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The Mcglashan Answers Hamish Mctavish


The McGlashan
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To obviate the risk of boring other contributors on the Aberdeen, ASPC Stats topic, I invite Hamish to continue our debate here.

Hi Hamish, Happy New Year.

From your own admissions, you are someone that has had a career in banking, a career in oil (ending when you were, and I quote, "laughed out of the boardroom"), and you now only work part time, 15 hours a week, in a self employed "creative" role......... whilst practising (and posting endlessly about) what you admit to be an "amateur" interest in Academic topics.

Bank job was more or less a summer job between secondary and tertiary education, not anything approaching a career.

Oil industry was, I thought, a career, until the disastrous episode you have picked up upon. I worked as a procurement manager for one of the large underwater construction contractors. Seeing the way the wind was blowing (pun intended) I suggested to the board that a business unit be set up to exploit the coming market for installation of deepwater offshore wind and tidal flow turbines. It was at this point I was metaphorically "laughed out of the boardroom".

A short few years later and we see this:

http://www.beatricewind.co.uk/home/default.asp

http://www.greatergabbard.com/opencontent/...lt.asp?itemId=5

http://www.offshore247.com/news/art.aspx?id=12464

and much more to come...

You jump on my use of the word "amateur". I use it in this sense:

amateur

noun

a person who engages in a pursuit on an unpaid basis.

adjective

engaging or engaged in without payment; nonprofessional

Translated from its French origin to the English "lover of", the term "amateur" reflects a voluntary motivation to work as a result of personal passion for a particular activity.

I engage in many interests on an 'amateur' basis. Some of these interests may be to my material gain in the future, and thus will turn out not to be 'amateur' after all...

And yet throughout at least two careers, in addition to your current situation, you have seemingly not been able to afford to buy a house. A situation you blame on prices, speculators, and lending, in short, anyone but yourself. I do not need to point out that had you purchased at the beginning of your career, and held until now, you would have paid in inflation adjusted terms, far less than you will now, or in the foreseeable future. You would also have seen a massive increase in your net worth, as by your own statements, the asset price would have gained dramatically whilst the debt was inflated away.

True enough, and I'm pleased to see you acknowledge the effect of inflation on affordability. Fact was, around the time of the "laughed out of the boardroom" incident, I was close to buying a double-garage McMansion in Portlethen. Had I done so at that time, I would have become the 'debt-driven wage slave' which I have sketched elsewhere. I would have been trapped in a career which I found increasingly unrewarding, and unable to embark upon the (initially) high-risk venture which has since provided me with a sinecure. I will be in a position to buy for cash sometime towards the beginning of next year, but I don't believe the price is right... yet...

You also have previously stated an interest in the attractiveness of prices in areas like Montrose, whilst more recently disparaging my

own statements about the affordability of southern coastal areas.

Again, true. However, you'll remember that what I specifically objected to was your suggestion that a young person should commute from these areas. I work (if you can call it work!) from a studio within my residence.

You have furthermore admitted that your own situation regarding desirability of location is guided as much as anything by your refusal to own a car (too expensive) and to cycle everywhere. Perhaps a noble endeavour, but hardly representative of the majority. You wish for, and cheer on, a crash.... in order to bring "flatted properties with garden" of 125K down to 70K or so (a situation in Aberdeen which no informed commentator believes will happen), ...

I admit to being an utter skinflint. However, my wish for a 70k flat in Aberdeen with a garden is not unrealistic. John Calverley, Standard Chartered “The key thing is that a 50 per cent decline in prices only takes many values back to where they should be. It does not make them cheap.”

...but which would allow you to purchase in a location limited by your "bicycle range" to the major facilities and sources of arts, entertainment and culture. Again, hardly a mainstream concern, and fringe values, such as your own, are unlikely to guide the wider market.

Arts, entertainment and culture are not mainstream concerns? The UK is a world-leader in the continually-evolving creative sector. This sector is comparable in size to the financial services industry (about 7.4% of the economy, approaching 30% of value-added), with 10% yoy growth and offers sustainable, high-level employment.

http://www.guardian.co.uk/education/2008/s...highereducation

Lastly, you have previously rejected my comments regarding your socialist tendencies and unrealistic expectations regarding property value declines to fit in with your chosen lifestyle.....

I again state that someone that works 15 hours a week, that has chosen (and i'm being generous here) to live a lifestyle where 15 hour weeks, spending many hours baking your own bread as the price of a loaf horrifies you, cannot afford to own a car, travels everywhere by bicycle, and trades hours of your time to balance your greengrocers books in exchange for a few pounds of fruit and veg a month, cannot possibly be considered either mainstream or economically viable for the majority.

I am not a socialist, as I have stated elsewhere, I cleave to no ideology and my expectations are perfectly realistic in the context of the references and citations which I have given at length and which you have made no attempt to refute. Bread is more expensive than it was; it's fun and fulfilling to bake one's own. I certainly can afford a car, but, on balance, have decided that, in my circumstances, it's inappropriate for me to have one - it's difficult to work out under what circumstances I'd use it! Cycling is fun for utility, leisure and fitness; and balancing my greengrocers books has much more to do with social capital than with any gross calculation of comparative advantage. Admittedly, these aspects of my lifestyle may not be mainstream, but, in the context in which I mentioned them, they are examples of what is possible if we chose to live debt-free, if we reject the 'spoonful of sugar' that consumerism offers, if we give up 'the chains we so revere'.

I know that you've voiced an objection to reviewing the various screeds of references I've given, but I urge you to read this speech from David Cameron:

http://www.guardian.co.uk/politics/2006/ma...es.davidcameron

And Keynes' text from which he took his major reference:

http://www.econ.yale.edu/smith/econ116a/keynes1.pdf

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Now, as for your comments regarding my own situation, as someone with two properties, the more valuable of which is paid for completely, zero additional debt, and significant additional assets, your comments on my LTV ratio are ignorant at best, and insulting at worst. My mortgage obligations (total debt) are currently less than 25% of my net worth. In the most extreme of cases, (ie, a crash and recession many times worse than is predicted by the gloomiest of prognosticators) they would still be less than 40%, a situation which is hardly troubling to me, given the long term (20 years plus) timescale that I base investments and asset ownership on.

