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Vince Cable - Hpc Policy Messiah?


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Your numbers are rubbish - the fact is noone knows just how many people are in the UK now 2006 - from the cencus in 2001 but they can see in their streets whats going on! However you make an interesting point dispite the condesending tone - and I will tell you why - what makes yabbey able to change thier lending multiple from 3.5 to 5?

It is making such loans based on the continued expectation of the (so-called) low inflation rate and low interest rates, with the inflation measure at 2-3%. (However, Real world inflation with council taxes, utilities etc.. at 5-6% according to David Smith of the Times.)

OK, we all know the inflation measure is a falsehood, the real return on a saving account is zero in general price terms even with the recent rate increases.

Generally however, the BOE is simply not concerned with this - sure some prices might go up, but there is no real worry about having interest rates which are zero, and which from time to time may be below the level of general price rises.

The reason for this is the massive influx of labour from all the world, as a delibrate policy of mass immigration is used, and anyone regardles of culture, race or intentions can now undercut the exisitng workforce.

It is the in-ability of the workforce to bargain - demand any wage rises - which is the key to low interest rates (as Mervin King himself states in a round about way!).

The central bank is printing 16% in new money per year. We may have higher interest rates, but don't be too surprised as they do not affect the housing market or rents as massive levels of immigration contines unabated.

So you see that central to all this talk of effective demand - i.e. debt/mortgages, low interest rates and lax lending etc...is unlimited immigration.

The Keysean 'effective demand' and the level of interest rates is based on this mass immigration policy which affects real world incomes, rents and the whole nature of society and citizenship. (BTW: the points I made on fines, liberties and reporting your details and movements is actual real world statue law)

Brainclamp, Laurejon - shall we do this in numbers?

Imagine a country - let's call it Great Bittern.

This country has 59 people living in it.

One immigrant from Ethnonistan decides to move to Great Bittern - making the population 60.

The basic demand for houses has thus increased from 59 to 60.

However houses are bought with something called money, and this money has to be borrowed from the local bank called Yabbey National. Yabby National will lend these people 3.5 worth of the Great Bittern unit of money.

Effective demand is thus 60 x 3.5 - i.e. 210.

The immigrant contributes 3.5 to this effective demand, the rest of the population contributes 3.5 x 59 - that is 206.5. The original population has a much more powerful impact on effective demand than our one new immigrant.

Now Yabbey National makes an announcement that it is loosening its lending criteria and will now lend people 5 units of Great Bittern's money.

Effective demand is thus 60 x 5 - i.e 300 - an increase of effective demand by nearly a third.

The increase in effective demand caused by the immigrant is only 1.5 unit. But the impact of increased liquidity from the native population is 88.5!

Thus we can see that the availability of money to buy Great Bittern's housing stock is much more powerfully impacted by lending criteria rather than immigration.

This would be even more the case if you took into account the fact that the immigrant is likely to have a lower wage than the native population thus reducing the level of his effective demand.

Does this make sense to you? Or are you going to start talking about milk cartons?

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Brainclamp - you have a very unitarian way of constructing an argument. Is the clamp affecting you're brain's ability to see more than one cause to a problem (and then roll everything else into in a very jumbled way)?

In fact your response is such an incoherent mush it's hard to know where to begin.

My numbers are not meant to be serious - but even if you asume that we have 10 new immigrants to the original 59 residents the observation I make remains valid.

The 'causes of low interest rates' are multiple and varied. In the current UK context interest rates are used primarily as a mechanism to control inflation.

Low inflation is caused by many different factors (costs of goods, basic materials, services etc..). Wage costs are only one part of a measure of inflation - and for the most part wage costs elsewhere (i.e. China) are a more significant driving force behind our current inflation rate here. It is true that immigration can have a downward pressure in wages within the UK - but only in certain sectors. You are also right to point out that this comes with distributional consequences. But this is only one part - and a fairly small part - of any analysis of why inflation and interest rates are low.

During the early part of the twentieth century anti semitism was called 'the idiot's socialism' - in that the anti semite was identifying the jew with the problems associated with banking and capitalism.

You seem to be suffering from 'the retard's socialism'.

At least in the twentieth century the uninformed had the excuse that jews had a fairly strong associative link with banking and finance. You don't even have this excuse - trying to blame an immigrant for problems created by central banks, the workings of free markets and a laissez faire government really is moronic.

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Yeah yeah - the usual and then degenerating into abuse, calling me racist, a retard etc... Do I swear or abuse people? You would think that someone who is consistantly proven right in his views for years, with all his forecasts panning out, while you lot have been wrong and are going to be wrong again might be offered a carrot of respect!

Anyway, If you cannot understand the above I try to make it simple.

There are lots of things which affect the borrowing rate. The main one is inflation.

INTEREST RATE = INFLATION.

The main cause of inflation is the UK wage level (COST) MINUS Productivity (GAIN) = DEMAND/SUPPLY PRICE OF PRODUCE. (GDP) The wage level and supply of produce affect inflation far more than any other factors like raw materials which you mention.

A policy of controlled immigration for rare skills - a team formed from experts from different countries around the world to cure cancer for example - might raise productivity as projects are sucessful, drugfirm patents and innovation rises and our competitve edge rises, so that per person GDP rises without affecting the structure of society. (GAINS)

A policy of mass immigration is recognised to lower wages and have limited effects on productivity, deeply affecting the structures of society and bargaining powers of individuals (LOWER COSTS) which raises GDP but lowers per person GDP.

So we have rising GDP - (the gains are mostly from rising houseprices and rents) from lowering UK WAGES even as RENTS and PROFITS rise. Under the 1980s and 1990s we have the opposite - rising GDP per person from productivity gains.

70% of INFLATION = UK WAGE LEVEL.

What Mervin King - the BOE - has stated (not me), is that the key to interest rates/inflation is the ability of the workforce to bargain for higher wages in the face of mass immigration.

Mass immigration is therefore the keystone underpinning this 'economic boom', low interest rates, and inflation.

If the policy is set to continue, then the banks can lower lending standards and lending mutiples without too many worries, to reflect the fact that workers bargaining power will never cause INFLATION / WAGES to rise, and to reflect the fact that housing is in short supply, in realtion to the millions and millions of people needed to make this policy work.

Edited by brainclamp
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You're just getting worked up because someone has pointed out that a political party other than the BNP might be prepared to tackle the house price crisis head on. You want people on this forum to vote for the BNP. That is the main reason you post here.

frugalista

I have this motive/that motive lalala - why don't you tell me how house prices will drop under the Lib dem policy of MASS immigration. They are a bunch of all thngs to all people jokers..

Edited by brainclamp
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  • 442 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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