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PerfectCircle

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Everything posted by PerfectCircle

  1. Is it really a bad news? Talking only about London, never understood why people bother with dogs given the requirement for internal space (the smell in a relatively small flat is quite upsetting even on best effort to clean), the lack of outside facilities (ok few large parks, but rarely on your doorstep) and the usual lifestyle which involves being away from the house most part of the day. Not even sure, animals were seen as companions on such a large scale in society in other time in history. Dog helped at the farm, and cats hunted mice, till 70's as far as my grandad was concerned.
  2. I am not denying a downward trend as most YoY data for London have shown a continuous price weakening. Volumes have gone from 12 000 in July 2015 to just over 6000. For the rest, you just introduce some technicalities such as wage inflation as if one would look at wage growth to justify spending more on a house, or picking up vastly illiquid authority such as Westminster and City (50 and 20 transactions a year) or K&C which do not reflective the larger London market (other falls are pretty insignificant). All borrows are closely correlated at least within the same region, yet we see some strong gains near flat prices. Housing maket is illiquid by nature, only 3% of the housing stock is exchanged every year, probably even less in London for couple of years. It is mostly bought by non-professional money (household) hence irrational and driven mostly by sentiment. The sentiment is that sellers refuse to take price cut and buyers can't stretch any further, I have read some estimates showing that almost 50% of property fail to sell and are withdrawn from the market. Bank have been very accommodating this business cycle 2008-today compare to the 90's crash, this explained largely why we didn't and still don't see big price falls despite strong headwinds.
  3. I am not trying to do anything, I want a London crash more than anyone else here. We had some bitcoin type capital gain since 2012 (+50%-100%) depending on the area, and you keep splitting hair to prove we are done 1-2% rather than up by the same amount. Volume is the only thing collapsing right now, but sellers don’t want to cut prices and buyers can’t afford to pay more, market is stalled. Fact. Price falls are never gradual and sustained to bring back historical prices to historical average, they are sudden, brutal and unexpected. When we will have one, we won’t have this debate, it’ll be obvious to even amateur BTLers but it’s not happening just now. London and part of the SE are totally dislocated to their respective population's income, we re talking about 12x multiple. Valuation are a lot tighter outside the commuting belt hence the capacity for a fall nowhere near the same, it is a two speed train, and possibly no strong correlation between them.
  4. We = This forum including myself Out of the 7 negative borrows, 2 (City and Wesminster) are far too small too be statistically viable (city must have less than 20 transaction a year), and one (K&C) is mostly niche super-prime which arguably peaked in Sep 14. Now for what must be 90% of the household in London, we see a slowing pace of price increase but no collapse. Now, it doesn't put in question the expectations of an incoming and well overdue crash but it just hasn't happen yet with no sign proving otherwise between December 2017 and now either.
  5. We say that every month, and when it's pointing south, we all expect an acceleration of the MoM fall. I have checked London data, almost every authority, including central ones, are up YoY. Situation is simple, nothing is going to collapse until we have forced sellers. Good news is BoE has seen enough evidence that the economy may start to overheat hence will continue their interest rate increase possibly as soon as May. BtL is going to take yet another hit with increased refinancing cost, and potential buyers may find that earning a bit more on their deposit savings is compensating for the inconvenience of renting. It 's a dominoes game, but the first piece hasn't moved yet.
  6. No supermarket in 40 years managed to even remotely approach the taste of Nutella. I won't even touch the waitrose/tesco one with a barge pole, might aswell through 2 quids in the gutter
  7. Nutella sits just under butter in the list of holly product that are unalterable for any respectable french person. I remember people outrage when some EU body tried to ban Nutella for health reason. Ferrero would be bonkers killing the golden goose.
  8. Are we saying that no Fund Manager would ever design a fund raising strategy based on a falling market? Obviously, those guys are doing so well for themselves with other people's money, an hair cut of 50% across 99% of the funds, would only hurt investors and reset the potential for future gain. Thinking about it, they can only attract more capital by claiming money growths.
  9. Report from the FT on Davos conference https://www.ft.com/content/6a892d1e-0013-11e8-9650-9c0ad2d7c5b5 Finance CEOs (Credit Suisse and Blackstone) bullish on the world economy, confirming earlier report this week from GS of buoyant sentiment underpinning stronger equity bull market. Are these 0.1% amongst the 1% brightest mind in the world be defeated by a self proclaimed ex-factory worker? More seriously, Durhamborn, how do you explain that none of what you presented here never seems to ever get remotely mentioned as a small probability by the most influential players in business? Do they have secret research department working out the unpleasant scenarios while the PR fabricate some spiel designed around what is commonly accepted?
  10. Exactly my thoughts, it couldn't sound any more bearish should it have been written by notorious CountofNW.
  11. I am an excellent listener aren't? I think probably 95% of the traffic here never post. Muts have been reading this forum daily for 5+ years. Anyhow, I am following London closely so looking to see what other data some will manage to collate but if Rightmove shows falls, Nationwide and Halifax to and finally LR, there isn't many holes in the puzzle left.
  12. CB slashed interest rate and increased QE (2008) => lowered cost of refinancing => increased number of companies in business => increased rate of employment => but downward pressure on margins => downward pressure on wages => household consumption gets negatively affected=> retail names start falling => defaults trickles up the chain to non-client facing business => unemployment rises, accelerating the negative spiral.