Regarding my statement about LTV, lets just examine the reason for your resentment at my stating that no amount of umbrage at me will "improve your LTV". Let me first point out that this is a statement of fact, and is based upon no assumptions whatsoever. Moreover, I have tolerated a barrage of personal abuse from you, ranging from comparisons to firebrand socialists, through questioning my parentage and calling me 'evil' to accusations of delusion. You have even lampooned my reading of books. You have put words in my mouth and you have impugned my lifestyle, jumping to conclusions about my circumstances in the absence of evidence, citing only cherry-picked statements taken out of context. For my part, I have called your statements topsy-turvy bombastic bluster, and have drawn conclusions about the ideologies and dogma (laissez-faire neo-liberalist capitalism) to which you subscribe; but these conclusions are easy to draw from the statements of your beliefs which you have given for all to read. You have not challenged any of these conclusions which I have drawn.

Yet, tellingly, when I offer a factual observation about LTV ratios, you bleat that it's ignorant and insulting for me so to do. I think we can infer that you see this as very important aspect of your life, your net worth (a phrase you use repeatedly) being the foremost aspect by which you measure your 'success'; an aspect in which you feel increasingly insecure.

At the risk of appearing patronising, I would actually like to help you overcome this crippling problem... :)

Listen to this - Radio 4, yesterday.

http://www.bbc.co.uk/iplayer/episode/b00g9...lub_04_01_2009/

However, what I seek to attack is your repeated and unfounded assertions that property prices will recover and boom in 2009. I personally regard a 20 year span as being so far beyond the horizon of predictability that to commit myself to financial obligations across such an ocean of time as to be tantamount to selling myself into slavery.

And furthermore, I am by no means one of the 6 figure salary, wealthy folk who inhabit these parts in increasing numbers. I make only 15% or so over average, and my wife makes roughly the same. To be fair, we have no kids, and don't lead a glamorous lifestyle and so have been able to pay debts early and save, and we also worked as expats for a while with the tax free benefits that that entails. But we have done nothing out of the ordinary, or that anyone of average ability could not do. The only secret to our success is that we have invested wisely over the years, and have been moderately successful at calling the trends.

All very nice, but you do (I think I read elsewhere) work up to 50 hours per week. I, on the other hand, work up to only 20 hours per week, and do lead (what many would regard as) a glamorous lifestyle. I expect it comes down to what you choose to measure your success by. I refer you to the David Cameron speech and JMK essay linked above. I prefer my jam today; I love my cat, not the kittens she may or may not have at some point in the future.

You may congratulate yourself on your wisdom and ownership of the secret of success, but, as I have mentioned elsewhere, your 'success' is similar to a lottery-winner's luck. One can place bets, but it’ll be luck, not any special insight or genius on the gambler’s part which determines the outcome.

Now, to the point at hand.

You make a number of assertions regarding economic theories and opinions of a select group of commentators, some of which are mainstream, some of which are quite obscure, but almost all of which have equally valid opposing viewpoints.

You also challenge me to refute them, with quotes. I quite frankly have no interest in spending that much time researching your posts, and quoting sources with opposing viewpoints (of which there are many).

If I may correct you, I make no assertions, I offer logical conclusions. The economists and commentators I have referenced may be the poster boys of opposing ideologies, but their ideas converge in the situation in which we now find ourselves. This is an example of the dialectic method (sort of), and does not negate my referencing them, rather, the fact that they find synthesis on this subject re-inforces my arguments.

Again, you shirk debate by refusing to offer sources with opposing viewpoints. As I love debate, and you are clearly a capable adversary, I sincerely wish you would do so.

I will though, and have already done so, stick my neck out with regards to my predictions for the Aberdeen and Scotland housing markets likely future, the causes and cures to our current economic malaise, and also post and discuss things of interest for the local economy, the local and scottish housing market, etc.

I am quite happy to continue to debate these issues with you, and in the spirit of new year would suggest something of a truce, (perhaps we should just agree to disagree on many points) and a more direct form of debate that doesn't make other readers eyes glaze over at the length of our posts.

Fair enough, likewise.

Whilst I'm at it with this spirit of detante, it's not that I in any way wish to denigrate your lifestyle choices, in some ways I actually admire the freedom from conventional restraints that they give you, but I do not believe them to be mainstream, and I feel that your longing for a HPC to enable you to live your self imposed financially restricted lifestyle at the expense of almost everyone else who owns property (70% of the population) is somewhat misguided.

I agree that I am far from mainstream, and appreciate your admiration. But you are quite wrong to believe that I am financially restricted: I just have a strong nose for value-for-money and am wary of over-indebtedness and the misery and cutting-off of choices that it implies.

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Hi Hamish, Happy New Year.

And to you.

True enough, and I'm pleased to see you acknowledge the effect of inflation on affordability.

I've never denied it. I view it as being an inevitable part of long term transactions. But this is not new, or somehow a result of the last decade of HPI. In the 60's, my parents purchased a house for £3000. By 1990, when the mortgage ws paid off, that amount seemed laughably low, as the house was valued at around £100K. Likewise, the house I bought last year, last sold in the late 70's for around £35,000. I paid around £200k. Before that, it sold for (roughly, as I'm doing this from memory as the deeds are with my solicitor) £5000, £350, and just after it was built (around 1900) for I believe in the area of £100.

The part I disagreed with was the assertion that this was somehow an improper, or new, way of long term debt becoming more managable or easier to pay off. It has always been so, and always will be, at least until the end of global economic growth. (which is another economics discussion altogether)

I would also suggest (just to pre-empt the argument) that at least since 1900, there have been periods of greater and lesser HPI, which may or may not loosely tie in to general inflation. However, there are many other reasons for this than just credit expansion, and it has been going on a lot longer than just the last decade.

Fact was, around the time of the "laughed out of the boardroom" incident, I was close to buying a double-garage McMansion in Portlethen. Had I done so at that time, I would have become the 'debt-driven wage slave' which I have sketched elsewhere. I would have been trapped in a career which I found increasingly unrewarding, and unable to embark upon the (initially) high-risk venture which has since provided me with a sinecure. I will be in a position to buy for cash sometime towards the beginning of next year, but I don't believe the price is right... yet...

Fair enough, although I would point out you do not disagree with me that had you done so, and sold at the top, you could have purchased that flat for cash several years earlier, HPC or no.......

On a slightly more general issue, it is probably appropriate to again mention that neither you nor I are the 'typical' housebuyer. The traditional pattern for such things is that young people start out on the bottom rung of the property ladder with a small flat, get married, have kids, need a larger place, get older, kids move out, downsize, etc etc etc. Using equity gained through inflation at each stage.

