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Mark Carney Says Uk Housing Market In Widespread Recovery

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http://www.bbc.co.uk/news/business-26216141

Mark Carney says UK housing market in widespread recovery

Mark Carney said there was little he could do to cool the London market

Bank of England governor Mark Carney says the UK housing market is generally recovering.

Mr Carney told the BBC's Andrew Marr programme that, looking at the UK as a whole, "we are now seeing house prices begin to recover, so it is a more generalised phenomenon".

He said the only area where prices had not picked up was Northern Ireland.

He also said there was little the bank could do to cool the London market, where prices were rising far faster.

Cash

Prices in London are rising by about 10% a year, but Mr Carney said a change in interest rate policy - not on the cards in any case until the recovery is well established - would not cool the market as a significant number of properties were bought without a mortgage.

Asked if he was concerned about the very fast-spiralling London property market, Mr Carney said: "Much of what's driven in London, of course, is not mortgage-driven but is cash-driven.

"It's driven, in many cases, by foreign buyers. We, as a central bank, can't influence that.

"We change underwriting standards - it doesn't matter, there's not a mortgage. We change interest rates - it doesn't matter, there's not a mortgage, etc.

"But we watch it and we watch the knock-on effect."

'Clarity'

Mr Carney reiterated his belief that UK interest rates would not return to pre-crisis levels of around 5% until all spare capacity was being used in the economy.

He said: "What we've had thus far is a consumer-led recovery.

"What we haven't seen yet is business investment picking up.

"It's part of the reason why we're trying to provide as much clarity to business that the path of monetary policy, the path of interest rates, is going to be calibrated very carefully, to ensure that only when we see sustainable growth in jobs, in incomes, and in spending will we make adjustments."

Last week, Mr Carney overhauled the Bank's interest rate policy to reflect falling unemployment and the economic recovery.

The Bank's rate policy will now be determined not just by unemployment, but by a wider range of indicators.

Limits

Mr Carney also discussed bankers' bonuses, saying new rules ordering banks to keep back more capital could hold back bonus payouts.

He said the rules, designed to protect banks from future economic shocks, would prevent them from paying increased bonuses if that would cause capital levels to fall.

The rules, known as Basel III, will come into force near the end of this decade and will apply internationally.

Mr Carney said they would have a real impact and should change banks' behaviour.

He also suggested that bonuses could be deferred for an even longer period than the current three to five years, giving a greater time frame in which they could be clawed back, should it emerge later on that unnecessary risks had been taken.

Last week, Barclays increased its bonus pool despite posting a fall in annual profits.

F*ckwit

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What does he mean by "recovery"?

Re-inflating the bubble is the opposite of a "recovery" I would have thought.

It's like you break your leg, and the doctor comes round, and says "hmm it's nearly healed. Here I'll stamp on your other one and break it, that will help you recover".

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What does he mean by "recovery"?

Re-inflating the bubble is the opposite of a "recovery" I would have thought.

It's like you break your leg, and the doctor comes round, and says "hmm it's nearly healed. Here I'll stamp on your other one and break it, that will help you recover".

My £ should buy more....not less...but if they want to steal my wealth, that is how they do it.

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So he can't control the london market- but if london were to collapse it would take down the rest with it- which means that he has no control over any bubble in the housing market.

So all that crap Osborne spouted about how the BoE could 'step in' if the housing market were to become a threat was not true- and he presumably knew it was not true.

And I have read reports that Carney privately thinks that Help to buy will overheat the market.

I just saw a web banner ad for Help to Buy on another site- it said ' Backed by HM Government'. :lol:

What a wonderful epitaph for the party of the free market that is-

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"Much of what's driven in London, of course, is not mortgage-driven but is cash-driven."

"It's driven, in many cases, by foreign buyers. We, as a central bank, can't influence that."

I'm genuinely baffled that a supposed senior economist doesn't understand (or won't acknowledge) how interest rates influence what rich people do with their cash! The majority of these cash buyers would simply not buy property with their money if it was earning a decent return from other instruments, like bonds, whose yeilds are of course are directly dependent on central bank policy! i mean WHAT THE F*CK?!

