To All The Critics Of Brown & Blair

[bobthe~]

Spot on, IMO

But hang on a minute, Bliar bought into housing quite late on didn't he? Perhaps Brown engineered it and advised Bliar to get in it? ....... nasty.

I'll say it yet again. I want a journo to ask GB, on TV, when he knew housing was getting out of control..... or did he honestly think the rate of change of house prices would continue.

Yeah but he doesn't think it is out of control, apart from maybe on the downside.

He wants to return to the boom, and has said as much.

What a nasty inhumane thing to want to do. Can't he think of the human misery that he will cause me as an STR.

[shippers]

If they had encouraged real business and industry rather than turning us into a nation of landlord then we would have been in a better positon to survive the stupidity of allowing banks to loan massive amounts of money in mortgages and credit cards.

but that's more Thatcher's fault with her home-owning, car driving, service industry economy

[hedgefunded]

Simplify the tax system. You earn money, you pay 20% of it in tax. That's it.

[Bloo Loo]

- Noticed that house prices were getting far out of step with earnings

- Noticed that the banks were loosening lending standards too much

- Threatened the banks with legislation if they didn't tighten standards themselves. (And with the amount of legislation that they've produced it wouldn't have been an idle threat).

- Told the FSA to do its job and regulate the industry properly. (If they said they didn't have the resources then give them more)

Of course, they DID notice all the above. Having a public witht he feelgood factore was invaluable for the blair government. I mean, if people didnt feel wealthy, imagine how bad the discontent would have got for the Iraq war.

Blair Needed and encouraged the housing bubble. It kept him in power for 10 years.

Now he doesnt need it, except to say "look how good it was under me". Thats nice on your CV for upcoming politcal jobs.

[Leonard Hatred]

Sadly, it doesn't matter how many of these steps had been put in place - the Labour party is all about denial and doublethink.

House prices are rising out of all connection to reality, but it's not a bubble.

People at the bottom need to pump in infinitely increasing amounts of money to give to people at the top, but it's not a pyramid scheme.

We are telling you there's a housing shortage while we're packing the country with migrants, but Britain is not full.

The price of everything is rising and rising, but inflation is not going up.

We are taking more money off you than ever, but you are not worse off.

[The Spaniard]

Good game, banksters. I'll be thinking of you when I see the first soup queue get RFID chipped.

Injin, you used to be more optimistic about the post-crash world, almost to welcome it.

Has your perspective changed recently? If so, why?

[huw]

Lots of good proposals in this thread. One thing that's been lacking is fiscal measures to control HPI. I'd suggest a mortgage tax to deter/control this inflationary way of funding property purchases, and a reform of council tax so that by bidding up the price you pay for a particular property, you're bidding up your future council tax bill (edit: and conversely if you pay less for a property the council tax on that property would decrease).

Edited May 7, 2008 by huw

[Injin]

Injin, you used to be more optimistic about the post-crash world, almost to welcome it.

Has your perspective changed recently? If so, why?

Because all I can see in posts here and elsewhere, all I can see in the media and all I can see in my day to day life is idiots going "the governmnet should do something". There is some clown threatening me with the state on another thread and even the most gentle questioning of the basic nature of the state seems to rile people fiercely. My view gets more pessimistic daily, not because the bankers are amazingly clever, but because the average person will want to queue up for soup rather than get off their ****! :angry:

The people who can benefit from a crash are few and far between. Most folks seem to hate and fear freedom, what can I say?

[Downtraded]

or was there nothing any government could have done?

The question assumes that all is not well and that the current situation is disasterous.

Hmmmm - V. high employment and a slight reduction in HP prices.

This question can only be answered when the result of these policies come to fruition.

Anything else is just hypothetical.

As much as many forum members want to believe it, the feck up hasn't happened yet.

People are still getting mortgages, the vast majority are still paying them.

Employment is still high.

[huw]

A Land Tax?

http://www.guardian.co.uk/money/2007/jan/08/tax.business

His analysis seems blinkered to me:

And people withdrew about £45bn of this untaxed capital gain last year to spend on things such as second homes, new cars and deposits for their children's houses. Was that money available to renters? No chance.

Withdrew? That's a prime example of house-as-ATM thinking. They borrowed $45bn on a Ponzi-asset and now they're going to have to pay it back. I'd sooner be in the position of a debt-free renter than a MEWed mortgagor.

Fred Harrison, research director at the Land Research Trust, has just published a book on this "great tax clawback scam". It works as follows. Someone in the bottom 20% of the income spectrum pays about £250,000 in taxes in their lifetime. Someone in the top 20% pays £1.2m in taxes. But those at the top will own property and see their total tax liability wiped out in just a couple of years by rising property values. This does not happen to the bottom 20%, since they are renters.

Because as we all know, property only ever goes up, right?

Not that I'm necessarily against a land tax, just against arguments that are based on the idea of high, permanent HPI.

