of props to help this happen without a crash in prices -- miras to support current owners (=prices) and tax breaks to support the institutional investors. (of course I'm probably wrong -- usually am...)
  9. I've been working with marketing folk recently regarding a product launch, and the general response has been that that generation are hopeless -- completely self-centred and they've got no-money anyway. [They've told me to focus on Baby boomers, as they've got all the money, and Gen-X as they're easily influenced by a sob-story.]
  10. Might be. I don't know. I've spoken of my thesis before -- that they've created a sh1tload of money and much of it is in the hands of the wealthy -- note, not the overleveraged speculators, but the otherwise wealthy. It is nice to think that they're all into BTL, but there is a tidal wave of wealth out there beyond that. I find the wealth out there to be quite scary now -- unearned wealth is now a much more significant force that earned wealth. The next financial crisis will (IMO) be the decimation of unearned wealth (just because it can't continue like this -- wealth doesn't work that way in the long term, although that is in itself a point for discussion), but that won't occur simply as the result of house prices crashing, because it doesn't actually have the impact of destroying much unearned wealth. The most direct way to impact unearned wealth is through inflation, and I see a long period of increasing inflation*, with interest rates always lagging. I don't like this, but I like the alternatives less. [*and house prices inflating but not matching general inflation -- so slowly depreciating in real terms]
  11. House prices were out of control in 2004. Now the entire economy is broken -- it'll take far more than a crash in house prices to sort it out. IMO a HPC would only make matters worse, as all the wealthy would swoop in and buy up all the housing stock -- what needs to happen is for all the unearned wealth (in the UK and around the world) to be destroyed, while earned income is supported. I'm not sure how this will happen*, but it will eventually happen. [*war is one way. I'd prefer it not to be that.]
  12. The interesting point comes when they make them in China -- shipping container house for $250 per foot (say), inc shipping. Until then they're just mucking about.
  13. It is a guide price. That sort of guide would indicate that they're expecting bids to get to around £2m. Be interesting to see what it does go for...
  14. About 6 years ago I was in conversation with a minister at DTI, and mentioned how difficult it was to get good younger people (in my specialist area) and asked what was being done to improve matters wrt training -- their response was 'just get them from Germany' with an incredulous look as though I was weird to even think of trying to use UK technical staff. I've been annoyed by that ever since.
  15. I know there are other costs in running a business, but we're comparing payment via PAYE and payment via dividend. My point was that you can't claim taxation via dividend is at 5% (or 7.5%) if you've paid CT (20%) to get to that point, where if you'd pay as PAYE you'd not have incurred the CT. I gain very much by being the director of my companies, but it isn't simply because I put through a few k as expenses. [I bought a bike last year as well. Cost me £25. I think you're mad.]
  16. How on earth do people not see where the money goes! If you pay yourself out of dividends this is after corporation tax, at 20%. 'Oh, that is different!' you might say, but it absolutely isn't. If you paid as PAYE it wouldn't attract CT. So, you could only get your 86K gross after first making a profit of £107k. This is what you should base your starting point as. I'll say it again -- if you decided to pay yourselves PAYE you'd have £107k of money to share, not £86. So, the £81k gives a tax paid of £26k and a tax rate of 25% (note again, you have to see this wrt to the total sum of money you had to pay yourself, before tax)*. Now, If you paid yourself PAYE you'd have £92k to pay yourself (after employer's NI), and you'd get about £60k after tax -- or a tax rate of 45% (after all allowances). Now this is much more than 25%, but don't make out that directors only pay 5%. [*Oh, and if you're a normal person like me (not on stratospheric income), then you'll find that the wife works anyway, massively reducing the 'pay the wife' tax dodge. I pay myself mainly paye with some dividends, and while I do pay less than if it was only paye there's only a few % in it]
  17. I agree. They should try to harmonise tax levels -- how come the base rate of tax is about 40%* for employees, 30% for sole traders and 25% for directors? See this is the problem. As a salaried employee you'll find that your employer pays some NI on your behalf. Essentially, for every £100 you earn they've had to put £116 to one side, and have paid the £16 to HMRC without even telling you. With the £100 that's left, they then pay out another £12 in NI and £20 in income tax. So, £28 in NI all together for every £100 you see on your payslip. Sole traders only pay the single % fraction of salary (9%), plus £150 a year class 4. IMO this u-turn is actually because some senior people have had a hurried call with PH about how important it is to keep obfuscated the real taxes people pay. Currently, the mob thinks that taxes are either 20%, 40% or 45% for some extra-wealthy. Even though it is obviously more than that from a simple glimpse at a payslip, that is what people think. But base rates are at about 40%. They don't want people to know that. Or that directors at base rate pay 25% -- lets not highlight that. Or that higher rate taxpayers actually are taxed at about 50% -- not double the base rate, but only higher by a quarter. Or that higher rate directors pay tax at about 45% -- only 5% more than the base rate payers. Definitely don't want the proles to know about that. [*if you read the numbers I've given elsewhere you'd be forgiven for thinking it would be 48%, but it is only 41% calculated as % from the £116 starting point (which is what you should think you should be getting) not from £100. There is a similar calc for higher rate payers, which works out at 50% of cost-to-employer -- this is lower than you'd think because employee's NI is regressive -- the tax burden decreases with increasing wealth. Similarly, for directors they've had to put aside £125 for every £100 that they want to 'pay' themselves (this time in corporation tax)]
  18. And it is difficult to exit as well! Even better! (for the Exchequer)
  19. IMO the interesting bit is that S24 mandates (pretty much) all landlords to fill in a tax return. As it stands, the HMRC don't know if a given landlord is not submitting a return through evasion or because they're not making money. With S24 they'll have returns where they can see whether there should have been a return in the past, and go chasing unpaid taxes. Actually, I see quite a few people filing incorrect returns, just because being honest would highlight past evasion.
  20. They'll introduce basic-rate miras instead. By my estimates this will be mentioned next year, and introduced 2019 ready for tax benefits to hit wallets by election 2020.
  21. They just can't see that it isn't 'an unfair tax rise' but 'the removal of a tax benefit that shouldn't have been allowed in the first place'. These people should first do a bit of research to identify all the situations where private individuals get tax relief on their interest payments, then come back and reassess their attitude.
  22. The nine most terrifying words in the English language are "I'm from the government, and I'm here to help." Ronald Reagan.
  23. Well, one aspect of the probate tax that annoys me is that it ends up being a regressive tax. The functional consequence is to increase death duty by a fraction of a %, as estate values get higher -- maxing out at about 1% (so 41% death duty at £2m estate) -- but then, the tax goes down again, so that a mega wealthy person is paying 40% again. [not that the mega wealth actually pay much tax, and certainly not at 40% of estate value]
  24. The job of councils is to spend all the money they can, whilst moaning about how little money they've got. This function is independent of how much money they've got and how much strain there is on their funds.
  25. Well, yes, but if automated 3D printing of houses became cheap and easy, then the reluctance of lenders to lend against a house not yet built is reduced (as it only costs £10k and 7 days to get to a shell, say) and the cost of land (with planning) goes up. So you sort of end up back where you started -- it costs lots of get a house and there's little you can do about it.
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