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IMHAL

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Everything posted by IMHAL

  1. This is looking very ominous. How will the markets react to this? Will this mean that the stock market will go exponential in a fight to tie up money to something that will preserve wealth?. [hence Buffets move into utilities?] I would have thought that gold would now start to move up up up. Could someone could enlighten with what the implications are. HAL
  2. With you all the way on that. These NuLabour guys have been taking the p1ss for years now - high paid jobs for the boys - planning developments for funding buddies - the list is endless and compounded by initiativitise - a constant money-go-round of new policies that are conciled to the bin of hare brained ideas that only a wall of highly paid NuLabour policy makers with a wall of our money could possibly dream up. They might as well be spending money on digging holes and filling them in again - it would do less harm. Its time for the NuLabour socialist experiment to end. HAL
  3. No mate average salaries for a factory worker in Greece is ~8-10k Euros - house prices are about 120-150k Euros for a two/three bed flat in a small town outside a city. They have it worse than us - however they by enlarge have inherited money (more of the population own land - so lots of old mony exsists) - this is what they are living on - the old money will come to an end eventually - but this may take a generation. Non the less they are finding it hard and they will find it harded. HAL
  4. All good questions. My take on this is that the banking deregulation experiment has failed - the banks expected ordinary people to be rational about what they borrow, especially when they consider that their homes are at stake - that has proved to not be the case. So - we had profligate lending matched my profligate borrowing - followed by laws which minimised the impact of arrears and viola! we now have a system where the banks and the whole system is a hostage to the people [the indebted ones that is]. So now the system is deemed to be not operating in a self correcting mode - the pain of correction is thought to be too much for the system to bear and may collapse. The net result is an all too visible hand on the tiller by the politicos in the most sensitive part of the financial system- this will inevitably result in unintended consequences. These consequences may take time to appear, but appear they will. [see the USA freezing of IR for subprime]. When these consequences manifest themsleves - the politicos will be tempted to rig the market again [to rebalance the problems they have caused] - this is a sure fire path to self slow corrosive destruction. The lowering of IR's at this point in time also send out the wrong message - they are saying we will always come to your rescue - so don't warry - if it gets bad we will help you [Northern Crock, IR cut in 2005, Will Hutton with his balmy ideas]. The BoE are now in doodoo teritory - we know that they know that we know that its all based on HPI - without it - there is no growth - so they have no option but to try to keep HPI going - the problem is that they also know that any more growth in HP's will result in certain destruction of the economy and certain depression. There only hope is for a softish landing in HP's followed by moderate 'under the radar' inflation [wage and real] to moderate its effects. The problem with their soft landing scenario as we all know is that when momentum starts to build the outcomes are uncertain - if HP's start to go down as a result of high LIBOR and credit tightness then they can kiss their soft landing goodbye and we will have a recession anyway. There will no doubt be a period now where we all assess what the mpact of this rate cut is - if LIBOR comes down then they will have succeeded in making everyone of use a debt slave - with savings or not. HAL
  5. What is the bet that they will Lower IR again in January? I think they will and in Feb and in March..... If they do then Merv will keep his job - the question for one and all is when will the meeja pick up on the fact that pertol prices are starting to to their pockets and heating costs and food costs.........ad infinitum. The MPC will not be happy until they start to see the inflation monster again - they need something to fight. By this time it will be too late - pay awards will be up and wage inflation will start eroding the accumulated debts. Only when the meeja start to sing about the costs of living will we get a return to sense. HAL
  6. Lets face it an IR cut would have the opposite effect of easing the strain on the economy: Saving on mortage (if any) - £20 per month Loss on inflaton - £1 per litre to £1.10 per litre - average loss per month £10 Loss on heating ~ 5% = £5 per month Loss on Food ~ 3% = £5 per month So by my reckoning they would be net neutral by the end of the month - with the increased prospect on further inflation to come. HAL
