Jump to content
House Price Crash Forum


  • Posts

  • Joined

  • Last visited

Posts posted by enrieb

  1. hi guys just found this forum and wondering if i could have your opinion, been offered 50 gold sovereigns(full) at £70 a coin .Is this good value as they are various dates and of good quality(the odd scratch).Also how can i tell if they are real, do i go to a jeweller or is it possible to get a scales or something like that.Sorry if this has come up already as i am lazy and havent read all the posts.


    It sounds like a good deal, but do you know this guy? and can you trust him? I don't know what your local area is but you could ring up a local BNTA member and arrange an appointment for him to value these coins before you buy. Possibly for a small fee. There are a lot of fakes out there and If your new to gold you should be very, very careful, it's even possible the guy selling may have bought them thinking they were real and does not know he may be selling fakes.

    The first thing you should do is do some serious research on sovereigns before you buy, heres a websites that will help. It does not pay to be lazy when spending £3500


  2. China have supplied cheap goods and created low global IR, then they have been experiencing over investment because of low global IR, because they had to drop IR to, to keep their currency weak. the result: lower prices because of over capacity. Lower prices, low rates, even more over investment. All in a cycle, until wage pressures mount, with everything boiling (that's where we are now). When US consumer demand fall, there is too much goods, smaller margins and prices could fall even more because factories tries to make more goods, and salaries break out from trend, going down, unemployment rise.

    All those new rich countries (like Russia), are suddenly a lot poorer due to weaker oil prices..China suffer.

    I don't see how supplying cheap goods creates low interest rates, I do however see that the over supply of cheap dollars to pay for cheap goods leads to huge trade imbalance and a surplus of dollars in the exporting countries, they then reinvest those dollars into countries like the US which lowers the natural rate of interest causing a consumer credit boom that sucks in even more cheap imports, thus exporting more borrowed dollars causing more dollar foreign investment to come flooding back into the country distorting the stock market and natural rate of interest.

    China will take a hit when the US goes into recession and the bubble part of their economy will burst, but they are producers and will benefit longer term from breaking away from the dollar. Lower oil prices? I just don't see that happening at all, with most of the worlds leading oil fields past their peak, but their are many other threads on peak oil and its probably best not to go into it here.

    I just don't see how china lose long term because of the economic problems in the US, its like saying that the US could not have grown into the major economic world power after WW2 because after the collapse of the British empire they would have nobody to sell their products to.

    China don't depend upon the US the US depend upon china without china supplying cheap goods on credit and then reinvesting those dollars the US would have gone in to serious economic decline years ago. The US needs 2 billion of foreign investment a day to keep the dollar from collapsing, china and Japan don't even have to sell all the dollars that they have to make the dollar fall, all they have to do is to start investing part of that money in other countries.

  3. The Shanghai are driven by the momentum from MR average Chen discovering stock trading, it's like a mania sweeping over the mainland.

    Actually the bubble is driven by the growth of money supply, which is growing at around 20 percent a year in China.

    Peter Shiff in his book Crash Proof explains, in simple terms how the US is exporting inflation to the rest of the world by creating dollars to pay for their consumption. The dollar bull argument about China depending upon the US to buy the products that it produces is compete nonsense, they will just sell their products to the next highest bidder, the difference is that the goods will be paid for in a currency that can actually be used by China to buy real products with, unlike dollars that nobody wants leaving them with little other option but to lend it back to the US consumers, which creates artificially low interest rates in the US/UK that have led to a consumption boom.

    China will have little problems selling goods to russia/iran/venezuela/africa in exchange for oil. gas, coal, metals etc... they should also do quite good trade with europe more specifically the counties in europe that still produce and export goods unlike the UK. I am sure that the middle east countries would much rather increase their trade with China then keep buying dollars, which they cannot exchange for real goods with the US on account of the US not being an economy based upon production these days.

    I am sure China will be hit quite hard at first by economic problems in the US, though they will soon find others to trade with, the SCO is still only in its early stages, yet I am sure that any loss of purchasing power in the dollar will help the SCO become stronger.


  4. The thing that is starting to bother me about Peter Schiff is that he is completely negative all the time.

    I agree with what he says about the macroeconomic situation, but as one comentator pointed out the other

    day these are mostly problems that have existed for a longer time. It seems that macroeconomic factors, which

    will have to be adressed sometime in the future, aren't necessarily too detrimental in the short-term.

    He is negative about the fate of the dollar, but he is very positive about how his investments are doing outside of the dollar. I understand how he can seem to come across as a merchant of doom, but that's more to do with the way the news program is set up to sell good news about the us economy. I would like to see a show where they talk about overseas investments vs the us investments, that would give peter the chance to show his positive message about how well they are doing and I would like to see the dollar bulls try to talk down the advantages of investing outside the dollar.