Neither your model (rent for two decades plus, save, and eventually buy a small flat for cash) nor my model, (buy large house young, have no kids, keep expenses low, pay mortgage off by late 30's, buy second house, repeat process)... would work particularly well for the traditional family.

In your case, you have skipped straight to the last stage (downsize), whilst having very low risk throughout... in my case, I bypassed the first stage, and repeated the second, (although in both cases at somewhat higher risk than the norm) would be particularly prudent for those with family obligations.

Finally, I note you use the term McMansion. The newbuilds around Aberdeen (Portlethen, Cove, Bridge of Don, last 15 years) hardly qualify. The McMansions in the USA are genuinely, properly, nice places to live. (if you like that sort of thing) The UK equivalents are nowhere near the level of luxury and space. I would say that whilst I dont think UK prices are as out of whack as you do, I do think the size and luxury levels of housing in the UK is atrocious by comparison to Australia, USA, Canada, Middle East, etc.

Again, true. However, you'll remember that what I specifically objected to was your suggestion that a young person should commute from these areas. I work (if you can call it work!) from a studio within my residence.

I admit to being an utter skinflint. However, my wish for a 70k flat in Aberdeen with a garden is not unrealistic. John Calverley, Standard Chartered “The key thing is that a 50 per cent decline in prices only takes many values back to where they should be. It does not make them cheap.”

I really don't see why commuting is such a problem. I did it for years (and at first in a late 70's Renault 12, now that really was torture by comparison to todays cars!!!!!!), and with the traffic problems in Aberdeen, it makes little difference to quality of life.

As an example, my wife works in Altens. Her daily commute to Altens from one of the southern coastal villages was almost exactly 40 minutes each way, and that was in peak hours. When we moved to Aberdeen, her commute was almost exactly 35 minutes each way in peak hours. The difference? One was 37 miles through nice scenery, and she enjoyed the drive. The other is less than 3 miles as the crow flies, but stuck in traffic, getting fumes belched all over from those bloody buses. The time spent in the car is almost identical, but living in town, for her commute, is much less enjoyable.

She did try taking the bus, but it required 3 changes, and took 50 minutes. To travel 3 miles!!!!!!

Arts, entertainment and culture are not mainstream concerns? The UK is a world-leader in the continually-evolving creative sector. This sector is comparable in size to the financial services industry (about 7.4% of the economy, approaching 30% of value-added), with 10% yoy growth and offers sustainable, high-level employment.

http://www.guardian.co.uk/education/2008/s...highereducation

You misunderstood. Arts and Ents are very valuable, worthwhile, and mainstream concerns.

Living within bicycle range of them is not, for most people.

I am not a socialist, as I have stated elsewhere, I cleave to no ideology and my expectations are perfectly realistic in the context of the references and citations which I have given at length and which you have made no attempt to refute. Bread is more expensive than it was; it's fun and fulfilling to bake one's own. I certainly can afford a car, but, on balance, have decided that, in my circumstances, it's inappropriate for me to have one - it's difficult to work out under what circumstances I'd use it! Cycling is fun for utility, leisure and fitness; and balancing my greengrocers books has much more to do with social capital than with any gross calculation of comparative advantage. Admittedly, these aspects of my lifestyle may not be mainstream, but, in the context in which I mentioned them, they are examples of what is possible if we chose to live debt-free, if we reject the 'spoonful of sugar' that consumerism offers, if we give up 'the chains we so revere'.

Fair enough, on this we'll agree to disagree. To me, my time is worth money. Somewhere around £40 to £50 an hour. As I enjoy my work, and don't particularly enjoy baking bread, I'd rather work an hour, and buy bread for several months from the proceeds. The alternative is to spend many hours baking bread, and lose either hundreds of pounds, or many hours of recreation that I do enjoy.

I fully understand the enjoyment that cycling can give. I just couldn't imagine showing up for work sweaty, wet, cold, bedraggled, hot, bothered, improperly dressed, etc. I keep it for the weekends.

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Regarding my statement about LTV, lets just examine the reason for your resentment at my stating that no amount of umbrage at me will "improve your LTV". Let me first point out that this is a statement of fact, and is based upon no assumptions whatsoever. Moreover, I have tolerated a barrage of personal abuse from you, ranging from comparisons to firebrand socialists, through questioning my parentage and calling me 'evil' to accusations of delusion. You have even lampooned my reading of books. You have put words in my mouth and you have impugned my lifestyle, jumping to conclusions about my circumstances in the absence of evidence, citing only cherry-picked statements taken out of context. For my part, I have called your statements topsy-turvy bombastic bluster, and have drawn conclusions about the ideologies and dogma (laissez-faire neo-liberalist capitalism) to which you subscribe; but these conclusions are easy to draw from the statements of your beliefs which you have given for all to read. You have not challenged any of these conclusions which I have drawn.

Yet, tellingly, when I offer a factual observation about LTV ratios, you bleat that it's ignorant and insulting for me so to do. I think we can infer that you see this as very important aspect of your life, your net worth (a phrase you use repeatedly) being the foremost aspect by which you measure your 'success'; an aspect in which you feel increasingly insecure.

Oh dear, we certainly did get a tad overenthusiastic. I think this thread was a sensible idea.

Now, without rehashing the more emotive bits, a couple of corrective points.

Theres a lot that you have written which I believe to be incorrect, not least of which are the assumptions about myself. However, in the calmer light of day, I am quite happy to concede that we just agree to disagree on most of these.

One point that I think bears some discussion however, is the basic characterisations that we have of each other.

Regarding LTV, my argument is with your portrayal of me needing inflation to kick in to minimise my debt. As I have previously stated, it is not that I need this to happen, but rather that this is the normal course of things, and will benefit future generations as much as it did myself. If it does not, and recession continues indefinitely, the economic conditions will be such that the low interest rates will also effectively minimise the total amount that I pay on debt. I think therefore that your attempt to portray me as someone who wishes excessive HPI on future generations to pay off my own debts is somewhat misleading.

Regarding Net Worth, you are wrong. Pointing out a ratio of ones debts to net worth is a valid point to argue against a self serving desire, or need, as you put it, for inflation to cancel out debt. By staying within a sensible debt to income/asset ratio, I don't need inflation to service debt comfortably.

Regarding my political leanings, you're right, and you're wrong. I'm not easy to pigeonhole in this regard, as I suspect, are you. It's an area worth discussing, but it's sufficiently complex that it's probably worth a post of it's own at a later point.

