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Wad

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Everything posted by Wad

  1. Just watching it on Channel 4 + 1. He really exposed how hugely rigged US the housing market really is and how it was created ironiclly by FDR after the 1930s Depression. Detroit was the epicentre of the massive collapse of the car industry in the 1930s and it is doing exactly the same thing today. Fraud, people buying houses off plan, massive over borrowing. How history repeates itself.... well it does in the housing market.
  2. Semi skimmed milk does freeze. I have 20 litres in my freezer right now - becasue I too live quite a way from the shop and have no car so it is to heavy to carry. I order 40 litres at a time from Sainsbury Direct who deliver by truck. I have a big chest freezer in the garage for bread milk, mince and other basics.
  3. A very great deal of it. I occassionally read Mumsnet and there are a few threads on there from people struggling with fees and discussing mortgaging their house to pay fees, taking a second job, hoping to work in the school in return for a fee reduction, hoping for a special scholarship or even hoping to get some money from the school hardship fund. http://www.mumsnet.com/Talk (Look at the Education forums) As I mentioned on an earlier post here a lot of Grandparents used money they had released from their house with MEW to pay school fees. A few people I know are quite open about the fact they could not afford to pay the fees without their parent's chipping in. A lot of others have made quite a bit out of servicing the property market - builders, architects, bankers and that has fueled school fees and the number of kids enetering private schools. Of course that has all come to an end now.
  4. Well, Anthony Bolton has a 50% chance of being right I suppose.
  5. I wouldn't necessarily put myself in the 'loser' cayegory but we have rented for ever - well 25 years anyway. The wife does champ at the bit about buying a house occassionally but she is pretty realistic and does agree it would be ridiculous to buy an overpriceed hovel.
  6. While I agree with you on cutting back - I think you may be letting yourself go. I suggest the following remedy: Monday: Normal wearing Tuesday: Back to front Wednesday: Inside out Thursday: Inside out back to front Friday: Pick the best out of the four above Saturday: Commando Sunday: Stay in your pyjamas all day I used to do this every week up to the age of 12!
  7. Ahh those were the days - the tanker war. I remember we took a few direct hits from Iranian Silkworm missiles straight in the 'back end 'toilet block''. We air dropped special forces divers (retired) on the decks of the disabled tankers to cut them in half with plastic explosives. The sunken back section was refloated with compressed air after being was separated from the still floating cargo hull section. We towed and unloaded the front end section and then dragged the whole lot to Cochin and ran them up on the beach to be hacked to bits by Indian scrap merchants. Good and well paid work all round. I think the oil price could bob up quite a bit from here on this OPEC cut news but then carry on down all the way to $20 or even lower. I am easy - got some Put options at $70 expiring late next year.
  8. The market is in deep contango (spot price is far lower than futures) and big oil firms and traders are renting storage space to store surplus crude it to capture the 'carry'. A deep contango shows no one is much interested in buying spot crude. To be honest the Saudis are saying they are going to cut because they have nowhere to store or sell their production so they have to slow the flow from the fields. They will have tankers stacked up off Yanbu before long. I still think the recent Saudi tanker captured by pirates was a one off because it was probably holding station waiting for orders to turn West or East as it exited the Gulf of Aden so was a relatively easy target. Super tankers without a stated destination that far out at sea and holding at turning point waiting for orders to go to major markets are generally 'distressed' cargos without a home. I know the Iranians have had 6 tankers full of Iranian Heavy crude off Kharg Island since summer and there is not that much tank storage capacity in the world. Many refineries are at tank tops in the USA as they are not getting the expected draw down in either gasoline or of distillates. Bleive it or not the world oil market is pretty much a 'just in time system' so there is usually not that much in storage but the stock is usually mostly in transit. In other words none of this news is bullish - expect further falls.
  9. I send my kids to private school and I know of 10 sets of parents who either pulled out or decided not to send their kids to private school in the last 2 years. Indeed, 1 child is being pulled out next term in my eldest son's class. I wrote to the bursar of my kids' school 18 months ago warning him that a combination of the demographic reduction in young school age children and the impending credit crunch may hit the school and asked his plans for reducing the size of the school real estate which is very extensive and spread across 3 sites. The answer I got suggested it was simply not an issue on his radar. It is now though as one part of the school is running far below full capacity. I am afraid to say that private schools have been completely oblivious and kept on raising fees far above the rate of inflation. What gets me is that in many cases they knew that parents were not paying the fees but it is grandparents mewing their houses to pay. Now that 'mew fee paying' has stopped I suspect many more will pull kids out. Add to that all the 'building contractor' and 'small business man made good' group who were paying fees out of their income and are generally first time private school buyers and that is a serious reduction in demand. In my case, I carried out an extensive search and deliberately chose a good quality school but with very low fees and put aside enough to pay at least 5 years fees if everything went bad. I am glad I did. I fully expect many private schools to be closed in the next few years. I especially think girls schools will be badly hit. I know the Malvern St James's, La Sagesse (Jesmond) and various ones in the South East have closed or merged in the last 2 years. Just in case any of you are interested here is the La Sagesse former grl's school site for sale in Jesmond, Newcastle. Informal bidding is underway already I believe and I suspect it will go for redevelopment. Not sure of the Malvern St James's site was sold or not as it came available in 2006. http://www.johnsontucker.co.uk/uploads/pdf...sse_website.pdf
  10. I don't really know where to start on this. The biggest flaw in the arguement is that the 'market' will let the UK Govt borrow at zero interest rate. Just because the Bank of England sets the Bank Rate at zero does not mean the rest of the world has to agree! We could easily be looking at 15% or more if the global capital market turns its back on Gilts. We are not there yet but the very fact that CDS are trading at 120bp over for 5 year UK Gilts suggests that the UK T Bill rate could not fall below 1.25% for very long. Encouraging the BoE to 'print' the money will cause inflation and that again will cause gobal investors to demand an interest rate at least equal to inflation plus a risk premium.