  5. I think imports will go up in theory, because the yuan will make products more expensive, and it did happen in korea, and japan, but I think the supply situation in china are getting out of hand with to many products beeing made (good deflation), the low interest rates in china and everywhere are creating overinvestment in china, that again create low rates, more over investment in a good deflation cycle... so I have a bit trouble seeing how weakening demand and increasing price can occur at the same time, if it did, it would be like stagflation in the seventies, when japanese imports got expensive. However it does not fit with Keynes economic theory, or the laws of supply and demand.

    I knew it your a Keynesian! Most of the gold bugs follow the Austrian school of economics, that's why you don't see eye to eye with us.

    here's a link to a lecture on business cycles and the Austrian bust, even if you don't agree with the Austrian perspective I am sure that you will find it interesting.


  6. You could try opening a pawnbrokers, all the goods bought on MEW will be sold off at rock bottom prices so that they can pay the higher interest rates on all the extra money they borrowed.

    If you really want to make even more proift out of their stupidity then you could buy there goods of them at a discounted price as long as they enter into an agreement to buy their own goods back on credit.

  7. I don't think inflation can be used to completly inflate away peoples debts, but it could be used to tie people into the debts they have and give them more of an incentive to keep paying the morgage, rather than handing back the keys.

    If you were lucky enought to have got a house at the start of the boom you may have got a house for 50k or even 100k the current market value of this house could now be 150k or more, you would be tempted to keep up the payments on the house as long as you can see at least some positive equity even if the morgage payments became much higher.

    If you bought a house at peak for 150k and did not put down any deposit, you would walk away from the house if prices fell or if the interest payments became to high. If the price were to remain high through the magic of inflation, you could then still be tempted to keep up the payments on the house because even though you put nothing down you may still have gained some positive morgage equity from the inflation.

    This is how I think that a lot of people will be kept locked into their debts. I know that its not a very well put theory and that the way I have tried to explain may cause some confusion, but if anyone does know a better way of explaining it, that would help (assuming anyone understands what I am trying to say).

  8. 2k per month is not a lot in the benefits economy.

    Rent of 800pcm, plus £300pw to live on for couple with two children.

    Its made up of bits and pieces, housing benefit, and DSS payments, but 2k is very average these days.

    Also if your on benifits you don't have to pay council tax, the numbers still do not make being on benifits a good carrer choice, as there are many disadvantages to being on benifits but unless you have a good trade or education the system is stacked against you if you try to work

  9. House prices in the street have probably risen >70% since majority moved in so negative equity almost certainly won't apply.

    So if £50,000 house goes up by 100% whats the price?

    Therefore I can only deduce that a 50% crash will have no effect AT ALL on the day to day lives of these people other than the fact their houses will be worth less!

    and it then falls by 50% whats the price of the house?

  10. you cannot casually dismiss for example, the impact of changes in the sun, and just assume that co2 is the root cause of global warming as it is nowhere near the case of being proven as you would like to make out.

    There can be few, if any climatologists who casually dismiss the impact of changes in the sun on the earths climate, yet the case is not proven, for or against, that the sun is the cause of global climate change.

    Yet you seem to be casually dismissing the impact of man made co2 on the earths climate, even though the case is not proven, for or against, that man made co2 is the cause of global climate change.

    The point is that there are many factors that influence the climate and could lead to global climate change, the sun is one factor that we have no control over what-so-ever. We can though do something about the amount of co2 that we pump into the atmosphere and do something to limit the amount of carbon sinks (trees) that we are destroying.

    Untill we have more conclusive data about the causes and potential solutions to the problem the one thing we should be moving towards is limiting the amount of damage that we could be doing to the climate though our actions. I don't think that politicians hold the answer and many will only fund schemes that will line the pockets of their backers, but we should at least attempt to acknowledge the potential of the problems that we may be facing.

    Do you agree that of the many factors that can influence climate change, we should at least look at doing something to limit the ones that we actually have control over, regardless of what the other factors beyond of our control are doing?

  11. I think if you look at the Reichmark, you will see that the trouble was too much cash chasing too few goods. Now people only have debt and credit cards, not cash, and we are floating over with goods. When the world economy hit a depression, those making all this products, everything from car makers in germany to those making cheap plastic toys in china, will make less money, then they will increase production output and decrease salaries leading to further price drops. Making it to many goods chasing to few money.

    Back then, they printed cash, now the money printing is done by issuing credit, using increasing M3 supply, at some point the market will enter a liquidity trap as nobody want to take on more debt, despite low interest rates, as Japan did in the eighties, the result will be deflation.