[huw]

My view gets more pessimistic daily, not because the bankers are amazingly clever, but because the average person will want to queue up for soup rather than get off their ****! :angry:

Hehe, you're beginning to see the problem

[thecrashingisles]

As much as many forum members want to believe it, the feck up hasn't happened yet.

People are still getting mortgages, the vast majority are still paying them.

Employment is still high.

What a pathetically myopic viewpoint.

When the average house costs so much relative to average earnings it IS a feck up. Just try putting yourself in the position of the next generation of housebuyers and you might understand why this is such a bad thing for society.

[I want a house!]

Legislation against 0% credit cards.

I like 0% credit cards. Banning them is no better than labour. I can drink without any issue but Joe next to me is a binge drinker, so now we need to ban 24 drinking because of him... B0ll0cks!

If I want to make a big purchase, 2000+, I take out one of these babies and then pay it off in 3 months to incur no costs.

[nmarks]

or was there nothing any government could have done?

Brown and Blair could have:

• enforced the law and existing FSA rules to prevent liar loans and other forms of fraud that have been so evident;

• done more to encourage contributing to pension savings;

• introduced compulsory training, testing and licencing of those working as estate agents;

• encouraged a more diversified economy to encourage enterprise other than buy to let, encouraging people to innovate ideas and build new businesses based on them;

• restrained TV property porn,

• restrained the creativity of quants analysts and other investment bankers lest it cause a credit crunch;

• called for more restraint in the remuneration structure of investment bankers;

• distanced New Labour from taking contributions from the building industry;

• included the cost of housing in the BOE target measure of inflation;

• taken a more European stance on property instead of following the Americans;

• actually behaved like socialists and shown some concern for the have nots (FTBs)

• told The Illuminati to f*ck off.

Dunno. I think you might have got me there. I can only open the barn door this much but then again I'm busy working.

Hmmm . .. I wonder what they could have done? D'ya know, I'm really stuck there.

Edited May 7, 2008 by nmarks

[Cunobelinus]

They should not have allowed companies to destroy good pension schemes.

Companies only started to abandon good final salary pension schemes after Gordon made them so incredibly expensive to run by over-regulating and taking away advance corporation tax credits (ie. introducing another stealth tax).

Also, primary supervision of the banks should never have been taken away from the Bank of England and given to the FSA. The FSA don't have a clue what they're doing. They've little in-house experience of banking and don't pay enough to recruit people who do.

[greenalien]

Had a proper inflation measure that included house prices rather than the CPI.

Spot on. It was the disasterous decision to swap RPI for CPI in 2003 that has caused this whole mess, by keeping interest rates artificially low while ignoring massive HPI. There should have been a balancing effect so that interest rates naturally rose as house prices inflated and thus compensated for the rise by increasing borrowing costs and keeping the house price rises in check.

The effect is that anyone who works for a living, or tries to save, has been robbed, as wages and saving rates should both have been at least 2% higher for the last 5 years.

[Downtraded]

What a pathetically myopic viewpoint.

When the average house costs so much relative to average earnings it IS a feck up. Just try putting yourself in the position of the next generation of housebuyers and you might understand why this is such a bad thing for society.

OK, its your opinion that house buyers have a "right" to buy a house at the historical price norm.

I always thought that a "market price" is determined by what a buyer is prepared to pay?

Instead of blaming the hoards of buyers, you blame the banks?

Individually, there will always be winners and losers but it doesn't mean its a total feck up.

A total Feck up is when EVERYONE loses.

[The Spaniard]

Because all I can see in posts here and elsewhere, all I can see in the media and all I can see in my day to day life is idiots going "the governmnet should do something". There is some clown threatening me with the state on another thread and even the most gentle questioning of the basic nature of the state seems to rile people fiercely. My view gets more pessimistic daily, not because the bankers are amazingly clever, but because the average person will want to queue up for soup rather than get off their ****! :angry:

The people who can benefit from a crash are few and far between. Most folks seem to hate and fear freedom, what can I say?

Yes, unfortunately we have been conditioned, memetically if not (yet?) genetically, to be fearful, docile and obedient.

Rather like domestic cattle, most of which could not now survive away from the farm, we have become all too dependent upon our handlers.

But nihil desperandum, or in other words, don't let the b*ggers grind you down.

[RajD]

Because all I can see in posts here and elsewhere, all I can see in the media and all I can see in my day to day life is idiots going "the governmnet should do something". There is some clown threatening me with the state on another thread and even the most gentle questioning of the basic nature of the state seems to rile people fiercely. My view gets more pessimistic daily, not because the bankers are amazingly clever, but because the average person will want to queue up for soup rather than get off their ****! :angry:

The people who can benefit from a crash are few and far between. Most folks seem to hate and fear freedom, what can I say?

