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Ephraim Bubble Blower

Charles Bean Anecdote....

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Thanks to having attended the same college as Charles Bean (Chief Economist at the Bank of England), I was invited to attend a private talk at the Bank of England a couple of years ago, at the peak of the bubble.

At the post-talk cocktail party, fuelled by a few too many dry white wines, I decided it was high time Prof Bean heard my rather lengthy spiel on the housing market (as the link in my signature below shows, I have quite a few views on the topic).

He listened politely, occasionally (but usually unsuccessfully) stopping me in full flow to give opposing arguments, but eventually realised I was determined to get through my full speech. At the end, he said 'thanks', finished his drink and walked out, thus depriving fellow attendees of their chance to spend quality time with him.

A minor victory for the bears I think.

Footnote: his main argument was that although homeowner incomes/cashflows may come under pressure as the result of too much debt and rising interest rates, their balance sheets were in 'great shape' thanks to rising house prices. I pointed out that these two things were not uncorrelated and would be expected to get worse at the same time. He looked at me like I was mad. Should we assume the people making vital monetary policy decisions know what they're doing?

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Thanks to having attended the same college as Charles Bean (Chief Economist at the Bank of England), I was invited to attend a private talk at the Bank of England a couple of years ago, at the peak of the bubble.

At the post-talk cocktail party, fuelled by a few too many dry white wines, I decided it was high time Prof Bean heard my rather lengthy spiel on the housing market (as the link in my signature below shows, I have quite a few views on the topic).

He listened politely, occasionally (but usually unsuccessfully) stopping me in full flow to give opposing arguments, but eventually realised I was determined to get through my full speech. At the end, he said 'thanks', finished his drink and walked out, thus depriving fellow attendees of their chance to spend quality time with him.

A minor victory for the bears I think.

Footnote: his main argument was that although homeowner incomes/cashflows may come under pressure as the result of too much debt and rising interest rates, their balance sheets were in 'great shape' thanks to rising house prices. I pointed out that these two things were not uncorrelated and would be expected to get worse at the same time. He looked at me like I was mad. Should we assume the people making vital monetary policy decisions know what they're doing?

I always tend to think that others know more than me especially if they have been trained to know more than me but looking back to past precedent and economist predictions for the 1989-95 period and the majority got it completely wrong.

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  • 301 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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