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Surrey cash buyer

Mpc March Minutes

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I can just imagine a sketch of the MPC meeting (not many people would get the jokes).

The MPC sitting round a large table Nickell sat at the opposite end to Merv. Dressed in outrageous Elton John style drag. Butting in on every comment made by other members 'nah, nah, nah, nah, nah I can't hear you... NO, I want it LOOOWWWWEEEERRRRR' and occasionally shouting 'LOOK AT ME!' before throwing himself on the floor and writhing around screaming.

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Despite trying to persuade us otherwise for the past couple of years, the MPC basically admits the implicit linkage between house prices and consumer spending, and by implication that their policy decisions may be influenced by the direction of the housing market. Item 12 of the minutes (my emphasis):

It was not clear why household spending should have weakened after Christmas. One possibility

was that it simply reflected a change in the seasonal pattern. Retail sales had been strong in November

and in Q4 overall. Taking an average of the October to January retail sales data might be a more

reasonable guide to the underlying growth rate. Other explanations included the possibility that the

amount of income available to spend on discretionary items had been reduced by the past increases in

petrol and utility prices, and there was a prospect of further reductions in disposable income following

the recent announcements of further gas and electricity price rises. But these explanations sat

somewhat uncomfortably with developments in the housing market. The balance of new buyer

inquiries had been positive for the eighth consecutive month; approvals for house purchase had been

close to the peaks of late 2003/early 2004; and the sales-to-stock ratio had continued to tighten

gradually.

And also item 24:

For some members, there were still downside risks to consumption, and the softer data since

Christmas suggested that these might be crystallising. For others, there remained some upside risks to

consumption resulting from the apparent strengthening of the housing market at a time when GDP

growth was recovering.

As for reasons why household spending should have weakened after Christmas, maybe it's something to do with the fact that people outside London haven't got any money. B)

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Everyone but Stephen Nickell agrees.

Ah man, you spoilt my surprise from reading the minutes to find out who wanted a drop :lol:

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Guest Charlie The Tramp

As for reasons why household spending should have weakened after Christmas, maybe it's something to do with the fact that people outside London haven't got any money. B)

It appears many people in London are in the same boat when you talk to the Retailers. Shops in my area are discounting heavily, take aways are flooding the area with their menus, the local chippie no longer has queues on Friday night, and the best of all our shoe shop is doing BOGOFs. What I am seeing in an accepted prosperous area is a massive change in sentiment with regard to spending. My observations for my area are there has been a very large proportion of MEWers during the last three years and they have finally realised it was not free money after all, it now has to be repaid. The jolly boy`s outing has finally come to an end. ;)

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"approvals for house purchase had been close to the peaks of late 2003/early 2004"

Despite trying to persuade us otherwise for the past couple of years, the MPC basically admits the implicit linkage between house prices and consumer spending, and by implication that their policy decisions may be influenced by the direction of the housing market.

They don't seem to understand that the approvals include remortgages to mortgage unsecured debt - plonkers!

Edited by Financial Planner

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It appears many people in London are in the same boat when you talk to the Retailers.

I'm not surprised. I based my comment on a retail report that February retail sales in London were up 9% YOY. But I suspect that is central London, where annual bonuses and hot money from oil riches are keeping tills ringing. Elsewhere it's likely as tight as the rest of the country.

Makes you wonder if MPC members ever get out there and experience first hand what's happening in the economy rather than poring over reams of stats.

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Guest Charlie The Tramp

But I suspect that is central London, where annual bonuses and hot money from oil riches are keeping tills ringing.

Or those who have money snapping up those irresistible bargains. Myself being a guilty party, what!!! a

8 mega pixel digital camera £179 before Christmas reduced to £95. B):D

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For some members, there were still downside risks to consumption, and the softer data since

Christmas suggested that these might be crystallising. For others, there remained some upside risks to

consumption resulting from the apparent strengthening of the housing market at a time when GDP

growth was recovering.

note APPARENT strengthening in the housing market

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Or those who have money snapping up those irresistible bargains. Myself being a guilty party, what!!! a

8 mega pixel digital camera £179 before Christmas reduced to £95. B):D

I have pixel envy :(

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Or those who have money snapping up those irresistible bargains.

True: I recently spent 400 quid upgrading my PC, and few of the parts I bought weren't on a 'special one-week sale' or whatever the companies are doing to shift their stock.

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It appears many people in London are in the same boat when you talk to the Retailers. Shops in my area are discounting heavily, take aways are flooding the area with their menus, the local chippie no longer has queues on Friday night, and the best of all our shoe shop is doing BOGOFs. What I am seeing in an accepted prosperous area is a massive change in sentiment with regard to spending. My observations for my area are there has been a very large proportion of MEWers during the last three years and they have finally realised it was not free money after all, it now has to be repaid. The jolly boy`s outing has finally come to an end. ;)

Is that 'buy left shoe, get right shoe free'? :unsure:

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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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