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House Price Crash Forum

zugzwang

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Everything posted by zugzwang

  1. Doombrose suggesting tonight that a gilt strike by foreigners is now calling into question the long-term stability of sterling. Please let it be true! http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/
  2. UK financial markets were (and are still, largely) a completely lawless free-for-all which is why the GFC's biggest frauds - Lehman Bros International, AIG, RBS, Madoff etc - either originated in or were run through the City of London. The City continues to oppose and frustrate Treasury efforts to impose parliamentary authority over the octopus of tax havens and shadow banking conduits it sustains, as it has done for half a century or more. The neoclassical insistence that markets are naturally risk minimising and utility maximising when left free of regulatory supervision is absolutely sovereign, despite said belief having no theoretical or empirical foundation.
  3. If household debt/gross disposable income is the measure then Osborne and Carney have almost certainly eclipsed Brown: the echo housing bubble has exceeded its inspiration!
  4. Benny the Bubble's got a new book out, explains everything.
  5. Torygraph in full-on, credulity shattering hyper-ramping mode. "The housing market has now bottomed out" says economists
  6. Subprime state backed lending has been tried before, it was the essence of Fannie and Freddie! The bailout and unwinding of both may ultimately cost US taxpayers north of $1 trillion...
  7. One imaginary number subtracted from another imaginary number to make an imaginary difference.
  8. Only the cheap, accessible stuff. As true today as when Hubbert proposed the idea in 1956. Shale oil is just another ponzi gimmick.
  9. Thanks for that link, FT. I share your scepticism about the OBR's household debt projections. They look absurd. Anything above 140% of gross disposable income is thin air indeed, and quite unsustainable (see below, and Steve Keen for an explanation). Given that UK household debt/disposable income currently stands at ~145% expectations of a substantial re-leveraging to come are almost certainly mistaken. Chart taken from here
  10. I don't think it helps to frame things as Labour vs Tory any more. They've made the same mistakes because both parties have been broadly following the same free market agenda, the Tories since 1979 and Labour since 1994. It's the idea of rational expectations, financial self-regulation and offshoring that's at fault - each of these constructs has been imported into the political economy via the City of London and the Bank of England. Traditionally, both parties would have treated them with suspicion if not outright hostility.
  11. Very welcome, and long overdue. Tobin tax next, please.
  12. 5.3% budget deficit. Dennis Healey was obliged to call in the IMF for less!
  13. That's Neoclassical/New Keynesian economics for you: public debt doesn't matter much because it can always be inflated away, and private debt doesn't matter at all since its simply a question of account balances. Hanging's too good for the bastards.
  14. Exhausted world stuck in permanent stagnation. Not my words, for once, but those of the IMF. http://www.telegraph.co.uk/finance/economics/11520098/Exhausted-world-stuck-in-permanent-stagnation-warns-IMF.html
  15. Quite terrifying, isn't it? Like 2005 on Whizz and E.
  16. It gives you some idea of how much of the national income is once again being diverted into the hands of these parasites. 100% more profit than any of them deserve.
  17. "To fight this recession... Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." Paul Krugman, 2002. http://mises.org/library/krugmans-call-housing-bubble
  18. Countries are struggling to manage their economies in difficult times because they took the advice of this innumerate, one-parameter hoon fifteen years ago. Keynesianism = welfare for bankers.
  19. We're in the same boat as we were in 2004-5. We know that it's a ponzi scheme. We know the economics used to justify it are flaring nonsense. We know it's guaranteed to collapse in flaming infamy, we just can't say when. For me, the key determinant is household debt. Anything over 150% of income is a red light historically. We're not there yet, but another 12 months at ~7% p.a. and we will be. Of course, last time we peaked at 170% some two years after we cleared 150% (in 2005) but lenders were desperately pitchforking world + dog onto i/o back then which may have enabled that final up leg.
  20. BRIC services PMIs slip, sliding away. Just need China to roll over nicely and we may have ourselves another global recession. Word. http://trueeconomics.blogspot.co.uk/2015/04/6415-bric-services-pmis-overall.html
  21. Feed the horse enough oats and eventually some will work its way through for the sparrows to eat, along with copious amounts of dejection. J. K. Galbraith's 'horse and sparrow' theory of tax and income, otherwise known as trickle-down economics.
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