However, what I seek to attack is your repeated and unfounded assertions that property prices will recover and boom in 2009. I personally regard a 20 year span as being so far beyond the horizon of predictability that to commit myself to financial obligations across such an ocean of time as to be tantamount to selling myself into slavery.

I would suggest you re-read my posts. I have frequently stated that I expect the HPC to continue in 2009, and I do not expect a recovery until 2010.

All very nice, but you do (I think I read elsewhere) work up to 50 hours per week. I, on the other hand, work up to only 20 hours per week, and do lead (what many would regard as) a glamorous lifestyle.

I enjoy my work. Far more so than I would enjoy baking bread or doing my greengrocers books. To each their own.

Everyone has different priorities in life. I don't live a glamorous lifestyle when I have to pay for it. However, I spent many years crisscrossing the globe, flying business class, staying in 5 star hotels, eating in the finest restaurants, and buying expensive and pretty shiny things for my wife, tax free. I also lived in some pretty good places, with the correspondingly nice expat package. All of which (except the pretty shiny things) was paid for by my employer. I even got to bring my wife along most of the time. It was fun. I got tired of it. Now I prefer quiet nights in by the fire, and the occasional romantic weekend in Paris or Rome. I don't go out in Aberdeen much, it has a hard time competing with my previous experiences.

I expect it comes down to what you choose to measure your success by. I refer you to the David Cameron speech and JMK essay linked above. I prefer my jam today; I love my cat, not the kittens she may or may not have at some point in the future.

My thing is more "Go hard or go home"...... I have always planned to work hard, play hard, and retire young with more than sufficient assets, fitness, and health to live a good lifestyle without worry while i'm young enough to enjoy it. I always wanted to retire at 45. I'm on track to retire at 50. And I've already had more fun and more interesting experiences than most people get in a lifetime. Again, everyone has their own priorities. But if it all went pear shaped tomorrow, I can honestly say I have no regrets, and I've already done 99% of the things I've ever wanted to in my life.

You may congratulate yourself on your wisdom and ownership of the secret of success, but, as I have mentioned elsewhere, your 'success' is similar to a lottery-winner's luck. One can place bets, but it’ll be luck, not any special insight or genius on the gambler’s part which determines the outcome.

I'd suggest theres quite a lot more to it than that. In general terms, I do hear that type of comment a lot, when applied to anyone that has done well. My theory is that you make your own luck. Never give up. Never listen to the nay-sayers. Never let failure be an option. View every setback as an opportunity. Almost every person with those mindsets will succeed. Perhaps not in their original endeavour, but in something.

If I may correct you, I make no assertions, I offer logical conclusions.

Well, logical to you anyway. Illogical to someone with a differing mindset, viewpoint and opinion. In my experience, it is most likely that neither of us will end up being completely right. The eventual result will probably be somewhere in between our predictions.

As I love debate, and you are clearly a capable adversary, I sincerely wish you would do so.

Likewise.

But I prefer my arguments to be somewhat less theoretical and a bit more specific.

I agree that I am far from mainstream, and appreciate your admiration. But you are quite wrong to believe that I am financially restricted: I just have a strong nose for value-for-money and am wary of over-indebtedness and the misery and cutting-off of choices that it implies.

Restriction is relative. Choices are relative. The freedom I admire is your lack of financial ties to Aberdeen (or any individual city). However, it is likely you have emotional ties that are just as binding.

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Hiya Hamish,

Thanks for your thoughtful responses - I appreciate it.

If I may, I'll indulge myself with some thoughts on a few of the political and philosophical viewpoints, before moving on to economic matters (which are probably more worthy of substantial debate)...

had you done so, and sold at the top, you could have purchased that flat for cash several years earlier, HPC or no.......

There can be no argument with hard economic facts of this statement. However, there are socio-political soft facts which I believe should inflence the decisions of young people in similar situations:

As I alluded to, a two-decade commitment to servicing a major debt whould have completely cut me off from the life which I have subsequently explored... "If you can't do it when you're young, when can you do it?"

I would have, in effect, been living someone else's life, a conventional cookie-cutter cubical existence, someone else's idea of how a good consumer-producer should be and behave. Always at the back of my mind would have been the nagging thought that there was something... else, something better outside the walls which I'd volunteered to have erected around me. No doubt I'd have succumbed to the consumerist 'spoonful of sugar' to help this bitter tasting 'medicine go down'.

I mentioned a 'Portlethen McMansion' and, apologies, didn't make it clear that I was using the term ironically. My criticisms and analysis of UK housing would be similar to your own. However, I think we differ radically in the perception of the desireability of luxury. If pushed, I would have to say that, rather than luxury, I desire quality, originality and authenticity: all things which (in all aspects of life - not just housing) are in short supply in the UK and other regions you mention. I do not feel the need, so prevalent today, to compensate myself with luxurious posessions because of what else might be missing in my internal life. I choose 'being' over 'having'. My family prefers my presence to presents.

I don't pretend to have any final answer to the perennial question 'how should we live?', but the individual is, indubitably, the person best placed to answer his own question 'how should I live?'. The crux of the problem is that, if we settle for an existence where we surround ourselves with undemanding distractions, with easy comfort, then we run the risk of ignoring, avoiding, dismissing or not even asking the real existential question which faces us all: "Who am I? What does it mean to be a human being?".

You, yourself, have also intimated your own deviation from the 'traditional' norm. Who is to say what the 'traditonal norm' is? From where do we receive our opinion of what is 'normal'? My personal objection to the consumer-producer paradigm which prevails today is that young people run the risk of denying themselves the opportunity of 'living', of 'being', while volunteering for what, in effect, is a form of bonded labour in a gilded cage. I shudder to think what we, as the human race, are denying ourselves in terms of unthought-of artistic, scientific, political and social advances because of this wholesale theft of human potential. It is no mere happenstance that the abolitionist movement culminating in the Slavery Abolition Act of 1833 co-incided with the rise of the joint stock company, the smashing of the artisan's guilds and the creation of the urban proletariat. There has been little progess since then.

Now, I am no foaming-mouthed seditionist preaching revolution from above, but as the global financial crisis enters a stage with an altogether more socio-political flavour, these are now open questions which are on the agenda for the first time in a long time. It is over the next decades that a new 'battle of ideas' will be fought. Yes, we're all in it together, but we've all go to work it out for ourselves. I doubt that we are all as well-equipped as we should be.

Did you listen to the iPlayer link to Oliver James on Radio 4's 'Bookclub' which I gave above? Did you read David Cameron's Google Zeitgiest speech, or JMK's 'Economic Possibilities...'? I'd be most intrigued to read your thoughts on these important topics.

