If Everything Is Hunky Dory..

[Guest Winners and Losers]

OK, so I am a bit of a doofus. But, if everything is fine why is there so much talk about the need to lower interest rates and that house price rises are good? Surely, we don't need this if everyone is so flush? Or have I got the wrong end of the stick here?

[shermanator]

OK, so I am a bit of a doofus. But, if everything is fine why is there so much talk about the need to lower interest rates and that house price rises are good? Surely, we don't need this if everyone is so flush? Or have I got the wrong end of the stick here?

No, you're not a 'doofus'.

I've said it before and I'll say it again. Falling interest rates and the clamour to lower rates are signs of an economy in trouble, not rude health.

Just look at Japan!

[look to the past]

Yes you are a 'doofus' (nice word)

Don’t look at Japan – look to Ireland – soon the bank of England will lower interest rates ignore inflation to ensure that the economy won’t suffer more than they are doing so at the moment. The pound will drop a little but house prices will continue upwards until something goes pop.

All right I know it’s not what you want to hear but in my opinion low interest rates and a rally in house prices here we come.

[Realistbear]

Yes you are a 'doofus' (nice word)

Don’t look at Japan – look to Ireland – soon the bank of England will lower interest rates ignore inflation to ensure that the economy won’t suffer more than they are doing so at the moment. The pound will drop a little but house prices will continue upwards until something goes pop.

All right I know it’s not what you want to hear but in my opinion low interest rates and a rally in house prices here we come.

If you are out of sterling you are in a win-win situation in your scenario. Either houses drop 30% or sterling does!

[look to the past]

If you are out of sterling you are in a win-win situation in your scenario. Either houses drop 30% or sterling does!

I have a good idea I shall move all my money into $ - that’s always been a safe currency

Head you lose – tails you lose

Edited March 10, 2006 by look to the past

[shermanator]

Yes you are a 'doofus' (nice word)

Don’t look at Japan – look to Ireland – soon the bank of England will lower interest rates ignore inflation to ensure that the economy won’t suffer more than they are doing so at the moment. The pound will drop a little but house prices will continue upwards until something goes pop.

All right I know it’s not what you want to hear but in my opinion low interest rates and a rally in house prices here we come.

So what you're admitting is, that the British economy (ie the consumer) is in a dire state?

They may well lower interest to get the morons to buy yet more tat but that's surely invitation to the likes of George Soros to orchestrate a massive raid raid on sterling?

No, for us HPCers it's heads we win tails we win, as reagrds interest rates.

[Realistbear]

I have a good idea I shall move all my money into $ - that’s always been a safe currency

Head you lose – tails you lose

If you look to the past the US $ has never had "Black Tuesday" events or devaluations (at least not since WW2). The US is often seen as a "safe haven" in times of global trouble and a sharp move to the downside would not be good for the debt from the creditor's point of view. As IR rates are moving up in the EU you might want to split your cash between the two. It is interesting that the "deficit" no longer affects the US $--some think it is because US interests are benefitting from all that investment in China and India.

[look to the past]

So what you're admitting is, that the British economy (ie the consumer) is in a dire state?

Yep – that’s the one – if you can wait then you may win – it’s the time scales that worry me – 3 years + in my opinion. Also if house prices do go up because of stupidly low IR’s – average house prices could be £400000 before they go into crash position- I personally am not going to wait if that looks likely to happen

[Once in a lifetime]

If you are out of sterling you are in a win-win situation in your scenario. Either houses drop 30% or sterling does!

I can’t help but get the feeling Europe has strong connections with what’s going on?

I pose a question because I don’t understand economics that well.

Will devaluing the pound, aid, assist and insure our joining the Euro?

I suppose it’s not a simple answer, but if it is; ‘yes devaluing the pound will insure our joining’.

Then I believe Nulabour (more importantly Gordon Brown) will screw the £ for that reason.

Get your money out of £££££££ ‘s

[look to the past]

I was joking about putting my money into the $ - I agree that the pound is suspect but it’s normally quite safe especially if you want to stay in this county –

Anyway if things do look up and the BOE do raise interest rates - you would probably lose more that you would gain if the opposite happens

[Guest Winners and Losers]

Yes you are a 'doofus' (nice word)

Doh! :angry:

[look to the past]

Doh!

