Mikhail Liebenstein Posted December 21, 2020 Share Posted December 21, 2020 (edited) But the very institutions, as Keen points out in the podcast, are still driven by that Boomer Economic class which do not allow any challenge to the Boomer economic and socio-political consensus. This again doesn't absolve millennials from their rather hilarious culture wars seeped in another manifestation of the century of the self - All that matters is my subjective view of who I am. CEOs, to Senior Civil Servants but crucially Economic Orthodoxy stems from that Boomer mentality of leaders. TINA - There is no Alternative to the Economic Boomer consensus of anarchic capital de-regulated neo-liberalism. Indeed, GenX are not really at the controls yet. But looking forward to pushing the last boomers out the door. We then need to address those final salary pensions in the public sector. Edited December 21, 2020 by Mikhail Liebenstein Quote Link to comment Share on other sites More sharing options...
Freki Posted December 22, 2020 Share Posted December 22, 2020 In a recent podcast in another thread, Keen mentions rightly, perhaps the most selfish generation of leaders we have ever had. All good 50+ ppl forgiven but my days, your comrades have a lot to answer for. I'm always looking for new economic podcasts mostly the one with debates, care to share the name please? Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 When you look at average incomes and mortgage repayments, housing outside London is just as "affordable" now as it was to the boomers in their heyday. When I say you can get a nice house in Blackpool for £100k you lot roll your eyes and reply I'm not living in a dump. But the boomers did. Quote Link to comment Share on other sites More sharing options...
Si1 Posted December 22, 2020 Share Posted December 22, 2020 When you look at average incomes and mortgage repayments, housing outside London is just as "affordable" now as it was to the boomers in their heyday. When I say you can get a nice house in Blackpool for £100k you lot roll your eyes and reply I'm not living in a dump. But the boomers did. Considering the low levels of home ownership in post boomer cohorts then that's nonsense. Have you seen the trajectory of salaries in the regions over the last 20 years? Quote Link to comment Share on other sites More sharing options...
GregBowman Posted December 22, 2020 Share Posted December 22, 2020 When you look at average incomes and mortgage repayments, housing outside London is just as "affordable" now as it was to the boomers in their heyday. When I say you can get a nice house in Blackpool for £100k you lot roll your eyes and reply I'm not living in a dump. But the boomers did. Its not I am a boomer and worked in the North West for a few years in the 80's - loved it - disposable income of everyone was massive so Manchester boomed, Cheadle, Knutsford, Alderley Edge etc But in common with the rest of the UK salaries are appalling relatively nearly 40 years on - people were earning 20/30/40k in good jobs but nothing special in the eighties all over the UK - now people think £60k is a fortune - compared to house prices it is no where near as affordable now as it was then tragically so You sound like a car dealer with your mortgage payment quote - what about the deposit and paying off the capital ? My deposit was £5k on a credit card on a flat in Surrey Quays that cost £63k in the late 80's If you weren't there you have no idea sorry Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted December 22, 2020 Share Posted December 22, 2020 Its not I am a boomer and worked in the North West for a few years in the 80's - loved it - disposable income of everyone was massive so Manchester boomed, Cheadle, Knutsford, Alderley Edge etc But in common with the rest of the UK salaries are appalling relatively nearly 40 years on - people were earning 20/30/40k in good jobs but nothing special in the eighties all over the UK - now people think £60k is a fortune - compared to house prices it is no where near as affordable now as it was then tragically so You sound like a car dealer with your mortgage payment quote - what about the deposit and paying off the capital ? My deposit was £5k on a credit card on a flat in Surrey Quays that cost £63k in the late 80's If you weren't there you have no idea sorry So right, I knew a sales guy in a job a few years back who had worked for Xerox selling industrial photocopiers in the 1980s; he had a £100k year one time - that was great money back then. You are right about there being a £60k threshold. A lot of people never cross that and can only dream. I did cross that line fairly early on in my career, mid 20s, and being able to show that does give you access to a rung of higher paying jobs. That said, working for an international business in a senior local/European role does seem to cap out at about £200-300k. I think to make more in the UK you really need equity or to set something up yourself. Quote Link to comment Share on other sites More sharing options...