Just another couple of things: you've again picked up on my horror of commuting, my cycling habit and my making my own bread. All trivial things really, but, in a sense, we can use them as sounding-boards upon which to test our assumptions.

Upon setting up my own enterprise, I was faced for the first time in years with funding my own transport. With every penny a prisoner, I calculated that the full life-cycle cost of a ‘decent’ car comes to about GPB £300 per month (not to mention the environmental externalities), an expenditure I simply couldn’t justify at that time. For that amount of cash I can take a taxi any time I need to, and if I REALLY need a car, I hire one. Shorter trips (less than around 15 miles) are by bike. Last time I hired a car, I felt an intolerable level of restriction on my freedom, what with speed limits, one-way systems, traffic queues, parking restrictions etc. I also felt physically restricted behind the wheel: strapped in an inhuman metal box in a horrific parody of bondage. “The chains we so revere” eh? There is also, of course, the carbon emission matter...

So, I cycle when it’s appropriate. I walk when its appropriate. I get the bus or train when it’s appropriate and I drive when it’s appropriate. I have found that the ‘appropriate’ test is indeed the acid test for motoring in my personal circumstances, and so I hardly ever do it. When we commute, our precious time is stolen and lost, as you have pointed out. Commuting by car is doubly inhuman, at least on the bus or train one can read, write or think. At this time of year it's triply inhuman, getting up in the dark, working inside, cut off from the natural environment only to return home once again in the dark is about as alienating a way of life as it's possible to imagine.

So, I cycle more than most, and regard easy access to amenities by bike an important consideration when deciding where to live. Agreed, this is not a mainstream consideration for many in this part of the world; but it is elsewhere.

http://www.webstockpro.com/DigitalVision2/...-Station-Photo/

Perhaps I'm in the vanguard of seeing things this way. The problem with being in the vanguard is that you're the first to face the enemy, and your comrades may shoot you in the back. :)

To me, my time is worth money. Somewhere around £40 to £50 an hour. As I enjoy my work, and don't particularly enjoy baking bread, I'd rather work an hour, and buy bread for several months from the proceeds. The alternative is to spend many hours baking bread, and lose either hundreds of pounds, or many hours of recreation that I do enjoy.

To me, time is worth soooo much more than money. The baking example is a very small thing, a tiny part of my life, but I'll address it nonetheless as an example of how I live: Baking bread doesn't actually take very long, about 15 minutes to make and knead the dough. What it does require is one's presence in one's home: 1 hour later, you put it in the oven, 45 minutes later, it's ready. In the meantime, you can feel free to make as much money as you feel you need, or watch a movie, or read, or play the bassoon, or play the buffoon, or post to a blog, or phone a relative, or whatever.

There is, however, an unquantifiable value, a small thing, a certain fulfillment, you feel a primeval connection with those humans who first moved to an agrarian mode of production 10,000 years ago as the delicious aroma spreads through the house. It's original, it's authentic, you control the quality yourself. (You control the salt content yourself!)

The grateful look of joy and delight you receive when you give a hand-baked loaf to an elderly neighbour or relative cannot be valued in monetary terms. Social capital is like that, part of its reward comes in creating it. Money and the possessions it can purchase (including houses, for that matter) are just things, they have no intrinsic human value; it is in the realm of thought, emotion, generousity, consideration, playfulness and creativity that we express our humanity and its potential.

I fully understand the enjoyment that cycling can give... I keep it for the weekends.

The concepts of 'working week' and 'weekend' mean absolutely nothing to me.

My thing is more "Go hard or go home"

I don't understand what that means. It sounds like some sort of motto from one of those TV-friendly artificial American spectator sports - all very macho and aggressive and posturing and shouty. I think I'll just go home.... ;)

When I mention luck as the significant factor in success, whatever one's method for measuring success you respond

I'd suggest theres quite a lot more to it than that. In general terms, I do hear that type of comment a lot, when applied to anyone that has done well. My theory is that you make your own luck. Never give up. Never listen to the nay-sayers. Never let failure be an option. View every setback as an opportunity. Almost every person with those mindsets will succeed. Perhaps not in their original endeavour, but in something.

Well, I thank providence for my luck every day. But if I analyse my situation per your quote, it applies to me just fine too. This chap has written a recent book on this very subject, with special reference to 'the American Dream'.

http://www.newscientist.com/article/mg2002...m-gladwell.html

I've not read it yet, but it's on my list, so I'll let you know what I think...

It's interesting to note that Gladwell is one of the 'Freakonomics' generation of 'behavioural economists' the like of which Barak Obama has surrounded himself with.

So, so much for the politics and philosophy, what of the economics?

Again, I must apologise, you have indeed stated that you see a house price recovery starting 2010. I'm not so sure, per this comprehensive article:

http://www.marketoracle.co.uk/Article8080.html

However, I still await your responses to the majority of the (bearish) outstanding and referenced points I have asked you to comment upon, and which I summarise below, and would also like to see forecasts or data which re-inforce your viewpoints.

We are all, if we're not careful, subject to confirmation bias; that is, we seek out resources which re-inforce our prejudiced viewpoints. I would like you to appreciate that I'm totally open (in my own enlightened self-interest) to having my interpretations adjusted in the light of any evidence which you might choose to present to me.

1. Kondriatev 'super-cycle', invoked by George Soros

2. Inherent instability - the dynamics of complex systems.

3. Aberdeen & the oil industry: In the context of the triple whammy of the liquidity crisis, resource depletion and price volatility - does Aberdeen have Dutch Disease? (or Resource Curse)

4. The credit cycle and credit revulsion.

5. Inherent economic, political and international barriers to the socialisation of debt and quantitative easing.

new link

http://blog.iea.org.uk/?p=222

6. Soros' reflexivity in markets, momentum, sentiment. 'The trend is your friend' (or enemy, depending upon your point of view.)

7. Glut of empty properties.

8. The Minsky process

I have provided the original links to citations elsewhere, but just ask if you need them again...

Cheers,

McG.

(edited for clarity, nuance)

Edited by The McGlashan
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  • 2 months later...
I am curious though, given your aversion to being a "wage slave", how do you justify paying for rent when buying is usually as cheap, if not cheaper?

Everyone's circumstances differ, I've only deemed myself to be in an advantageous enough position to consider buying since about late 2006, and at that point, with a significant mortgage. Something didn't quite feel right, so I delayed. Luck - I am now in a position to parley a portion of my assets into cash to buy a house without a mortgage. I'm just waiting for the curves to intersect...

