@contradevian
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Posts posted by @contradevian
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I tried to explain to him that it was because of the subsidy that he couldn't actually make any money by farming the land, but he didn't get it.
This year his wheat has cost about £114 / tonne to produce and the current price is about £114, but has been lower since the harvest. I suspect it will go up, but for now his profit will be his subsidy
Farming is, as a business, merely a way of keeping hold of the land anyway isn't it?
Well according to Share The Rents
http://www.sharetherents.org/articles/scotlands-bank-backed-land-grab/
With arable land at £8,000 per acre and the cost of borrowing at about 4%, the annual interest cost is £320 per acre. This is unaffordable at current wheat prices. The price of wheat would need consistently to be £250 per tonne to justify a purchase price for arable land of £8,000. The traditional method for estimating the price of a farm which would enable the purchaser to fund a mortgage and to make a living from the farm puts the price of a farm at 20 times its rent. This was the basis of the price we paid for our farm in 1992. The Royal Institute of Chartered Surveyors (RICS) Land Market Survey (2015) states that the average rent of arable land is £85 per acre which means its purchase price should be £1,700 per acre. The current acreage price of £8000 is 4.7 times more expensive than its productive capacity would justify and its rent would be £400 per acre.But basically the farming subsidy is to buy land not grow food. The real 'crop' is to harvest land subsidies and entitlements to subsidies, only nieve fools thinks its actual food that you eat.
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I don't see what the problem is... The basic income should be enough to live on. If people want more they can work for it. In theory this is the safety net that the current benefits system is supposed to provide but which it fails to do in practice.
In reality the current safety net completely fails some people (e.g. single unemployed working age people) while trapping others in a low productivity tax credits limbo where if they work too much they actually get poorer.
The obvious solution would be a basic income for everyone. Ideally taxed out of land rents
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Im not a Tory - I am a left leaning collective workerclass bloke from the North.
Im not pinning Tax credits on Labour. Im pinning them on Brown.
Tax credits were brought in 2003 as part of Gorddie's 'Vote-for-me' splurge.
The origins of tax credits began under Heath in the 70's when they were called FIS or Family Income Supplement.
Benefit of hindsight. The aftermath of 9/11 economists feared global recession, and Brown went off the rails with spending I agree and blew an even bigger bubble (going into housing - as usual). Previously he'd stuck with Clark/Major spending limits.
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Lot of Tory boys trying to pin everything on Brown. I suspect we'd have had the same scenario under the Tories. Probably worse, especially as they were wanting even less bank regulation than even Brown. The only difference maybe less of a tax credits mess, but of course have created a mess of their own with Universal Credit.
Unless employers can come up with proper paying jobs, this is going to unravel very quickly for the Tories.
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Is that £60K of work? Extension already in place (it seems to me).
Archived listing (more pics and description): http://www.zoopla.co.uk/property-history/116-headroomgate-road/st-annes/lytham-st-annes/fy8-3bg/34433250
The house next door sold at about the same time (£105,000) (asking price was £135,000) - ? -
He has overspent, probably should have spent less than £30k to successfully flip
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I wonder if some of the savings from lower oil prices have simply fed into rents, according to Ricardo's law of rent this is where the rental increases in the UK an USA are coming from.
Now supposing oil prices rose and interest rates went up 0.5%, what do we suppose would happen?
I like the way you are thinking!
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If the cost of living has moved beyond what a full time wage can pay in a job from a multinational publically traded firm, then society has a massive problem.
I dont believe for one second thats the case- yet. Employers have no incentive to raise the wage because of the tax credits topping things up at the margins. So f**k the shareholder dividends and f**k corporate bonuses. Make them pay the wage and then calc their profits.
I say this as someone with most of their wealth in shares.
I read yesterday that whsmiths are squealing that paying the living wage will increase employment costs by 3m per annum. In thr same article they'd announced profits of over 100m. *plenty of wiggle room* to cut my divi.
www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11932777/Profits-grow-at-WH-Smith-as-it-braces-for-living-wage.html
Also raise the lower bound for paying tax and NI upto higher levels - levels that allow that single person or family unit to live in a basic manner. Noone should be paying tax and then getting money back. Its nonsense.
Basically agree, but any improvement in workers situation will most likely just increase in rents and end up in land. I've no doubt some of the bonuses and dividends that WH Smith's pay out will end up in land somewhere.
Its land reform and taxing land as high as possible that is key and taxing everything else as little as possible that is key.
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I'm a bit old fashioned and don't like kitchens in the lounge
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Permitted development legislation changed from april.
http://www.legislation.gov.uk/uksi/2015/598/pdfs/uksiem_20150598_en.pdf
Now watch the price of land rocket even more!
