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Roger Bootle On Top Form

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Finally, somebody at the DT gets it:

For an individual, the availability of more money may help them to become a property owner, but this is not true for the population as a whole. In the short run at least, the supply of housing is fixed. An increase in mortgage lending will only generate higher house prices.

And.....

For without a change in the supply of houses, or in buyers' preparedness to buy, all that lower construction costs will do is to increase the price of land, leaving house prices broadly unchanged.

It is supply, not demand, that determines the availability of property. Demand determines the price.

If the Government wanted to be really radical, though, it would end the ludicrous subsidies to owner-occupiers – the exemption from capital gains tax and the absence of tax on the imputed rent from living in a property.

My link

Although he hasn't mentioned it explicitly (that's far too dangerous) he's clearly gunning for a LVT style reform, the article is definately worth a read.

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Roger Bootle is a p***k of the first order. It beggars belief that people like him are elevated to such high esteem with a salary to match. I have been following him for 6 years and find he must draw pieces of paper with different predictions from his hat when making his personal predictions with the first out. :rolleyes:

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Roger Bootle is a p***k of the first order. It beggars belief that people like him are elevated to such high esteem with a salary to match. I have been following him for 6 years and find he must draw pieces of paper with different predictions from his hat when making his personal predictions with the first out. :rolleyes:

I don't think the linked piece really focuses on predictions though...

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I don't think the linked piece really focuses on predictions though...

My point is I can`t take him seriously, in August 2005 when the MPC reduced IRs to 3.5% ( and Mervyn admitted it was a mistake a few years later )with all the brainy pundits saying IRs had peaked and were now on the way down, Roger made his infamous statement that by Q4 2006 IRs would drop to 2%. :rolleyes:

Well the rest from thereon is history. Thus started the new and dangerous credit binge by the masses ending up in the biggest bang ever known since 1929. ;)

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If the Government wanted to be really radical, though, it would end the ludicrous subsidies to owner-occupiers – the exemption from capital gains tax and the absence of tax on the imputed rent from living in a property

Isn't google great? I just found out that imputed rent is part of GDP!

That means that if you've paid off your mortgage - and live rent free - then the value of the rent you'd pay (the imputed rent) is estimated by government statisticians and added to the UK accounts for Gross Domestic Product.

Optobear

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My point is I can`t take him seriously, in August 2005 when the MPC reduced IRs to 3.5% ( and Mervyn admitted it was a mistake a few years later )with all the brainy pundits saying IRs had peaked and were now on the way down, Roger made his infamous statement that by Q4 2006 IRs would drop to 2%. :rolleyes:

Well the rest from thereon is history. Thus started the new and dangerous credit binge by the masses ending up in the biggest bang ever known since 1929. ;)

I see what you are saying, but failing to predict interest rate movements should not debar someone from commenting on what he sees as flawed goverment policy. That would be akin to saying that because your mechanic failed to predict the result of the Monaco Grand Prix, he is unfit to undertake an MOT on your car.

Plus, the episode you refer to may be in part what he is talking about - the pointlessness of just pumping the bubble back up again.

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Isn't google great? I just found out that imputed rent is part of GDP!

That means that if you've paid off your mortgage - and live rent free - then the value of the rent you'd pay (the imputed rent) is estimated by government statisticians and added to the UK accounts for Gross Domestic Product.

Optobear

FFS. That is just stupid.

Edited by Timm

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Isn't google great? I just found out that imputed rent is part of GDP!

That means that if you've paid off your mortgage - and live rent free - then the value of the rent you'd pay (the imputed rent) is estimated by government statisticians and added to the UK accounts for Gross Domestic Product.

Optobear

The fiddler (c_rab) on the roof!

2005

However, private-sector employment fell and, without Brown's huge spend, public-sector employment wouldn't have grown either.

Direct public spending wasn't the only way the chancellor conspired to boost the economy in the short term.

He needed a compliant Bank of England to set artificially low interest rates to keep credit-fuelled consumption booming. Unfortunately, the first thing he'd done as chancellor was give the Monetary Policy Committee its independence, hence, on the face of it, depoliticising interest-rate decisions. Still, to even this out all he had to do was politicise the inflation measure the MPC was instructed to track. When the RPIX went above target in late 2003, Brown just switched the measure to be followed to the new CPI, which was well below target.

Truman once said: "there are lies, damn lies and statistics", but on Brown's watch, nothing has been sacrosanct. The rate of inflation has been changed to sustain Brown's boom. Inflation measures increasingly ignore any component that goes up through arcane fiddles such as hedonic accounting (which makes inflation look much lower than it feels) and substitution.

The definition of maintenance in the highways budget has been changed to capital expenditure (or investment) to cover Brown's overspend and the length of this economic cycle has been extended deep into the previous one to cover the trail.

Perhaps irreparable damage has been done to the trustworthiness of the national statistics.

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I have been following him for 6 years and find he must draw pieces of paper with different predictions from his hat when making his personal predictions with the first out. :rolleyes:

This is what mystifies me. He does occasionally (and perhaps more often than a stopped clock) get things right - and more so of late. But he has got such a variable track record - and is so inconsistent with his views - that its hard to take him seriously.

How you doing Charlie? :)

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What a jolly good idea. There's so many things that don't appear in gdp - like if you mow your own lawn for instance or grow your own food.

I think if we impute these too, that could be a massive boost to gdp and we'll all be rich. Yay.

Now we're on track. What about the effort typing this post? That ought to count? What about time spent on the lavatory - is that imputable?

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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