BTW, I don't really pay 'rent' - the arrangement I have is a little different. As I say - everyone's circumstances differ. One size does not fit all.

Surely if you do not pay rent, then you will be just as homeless as if you do not pay a mortgage? How is this any more secure than buying?

Particularly in a market such as Aberdeen where rental yields are high and equivalent to, or more expensive than, a repayment mortgage.

All of that very much depends upon what sort of landlord you have.

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Everyone's circumstances differ, I've only deemed myself to be in an advantageous enough position to consider buying since about late 2006, and at that point, with a significant mortgage. Something didn't quite feel right, so I delayed. Luck - I am now in a position to parley a portion of my assets into cash to buy a house without a mortgage. I'm just waiting for the curves to intersect...

BTW, I don't really pay 'rent' - the arrangement I have is a little different. As I say - everyone's circumstances differ. One size does not fit all.

.

Which is all fair enough, but, I think you will have to admit that your circumstances are likely not easily replicated by the majority as a practical solution for long term housing.

I can think of several ways in which such an arrangement is possible for a very few people......

Living with parents/family, perhaps even in an unused part of a large old family house. Living in subsidised accomodation through an employer, such as a flat above a pub or shop for employees of same, arranging a form of barter with a landlord, etc. I'm sure there are others as well.

However such arrangements are rare, and usually quite restrictive for the majority of people, and whilst I accept they can work for a few people, it is simply not a viable option for most.

Without getting into a debate of whether or not some new utopian system could be invented to replace our current one, surely you would have to acknowledge that up until now at least, for people in Aberdeen, buying has been a better financial option than renting at open market rental rates, for the vast majority?

Our annual price falls have been less than typical rental yields to date.

I'll admit that equation may change for a few months or even a year or two in the middle of a crash, although it has not yet for all but perhaps the couple of hundred that bought at the exact peak in 2008, and even that may change come the comparable spring bounce this year.

But in general terms, buying has been less costly than renting for almost everybody so far.

All of that very much depends upon what sort of landlord you have

Well yes, family is less likely to evict you if you don't pay the rent.....

But for the vast majority of people, who have no real choice but to either rent privately or purchase, the consequences of failing to pay either a rent or mortgage are almost identical. Both will lead to impaired credit and eventual eviction. Again, I fail to see how for most people there is any material difference in security of tenure.

And thus for most people, property ownership is no more a route to wage slavery than rented accomodation is.

Edited by HAMISH_MCTAVISH
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surely you would have to acknowledge that up until now at least, for people in Aberdeen, buying has been a better financial option than renting at open market rental rates, for the vast majority?

Our annual price falls have been less than typical rental yields to date.

Up until now. We none of us have time-machines to exploit the benefit of 20-20 hindsight.

I'll admit that equation may change for a few months or even a year or two in the middle of a crash, although it has not yet for all but perhaps the couple of hundred that bought at the exact peak in 2008, and even that may change come the comparable spring bounce this year.

Elsewhere, you have advised a poster that property goes up and down and follows a 15-20 year cycle. How can this be reconciled with your belief that HPI will take off again in 2010? Are you suggesting that the down-leg can only be expected to last for a few months or even a year or two?

But in general terms, buying has been less costly than renting for almost everybody so far.

Has been.

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Yeh Mcglashan, don't challenge Hamish on the Aussie housing market, especially stamp duty, he's an expert and caught me lying red handed :rolleyes: I'm not worthy.....

No, you're just wrong.

Your assertion was that FTB grants are essentially worthless as they are less than stamp duty, therefore the govt gives with one hand and takes away with the other.

That is incorrect.

Economists claim that western Sydney families are now enjoying lower fuel prices, reduced mortgages from lower interest rates and a boost from both state and federal government to the respective first-home buyer grants last year.

They are also the most likely demographic to have benefited from bonus payments from the Federal Government's two stimulus packages.

But the boom is a double-edged sword for the State Government, with the demand for first-home buyer grants costing Treasury $355 million last year.

It is also impacting on state revenues, with the majority of transactions under $500,000 and exempt from stamp duty.

Treasurer Eric Roozendaal confirmed western Sydney was driving a mini-boom in the property market and said it was clear young families were driving growth, not investors or high-end buyers.

"We are seeing major housing growth in western Sydney where the great Australian dream of owning your own home is within reach," he said.

"We are getting more young families into their first homes. Stamp duty concessions and first-home buyer grants mean benefits of up to $41,990 are available for first-home buyers."

My assertion was that the FTB grants were creating a two teir market, with properties under the 500K median price generally gaining in value, whilst properties above it are declining, but at a slower rate than elsewhere in the world.

I was correct.

Edited by HAMISH_MCTAVISH
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Up until now. We none of us have time-machines to exploit the benefit of 20-20 hindsight.

Finally. Agreement that up until now buying has been more cost effective than renting in Aberdeen. Thats all I've been saying for the past few months.

Elsewhere, you have advised a poster that property goes up and down and follows a 15-20 year cycle. How can this be reconciled with your belief that HPI will take off again in 2010? Are you suggesting that the down-leg can only be expected to last for a few months or even a year or two?

As has been discussed, I do not neccessarily expect some great instant recovery, however I do expect losses to slow and then level off by the end of this year or beginning of next.

I've posted at length about my reasoning and timeline expectations. I won't repeat it again now.

However in this conversations context, the duration of continuing losses must be balanced against the losses incurred by renting. If rental yields are typically around 6-7% of todays CMV, then losses of more than 6-7% a year in capital are required to make delayed purchase or STR a viable proposition. That did not occur in 2007, it did not occur in 2008, and it may or may not occur in 2009 or 2010.

However, if this financial downturn lasts 4 or 5 years, then cumulative losses of at least 25-28% are required just to break even on a rent versus purchase equasion in Aberdeen.

Therefore even if the losses continue until 2012, at the current rate of decline this will not prove advantageous for delayed purchase.

Has been.

And still is......

Edited by HAMISH_MCTAVISH
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However in this conversations context, the duration of continuing losses must be balanced against the losses incurred by renting. If rental yields are typically around 6-7% of todays CMV, then losses of more than 6-7% a year in capital are required to make delayed purchase or STR a viable proposition. That did not occur in 2007, it did not occur in 2008, and it may or may not occur in 2009 or 2010.