  7. An IR cut on the card today and the VI's out in droves baying for an IR cut. The effect of an IR cut has been discussed with the majority of pundits sensing that the actual impact on the borrowers will be negligable as LIBOUR is the factor that drives mortgage rates. However we have seen that in 2005 the BOE reduced IR to forstall falls in house prices and it seemed to have worked - magically taking the pain away from home owners and freeing them to get into more debt and carry on partying. In 2007 Northern Rock where bailed out by the BOE just when it looked like pain was on the horizon - the government even provided extra protection to NR savers that was not afforded to savers elsewhere - other banks must have taken note and must be wondering is there is any price to pay for taking excessive risk. In the USA there is talk and solid plans to bail out sub prime borrowers - with Will Hutton talking about similar plans here. I feel that an IR cut today will simply re-enforce peoples view that the BOE and Gov will always come riding to the rescue of the hapless and feckless - the stakes of Moral Hazard have increaed sgnificantly - leading even the sane, prudent and resourceful to question the sense of being on the right side of any financial contract. If the BOE cut IR - given that HPI is still YOY positive, growth is still respectable, Inflation is on the up, employment is strong, spending is still relatively healthy and the issue of Moral Hazard so accute then IMHO we are headed for hyperinflation. What is your view? HAL
  8. This is a one dimensional arguement to say the least. If the state cannot provide basic services entirely financed by a relatively modest wage then surely the state is too big and inefficient - the services cost too much and there is too big a saftely net for the hapless and the unfortunate (turning them into the hapless?). The problem is that the real cost of living has spiralled out of control - which is being financed by you and me by increasing levels of debt and leaving all of us out of pocket - for a very long time. HAL
  9. Very very good point - not one picked up by any of the politicos so far. This would get the blood boiling if put to the public and make Gordos job (pathetic attempt at) even tougher. HAL
  10. This is just public bid posturing - they are sending a message to the bidders that they 'really are' prepared to break it up unless someone comes up with a non extortionate offer on the taxpayer. My guess is that they have put this in a place that will not get too much public attention - they like to keep the message simple for the sheeple - oen't want to panick them into taking out more saving - or disillusion those valuable voters that have cost them so much money to hang onto. The bidders on the other hand will sit back and watch the gov sweat - at the last minute they will up their offer by a tiny bit and the gov will cave in (easiest option for them) - the taxpayer will be utterly shafted and Virgin will make a bundle. HAL
  11. Generalisations are likely to offend someone - that some one being you on this occasion. I think that the meaning behind the generalisation was that resource/investment is being diverted into areas that are in the logm term not good for the economy - these are false avenues - a kind of mal-investment that results from speculation into something that ultimatley proves to be false. The gentleman is simply saying that if we did not have this mad speculative bubble then that investment would possibly have been targetted at something more productive (wherever that may by - engineering, media etc). No one can blame anyone for deciding to work in any environment that pays the best wages - its just that this level of diverted resource into a false avenue means that we have lost time and skills in other potentially profitable avenues. HAL
  12. All makes sense if you think that oil is running out - so go from the petro dollar to the gold backed Amero. Ahhh - thats better - the yanks are still in control. HAL
  13. I do not think this will work - it creates a vicious circle - after all who would buy mortgage backed debt if the prospect of a rate freeze is on the horizon - it will make worse the woes of the credit market. Making both short and long term money virtually impossible to get for any potential home owners. It would essentially make cash Super King. Have I got this wrong? HAL
  14. The original web based article had many intelligent comments from readers - needless to say that most of them where less than impressed with WH's arguements. My own view is that WH has lost the plot - he can see that something nasty is coming down the road and wants to do what every good champagne socialist wants - protection on the down side but have all the gains from the upside. If WH is reading this - GROW UP - we either live in a socialist state and the government confiscates all assets and hands out equally to all citizens or we live in a capitalist state and you take your chances in life - that means speculators are allowed to be punished by the market. I really thought that Labour was about helping the poor - no - they like to help themselves stay in power by whatever means necessary. HAL
  15. He's talking out of his jacksy - he is basically saying that if prices go up then consumers should be allowed to borrow more - the trouble with that arguement is that you are basically saying that the public should continue to subsidise industry by printing more money and allowing consumers to get into even greater debt. This turkey is advocating hyper-inflation - lets hope he does'nt live in Diss and DEFRA don't find him. HAL
  16. LOL!! I think Nu Labour are trying a perverse sort of reverse attempt to colonise the world - instead of occupying a country and then running it - they are inviting everyone into this country and then when there is no one left in the host country, they will sneek in and swap. Breaking news! Nu Labour have announced their new vision which is to swap country with Poland. They aim to do this by inviting all Poles into England and then when there is no one left in Poland we are to sneak in and take over. Gordon has set two targets 1) that the rate of Polish migration is to be increased to 3m a year 2) that each year indigenous Brits will be migrated to Poland at a rate of 5 million a year. In this way we should achieve a country swap within 15 years. Gordon has been keen to point out the upsides which are that Poland has more land, better infrastructure and pleasant weather - with an added bonus that we will no longer be neighbours with the French. His long term plan is to re-use this strategy and eventually invite all the Russians into Poland and then swap country with Russia - he claims that this will ensure energy security and Great Britains rightful place on the work stage. Gordon has shrugged off suggestions that Stalin is his hero and that leading Russian was always his long term plan. HAL