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Oh really, what about the guys who set up Paypal, ebay, facebook, etc. And this is just off the top of my head example because my business and millions of others would never have worked without the incredible wealth share these things are.
The surplus of profit and wages all go into 'land rents' anyway. In SF/Bay area the one's really making out are the landowners and landlords who did absolutely nothing to bring about a tech boom. Just hitched a free ride on the enterprise of others.
Certainly a problem that needs tackling with automation/robotics just around the corner. Or the main beneficiaries will be land owners
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As I've said before part of the bad economic choices people made is they encouraged you to borrow more because of the tax credit system. I would suspect many people did gleefully borrowing in excess because of it. Withdrawing the money is going to highlight these bad decisions, if that happens the government is likely to panic and reverse some of it's decisions. It's going to be interesting once these cuts start to kick in. There is something of a paradox that these "bad economic decisions" at the time could be viewed as reasonable because that is what the system allowed, people never seem to realise that the free money might be withdrawn. Once it's been implemented people just assume it will always be there.
The woman on Question Time didn't. She rents apparently and pays quite a high rent so her landlord might have! So part of her £400 'package' is funding her landlords mortgage (if he has one).
This is what really annoys me though. The financial crash was basically a crisis of private debt loaned mainly on property, yet it was successfully rebranded by the Tories as a crisis of public debt which has enabled them to carry out, basically a class war in an entirely bogus austerity programme.
Yet the real culprits, those that borrowed up to the hilt, lied about income to get on the 'property ladder;' have been left totally unscathed. I suppose these are the so called 'strivers?.' Indeed they have suffered no 'austerity' at all, as thanks to QE and ZIRP their borrowing costs were slashed, and they were further rewarded by more house price inflation, to help inflate away the debt (despite apparent deflation in the real economy). If you were a landlord, you will have had benefited from the windfall of lower borrowing costs, none of which was passed onto tenants (and onto the State, if the tenants are on housing benefit).
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Governments have 'nudged' people into bad economic decisions over decades. Long term unemployed were nudged into sickness benefits under Thatcher to hide the figures. Then baby farming became profitable, until the baby farmer gets too old and is faced with old age penury.
Finally long and short term unemployed were 'nudged' into highly marginal self (un) employment with the help of tax credits. Indeed someone I know in London has moved off JSA to become a 'self employed painter and decorator) thanks to tax credits. His hostel rent is a ridiculous £148 a week, so he has is going to have to be very successful just to pay that!
I doubt very much thelady on bbcqt would ever earn £400 a week running a nail bar from her living room, or has any incentive for it to be a success.
That said, given these bad economic choices people have made because of the State, people should be given time to adjust. No way would our parasitic rentier elite tolerate having their 'benefits' (sorry subsidies) cut like this. Giving people time to adjust to the changed economic decisions would be the 'right thing to do' in my opinion.
Sooner or later though the Tories are going to have to come good on proper job creation and actually start creating some for the masses. Can't see it happening myself with China dumping and robotics and automation just round the corner. But the job numbers are going to take a knock once the self (un)employed start signing on again.Love how people bought into the 'scrounger' rhetoric that everyone on benefits has a full Sky package and spends it all on booze and fags, only to discover the Tories mean't them!
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Having lived in a container, they are most certainly NOT the solution.
Dorkin's nails it. The benefit from cheaper housing merely transfers to the landowner because that is what happens under rentier crapitalism. Quite easily fixable my socialising the economic rent (ie LVT). -
"baby boomers - are just coming up to retirement, and were going to start putting all their impossibly expensive houses on the market."
They tend to stay put rather than downsize.
Always thought there is a risk of London boomers, pumping up house prices in the regions when they retire, as they sell up and buy Norfolk, Devon etc
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Its probably worth the piece of mind to rent from a bank, rather than some fly by night 'mom and pop' rentier
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Don't entirely buy this argument. Friend with £270k IO mortgage only paying £600 a month I think. Unbelievably was £270 pcm (I saw the mortgage statements from the Chelsea).
If you've got the equity/deposit you can 'own' a 3 bed semi for less than room rent
Oh and being self employed, he got a BTL mortgage, and lives in the property. He was looking for someone to 'fake' an AST which he might have found, so he has a rent slave paying the mortgage, but he can live there as well. -
If you look at the comments on the DT's item about BTLs looking for CGT relief (on another thread), most could have come from this forum. The mood is changing and the MSM are picking up on it.
Most probably did come from this forum
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Daft suggestion I know, but refer to your tenancy agreement for compliance
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Why on earth can't Council's revalue Council tax bands, and create an extra one for mega properties.