markyh Posted December 22, 2020 Share Posted December 22, 2020 Indeed, GenX are not really at the controls yet. But looking forward to pushing the last boomers out the door. We then need to address those final salary pensions in the public sector. You miss the masterplan. Gen X (me) own more Bitcoin and Crypto than Millenials and younger. They are coming in after transfering their little wealth to Gen X. When Gen X start cashing out of Crypto they will buy up the boomers property (50% off due to a ***) with Crypto gainz, and rent it to millenials and younger. And so the circle is complete. Gen X FTW. Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 Considering the low levels of home ownership in post boomer cohorts then that's nonsense. Have you seen the trajectory of salaries in the regions over the last 20 years? Look up the Nationwide affordability index. That takes into account disposable income and what your mortgage payment would be. The mortgage payment these days is very close to what it was in the 1980's. In fact it is better in many cases. The above statement does not apply to the London area obviously. Also, the affordable mortgage payment is predicated on interest rates being low of course. Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 Its not I am a boomer and worked in the North West for a few years in the 80's - loved it - disposable income of everyone was massive so Manchester boomed, Cheadle, Knutsford, Alderley Edge etc But in common with the rest of the UK salaries are appalling relatively nearly 40 years on - people were earning 20/30/40k in good jobs but nothing special in the eighties all over the UK - now people think £60k is a fortune - compared to house prices it is no where near as affordable now as it was then tragically so You sound like a car dealer with your mortgage payment quote - what about the deposit and paying off the capital ? My deposit was £5k on a credit card on a flat in Surrey Quays that cost £63k in the late 80's If you weren't there you have no idea sorry The 1980's were catastrophic for the working class in the regions. I note you mention the well-off areas in Cheshire. It certainly was not like that in most other areas in the north. I've got quite a few nephews, nieces and offspring of my own. All of them that have got into their 20's have managed to buy much better houses than mine and in more fashionable areas. But not in the south-east. Quote Link to comment Share on other sites More sharing options...
monkeyman1974 Posted December 22, 2020 Share Posted December 22, 2020 When you look at average incomes and mortgage repayments, housing outside London is just as "affordable" now as it was to the boomers in their heyday. When I say you can get a nice house in Blackpool for £100k you lot roll your eyes and reply I'm not living in a dump. But the boomers did. This is a very good point, plenty of housing in UK is below replacement cost (say £150 psf for a new build), including Blackpool; and indeed where I grew up on the east coast. Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 Right what do you think of this. I have taken the Nationwide affordability index and contracted the data for pasting on here. The original data has 4 quarters in each year (except 2020, which has two). I have found the average index for each year to make the list much shorter. The index is based on 1985 average =100. They have found the mortgage payment needed to buy as a 1st time buyer in that year (obviously dependent on interest rate). They have found the average disposable income in that year and ratio'd the mortgage payment to the disposable income. I've provided both North-West region and London. Year NW London 1983 85 66 1984 91 80 1985 100 100 1986 86 101 1987 84 117 1988 84 120 1989 125 137 1990 144 117 1991 114 81 1992 92 57 1993 71 42 1994 67 39 1995 63 39 1996 60 38 1997 68 49 1998 71 55 1999 67 56 2000 71 65 2001 71 64 2002 73 66 2003 85 71 2004 116 84 2005 126 87 2006 129 90 2007 137 105 2008 124 96 2009 98 79 2010 95 81 2011 92 80 2012 88 82 2013 84 84 2014 86 100 2015 82 105 2016 79 105 2017 77 99 2018 77 95 2019 76 90 2020 76 87 The first thing I notice is that recent years are a lot better than some previous eras, e.g 2004-2008 and 1989-1991. But also not as affordable as 1994-1999. Recent years are notably better than the 1980's. Comments please. Quote Link to comment Share on other sites More sharing options...
