Friday, August 18, 2006

Mervyn talking sense again, why does noone listen?

U.K. First-Time House Buyers Dwindle, Threatening Blair's Boom

"Clearly, in the long run, the market requires first time buyers to come in and provide base demand,'' Mervyn King said at an Aug. 9 press conference in London." There is a great deal of uncertainty about the sustainability of the present level of house prices relative to earnings or incomes.

Posted by @ 10:56 AM (491 views)
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3 thoughts on “Mervyn talking sense again, why does noone listen?

  • Leaving The Country says:

    Well instead of Mervyn King speaking as a bystander commenting on the economy as if he were speaking of an England football team selection, perhaps he should so something.

    It is easy to state that first time buyers are required but when you have Tony Blair’s hand up your backside making you their puppet, lowering interest rates and fueling a debt time bomb and rapid house price inflation, it might be a suggestion to remove the hand from his anus.

    They have near half the MPC selected by the Government, working to flawed data prepared by the Government.

    The economy is hanging by a shread. Jobless totals rising, debt rising, house prices rising, inflation rising (rapidly)……

    Good job I’m leaving the country for a high salary.

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  • I had a moment of clarity this morning. There is only actually one solution – the government has to re-introduce restrictions on bank lending.

    It’s not actually going to work any other way. Let’s say we stay in the houseprice doldrums for the next 15 years (the amount of time required for salaries to catch up with house prices) and you’ll have a whole generation that can’t trade up to reduce the size of their mortgages, who will then not be able to move up the ladder, and be laden with debt for the next fifteen years with no reprieve in sight.

    I think the current inability to do what’s required is a testament to the extraordinary selfishness of the baby boomer generation. They stole future generations’ pensions and now they’re stealing future generations’ housing.

    The trouble is of course, that the people in the driving seat who can do something about it are the people whom it benefits the most to keep the current status quo, leaving a generation saddled in debt with reposession to look forward to when they retire (because they’ll still be repaying).

    The UK economy is doomed. And I’m afraid it’s the Bank’s fault.

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  • Not encouraging having our fate in the hands of some maniac who was hoping to create “boredom” in the banking industry and has just realized that sustaining the property market will require viable buyers, not just self-satisfied owners. Let’s hear it for Merv and his economic prowess!

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