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Carney really is an absolute C U Next Tues.

What's interesting though is to read the comments on the article... almost every one of them could have come from HPC. The public sentiment re house prices has definitely shifted.

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"Much of what's driven in London, of course, is not mortgage-driven but is cash-driven."

"It's driven, in many cases, by foreign buyers. We, as a central bank, can't influence that."

I'm genuinely baffled that a supposed senior economist doesn't understand (or won't acknowledge) how interest rates influence what rich people do with their cash! The majority of these cash buyers would simply not buy property with their money if it was earning a decent return from other instruments, like bonds, whose yeilds are of course are directly dependent on central bank policy! i mean WHAT THE F*CK?!

+1

Anyway, I do not believe in existence of these "cash buyers", and even if that is true, then who are those alleged endless que of people buying houses (slums usually) like mad for huge amounts of cash at totally mad prices for all these years constanly? This myth does not make sense.

What makes sense is that City funds use FLS and HTB via proxy (middle man) to "purchase" these properties.

Also,if these tens of billions of alleged cash are entering the market, then in order to "help hardworking people" compete with all this alleged cash, HTB also has to be infinite and involve unlimited amounts of money.Crazy.

Not to mention that HTB is definitely NOT needed in London if it's housing market is already "strong".

Any way one looks at these stupid comments (and stupid outcomes) it does not make sense, unless one (and many others) are imbecils.

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"Much of what's driven in London, of course, is not mortgage-driven but is cash-driven."

"It's driven, in many cases, by foreign buyers. We, as a central bank, can't influence that."

I'm genuinely baffled that a supposed senior economist doesn't understand (or won't acknowledge) how interest rates influence what rich people do with their cash! The majority of these cash buyers would simply not buy property with their money if it was earning a decent return from other instruments, like bonds, whose yeilds are of course are directly dependent on central bank policy! i mean WHAT THE F*CK?!

Come on, it is obvious that he knows that, his comments are for sheeple consumption. Was it the Marr show? The opening credits tell you all you need to know, Welcome to Diddy Land, Marr hasn`t asked a challenging question in his life, his job is just to give politicians a comfortable chair to spout from as sheeple eat their toast and dream of HPI "wealth".

Sorry, it was the BBC website. The Marr show is still an insult to anyone with a half functioning set of brain cells, as is the like of QT (mostly)

Edited by dances with sheeple

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prices being forced up by sub prime lending backed by money printed by the boe and supported by government schemes and propaganda, plus letting every investor in the world buy a house in u.e UK i can assure everyone, in NOT a recovery, its a disaster waiting to happen.

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Bank of England governor Mark Carney says the UK housing market is generally recovering.

Mr Carney told the BBC's Andrew Marr programme that, looking at the UK as a whole, "we are now seeing house prices begin to recover, so it is a more generalised phenomenon".

Perhaps next time there is any market weakness, we won't have a repeat of last time, with hpcers trying to outdo one another with excuses for victim big mortgage debtors. Playing straight into VI hands, and bringing worse continuation pain on to non-owning younger generations and savers.

The end of 'The Hunt for Red October' comes to mind; "You arrogant ass. You've killed us."

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Macro pru... phooey. He won't do anything to rein in London prices because Osborne is preparing to take the bubble nationwide with the Spring Budget.

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Asked if he was concerned about the very fast-spiralling London property market, Mr Carney said: "Much of what's driven in London, of course, is not mortgage-driven but is cash-driven.

"It's driven, in many cases, by foreign buyers. We, as a central bank, can't influence that.

"We change underwriting standards - it doesn't matter, there's not a mortgage. We change interest rates - it doesn't matter, there's not a mortgage, etc.

How do banks/lenders make a profit, on all this cash buying, at ever zanier prices of last few years? (whilst hpcers cry about victims lured into it, told by their parents, couldn't expect a crash ect ect).

Even if it's money from abroad, that gets parked in UK seller's account, it's something they have to pay a little bit of interest on, and hopefully assists their overall 'health' capital position.