    Interesting, it may be better to start a seperate thread on inflation vs deflation rather than go into this in depth here, that is if there unless there already is a thread about it.

    When the world economy hit a depression, those making all this products, everything from car makers in germany to those making cheap plastic toys in china, will make less money, then they will increase production output and decrease salaries leading to further price drops. Making it to many goods chasing to few money.

    The problem with the increase of the money supply leading to the debasement of paper currency is that you have to print more worthless money inorder to import or produce the same goods, and people don't want to be paid in worthless money, so they don't accept the paper notes at the face value, farmers stop growing food because they don't need worthless money (this happend in germany it happened in revolutionary france and its happening right now in zimbabwe). The countries that have the capacity to produce will export their goods to countries that can export back goods of equal value. The worthless paper currency that they hold from the countries that do not produce anything will be returned home to where it came from. This may be done by buying up goods in those countries at inflated prices in worthless moneyy, then the goods that exist in the country with hyperinflation will be exported out of the country, then there will be even more fiat cash chasing what little tangeble goods are left in the country.

    I'm sure others can explain it better, but it may be best to do this in another thread.

  12. Thanks for the comments.

    We have been looking to buy since last summer, and have had a couple of purchases fall through since then. In response to the question 'why buy now if i know the market has peaked': Once you start looking for a place of your own, generally you keep going until you get somewhere. Our offer was accepted on this place back in late March. Its only recently, looking at the figures, that I have realised the market is definitely slowing and that its probably going to slow exponentially from here.

    That's not really a very good answer to the question though is it? It does not matter to me if you answer the question or not, but it will have a big impact on you for the rest of your life if you cannot come up with a better reason to buy than that, its like saying well the other ppl are still buying so it must be safe to buy

    Odd how people can feel secure even when they know the risks, just because they see others taking the same risks they assume there must be some saftey in numbers. If people see a building that looks in danger of collape, they may not walk close by it, yet if they see large numbers of people walking past the same building they will not think twice about walking near it.

    The other thing about buying now is that it feels hard on the missus to call off the move when she is looking forward to it, and the place we are renting at the moment is not adequate and so another 18 months here is not an attractive option. I suppose we could move to improved rented accommodation, but the big upheaval to move to somehwere we don't own is also an unnattractive option. The missus don't care about market conditions! She just wants a nice pad!

    Anyway good luck, I hope for you and your missuses sakes that it all works out for you both.

  13. Why do you want to buy, when you acknowledge that the market is at its peak?

    Why don't you just rent? You say you want to get on the ladder, but can only be a ladder in a rising market, if the market has peaked then the ladder you are attempting to climb may turn out to be a snake.

  14. I don't think there is a huge shortage of supply in housing, there is however a serious shortage in supply of affordable houses located in areas that people want to live in.

    The oversupply of money through lax lending standads and low interest rates has allowed some very financial unwise people to bid up the prices of houses, leaving the more sensible first time buyers with unrealistic prices that they are unable or unwilling to take out morgages on.

    The btl problems has also helped fuel the housing problem, but it seems to me that when money supply is increased then people will bid up the prices of houses, there are still plenty of cheap houses for sale but these cheap houses are in areas with social problems that people do not want to live in.

    So I do kind of agree with you that it is a supply and demand problem, it's just a bit more complex than the 'theres not enought houses' reason that I hear to often from people who are talking up the market. Increasing the housing stock would have a dramatic effect of the price of houses, even though most built recently are just flats and apartments, this is now starting to have an effect of prices.

  15. This article helps to show the bbl/oz ratio is still bullish for despite recent central bank sales.


    St. LOUIS (ResourceInvestor.com) -- With oil prices hitting 9-month highs and gold prices trading under both the 50 and 100-day moving averages this week, the gold to oil ratio has fallen below 10 barrels per ounce for the first time since December 2006.

    The historically linked inflationary measures have been diverging rapidly in the last two months, with gold down 5% and crude up nearly 8%. Gold analysts wonder if and when the yellow metal will make up the lost ground.

    Dennis Gartman, editor of the Gartman Letter, a long-time trader of this correlation, remains long of seven units of gold and short of seven units of crude oil. He vows to sit tight with this position.

    “However we'll not be happy again until the ratio trades back above 11:1,” he said in this morning’s Letter.

    Last year, the gold to oil ratio averaged about 9.2 bbl/oz, hitting lows of 8 in June 2006. At that time, gold was trading in the $570s, while crude was rallying above $70.

    The ratio could not sustain levels above 10, however, until gold breached $630 and oil fell below $60 in November.