  13. London borough Oct-17 Oct-16 Price Diff. Sales Volume Brent £478,958 £504,665 -5.10% -33.00% Southwark £503,286 £521,833 -3.60% -35.30% Wandsworth £606,092 £617,956 -1.90% -6.20% Lambeth £515,220 £521,630 -1.20% -3.00% Enfield £398,294 £400,662 -0.60% -14.90% City of Westminster £971,478 £961,901 1.00% 4.50% Camden £819,641 £805,146 1.80% 3.70% Croydon £375,112 £368,082 1.90% -33.80% Barnet £544,579 £533,793 2.00% -32.90% Sutton £382,887 £374,923 2.10% -15.60% Kensington And Chelsea £1,246,683 £1,217,676 2.40% 15.60% Barking and Dagenham £293,230 £286,210 2.50% -8.80% Haringey £552,909 £537,787 2.80% -21.30% Havering £365,854 £355,900 2.80% -6.40% Harrow £478,613 £465,172 2.90% -20.40% Hillingdon £418,994 £406,859 3.00% -24.80% Richmond upon Thames £661,723 £639,088 3.50% -0.80% Islington £657,710 £634,621 3.60% -9.30% Ealing £494,778 £477,266 3.70% -22.80% Bromley £447,425 £430,090 4.00% 3.50% Hounslow £400,095 £384,391 4.10% -15.20% Hackney £569,343 £546,368 4.20% -19.50% Bexley £344,383 £330,194 4.30% 3.40% Lewisham £425,029 £406,336 4.60% -18.20% Waltham Forest £441,061 £420,220 5.00% -14.80% Newham £380,293 £359,280 5.80% -20.60% Hammersmith and Fulham £765,971 £720,857 6.30% -16.80% Redbridge £426,488 £401,347 6.30% -11.20% Kingston upon Thames £515,912 £484,221 6.50% 15.90% Merton £537,253 £504,287 6.50% -4.90% Tower Hamlets £498,598 £465,362 7.10% -56.20% Greenwich £404,271 £374,524 7.90% -45.40% City of London £889,728 £792,664 12.20% 150.00%
  14. 20M+ people are gravitating around London, prime prices dictate the premium/discount associated with the proximity to the center. Prime is down since end of 2014, central locations are pointing south for 12 months (Islington, Camden, etc), peripheral authority should be the next dominoes to fall as people find better value inner london.
  15. Looking at trendsetter, London is down -0.9% MoM, and up 2.1% YoY. It is largely evidenced now that prices have stopped rising for the last 12 to 24 months depending on how central you look.
  16. Indeed. Last year was down -4.6% MoM... http://www.rightmove.co.uk/news/wp-content/uploads/2009/07/Rightmove-House-Price-Index-December-FINAL.pdf
  17. Meanwhile.... https://uk.reuters.com/article/uk-japan-eu-trade/eu-japan-conclude-worlds-largest-free-trade-agreement-idUKKBN1E21QH Oh ******** I hear you say, but don't worry, our fine negotiators will carve out a most favourable deal that will put this minor agreement to shame. Taking back control!
  18. The whole thing was doomed from the beginning, I have no idea what people were expecting when leaving the biggest trading bloc in the world. I guess they got sold by Brexit politicians who certainly nailed their rhetoric but became a lot quieter when reality caught up. Border control, trade agreement, regulatory law, that's a hell of a task for a country so divided in the first place.
  19. First of all, I give you credit for depicting such a controversial prediction with so much detail. It is also quite captivating to read. I think we all agree here something is brewing since the sorcerer's apprentices cheated the last economic cycle in 2008. Casualization of employment, liberalisation of the economy, privatisation, explosion of public and private debt and general high leverage in the economy, there isn’t much left the govs’ haven’t done to prop up the economy any further, and you may be right to think that we are on the verge of witnessing the greatest investment programme ever conceived. Saying all that, the industry of the future are robotics, medical, AI, big data, green energy, telecom, and socially responsible tertiary company to name a few, where the heck are they going to find millions of trained engineers and tough low skilled workers to put the rail down or install fibre optic up the highlands. History doesn’t repeat itself, and there is something deeply unintuitive in expecting the next recovery cycle to be based on traditional, old fashioned industries (but my intuition might be completely wrong!). Inflation wise, if we have a large unemployed workforce, and an ever greater overcapacity in most commodity markets after decades of cheap money (china is piling up vast amount of unused steel and other raw materials), the inflationary pressure will be initially low, although I guess enough money printing will eventually trigger some. On the other hand, I do agree that infrastructure are in a severe need of investment (US alone needs $15 TRILLION just to renovate the existing ones, let alone building more) so some dots undeniably align here.
  20. Indeed, I meant unemployment. I am not denying the recession part of the prediction and its endogenous causes, but cannot understand the inflationary mechanism behind the cycle theory.
  21. Fascinating thread. I have read a big chunk of the many pages but still struggle to understand what will trigger the hyperinflation cycle (given that the entire theory is built on the back of the 30 years deflation/inflation cycle turning soon, that is a big hole). Economy enters into recession due to chain reaction of defaults in a low margin hyper leveraged environment, employment rockets up. Governments panic and start a massive infrastructure investment programme on a back of supportive central bankers who created as much liquidity as needed. So essentially, privately funded activity gets substituted by public (state) intervention, here governments are only pick up the slacks on a typical Keynesian way, employment is unlikely to be lower than currently, job will be of low added value, so little upward pressure on wages. When we draw a parallel with today’s situation, it is clear that the classic Phillips curve does not apply any longer, so much so that every central banks admit not understanding anymore the drivers of inflation. Theories of various sorts like commodity prices, globalisation, new tech and demography are pushed forward, and god knows which one is determinant. In that context, I struggle to understand how Durham can be so certain about the inflation direction over the next 5-7 years while it seems the concept of inflation itself is questionable in the 21st century. If anyone can shed some light...?
  22. The share is taking a tumble this morning, -5.5%, and flirting with record low 90.
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