Totally agree. 99% of the world population are in some sort of brainwashed slumber. They trust and believe that those that govern them will act in the best interests of the majority - of the common people. What they don't realise is that the governments of the world dance to the tune of mightier entities - the rich elite - the international banking cartel - who have them by the b*ll*cks. The secret of the international bankers’ success is that they have managed to control national money systems while letting them appear to be controlled by governments. The boom and bust cycle is not an unavoidable certainty that must, like some immutable law of physics, take place every 15-20 years. There have been a series of such events since the central banks took over the creation and control of the international monetary system. These have all been orchestrated as a means of gradually transferring wealth and resources from the common people to the rich elite few. Is it any wonder that the gap between rich and poor grows increasingly wider? That the levels of personal and government debts are at historically record levels? And while I'm on it - the US has a total debt to GDP ratio of over 300%. The IMF defines any country with a ratio of 200% or more to be a 'de-constructed Third World nation-state'. That might well be the case just a few years from now.

Edited May 7, 2008 by RajD

[thecrashingisles]

OK, its your opinion that house buyers have a "right" to buy a house at the historical price norm.

I always thought that a "market price" is determined by what a buyer is prepared to pay?

I didn't talk about rights but what has happened in the property market is a clear example of market and political failure. It was a bubble which has just begun to burst. Prices will drop 20% this year and keep dropping.

Instead of blaming the hoards of buyers, you blame the banks?

Whose money was it anyway? If people were using their own money then yes they can pay as much as they like.

Edited May 7, 2008 by thecrashingisles

[THE BALD MAN]

OK, its your opinion that house buyers have a "right" to buy a house at the historical price norm.

I always thought that a "market price" is determined by what a buyer is prepared to pay?

Instead of blaming the hoards of buyers, you blame the banks?

Individually, there will always be winners and losers but it doesn't mean its a total feck up.

A total Feck up is when EVERYONE loses.

Everone will lose when the bubble bursts as the economy exists on HPI, The government is losing revenue and have to cut many of the jobs they have created, the banks are losing capital and shareholders are bailing them out, financial services jobs disappear and recession arrives. This is the inevitable consequence of boom and bust. The only winners will be those who have taken their bonuses and run,

[chichi]

but that's more Thatcher's fault with her home-owning, car driving, service industry economy

So governments can't do what's right because a previous administration didn't?

Nulabour have been in power long enough to make all the changes they needed to to bring industry back to the UK. They failed in that too.

[Injin]

Totally agree. 99% of the world population are in some sort of brainwashed slumber. They trust and believe those that govern them will act in the best interests of the majority - of the common people. What they don't realise is that the governments of the world dance to the tune of mightier entities - the rich elite - the international banking cartel - who have them - by the b*ll*cks. The secret of the international bankers’ success is that they have managed to control national money systems while letting them appear to be controlled by governments. The boom and bust cycle is not an unavoidable certainty that must, like some immutable law of physics, take place every 15-20 years. There have been a series of such events since the central banks took over the creation and control of the international monetary system. These have all been orchestrated as a means of gradually transferring wealth and resources from the common people to the rich elite few. Is it any wonder that the gap between rich and poor grows increasingly wider? That the levels of personal and government debts are at historically record levels? And while I'm on it - the US has a total debt to GDP ratio of over 300%. The IMF defines any country with a ratio of 200% or more to be a 'de-constructed Third World nation-state'. That might well be the case just a few years from now.

Oh I agree with this, but I see the current malaise as something nastier - the international bankers have ******ed up themselves for a change - they've gone too far, got too confident. Originally I thought this would mean their stranglehold over trade etc would be severely curtailed and other systems would arise to replace them - a more free and equitable world due to the vanishing of certain important monopolies such as currency, limits on inflation because of a return to a gold standard etc*, collapse of government power.

Trouble is, average Joe Public will want the old system back asap, so the elite might have the last laugh yet.

Anyhoo..Blair and Brown couldn't have stopped this bubble, they are the used car salesmen of mercantilism. Brown is as brilliant at his job as Blair was, albeit in a different way - he's easy to dislike and that's a godsend in a downturn for the PTB.

*Gold standards are crap and do not work but people will want them.

[nixy]

Because all I can see in posts here and elsewhere, all I can see in the media and all I can see in my day to day life is idiots going "the governmnet should do something". There is some clown threatening me with the state on another thread and even the most gentle questioning of the basic nature of the state seems to rile people fiercely. My view gets more pessimistic daily, not because the bankers are amazingly clever, but because the average person will want to queue up for soup rather than get off their ****! :angry:

The people who can benefit from a crash are few and far between. Most folks seem to hate and fear freedom, what can I say?

We definitely need far less government.

If government was allowed to 'interfere' in one area only, it must surely be, most and foremost, controlling money supply?

Do you think the 'cleverness' of bankers can (should) be countered?

If so, how?

[sun n sea]

Simple;

House price inflation should have been included in the general inflation figure- doing so would have had an impact on wages and earnings meaning that prices and wages would not have headed off in different directions.

Buy to let and other empty properties forced to pay the full council tax with no reductions or exemptions. Buy to let portfolios treated as"real" businesses with the full tax implications involved- corporation tax etc.