  11. I have been thinking for a while that perhaps some sort TARP scheme might work where the Govt bought ABS bonds at say 50% of face value and then offered all the underlying mortgage borrowers a 40% discount on their mortgage on condition that they take their business elsewhere. Surely this woudl be the quickest way to end the credit crunch. Overnight all the mortgage borrowers would be able to afford their mortgage and would no longer be in negative equity. The banks have already marked the ABS down anyway so they lose no more than they have already and can then just get on with recapitalising. Toxic would be wiped out and the consumer would be given some headroom to start spending again. It is moral hazard write large but then I think mortgage borrowers will just walk away anyway rather than pay their mortgage on a negative equity house. A mass coordinated debt write off for mortgage borrowers - with ABS write offs on the other side of the balance sheet at the banks is just an alternative to mass chaotic default.
  12. I've heard of TK Maxx ... maybe Woolies could rebrand to Mad Max?
  13. Very interesting thread. I was watching TV yesterday and there was a lot of stuff about how online sales businesses were going great guns and taking sales from traditional retailers and how this was good news. I was immediatley very suspicious of this story because I ordered a DVD boxed set from Amazon a few days ago and got an email the following day to say it had already been dispatched. Interesting that others are having the same experience. Perhaps there has been some increase in delivery capacity among courier firms because there were lot of late deliveries last Xmas but I suspect more strongly that there is also just a lot less demand for delivery services so there would have been plenty of spare capacity without the expansion. I noticed earlier in the year that Rentokil indicated their City Link couriers business has done badly. Perhaps not all down to online sales falling but more general reductions in deliveries by business of urgent letters and parcels. http://news.bbc.co.uk/1/hi/business/7268354.stm http://www.yorkshirepost.co.uk/businessnew...ains.4671384.jp
  14. Yeah and the worst part of it all is that quite a lot of the 'older person' generation have gone and mewed the other 50% in the last 10 years maintainng their lifestyle. Bet quite a few have no equity at all by the time this market bottoms. It explains why so many older people are clinging desperately to the hope that their house will start going up in value again and wil not even consider accepting 10% under their ludiocrous asking prices.
  15. I have a friend who rented a really large famly home in Frankfurt for 7 years. He explained that the agreement was that he had to paint the entire house and leave it in perect condition when he left which was exactly how he found it and I think he also paid for a kitchen when he got there but as he had complete security of tenure he was happy to do so. He said his rent had just gone up by inflation over the period and it was a quite normal relaxed relationship with his LL. He paid the rent and his LL just left him alone. There was nothing like the hassle and conflict we see so much of between LL and tenants in the UK. That said, I could see how in a high inflation environment 'quasi controlled' rents could lead to poor quality rental accomodation, shortgages of rental property and a 'black market'. I do sometimes wonder why we cannot have the same sort of tenancies for residential property as are common in the UK for commercial property. Surely all commercial LLs would be attracted to residential propertty if this were the case then lenders would surely be as happy to lend on rented residential property as they are to lend on rented commercial property such as office blocks. The only difficulty woudl be when a tenant wanted to move before the end of a 5 year term of a contract which is typical in commercial property. He/she would have to sublet to another tenant but I do not see a problem with that as it happens in commercial property without too much difficulty. Anyone an expert here on how UK commercial property leases work and whether they could be used for residential?
  16. I have had some interesting conversations with letting agent in the last year on this issue. I have asked on a few occassions for some kind of assurance that the LL has permisison to rent out the property by his/her mortgage company. Most agents say they have received written confirmation that the LL has a BTL mortgage. However, a few have refused. I strongly suspect that in most cases where the LL is a 'forced landlord' as they cannot sell this will almost always be the case. Which homeowner who is desperate to sell wil also go and pay an extra 1% on their mortgage just so they can rent it out? Many will not even be willing to do repairs. On the wider issue, I just cannot see why a simple reform of letting law cannot be carried out which allows landlord and tenant to sign a fixed term contract with neither LL or tenant having any right to vary any terms until the end of the tenancy. In adidtion to that, the tenancy should by law be registered at the land registry so that the tenant appears as a named party on the register alongside the mortgage provider. That way, if the LL stops paying the mortgage then the mortgage provider has the right to seize the rent but no right to seize the property until the end of the tenancy. In other words, give LL, mortgge provider and tenant equal parties with the mortgage provider havng to provide specific agreement that the property may be rented out. Indeed, the mortgege provider could specify legal minimum rent and maximum term they are prepared to agree to have the property rented out at. Perhaps a standard tenancy agreement could also be enshrined in law as well with a page attached that has to be sent to the Land Registry along with the deposit.
