I Like It

[buyerbeware]

It seems the Tories and Libdems are seriously goading each other into Government reducing (public) spending at the moment. This is probably more than either party expected from their manifestos. They are both correct with the large knife, but the skill is in the small scapel. Wait and see.

[Mega]

I got a contact in the Civil service.............."They" know what they need to do, but they need to "feel" their way in........house price a major worry......they want to deflate the bubble not burst it!

Mike

[Executive Sadman]

It is a nice change to hear not the "xxx of 'efficientcy savings at some future date" but actual cases Liebour Pork Barrel spending being slashed.

Apparently the A14 near me wont get upgraded either. A shame, but a good thing in this climate.

Oddly maybe its the libdems providing the impetus for these cuts - they were both against nucular power and the A14 widening.

[LJAR]

The thing is that the coalition lends itself to cutting. The blame will not stick to either party really.

They have a massive democratic mandate (sort of) due to being two parties rather than one, and it means that there are two voices in govt calling for cuts rather than two in opposition sniping at any opportunity.

If they push through the increase in personal allowance, that could have a massive stimulus effect on the economy too.

My fingers are crossed!

[Liquid Goldfish]

...house price a major worry......they want to deflate the bubble not burst it!

Mike

does that mean keeping house prices at their current level but not letting them go any higher?

[Kazuya]

does that mean keeping house prices at their current level but not letting them go any higher?

Well I think the meaning of "they want to deflate the bubble" would be akin to a slow tire puncture rather than a BANG!!! - flat tyre scenario.

[Blue Nose Bear]

I got a contact in the Civil service.............."They" know what they need to do, but they need to "feel" their way in........house price a major worry......they want to deflate the bubble not burst it!

Mike

They do not have the ability, resources, options, co-ordination or intelligence to manage a 'deflation' of the housing bubble.

It's already started and will gather pace like a runaway train.

TOOT! TOOT!

[Guest_James Toney_*]

all sounding good i must admit, few more months we will be able to see good results

[Mr Yogi]

They do not have the ability, resources, options, co-ordination or intelligence to manage a 'deflation' of the housing bubble.

It's already started and will gather pace like a runaway train.

I'm sure you're right.

NuLab demonstrated that with enough resources Government can delay the bursting of the bubble, but a 'managed deflation' is another matter entirely.

The thing that they have no control over is sentiment. Once the population at large realises that house prices are heading south - albeit slowly - then supply will dwarf demand and the snowball will start to gather pace.

I have long predicted that the 'crash' will unfold over a 4 or 5 year time-span of 5-15% falls per annum. This is exactly what those of us old enough to have witnessed the crash of the early 90s saw.

The new government's change in attitude is all that is needed to get the ball rolling...

...the danger for ConDem is that it is themselves, not NuLab, who will get the 'blame'!

Edited June 18, 2010 by Mr Yogi

[Blue Nose Bear]

I'm sure you're right.

NuLab demonstrated that with enough resources Government can delay the bursting of the bubble, but a 'managed deflation' is another matter entirely.

The thing that they have no control over is sentiment. Once the population at large realises that house prices are heading south - albeit slowly - then supply will dwarf demand and the snowball will start to gather pace.

I have long predicted that the 'crash' will unfold over a 4 or 5 year time-span of 5-15% falls per annum. This is exactly what those of us old enough to have witnessed the crash of the early 90s saw.

The new government's change in attitude is all that is needed to get the ball rolling...

...the danger for ConDem is that it is themselves, not NuLab, who will get the 'blame'!

+1

Thats why they need to get the painful bit out of the way in the next 18 months.

Then they have 3 years to legislate to ensure that the opportunity of using property as an investment is squashed forever.

Only then, once the attitude and sentiment towards housing has been fundamentally changed can the UK begin to put a sustainable recovery in place that will enable it to remain competitive in the world market.

On thing is for sure wage inflation is dead for at least 4/5 years.

[Guest_James Toney_*]

I'm sure you're right.

NuLab demonstrated that with enough resources Government can delay the bursting of the bubble, but a 'managed deflation' is another matter entirely.

The thing that they have no control over is sentiment. Once the population at large realises that house prices are heading south - albeit slowly - then supply will dwarf demand and the snowball will start to gather pace.

I have long predicted that the 'crash' will unfold over a 4 or 5 year time-span of 5-15% falls per annum. This is exactly what those of us old enough to have witnessed the crash of the early 90s saw.

The new government's change in attitude is all that is needed to get the ball rolling...

...the danger for ConDem is that it is themselves, not NuLab, who will get the 'blame'!

i think if they do it now, and make a fast hard crash happen they can blame it on nulabour, if the try the managed deflation then people will think it is ConDem fault, and will be harder to forgive them,

so "lets get it on"

[Liquid Goldfish]

i think if they do it now, and make a fast hard crash happen they can blame it on nulabour, if the try the managed deflation then people will think it is ConDem fault, and will be harder to forgive them,

so "lets get it on"

If house prices fall for more than 18 months it will, sadly, be seen as ConDem's fault

[Mr Yogi]

If house prices fall for more than 18 months it will, sadly, be seen as ConDem's fault

If they realise that a 'correction' is inevitable - and with Vince Cable in the cabinet they are not going to be able to avoid the suggestion - then they may well take the view that to get it all over in a year or so may well be in their long-term interests.

It would be a very brave strategy though. If the 'natural' time span of an HPC is 4-5 years, then for the entire fall to happen in such a short time would suggest total carnage. I'm not sure that any government could survive that...

Edited June 18, 2010 by Mr Yogi

[since the beginning]

The thing is Labour knew it would be inevitable as well, so they kept banging on about locking in the recovery and to carry on spending. Obviously with or without cuts the economy would have probably gone back in recession, however when / if it does Labour will say this is the Coalitions fault. Couple that with the wrong interruption of Keynesian economics i.e. calling for spending on any old shit while in recession, as well as not having set aside during a boom, a large part of the population will blame the Coalition.

I still think that most of the Lib voters were actually Labour voters having a protest vote. I saw posts before the election of "don't be scared of a coalition" etc Of course when this Coalition involved a Tory government they all started bleating about it being a stitch-up. I was amazed to see members of Question Time audience the other day, criticising the cuts of 'front-line' services of for example hospitals, when it reality it was future spending that Labour had promised immediately before an election. It is amazing how many people in this country are oblivious to the mess Labour made.