Wednesday, January 30, 2013
Spinal Tap economics
"If we look at the level of official support in this area it may not quite be at the â€œturn up to eleven (out of ten)â€ scale pioneered by Spinal Tap but it is not far off. Measure has followed measure and whilst much of this has been yet another disguised aid package for our banking sector some has flowed also into the housing market. New buyers have the prospect of some lower mortgage rates although existing ones have seen higher and not lower rates. Frankly this looks an utter mess to me. After all if we tempt people into the housing market and hold it up by any means what happens next? They will not thank us if we then see house prices fall as the stimulus measures are withdrawn. This poses the question how will they be withdrawn which quickly morphs into an if they are?!"