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marko

Global Enclaving As A Support For Hpi?

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Hello, back again because I have just had (to me at least) an interesting thought on the phenomenon of HPI and one of the mechanisms that might be at work.

I have just been reading about the HPI in Ireland - and it has struck me that a possible reason to support localised HPI in somewhere like Ireland or the UK (especially London of course) is that these places could be undergoing some sort of enclaving process, whereby the rich all move there.

All of us on here keep moaning about how the UK has lost all it's productive capacity - but what if the same thing that happened to posh West End areas in London is now happening on a global scale to entire regions or countries?

Take these two situations:

1)West-End and Surrey belt circa 1850: this is a leafy, wealthy area with massive beautiful houses lived in and owned by very rich businessmen etc. who own a lot of money-generating assets - what are these money-generating assets? Stocks and shares in companies that employ cheap labour far away in the East-end of London, where all the stinky factories and industry are based. The rich don't want the productive capacity to be located where they live.

2) The 'West' circa 2000: this is a leafy, wealthy, deindustralised area with massive beautiful houses lived in and owned by very rich businessmen etc. who own a lot of money-generating assets - what are these money-generating assets? Stocks and shares in companies that employ cheap labour far away in the East, where all the stinky factories and industry are based. The rich don't want the productive capacity to be located where they live.

This mechanism has happened at a city (e.g. West-End - actually the rich chose to live in the West of European cities because the prevailing wind was from the West so the smog and sh1t from the factories did not reach them), and small level globally (Aspen, St. Morritz, Cannes etc. - won't find any factories there!). Why won't it happen at an entire country level? i.e. Ireland just becoming a massive playground for rich golfers etc?

May be productive capacity really is irrelevant in a globalised economy? The trick is to outsource all the unpleasantness of life and then turn your country into a desirable enclave for the wealthy - targetting the largest industry in the world...tourism). This is what seems to be the goal for many countries - may be they are not so dumb.

Who wants stinky factories? :huh:

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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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