Saturday, April 12, 2008
Strong words indeed
Don't kid yourself - the housing slump really is here
HOW OFTEN must I say it? Falling house prices are a good thing, not a bad thing. It was property madness that got us into this financial mess in the first place, and the credit crisis will not be resolved, will not begin to be resolved, until house prices start to become more rational. That means house prices must come down. Average UK house prices of over eight times average earnings are unsustainable, morally and financially. Most home owners, sitting on large paper gains, know and accept this; many have the decency to be embarrassed about it. Brown leant on the governor of the Bank of England to cut interest rates by announcing, falsely, that "Because we've got low inflation we can cut interest rates." A housing "collapse" is necessary and unavoidable.
Posted by little professor @ 08:33 PM (1006 views)
13 thoughts on “Strong words indeed”
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gone-to-colombia says:
My word, strong stuff!
HPC – How does it feel to be mainstream?
Great posting little p
plato says:
” But it is at moments like this that you realise that the country is being governed by fools, by people who behave in a contradictory and irrational manner.”
“The only problem was that this was the most reckless economic mismanagement in modern history.”
Sweet Words.
plato says:
In fact this applies to this whole article.
little professor says:
PWNED!
bystander says:
Brillliant!!!
mark wadsworth says:
That’s all good stuff, but out of interest, what is Ian Macwhirter’s solution to all of this?
uncle chris says:
One of the best articles I’ve read in many months, and hits the nail right on the head. If only the establishment would read this and start doing what’s right for this country, not what they believe is right for saving their own skins. Well done Iain.
quiet guy says:
@mark wadsworth
“what is Ian Macwhirter’s solution to all of this?”
Macwhirter said in his article:
“To repeat: a housing “collapse” is necessary and unavoidable if the economy is to be restored to anything like equilibrium.”
Which I interpret as simply letting the market do its job – a house price correction.
Macwhirter’s analysis is clear, simple and powerful. The sooner we get this bubble over with and start thinking about living within our means the better.
Fed Up says:
Excellent article, it’s a shame that this won’t be widely read outside of Scotland. That fool David Smith certainly needs to read it.
Dude says:
I’m sorry but I don’t see any change in our policies until the political environment changes. As long as elections are won on marginal seats the political establishment will not do what’s right, only what is politically expedient. With 70% of households owning their own home, policies that are benign to home ownership will win out every time.
I turn on the TV and see ‘Britain’s got Talent’ and, alas, realise that there is little hope for this country. The consumerism (flash cars, widescreen TVs, and foreign holidays) that has touched the ambition of so many people will not be put back into its box so easily. I’m sorry to say that in general people really are stupid — high house prices mean they must be wealthy. End of story.
So it doesn’t matter how eloquently the position is laid out, as the painful things that need to be done now (which may mean many, many more repossessions, for example) will be avoided as much as possible. Labour can’t afford to let it happen, and if it does must do their utmost to blame ‘the wider world,’ and the Tories will try to make hay as much as possible.
Bummer!
confused76 says:
best posting in a long long time
thank you little prof
I agree with quiet guy
Micthemike says:
little prof best ever posting on this web sums it all up in a nutshell
renting2 says:
Fantastic article and brilliant summation of the whole debacle.