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A very good point, and one which the msm seems incapable of grasping. How has the divergence of house prices and rents from incomes been maintained for so long? Markets aren't perfect, of course, but the generational inequality we've seen implies an extraordinary degree of dysfunction.
Its understandable. They got round the problem of 'economic rent' that befuddled the classical economist Adam Smith, Mill and Ricardo, by no longer teaching classical economics in schools.
Basically surplus from wages and profits goes to rent and so to 'the rentiers that make money in their sleep.'
You can see the effect in the High Street. Cheap stuff from Chindia, free staff (or on zero hours) so what is the effect of this on "rent?"
Tax rentierism and there would be no one on zero hours contracts, fewer on minumum wage, and probably much fuller employment. The only obvious solution is the one that is never taken of course.
What was the obvious outcome of dual income households? Well higher house prices, through higher land values.
This great 'capitalist' model has resulted in housing that is unaffordable, and land that is too expensive to grow food on. We are constantly told the only alternative is 'dangerous socialism' hmm. It isn't.
If the Government were really on 'our side' it would strive to lower the cost of living and preserve our competitive edge. It would squeeze the rentiers out of existence but instead they have created a tollbooth economy from education to energy supply, where the populace would be powerless against price gouging.
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Indeed. Re-direct the foreign aid budget to encouraging repatriation back to poor countries...more of it will probably end up in the local economies of those poor countries than giving it to foreign governments.
Oh you mean like Latvia. Sorry but the neofuedalist rentiers of the Chicago School got there first. Latvians had to leave because they couldn't afford to live there.
Latvia emerged from the Soviet Union without any debt, and also with a lot of real estate and a highly educated population. But its political insiders turned over most of the government enterprises to themselves. Latvia had been a computer center and also the money-laundering center of the Soviet leadership already in the late 1980s (largely as a byproduct of Russian oil exports through Ventspils), and Riga remains the money-laundering city for today’s Russia.
Privatizing housing and other property led to soaring real estate prices. But this bubble wasn’t financed by domestic banks. The Soviet Union didn’t have private banks, because the government had simply created the credit to fund the economy as needed. The main banks in a position to lend to Latvia were Swedish and other Scandinavian banks. They pounce on the lending opportunities to opened up by an entire nation whose real estate had almost no tax on it. The result was the biggest real estate bubble in the world, along with Russia’s. Latvians found that in order to buy housing of their own, they had to go deeply into debt. Assets were only given to insiders, not to the people.
A few years ago there was a reform movement in Latvia to stop the economic bleeding. Jeff and I brought over American property appraisers and economists. We visited the leading bank, regulatory agencies. Latvia was going broke because its population had to pay so much for real estate. And it was under foreign-exchange pressure because debt service on its mortgage loans was being paid to the Swedish and foreign banks. The bank regulator told us that her problem was that her agency’s clients are the banks, not the population. So the regulators thought of themselves as working for the banks, even though they were foreign-owned. She acknowledged that the banks were lending much more money than property actually was worth. But her regulatory agency had a solution: It was to have not only the buyer be obligated to pay the mortgage, but also the parents, uncles or aunts. Get the whole family involved, so that if the first signer couldn’t pay the cosigners would be obligated.Sound familiar?
Sure. If we could just shoot/hang all the faux free market 'libertarians' then yes, everyone would go home
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!!
One of these days there is going to be a major fire, and a whole world of grief is going to come crashing around their ears.
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My parents first colour TV was £350 in 1971 and it was only 19' and only got 4 channels
Wish they had held out cos they could have got a flat panel TV from Tesco with a bigger screen and Freeview for just over a hundred.
Oh hang on, they are now dead.
What people should be asking is why is 'stuff' cheap and housing hideously expensive. Sometimes you watch this old re-runs of old game show showing 80's tat like HiFi's and you think, "thats quite expensive."
If housing were subject to the normal laws of capitalism rather than the neofeudal laws of rentierism, then a house would be a few years wages and you could order one online.
I posted a link yesterday. I suggest people read it. Industrial capitalism was supposed to free us from the bondage of feudalism. Yet since the our de-industrialisation, we have merely re-instated the robber barons. All the gains of free markets and white heat of technology went to the rentiers.
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This was the headline issue for me. Basically formal recognition in international law of something we have long suspected - corporates are more powerful than sovereign countries. Get used to it.
Correction. American corporations
Tax Credit Sad Face :-((((((
in House prices and the economy
Posted · Edited by RentierParadisio
You need an 'entitlement' to claim CAP. And from what I can gather they get bought and sold too! You can even 'rent' an entitlement to CAP!
http://www.townsendcharteredsurveyors.co.uk/entitlements-wanted-2013-c130.html
Be nice to have a working tax credit 'entitlement' and be able to sell it on the open market for cash! lol