    This year, the ratio has averaged 10.83 bbl/oz, hitting a multi-year high of 12.53 bbl/oz on January 18, but fluctuating between 10 and 11 since mid-March.

    With the 36-year average at 17.5 bbl/oz, followers of this correlation see gold moving much higher. However, weakness in the gold market of late has kept bullion trading under $700, as oil enjoys bullish fundamentals.


    In the last three months, CBGA banks have sold more than 170 tonnes into the market. Ryan estimates a total of 240.5 tonnes of sales in the last four months from central banks around the world.

    “Seeing the gold price hold above the $640 level during this period of increased sales should be the best demonstration of just how robust the physical demand side of the market is at present,” said Ryan.

  16. Should home ownership be open to all, or it should it be regulated so only smart people like investors and those in politics can buy.?.

    Yep it should be regulated by house prices relevant to realistic interest rates that are based on savings rates and money supply that is inline with GDP.

    We call this type of price regulation 'DON'T BUY STUFF YOU CAN'T AFFORD'

    Even if by manupulation of the money supply and the real rate of interest you are fooled into thinking that you can in the short term afford something that in normal economic circumstances, you cannot afford, then the same rule applies 'DON'T BUY STUFF YOU CAN'T AFFORD'


  17. nah, as im sure someone said in this thread already (i havent read it), this is because it costs banks more money to distribute more notes. Its a money saving thing. We all know what banks are like ;)!

    Varies massively. I paid £3.05 for a Fosters the other day in the Walkabout by Temple. I was shocked by that. At venues you can even pay up to £3.50 - ouch! However my local in the City charges less than £2 for the ales and non-premium lagers. But tbh I dont drink much in pubs either, Id rather save my money and pay off my mortgage - but each to their own. I certainly wouldnt have afforded my house if I had been a big drinker! I realise that beer is more important to some however, so good luck with that.

    Actually I was smug enought to buy a house at the bottom of the market over ten years ago, back then £1.80 would buy me a pint of stella so it was five pints for a tenner, or if you preffer we could measure the price of houses in stella, at those prices it cost me 15,000 pints of stella to buy at house at £27,000, which is now paid off. BEHOLD MY AWESOME SMUGNESS! Now if I were to buy the same house today at the same local pub where the stella price is now £2.70 (not even two pints for a fiver now) I would need 44,444 pints of stella to buy the same house. So either we can conclude that stella is underpriced or houses are over priced and expect some sort of correction to occur. More inflation in the beer price or a fall in the house prices to reflect a more traditonal beer ratio. Oh and good luck with teh morgage.

  18. Bank acts on £5 note distribution


    The Bank of England is to look at how it can encourage banks to issue more £5 notes, the number of which has fallen compared with other denominations.

    Bank governor Mervyn King said it had £1bn worth of £5 notes in its vault but high street banks did not want them.

    They found it cheaper to issue £10 and £20 notes and the shortage of "fivers" in circulation led to their "noticeably soiled and scruffy" condition, he said.

    Is this more evidence that we are witnessing the effects of inflation? for a few years now I have tried to use up the £5 first as they don't have that much value anymore. (good money chasing out bad?) You are lucky if you can get two pints for a fiver in most pubs, even £10 pound notes don't have much value at all. When I was younger I could get four or five drinks in a pub and spend £10, now I would not even contemplate going for a pint unless I had at least a £20.

    Would just like to add that I live up north, and the prices above are based on my experience around the manchester area, I dread to think what prices people who live in london have to pay for beer.

    On the issue of £5 notes, Mr King noted that their circulation had not increased in 15 years and that over that period the average time they remained in the banking system had doubled.

    "The problem is not at the production end - we have an ample supply of new £5 notes waiting to be used," he said.

    "There is a need for an adequate supply of low denomination notes that can be used for small transactions."

    However, he accepted that the public convenience might not "correspond to the private interests of commercial banks".

    hmm "However, he accepted that the public convenience might not "correspond to the private interests of commercial banks" Now where have I heard that before?

  19. I think I was about 24 when I bought my house in 1997, I don't think that the age you are matters, I have freinds who are 40+ who don't own and I don't think there's any real downside to not owning a house, technically you don't own it untill you have paid off the morgage. If you do want to buy then what is most important is that you buy when prices are low, no bonuses for buying at the top of the market. I can't wait to sell and get into rented accomodation.

  20. I was born in england, my father was born in england, my grandfather was born in england I do not feel 'english' or 'british' I think they are redundant labels, people are the same all over the world, sure you get a few vocal nationalists in every country, but they don't represent the majority, just as all people from london do not self identify as a cockney and talk in slang.

  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.