  17. I forgot to add NHS dentists to my list of typical expenses that a migrant may use - then again there aint any so maybe it was not such an oversight. Seriously - this government has been guilty of putting over one sided stories for so long (spinning and getting away with it) that they now think its normal - no wonder democracy is breaking down - typical Nu Labour. Here is a corking example - Brown says he cares about the environment: - we trade carbon used in this country so that other countries burn the same amount that we do not use - Derr?? - we promote growth so that...... we can consume more - Derr?? - yet we disincentivise saving so that.... we can consume more today - Derr? Nu Labour thinking is so sclerotic that they cannot see that a savings culture actually makes everyone better off and promotes delayed gratification (remember that?) which conserves resources. The problem with saving of course is that it would not give Gordon more taxes with which to buy votes. Its quite simple: Growth = More Resources Consumed (the efficiency arguement is usully bogus) Even idiots understand this simple principle (but not Nu Labour). HAL
  18. [ Was it REALLY worth it? Well the answer is probably not: Typical state funded expenses for said labourer. - Cost of school for a child - Cost of doctor or hospital visits - Child benefit - Road use - Local services (police, libraries etc etc etc) - Translation services, Government quangos to see how we can integrate better etc etc etc And what is the average wage for a migrant £15k per year out of which they pay say £3k in tax and get back some of that in child benefits. It does not seem to stack up at all - the private cost of an annual hospital/doctors visit alone would wipe most of the tax paid by the migrant. The government have given us the 'free lunch' message that migrants are good for the economy - well they may be but the rest of us have to pay for it in increased council taxes and a lower level of servics that we thought we'd be getting with rising taxes. I am sure that research has been done on this before (probably by a state body that wanted a specific outcome) - but I just cannot see how it could stack up! I am not normally so vocal on this issue - but it has become a joke, the Labour government have treated the public like fools. HAL
  19. I agree - it is harmonious - this is how business works - anyone who thinks otherwise is deluded. The job of the government is to control how far business can go and how it incentivises citizens to either spend or save - they have simply encouraged us to spend without a thought for what will happen if we get maxed out on debt AND a rainy day comes along (think pension tax breaks, inceases in NI etc). The government is the one who has turned a blind eye to our excesses and we should not and cannot blame business for doing what comes naturally by making money. This is not to say that NRK business model was not found wanting - it was and the tax payer should be seriously convinced by the BOE that we the tax payer will get our money back. HAL
  20. Informative piece in the Telegraph today: http://www.telegraph.co.uk/money/main.jhtm....xml&page=3 Is the US hitting the self destruct button on capitalism - by proping up the toxic mess and reducing IR's it is effectively bailing out the big players who got it wrong and helping to perpetuate the situation - has it gone double or quits on moral hazard or has it just gone nuts? What is for sure is that the capitalist system will never be viewed as a market free of manipulation again - if this goes wrong then people will want to be paid in gold and fiat money will become worthless - this is a very dangerous game they are playing. HAL
  21. Funny - I was thinking about Guy Fawkes - what with the government set to slash private sector pensions yet again by stealth (see todays telegraph) - Guy would have been incensed today and probably would have had a mind to repeat his actions (thereby saving the tax payer much mula). HAL
  22. WOW! So this is what happens when the world runs out of resources! There is a war and they kill lots of people. HAL
  23. Hear Hear! - Mew Labour need more time to sort the mess out that the Tories created. We really need to give GordonRon Brown more time because he was not really in charge of our conomy whilst Tony was in power. Gordon really needs to make housing more affordable by allowing developers to take flats and sub-divide them into I-Flats - in that way we can get even more immigrants into the country to pay for even more worth while public servants to care for our benefit needs. HAL
  24. In the last 30 years the IMF have predicted 29 recession out of the 5 that have occured - they like to play safe. HAL
  25. Greenspan is getting worse - you can almost see through that thin veil of vested interest in helping the markets to stay steady and calm - why? - because he knows full well that he is the architect of current events and he knows that we know. HAL
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