Sunday, September 23, 2007

Do not miss this week’s Davinomics

Danger lurks as Bank credibility suffers

"On the other hand, money-market interest rates remain high in spite of last week’s swerve, and represent a tightening of monetary policy, particularly for the 60% of business borrowing directly linked to Libor" "PS: My reference last week to the fact that UK house prices are not 11 times average earnings, not much more than half that, brought a flood of responses, some quite rude. A disturbing number of people believe it. Let me set the record straight."

Posted by confused76 @ 10:37 PM (1011 views)
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6 thoughts on “Do not miss this week’s Davinomics

  • Again, David Smith uses statistics the way a drunk uses a lamppost.

    Those figures for average and median earnings are for very select AB1 groups of people, and the higher earners’ incomes have a heavy skewing effect which he chooses to completely ignore.

    The published government figures for average earnings are estimated to be represent around a quarter of all adults of working age, and if he was an economist worth his salt, he’d know that already.

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  • crash bandicoot says:

    Why has he multiplied last years’s average earnings figure by 4%? Does he think that everyone has an inflation-busting pay rise?

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  • His figures on govt dept as a % of GDP are also spectacularly wrong. If you go to the Nat Statistics webpage you can see that the most recent data (2006) gives a figure of 43% (to which you can then add PFI etc). I have e-mailed that to his original article, but predictably as yet they are refusing to add it as a comment. Smith really is a discgace and has given up all pretence of balanced analysis – he is Brown’s creature, as is Kaletsky.

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  • I hope you chaps above have both posted accordingly to The Times. On the other hand, see the thread about their censorship….

    Re. average income, two points occur to me:

    (1) This is the average income of those who actually buy a house (otherwise Halifax etc. couldn’t measure it). Therefore by definition it will always exclude the income of all who can’t afford to, no matter how many or how poorly-paid they are.

    (2) It of course includes all those phoney inflated incomes for purposes of self-cert mortgages.

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  • He knows he game is up but has not quite managed to sell his property portfolio yet!

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