  17. The really crucial part of 1970s pay policy was that unionised and public sector pay awards kept pace with inflation or even exceeded it in many cases. That had a huge effect on the private sector worker who bore most of the job losses and did not get inflation matching pay increases. Add to that fact that public sector pensions are index linked and final salary and pretty much you can see that the public sector would do well in an inflation environment like the 1970s. All paid for by taxes of course. It also explains why so many wealth creators left the UK in the 1970s.
  18. The rate on Premium Bonds is 0.4% ABOVE the marginal rate of 1.38% that UK Govt paid at the latest 3 Month T Bill auction. Se here for latest tender result: http://www.dmo.gov.uk/reportView.aspx?rptC...s/tbill_tenders It is not a con - it just reflects the rate the Govt can borrow at elsewhere. That said, I am cashing in my Premium Bonds as 1.8% is a rate at which I am not prepared to lend to Govt. ISIN CODE: GB00B3BZ5C12 3 Months Treasury Bill Maturing on 09-Mar-2009 EDIT I put the latest tender result below as the link does not work too well. Lowest Accepted Yield 1.150000 Average Yield1.320928 Highest Accepted Yield 1.380000 (About 23.20% allotted) Average Rate of Discount (%)1.316592 Average Price per £100 Nominal (£)99.671754 Tail (In Yield Terms)0.059072% Amount Tendered For (£)2,386,700,000.00 500,000,000.00 Amount On Offer (£)Bid to Cover Ratio4.77 500,000,000.00 Amount Allocated (£)
  19. Guido (see here http://www.order-order.com/) has noticed this interesting clause in the upcoming Banking Bill that will remove the need to produce a weekly return from the Bank of England: Banking Bill Part 7 — Miscellaneous Weekly return Section 6 of the Bank Charter Act 1844 (Bank to produce weekly account) shall cease to have effect. The clause to be deleted is: And be it enacted, That an Account of the Amount of Bank of England Notes issued by the Issue Department of the Bank of England, and of Gold Coin and of Gold and Silver Bullion respectively, and of Securities in the said Issue Department, and also an Account of the Capital Stock, and the Deposits, and of the Money and Securities belonging to the said Governor and Company in the Banking Department of the Bank of England, on some Day in every Week to be fixed by the Commissioners of Stamps and Taxes, shall be transmitted by the said Governor and Company weekly to the said Commissioners in the Form prescribed in the Schedule hereto annexed marked (A.), and shall be published
  20. Oh goody. I am short at $70 ..... which I took on as an economic hedge to offset losses in my share portfolio. It has not worked out yet though. :angry: :angry:
  21. I recently tried to rent a property on a long tenancy of about three years. I asked for some sort of letter confirming the mortgage company were aware the property was being rented as I did not want to be thrown out half way through. Thee agent refused to contact the owner about the matter. EDIT: Needless to say the owner and agent wanted a full credit reference and rent up front and a deposit from me.
  22. Dead right. Printing money to prevent deflation is one thing - but I do think that very few politicians or central bankers wil have the guts to switch off the presses for fear of being 'too early'. The net result will be explosive inflation. The trick from an investment of point of view is to time your strategy switch out of preserving capital in default free 'safe' nominal assets (i.e Govt bonds) back into borrowing huge quantities of cheap money to buy real assets (i.e shares, property, business assets, commodities).
  23. That is what a lot of older people will have to start doing in the next few months because their savings are not earning any interest and in any case most have been digging in to their savings capital for the last two years because inflation has outstripped income. The only asset they have to sell in most cases is their house. What ensues is a fire sale of assets as happned in the 1930s - that is unless Govt decides to directly support house prices by printing money and buying houses at 2007 asking prices. Dont laugh ... anything is possible. Nothing is impossible.
  24. I think I can spot a tiny problem with this plan ..... IT DID NOT WORK FOR THE LAST DECADE AND STILL IS NOT WORKING! If they want to do quantitative easing the most direct way would be for the BoE to just send everyone £10k by electronic transfer to their bank accounts. Now that is what I call a radical plan.
  25. Wow! This is impressive. Its hapening at the UK ports too. I remember in the early 1980s crash that a unused airstrip was used to park cars near where I lived. They hid the cars behind very high walls made out of straw bales stacked on the runway. It became quite a local tourist attraction. The farmer who owned the airstrip made a fortune. At its peak I think they had about 10 acres of land with parked cars on. Then they all magically disappeared as the economy picked up and they sold them off cheap as 'used' cars.
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