I thought you might be one, as I don’t know what it means although spell check wants me to use “doves” instead

[cupidstunt]

Doh! :angry:

Thought you'd be at Crufts warning others of an impending Kennel crash

[Guest Winners and Losers]

Thought you'd be at Crufts warning others of an impending Kennel crash

Well, I did try but all I got was 'kennel prices never go down', 'dogs need somewhere to live', 'renting a kennel is dead money', 'if you buy a kennel now it will be worth £10 more next month', 'I MEW'd my kennel to buy a glow in the dark bouncy ball' - blah blah blah.

Everyone at Crufts is a BTL landlord. They have made a killing in kennels. They thought the fox hunting ban would cause a crash, but the resilence of the kennels market has surprised everyone.

Edited March 10, 2006 by Winners and Losers

[look to the past]

My dog put all his investments in one of those glowinthedark bounce balls – and over night he ate his investment and is now bankrupt –

He recommends that in hindsight a larger investment would have been better although riskier and less fun

Edited March 10, 2006 by look to the past

[Guest Winners and Losers]

My dog put all his investments in one of those glowinthedark bounce balls – and over night he ate his investment and is now bankrupt –

He recommends that in hindsight a larger investment would have been better although riskier and less fun

Yes, you do have to watch these 'fly by night' pyramid scam investments. You start off with a bog standard tennis ball, move up the ladder (in the belief that the price of balls will always go up) and find yourself in a situation where you have to eat your asset to survive. I hope all those pampered little pooches at Crufts, renting our their 'second' kennel' get what's coming to them - the dog house!

[look to the past]

pyramid scam investments.

Have you ever tried to make a pyramid out of balls – the only way is to make a good base that hold the bottom ones in place –if the bottom rolls away the rest follow.

The point is there is no limit to how high the balls can go –as long as the bottom keeps expanding the balls will go higher

Nothing at the moment is stopping the bottom growing

[Guest Winners and Losers]

Have you ever tried to make a pyramid out of balls – the only way is to make a good base that hold the bottom ones in place –if the bottom rolls away the rest follow.

The point is there is no limit to how high the balls can go –as long as the bottom keeps expanding the balls will go higher

Nothing at the moment is stopping the bottom growing

But the lack of FTB's (first time balls) is reducing.

[look to the past]

But the lack of FTB's (first time balls) is reducing.

Is it though – last year yes

But this year? – They all waited have they all given up waiting – houses are selling – who is buying – it can not all be BTLers

[dnd]

Yep – that’s the one – if you can wait then you may win – it’s the time scales that worry me – 3 years + in my opinion. Also if house prices do go up because of stupidly low IR’s – average house prices could be £400000 before they go into crash position- I personally am not going to wait if that looks likely to happen

£400000 prices - I wonder what the multipliers will be like

Nobody can predict the future but I thought houses were expensive back in the 90's @ around £80K

It's the young FTB with no experience of economic cycles that's driving these prices - although from what I've seen of them - they deserve everything thats coming to them - most of them are greedy, selfish, superficial

Edited March 10, 2006 by dnd

[time 2 raise interest rates]

Yes you are a 'doofus' (nice word)

Don’t look at Japan – look to Ireland – soon the bank of England will lower interest rates ignore inflation to ensure that the economy won’t suffer more than they are doing so at the moment. The pound will drop a little but house prices will continue upwards until something goes pop.

All right I know it’s not what you want to hear but in my opinion low interest rates and a rally in house prices here we come.

You recently posted on *** that you sold-to-rent two years

ago and you are expecting rates to go 8%.

[Badlad1967]

Is it though – last year yes

But this year? – They all waited have they all given up waiting – houses are selling – who is buying – it can not all be BTLers

What are transaction levels at the moment? If they are at "normal" levels then I would agree with above...

If the levels are still extremely low, then it's most probably a question of the MEAN price being thrown out of kilter...

[look to the past]

You recently posted on *** that you sold-to-rent two years

ago and you are expecting rates to go 8%.

Not quite right – I STR’ed expecting rates to go to 8% (obvious now that they are not going too)

Until today I have thought that the BOE will have to reduce rates to keep the economy going – but on reflection it looks like the economy is doing ok – so perhaps 1or 2 increase -then I still think European rates (2%-4%) once the economy goes tits up.

It’s a bit of a work in progress – I perhaps regret STR ing as I have lost money and I don’t think House prices have reached the top yet - and I am still thinking of buying again