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It's Different This Time

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All (?) of us here appreciate the business cycle. The warning lights seem to be flashing red and the alarms are screaming for all those without tin ears to hear.

A crash is not a matter of if. It is when, I will stick out a leg and say not much more than a year (this feels so much like 2006), but I may well be wrong on that, maybe we are at 1997 :blink:

But this time it's different. in 2009l the reckless and the feckless were bailed by interest rates to 0.5%.

What are they going to do to save them this time? Direct QE to mortgage holders... ;)

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Bail in...... except for protected hard-working pensioners of course.

Hard to tell when at the moment. It's like a staring game out there.

Edited by Maynardgravy

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All (?) of us here appreciate the business cycle. The warning lights seem to be flashing red and the alarms are screaming for all those without tin ears to hear.

A crash is not a matter of if. It is when, I will stick out a leg and say not much more than a year (this feels so much like 2006), but I may well be wrong on that, maybe we are at 1997 :blink:

But this time it's different. in 2009l the reckless and the feckless were bailed by interest rates to 0.5%.

What are they going to do to save them this time? Direct QE to mortgage holders... ;)

Good question, they may let them sink this time?

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Bail in...... except for protected hard-working pensioners of course.

Hard to tell when at the moment. It's like a staring game out there.

There is not enough "money" to bail in to make a dent on the side of this debt mountain.

They will do something stupid, reckless and damaging (to most people), of that I am certain.

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Shameless ramping on the One Show - Andrew Bulmer: "There are no warning signs out there.."

Stupid Bint: "There you go... it's a good time to buy then...."

They are really rolling them out now. Can't be far off.

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There is not enough "money" to bail in to make a dent on the side of this debt mountain.

They will do something stupid, reckless and damaging (to most people), of that I am certain.

Sure, what's new?

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Guest spp

Looking at modern history (70's-present), apart from the last few years we've never had interest rates/basic savings rate running below inflation for a prolonged period of time...consequences??

Doesn't real capital formation come from savings...consequences?

Granted the U.K is borrowing on average around £2 billion a week, but there does seem no end in sight to the faux 'recovery'!

Going by the economical confidence model from Martin Armstrong it does show a major down turn next year (2015.75) though.

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Shameless ramping on the One Show - Andrew Bulmer: "There are no warning signs out there.."

Stupid Bint: "There you go... it's a good time to buy then...."

They are really rolling them out now. Can't be far off.

So...the insane asking prices..the 0% interest rates..the government backed deposit scheme and 90% of the population screaming BUBBLE...are not warning signs?

These people are either stupid...naive...up to their knees in the pyramid or just plane corrupt. When London finally goes these people should be locked up for their part in it.

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So...the insane asking prices..the 0% interest rates..the government backed deposit scheme and 90% of the population screaming BUBBLE...are not warning signs?

Step back and forget what we've witnessed the last 5 years...When you look at those stats above and compare them to what was considered the previous 'normal'...3.5x wages, strict lending, around 5%+ savings/interest rates etc :blink:

So they are really just squeezing out every borrower they can...stretching the ponzi elastic band?

Edited by spp

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Step back and forget what we've witnessed the last 5 years...When you look at those stats above and compare them to what was considered the previous 'normal'...3.5x wages, strict lending, around 5%+ savings/interest rates etc :blink:

So they are really just squeezing out every borrower they can...stretching the ponzi elastic band?

Trying to prop up the pyramid if you ask me, most likely while then in the know sell off their portfolios. Its like some crazy man with freshly printed counterfeit money is going round buying loads of property just to swap their dodgy money for something tangible....

No one in their right mind would buy now.

Edited by TheCountOfNowhere

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Trying to prop up the pyramid if you ask me, most likely while then in the know sell off their portfolios.

No one in their right mind would buy now.

It probably comes down to who the biggest debtor is...western governments. The VI seems to know no end to its debt limit. The banksters just go along for the ride because they can take a cut of the interest.

Can it go on forever!? :unsure:

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It probably comes down to who the biggest debtor is...western governments. The VI seems to know no end to its debt limit. The banksters just go along for the ride because they can take a cut of the interest.

Can it go on forever!? :unsure:

No. The FTSE has been more or less flat since Feb 2013, even more so in inflation-adjusted terms. The law of diminishing returns appears to be kicking in.

This pig is done.

financialization-curve.jpg

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It probably comes down to who the biggest debtor is...western governments. The VI seems to know no end to its debt limit. The banksters just go along for the ride because they can take a cut of the interest.

Can it go on forever!? :unsure:

Quite simply no.

Eventually everything will be monetized and there will be nothing left to borrow against. Once all future income, property, commodities, education, health system, the roads - or income from, railways, lotteries, mineral right etc.

Can't be too far away though,

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Good question, they may let them sink this time?

Didn't Mike Carney say in November last year "Home-owners should not rely on being bailed out of any future difficulties by rising house prices" , but I still get very confused, were the bail outs to save home-owners or to keep the market high? I somehow doubt it is ever about ordinary people trying to get on and live ordinary lives. If this whole mess had anything to do with ordinary people the government wouldn't be lending people in a "bubble" market, deposits that the banks/building societies will not lend. Why? Every time I look at a property prices on Rightmove in 2001 and then 2005, I still sit here incredulous that ANYONE ever allowed that to happen, yet here I am, 8 years on, watching people putting their properties on at ludicrous prices 2007 + another 10 or 20%, when what property should be doing is dropping to pre-bubble affordability. Every time I hear "we need to build more homes" , I wonder , who can afford them, even the affordable ones even at historically low interest rates?

