interestrateripoff Posted January 12, 2009 Share Posted January 12, 2009 Perhaps the government should just get on with the job and nationalise the entire economy.But seriously, every day we get the announcement of another crazy scheme-this morning on Today they mentioned the government is intending to give £2,500 to any employer taking on a person who has been unemployed for more than a set number of months, last week it was subsidised apprenticeships. How is all this going to be paid for by a government that is deep in debt already and what are the inevitable eventual tax hikes going to do to what is left of the economy? Policy on the hoof don't you just love it, one way of knowing when a govt has no idea of what's happening is when they just keep making random announcements in the vain hope that one of them actually works. If you keep making announcements people focus on them rather than the problem and why the problem happened in the first place. One factor in the equation is set to be changed, and another ("Quant. Easing") is likely to soon follow.As usual, before the details and timeframe are known it's impossible to really estimate the results. Even when they are known, the size and speed of this economic collapse has always, to date, overtaken new measures and made the estimates irrelevant. I suppose some sort of grip, however grotesque, will be gotten one day by Govt. but I would still expect houses to be significantly cheaper in real terms by that time. What happens next is "over the rainbow", though the recieved wisdom here is it will involve inflation, eroded debt and various nasty repercussions that put house prices into a new perspective. This is the wonderful world of guessonomics, the situation is completely in freefall no one has any idea how big the whole is, all the money they have thrown at the problem so far has failed. Personally I think we need to work out the value of housing globally at peak, double it and then add on stock market value at peak and announce that as the bailout number. It still won't work but it would be a nice big figure making the politicians look all important and like they are doing something. Quote Link to comment Share on other sites More sharing options...
RajD Posted January 12, 2009 Share Posted January 12, 2009 Who will buy the bonds?the boe? Hyperinflation here we come. This has the feel of a last-gasp clutch at straws to save our drowning ponzi economy. Quote Link to comment Share on other sites More sharing options...
Sonic the Hedge Fund Posted January 12, 2009 Share Posted January 12, 2009 Does the Uk Government have AAA? Good point BL IIRC the CDS spread for UK government debt is much wider than that for Macdonalds or Coca Cola If the govt do underwrite mortgage debt then they will simply further undermine their own credit rating. Quote Link to comment Share on other sites More sharing options...
Meerkat Posted January 12, 2009 Share Posted January 12, 2009 No action can stop the global cascade, IMO. Who would you buy a house if they might lose their job? Who would invest in these things when they can see the government is overpromising and risking its rating, ending up like Ireland, or worse, Iceland? Who would buy a house that is plummeting in price? My thinking - those who may have spare cash to invest in those volumes ought to see the scam. In the best case, risk premia and GBP interest rates will rocket up if they try it in practice IMO. It's not 2007, it's 2009 we live in. As you say, anyone lending for these purposes ought to be understanding what's the collateral. Quote Link to comment Share on other sites More sharing options...
RajD Posted January 12, 2009 Share Posted January 12, 2009 Good point BLIIRC the CDS spread for UK government debt is much wider than that for Macdonalds or Coca Cola If the govt do underwrite mortgage debt then they will simply further undermine their own credit rating. Who gives a tat about their credit rating. They'll just sell the MBS's that nobody else wants to buy to the great British taxpayer via BOE (who now don't have to tell us how much money they're printing - fabulous idea donchaknow ). Banks get to rake it in risk-free, we get to absorb all of the losses . Quote Link to comment Share on other sites More sharing options...
the primitive Posted January 12, 2009 Share Posted January 12, 2009 Perhaps the government should just get on with the job and nationalise the entire economy.But seriously, every day we get the announcement of another crazy scheme-this morning on Today they mentioned the government is intending to give £2,500 to any employer taking on a person who has been unemployed for more than a set number of months, last week it was subsidised apprenticeships. How is all this going to be paid for by a government that is deep in debt already and what are the inevitable eventual tax hikes going to do to what is left of the economy? What's to stop companies getting rid of people, then nriing some lomng-termers for the £2500, then getting rid os them and rehiring the original people? or something perhaps not quite as brazen. Anyway it's yet another sh1t idea from this game-over government. Guaranteeing mortgages as well? What b0ll0cks. What is the best way to protest about this? I wrote to my (tory) MP once but he was crap, and tried to justify reducing stamp duty as the way forward Is there any hope for the UK? Quote Link to comment Share on other sites More sharing options...
Bloo Loo Posted January 12, 2009 Share Posted January 12, 2009 snip As you say, anyone lending for these purposes ought to be understanding what's the collateral. thatll be prime shared ownership 6 times joint income primest of prime rump M&S mortgages. Quote Link to comment Share on other sites More sharing options...
aliveandkicking Posted January 12, 2009 Share Posted January 12, 2009 One factor in the equation is set to be changed, and another ("Quant. Easing") is likely to soon follow.As usual, before the details and timeframe are known it's impossible to really estimate the results. Even when they are known, the size and speed of this economic collapse has always, to date, overtaken new measures and made the estimates irrelevant. I suppose some sort of grip, however grotesque, will be gotten one day by Govt. but I would still expect houses to be significantly cheaper in real terms by that time. What happens next is "over the rainbow", though the recieved wisdom here is it will involve inflation, eroded debt and various nasty repercussions that put house prices into a new perspective. Governments can inflate out of this no doubt. But what comes next? That is very very unclear to me. I think some kind of managed population reduction is needed over the longer term and a totally different attitude towards growth at any cost for the benefit of the few at the expense of the many. Quote Link to comment Share on other sites More sharing options...
GregG Posted January 12, 2009 Share Posted January 12, 2009 I think some kind of managed population reduction is needed over the longer term and a totally different attitude towards growth at any cost for the benefit of the few at the expense of the many. Good idea. You go first. Quote Link to comment Share on other sites More sharing options...
godless Posted January 12, 2009 Share Posted January 12, 2009 Governments can inflate out of this no doubt. But what comes next? That is very very unclear to me. I think some kind of managed population reduction is needed over the longer term and a totally different attitude towards growth at any cost for the benefit of the few at the expense of the many. Soylent Green? Quote Link to comment Share on other sites More sharing options...
Guest mattsta1964 Posted January 12, 2009 Share Posted January 12, 2009 Crosby proposals to be implemented - 100% mortgages here we come ;http://www.independent.co.uk/news/business...in-1301863.html Well. There we go then All links with reality are gone basically. The train now approaching Platform 2 is the delayed 19.55 British Government service to Economic Armageddon, calling at 100% Mortgage, Government Bond Issue, Extended Ponzi Scheme, and HELL Passengers are reminded not to travel without a valid ticket to self immolation Quote Link to comment Share on other sites More sharing options...
RajD Posted January 12, 2009 Share Posted January 12, 2009 Well. There we go thenAll links with reality are gone basically. The train now approaching Platform 2 is the delayed 19.55 British Government service to Economic Armageddon, calling at 100% Mortgage, Government Bond Issue, Extended Ponzi Scheme, and HELL Passengers are reminded not to travel without a valid ticket to self immolation You forgot to include 'money printing on-the-sly' and 'BOE buying gvt bonds' after 'Government Bond Issue'. Quote Link to comment Share on other sites More sharing options...
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