However, if this financial downturn lasts 4 or 5 years, then cumulative losses of at least 25-28% are required just to break even on a rent versus purchase equasion in Aberdeen.

Therefore even if the losses continue until 2012, at the current rate of decline this will not prove advantageous for delayed purchase.

And still is......

:blink:

The latest figures I showed on the thread in the main forum showed Aberdeen prices down 11% over the year to Q1 2009 ?

Isn't 11% more than 6% ?

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However in this conversations context, the duration of continuing losses must be balanced against the losses incurred by renting. If rental yields are typically around 6-7% of todays CMV, then losses of more than 6-7% a year in capital are required to make delayed purchase or STR a viable proposition. That did not occur in 2007, it did not occur in 2008, and it may or may not occur in 2009 or 2010.

Therefore even if the losses continue until 2012, at the current rate of decline this will not prove advantageous for delayed purchase.

Hamish, why don’t take interest gained or interest paid or maintenance costs into any of the above equations ?

Your basic logic of what capital falls are required vs Rental yield is fair enough. In very simple terms.

However you fail to take into consideration that (even based on you paying on average 6% back for the money owed) you will pay back roughly double including interest.

You will also lose any possible returns you could get for investing that elsewhere. Yes of course interest rates are low but you can still get 2% or so if you an be arsed to look around.

You also don’t take into consideration any potential maintenenace costs saved by renting over buying - for a year or two.

To say that you need capital depreciation of SIMPLY MORE THAN the current rental yield is completely ignoring the 3 above very important factors.

Taking these into consideration I reckon falls of even half the rental yield makes sense. Considering prices fell 11% in Aberdeen in the last year, according to Nationwide, then your assertion that buying today still makes sense - is clearly wrong.

Flat cost 100,000 last year.

Flat costs 89,000 this year.

Rent over that year cost you 6500.

You are up already by almost 5k before you even consider maintenance or interest losses.

If this goes on for another year then you are up even more. If it goes on for 3 or 4 years then the gains are huge.

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Finally. Agreement that up until now buying has been more cost effective than renting in Aberdeen. Thats all I've been saying for the past few months.

Has been. That is the past, which we cannot revisit.

As has been discussed, I do not neccessarily expect some great instant recovery, however I do expect losses to slow and then level off by the end of this year or beginning of next.

I've posted at length about my reasoning and timeline expectations. I won't repeat it again now.

I'll ask again, how is this reconciled with your statement elsewhere that house prices follow a 15-20 year cycle?

However in this conversations context, the duration of continuing losses must be balanced against the losses incurred by renting. If rental yields are typically around 6-7% of todays CMV, then losses of more than 6-7% a year in capital are required to make delayed purchase or STR a viable proposition. That did not occur in 2007, it did not occur in 2008, and it may or may not occur in 2009 or 2010.

However, if this financial downturn lasts 4 or 5 years, then cumulative losses of at least 25-28% are required just to break even on a rent versus purchase equasion in Aberdeen.

Therefore even if the losses continue until 2012, at the current rate of decline this will not prove advantageous for delayed purchase.

No, there's something you're missing there. Let's make some simple assumptions and do the maths.

Elsewhere, you've predicted a conservative 15% decline in Aberdeen house prices over about 18 months. Let's examine that.

Taking an average-ish house price of £200,000 and a long-term average interest rate of 6% (conservative) over a 20 year interest-only mortgage. Monthly repayment = £1000.

Same property, 18 months later £170,000, all other things equal. Monthly repayment = £850.

Total interest saving = £36,000

Plus capital saving £30,000

Total saving £66,000.

Over 18 months, for £66k, one could live in a 4 star hotel, and still come out on top.

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And thus for most people, property ownership is no more a route to wage slavery than rented accomodation is.

My original characterisation of the mortgage debtor was as a "debt-driven wage-slave". There is a vast difference between mortgage debt and property ownership. One can only claim property ownership when one is debt-free. This is my whole point, I am not in any way against property ownership, but I am extremely wary of the over-indebtedness that some have let themselves in for by taking on mortgages recently - it has robbed them of their choices in life, it will rob them of their freedom.

The freedom they will lose is the freedom to jack in their job and start on something else, be that composing a symphony or writing the great Scottish novel. They now cannot trek across the sahara or row across the Atlantic. They now cannot devote their lives to charitable works, nor will you they able to find the time to enrich themselves in non-monetary ways. Now they must work. Work work work. Where once they might have created social capital, now they must help prop up the ailing system of international finance capital.

They are now chained to and work for the bank, and if they don't, the bank will their home away. The "freedom to make the place their own" is illusory - the bank have a charge on the property. Miss one mortgage payment and the illusion will vanish quicker than snow in spring. Late with their store card or credit card payments or gas bill? Recent legislation allows these cretitors to put a charge on the property too.

They have given up the security and protection of living under a lease for the risk and uncertainty of now living under a charge. They must now look forward to a future of bondage, spinning the hamster wheel for the next 20 years.

Voltaire said "it is difficult to free a man from the chains he so reveres".

Whoosh!

Ooh what was that?

"That was your life, mate"

Was that it?

"'Fraid so"

Edited by The McGlashan
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:blink:

The latest figures I showed on the thread in the main forum showed Aberdeen prices down 11% over the year to Q1 2009 ?

Isn't 11% more than 6% ?

Q1 2009 figures have not been released yet by anyone, as we're still in it.

Q4 2008 figures have been released, you chose a single banks survey, out of the half dozen or more major banks and building societies that service Aberdeens market. You have already pointed out the errors of relying on a single banks survey data when disputing the Lloyds survey data for Edinburgh showing a recent price increase. To now insist that a single banks survey data is in fact more accurate than total market info available from ASPC or ROS would be hypocritical in the extreme.

The more accurate figures, that represent ALL sales, not just those from one bank, would be the ASPC stats which showed a 3.6% annual fall, or the ROS stats which showed a 5.8% fall.

Both of which are in fact less than 6%.

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Q1 2009 figures have not been released yet by anyone, as we're still in it.

Q4 2008 figures have been released, you chose a single banks survey, out of the half dozen or more major banks and building societies that service Aberdeens market. You have already pointed out the errors of relying on a single banks survey data when disputing the Lloyds survey data for Edinburgh showing a recent price increase. To now insist that a single banks survey data is in fact more accurate than total market info available from ASPC or ROS would be hypocritical in the extreme.

The more accurate figures, that represent ALL sales, not just those from one bank, would be the ASPC stats which showed a 3.6% annual fall, or the ROS stats which showed a 5.8% fall.