dugsbody Posted December 22, 2020 Share Posted December 22, 2020 (edited) Right what do you think of this. I have taken the Nationwide affordability index and contracted the data for pasting on here. The original data has 4 quarters in each year (except 2020, which has two). I have found the average index for each year to make the list much shorter. The index is based on 1985 average =100. They have found the mortgage payment needed to buy as a 1st time buyer in that year (obviously dependent on interest rate). They have found the average disposable income in that year and ratio'd the mortgage payment to the disposable income. I've provided both North-West region and London. Year NW London 1983 85 66 1984 91 80 1985 100 100 1986 86 101 1987 84 117 1988 84 120 1989 125 137 1990 144 117 1991 114 81 1992 92 57 1993 71 42 1994 67 39 1995 63 39 1996 60 38 1997 68 49 1998 71 55 1999 67 56 2000 71 65 2001 71 64 2002 73 66 2003 85 71 2004 116 84 2005 126 87 2006 129 90 2007 137 105 2008 124 96 2009 98 79 2010 95 81 2011 92 80 2012 88 82 2013 84 84 2014 86 100 2015 82 105 2016 79 105 2017 77 99 2018 77 95 2019 76 90 2020 76 87 The first thing I notice is that recent years are a lot better than some previous eras, e.g 2004-2008 and 1989-1991. But also not as affordable as 1994-1999. Recent years are notably better than the 1980's. Comments please. Maybe you should rephrase the question to everyone: - When would you rather buy your house? During the 1980s or now? I know for certain what my answer is: 1980s. Like most people I would have had some hard years but I'd be living in a house that I could never afford now. (I can only speak for my location which is London / SE) Edited December 22, 2020 by dugsbody Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 Maybe you should rephrase the question to everyone: - When would you rather buy your house? During the 1980s or now? I know for certain what my answer is: 1980s. Like most people I would have had some hard years but I'd be living in a house that I could never afford now. (I can only speak for my location which is London / SE) But the late 1980's were less affordable than the current era. The early 1980's were no better than now. The golden era was 1993-2002. Since about 2010 or so there's been a long period of stability in this index. There seems little prospect of interest rate increases in the foreseeable future. So, 2010 was probably the time to buy. Quote Link to comment Share on other sites More sharing options...
dugsbody Posted December 22, 2020 Share Posted December 22, 2020 But the late 1980's were less affordable than the current era. The early 1980's were no better than now. The golden era was 1993-2002. Since about 2010 or so there's been a long period of stability in this index. There seems little prospect of interest rate increases in the foreseeable future. So, 2010 was probably the time to buy. You're missing the true picture, which is why I said you should ask a rephrased question, which I answered. Buying a house now, with interest rates where they are and deposit requirements where they are, you will be paying it off for the full term, which is now usually 30 or 35 years. Back then the full term was 25 years, interest rates shot down over the years, your equity increased enormously, as did your wages, and you ended up living in a house that none of us today will be able to afford in our lives. Quote Link to comment Share on other sites More sharing options...
kzb Posted December 22, 2020 Share Posted December 22, 2020 You're missing the true picture, which is why I said you should ask a rephrased question, which I answered. Buying a house now, with interest rates where they are and deposit requirements where they are, you will be paying it off for the full term, which is now usually 30 or 35 years. Back then the full term was 25 years, interest rates shot down over the years, your equity increased enormously, as did your wages, and you ended up living in a house that none of us today will be able to afford in our lives. We did not know what was going to happen when we bought ! This is all hindsight. You are wrong about the last bit. My young relatives, at least the ones who have hit the mid-20's, have all bought houses better than mine. My neighbours, in a pretty much identical house to me, are early 30's, moved in about 4 years back when they were late 20's. Quote Link to comment Share on other sites More sharing options...
Notting Hell Posted December 22, 2020 Share Posted December 22, 2020 Right what do you think of this. I have taken the Nationwide affordability index and contracted the data for pasting on here. The original data has 4 quarters in each year (except 2020, which has two). I have found the average index for each year to make the list much shorter. The index is based on 1985 average =100. They have found the mortgage payment needed to buy as a 1st time buyer in that year (obviously dependent on interest rate). They have found the average disposable income in that year and ratio'd the mortgage payment to the disposable income. I've provided both North-West region and London. Year NW London 1983 85 66 1984 91 80 1985 100 100 1986 86 101 1987 84 117 1988 84 120 1989 125 137 1990 144 117 1991 114 81 1992 92 57 1993 71 42 1994 67 39 1995 63 39 1996 60 38 1997 68 49 1998 71 55 1999 67 56 2000 71 65 2001 71 64 2002 73 66 2003 85 71 2004 116 84 2005 126 87 2006 129 90 2007 137 105 2008 124 96 2009 98 79 2010 95 81 2011 92 80 2012 88 82 2013 84 84 2014 86 100 2015 82 105 2016 79 105 2017 77 99 2018 77 95 2019 76 90 2020 76 87 The first thing I notice is that recent years are a lot better than some previous eras, e.g 2004-2008 and 1989-1991. But also not as affordable as 1994-1999. Recent years are notably better than the 1980's. Comments please. I have done a similar analysis of mortgage affordability. I agree with your analysis that once mortgage repayments have commenced they are more-or-less as affordable as they ever have been as a percentage of take home pay. The problem lies in raising the deposit for the mortgage in the first place: raising the deposit is the barrier to entry, not the ongoing repayments. Quote Link to comment Share on other sites More sharing options...