Wouldn't it be lovely if life was about something other than house prices?

I wonder if anyone else on houseprice crash just wishes property was something affordable that people just live in ....

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What are they going to do to save them this time?

As Gerald Celente says, 'When all else fails, they take you to war.' Think Syria. Think Ukraine.

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.........

Wouldn't it be lovely if life was about something other than house prices?

I wonder if anyone else on houseprice crash just wishes property was something affordable that people just live in ....

The sad thing is, it's not just about house prices. It's going to bring down the whole economy, perhaps the whole western world. And everyone (well most people on this board) knows it.

You can bet the people in charge have got bolt holes, 1000s of miles away, from themselves and their families. They must know the consequences of what is about to happen..

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The sad thing is, it's not just about house prices. It's going to bring down the whole economy, perhaps the whole western world. And everyone (well most people on this board) knows it.

You can bet the people in charge have got bolt holes, 1000s of miles away, from themselves and their families. They must know the consequences of what is about to happen..

:angry:

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The sad thing is, it's not just about house prices. It's going to bring down the whole economy, perhaps the whole western world. And everyone (well most people on this board) knows it.

You can bet the people in charge have got bolt holes, 1000s of miles away, from themselves and their families. They must know the consequences of what is about to happen..

Yes, it's why I'm not at all looking forward to it. I know it needs to happen but I take no pleasure in it, knowing the abject misery that it will cause.

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The sad thing is, it's not just about house prices. It's going to bring down the whole economy, perhaps the whole western world. And everyone (well most people on this board) knows it.

You can bet the people in charge have got bolt holes, 1000s of miles away, from themselves and their families. They must know the consequences of what is about to happen..

I don't quite believe that. It's a convenient a position to hold for those against hpc, those who've owned houses who've only known decades of mental house price inflation, or those who feel their overpaid boom jobs at risk.

Even if it were true, if would be very painful, but may be better than the extreme unfairness now, to allow more balance.

This is more likely, which may mean creditors having to accept less, in exchange for a different mix of things. Quid quo pro; one thing for another.

Debts are retired by paying them off, " restructuring" or default. In the first case, no value is lost; in the second, some value; in the third, all value. In desperately trying to raise cash to pay off loans, borrowers bring all kinds of assets to market, including stocks, bonds, commodities and real estate, causing their prices to plummet.

The process ends after the supply of credit falls to a level at which it is collateralised acceptably to the surviving creditors. Financial assets, and all other asset-classes of value, will be selectively repudiated by default, not obliterated by inflation.

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I don't quite believe that. It's a convenient a position to hold for those against hpc, those who've owned houses who've only known decades of mental house price inflation, or those who feel their overpaid boom jobs at risk.

Even if it were true, if would be very painful, but may be better than the extreme unfairness now, to allow more balance.

This is more likely, which may mean creditors having to accept less, in exchange for a different mix of things. Quid quo pro; one thing for another.

Nope, it's going to bring down the system. Consider how the money-system completely froze up with just one investment bank, Lehman Brothers, collapsing. Now what happens when 50%+ of the banks go under all at once? Well we kind-of already know from the example of the great depression in the 1930's. Worse still the system is much more finance dependent and interconnected now than in those days.

There is only one logical conclusion - we are going to have a system wide collapse and reset.

Edited by alexw

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Yes, it's why I'm not at all looking forward to it. I know it needs to happen but I take no pleasure in it, knowing the abject misery that it will cause.

It's loads of laughs around here with house prices x2-x4+ what I think they're worth.

Save us from the misery won't you alex, with anti-crash tales of terribleness.

Let's have even more HPI, or price stablisation, to make it all nice for everyone. Got to keep home-owners strutting around on how much their homes are worth, and BTL portfolio landlords happy.

Housing stock valued somewhere around £4-£6 Trillion pounds. National debt of what... £1 - £2 Trillion including a few offsheet balance things? Consumer debt of say £1.5 Trillion. And we'd all get wiped out in a crash, everyone in poverty, scavenging for food? All it would require is some deflationary adjustments and living within our means in the global economy.

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It's loads of laughs around here with house prices x2-x4+ what I think they're worth.

Save us from the misery won't you alex, with anti-crash tales of terribleness.

Let's have even more HPI, or price stablisation, to make it all nice for everyone. Got to keep home-owners strutting around on how much their homes are worth, and BTL portfolio landlords happy.

Housing stock valued somewhere around £4-£6 Trillion pounds. National debt of what... £1 - £2 Trillion including a few offsheet balance things? Consumer debt of say £1.5 Trillion. And we'd all get wiped out in a crash, everyone in poverty, scavenging for food? All it would require is some deflationary adjustments and living within our means in the global economy.

It's not about us, it's about everywhere. The same bubble exists everywhere. It will result in a global depression worse than the 1930's. Don't you get that yet?? The monetary system connects everything. You wipe out the banks you wipe out the global financial system - the one that global trade depends upon. Why do you blind yourself to this?

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