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Macro pru... phooey. He won't do anything to rein in London prices because Osborne is preparing to take the bubble nationwide with the Spring Budget.

Yeah I'm moving towards this view. Maybe the htb 5% will be lowered to 0% as I think they are limited in that they cannot kill the stamp duty cash cow. If you look at Lloyds market update rising prices is improving the look of the loan book. It is magic.When it all goes wrong the fscs guarantees might be tested.

Edited by Ash4781

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It's a load of ******!

Say I have some tulip bulbs and I want to sell them. There's a price.... £1 per bulb. If I then say I will lend up to £1,000,000 for the purchase of a bulb, because tulip bulbs only ever increase in value. The price of the bulbs go up, so I'm correct in my assumption that tulip bulbs increase in value as they now cost £1,000,000 !!!

So if I now want to purchase a tulip bulb, with cash. I have to pay the inflated price, as though I was paying with borrowed money.

This is pretty basic stuff here Mark, you dick!

Now bulbs cost £1,000,000 so I stop all loans for bulbs, as (to be honest) it's getting out of hand. Nobody can borrow for bulbs, it's cash purchasers only I'm afraid. :angry:

What happens to the price of bulbs? Do I as a cash purchaser still value bulbs at £1,000,000? or do I pay £1 for them?

I rest my case your honour. :)

This is pretty basic stuff here Mark, you dick!

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Where there is a will...

he could pressure the government to change rules of ownership as they have in Switzerland.

or put in place capital controls.

or indeed thru the simple effect he has on the exchange rate...after all THEY CRASHED THE POUND with their interest rate/loose money policy that created an instant housing crash for overseas buyers but continued to price out non owners in this country.

...they have steadily sold a chunk of our joint collective assets over the years, trains, power, water, electricity, council homes, sold our dredgers, slowly selling off parts our health services, sold the post office...now our private houses are up for sale to anyone who believes in them enough to think that they will be a good buy going forward...goodbye, nice knowing you, moving on rapidly. ;)

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its seems the 2007 bubble prices that collapsed the economy and banks is their normal and a target for them. the banks balance sheets must look rosy at those prices.

a recovery for the banks for sure....a recovery for the population of the country...its the opposite of that. wages not going up, government debt going through the roof, no real jobs, country falling apart.

this foreign bloke carney is a disaster for us all...allied with the governments desperation to get re-elected they are putting us on course for a real collapse...will the savers profit from it...unlikely....they just want everyone's money to save themselves...we is being robbed and them elected by us are helping them!

Edited by TheCountOfNowhere

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Macro pru... phooey. He won't do anything to rein in London prices because Osborne is preparing to take the bubble nationwide with the Spring Budget.

"We have tools to deal with that" :D

Good wheeze.

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Really what did you expect of the Tories.

National assets, rentierised under the guise of privatisation.

London property being sold to the highest foreign bidder. God help people that have to work there.

Don't vote the Chunts ever again (not that there is any real choice). All are HPI/rentier parties.

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Overheard in Hampshire last week - asking price £265k, reduced to £215k: "I just need to exchange".

There is a banking castle defended by a moat and a drawbridge. The water is thick with corpses and mortgagors are still falling off the bridge.

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Overheard in Hampshire last week - asking price £265k, reduced to £215k: "I just need to exchange".

There is a banking castle defended by a moat and a drawbridge. The water is thick with corpses and mortgagors are still falling off the bridge.

Nicely put.

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Even talk on some of the FX forums of GBPUSD 'gapping up' this evening as the markets open. Carney made it quite clear interest rates are not going to be raised anytime soon. Think some traders are getting a bit carried away on last weeks buying spree. There is some pretty touch resistance just ahead.

But I could be wrong of course!

Edited by aSecureTenant

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I did watch this interview, he came across as incredibly smug and arrogant.

He said nothing really of any substance,

The only point of note to me was how Marr spent most of the interview talking about house prices and very little about the actual economy.

The whole thing was bizarre from that respect,

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