Both of which are in fact less than 6%.

Makes you wonder what the quarterly falls indicated. :lol:

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Hamish, why don’t take interest gained or interest paid or maintenance costs into any of the above equations ?

Because there are almost infinite variables that make calculation next to impossible.

A person could have bought at peak on a 100% mortgage with a tracker rate of less than BOEBR, in which case the bank may be paying them to live in the house. They would at worst be paying zero interest now. They may have a lifetime tracker of BOEBR + 0.5%. They may have a fix, they may be on a capped SVR. Their mortgage may only be for 30% of the purchase price, or 70% or 100%.

Your basic logic of what capital falls are required vs Rental yield is fair enough. In very simple terms.

It is a very rough and ready argument, I'll admit, but it's certainly the case for STR, cash purchasers, those with high equity and those taking advantage of the record low rates. There may be some people on high rates where it's more marginal, but very few where it's a clear loss.

But thats why I argued that it is the case for most people, not all people.

However you fail to take into consideration that (even based on you paying on average 6% back for the money owed) you will pay back roughly double including interest.

Banks are now confident that rates will stay low for a while, thats why you can now get a tracker capped at 5.69% for 5 years. Launched last week as I recall.

You will also lose any possible returns you could get for investing that elsewhere. Yes of course interest rates are low but you can still get 2% or so if you an be arsed to look around.

1% net return after tax is more common at the moment.

You also don’t take into consideration any potential maintenenace costs saved by renting over buying - for a year or two.

I bought my current place two years ago, I have cleaned my gutters, repainted a drain pipe, replaced one roof slate, replaced a cupboard handle, and mowed the lawn a few times. Thats it.

I doubt it cost me more than £20, and thats including two summers worth of petrol for the mower.

This year I'll get the heater serviced, and may paint some exterior woodwork. Another £100 or so at most.

Maintenance for first 3 years, £120, or £40 a year.

In my previous house, I redecorated a couple of times, replaced the boiler and most of the white goods once each,kept on top of preventative stuff like exterior wood paint, and fixed the roof once. That was in 20 years. 10 grand at the most, over 20 years, and thats for a big 100 year old detached. And almost none of it was needed for 5-10 years after I bought it.

Maintenance is just not a big expense for most houses, so long as you keep on top of minor and cheap preventative work. Keep the gutters cleaned, the exterior woodwork painted, the heating serviced every couple of years, make sure if slates come off in winter you get them fixed right away, etc.

I personally like buying from old people, as although the decor may not be to your taste, they are generally quite obsessive about keeping the place very well maintained. If you buy a house that way, it is highly unlikely you'll need to spend anything major for many years.

To say that you need capital depreciation of SIMPLY MORE THAN the current rental yield is completely ignoring the 3 above very important factors.

Taking these into consideration I reckon falls of even half the rental yield makes sense. Considering prices fell 11% in Aberdeen in the last year, according to Nationwide, then your assertion that buying today still makes sense - is clearly wrong.

Flat cost 100,000 last year.

Flat costs 89,000 this year.

Rent over that year cost you 6500.

You are up already by almost 5k before you even consider maintenance or interest losses.

If this goes on for another year then you are up even more. If it goes on for 3 or 4 years then the gains are huge.

Again, the data for Aberdeen supports annual falls of 3.6% or 5.8% in 2008, less in 2007.

Maintenance should be minimal for most people.

Interest rates and amounts are different in every case, but for the majority it still works.

Edited by HAMISH_MCTAVISH
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Cheers for the reply Hamish. I see no issue with what you are saying, except it makes for a lot of assumptions.

There are of course lots of variables involved. Using this to negate any accounting for intereats payments is pretty lame though. Taking a 6% average interest rate is being extremely generous. This equates to paying roughly double what you borrow. Hence any calculation MUST take this into consideration to make it valid IMO.

So I will agree to a point. Price falls of less than ~2-3% mean it may make sense to buy rather than rent. However the flexibility that renting gives IMO means at any point when prices are falling - it makes no sense to buy.

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- it has robbed them of their choices in life, it will rob them of their freedom.

The freedom they will lose is the freedom to jack in their job and start on something else, be that composing a symphony or writing the great Scottish novel.

Why? How is renting in the private sector any different to a mortgage?

Do you think a private sector landlord is any more sympathetic to your desire to jack in the job and write a symphony as a bank is?

If you live at home with your parents (or some similar non commercial rent situation), fair enough. For most people that is not a practical or viable option.

You have to pay the piper either way, whether you are paying off your own mortgage, or your landlords mortgage, makes no difference to the fact that you still must pay, or be homeless.

They now cannot trek across the sahara or row across the Atlantic.

Untrue. They could rent out their house and travel just fine. I worked overseas for years, spoke to bank manager, asked him if I could rent the house, he said no problem and I wouldn't even need to change the mortgage if I didn't buy another house and so long as it wasn't permanent.

They now cannot devote their lives to charitable works, nor will you they able to find the time to enrich themselves in non-monetary ways. Now they must work. Work work work. Where once they might have created social capital, now they must help prop up the ailing system of international finance capital.

Whoa there...... How is this possible now for anyone that rents commercially? Possibly for council house tenants, after all, they are not renowned for working at the best of times. ;)

But for most people, not working is an impractical option.

They are now chained to and work for the bank, and if they don't, the bank will their home away. The "freedom to make the place their own" is illusory - the bank have a charge on the property. Miss one mortgage payment and the illusion will vanish quicker than snow in spring. Late with their store card or credit card payments or gas bill? Recent legislation allows these cretitors to put a charge on the property too.

As opposed to being chained to and working for their landlord?

If you don't pay your rent, the landlord will evict you. (Unless you live with your parents or similar.)

Again, for most people, not a practical option.

Pay rent or mortgage, or be evicted and homeless. At which point the council will no doubt stick you in a B&B.

They have given up the security and protection of living under a lease for the risk and uncertainty of now living under a charge. They must now look forward to a future of bondage, spinning the hamster wheel for the next 20 years.

Again, I ask you, now over several posts and in several threads, how is paying a monthly rental payment any different to a mortgage payment in terms of work required to achieve it?

What security does a lease in the private sector, which is the only viable option for most people today, offer that a mortgage does not?

Non payment of either will result in eviction and impaired credit. How is renting advantageous in terms of not being a wage slave?

Voltaire said "it is difficult to free a man from the chains he so reveres".

Voltaire also said "a witty saying proves nothing"....... :P

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