dugsbody Posted December 22, 2020 Share Posted December 22, 2020 We did not know what was going to happen when we bought ! This is all hindsight. That's not the point. You're trying to prove that we have it better today. We have hindsight. We can see we don't. Again, you can pick parts of the North to suit your narrative, I can't speak for those, only my experience in the SE. Quote Link to comment Share on other sites More sharing options...
dugsbody Posted December 22, 2020 Share Posted December 22, 2020 I have done a similar analysis of mortgage affordability. I agree with your analysis that once mortgage repayments have commenced they are more-or-less as affordable as they ever have been as a percentage of take home pay. The problem lies in raising the deposit for the mortgage in the first place: raising the deposit is the barrier to entry, not the ongoing repayments. There is that but there is also the measurable impact in the longer term. With interest rates this low and low inflation and low wage inflation, you're going to be paying that house off for the full 35 year term. People who bought in the 1980s would have been able to pay their house off much, much faster due to lowering interest rates and rising wages. That has a measurable impact on your long term wealth. Quote Link to comment Share on other sites More sharing options...
Notting Hell Posted December 22, 2020 Share Posted December 22, 2020 There is that but there is also the measurable impact in the longer term. With interest rates this low and low inflation and low wage inflation, you're going to be paying that house off for the full 35 year term. People who bought in the 1980s would have been able to pay their house off much, much faster due to lowering interest rates and rising wages. That has a measurable impact on your long term wealth. Completely agree: these factors are a direct consequence of low interest rates. Quote Link to comment Share on other sites More sharing options...
steve99 Posted December 22, 2020 Share Posted December 22, 2020 Considering the low levels of home ownership in post boomer cohorts then that's nonsense. Have you seen the trajectory of salaries in the regions over the last 20 years? I think you will find genX is fully subscribed to the housing market and in fact had one of the best runs ever when they came of buying age during the 90's. All my and my wifes siblings of that age group bought then and at good prices compared to the 80s with the mega interest rates. 90's was the era of low house prices with ever declining interest rates. As I said in other posts, its not a generational war as many think but a structural change imposed somewhere at the top to fill the pockets of the already very rich. If you think a younger generation of governance is going to make a difference you have your head up your bum. Nothing short of a social revolution will change it and as we can see, a pandemic has just entrenched it. Just look at who is in charge now, what age they are and what class they represent. Quote Link to comment Share on other sites More sharing options...
steve99 Posted December 22, 2020 Share Posted December 22, 2020 There is that but there is also the measurable impact in the longer term. With interest rates this low and low inflation and low wage inflation, you're going to be paying that house off for the full 35 year term. People who bought in the 1980s would have been able to pay their house off much, much faster due to lowering interest rates and rising wages. That has a measurable impact on your long term wealth. Those who bought any time up to the early 2000s have benefited for low prices and declining interest rates. Quote Link to comment Share on other sites More sharing options...
steve99 Posted December 22, 2020 Share Posted December 22, 2020 Maybe you should rephrase the question to everyone: - When would you rather buy your house? During the 1980s or now? I know for certain what my answer is: 1980s. Like most people I would have had some hard years but I'd be living in a house that I could never afford now. (I can only speak for my location which is London / SE) 20:20 Hind sight is wonderful magic. Of course using that super power you would make that decision. No one back then had any inkling as to what the future changes to the economic system were going to be. Quote Link to comment Share on other sites More sharing options...
Social Justice League Posted December 22, 2020 Share Posted December 22, 2020 I feel a bit hard done buy as I was born in 1975 so during the golden years of low house prices I was at uni. Came out of the other side in 1997 age 22 and we all know the story from then on...................and I voted for Blair. A life wasted you could say. I now say a life debt free or maybe even a lucky escape. Quote Link to comment Share on other sites More sharing options...
Tapori Posted December 22, 2020 Share Posted December 22, 2020 I feel a bit hard done buy as I was born in 1975 so during the golden years of low house prices I was at uni. Came out of the other side in 1997 age 22 and we all know the story from then on...................and I voted for Blair. A life wasted you could say. I now say a life debt free or maybe even a lucky escape. THINGS CAN ONLY GET BETTER Quote Link to comment Share on other sites More sharing options...
MonsieurCopperCrutch Posted December 23, 2020 Share Posted December 23, 2020 I'm always looking for new economic podcasts mostly the one with debates, care to share the name please? If your looking for interesting podcasts here is one: https://www.whatbitcoindid.com Quote Link to comment Share on other sites More sharing options...
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