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FWIW

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Posts posted by FWIW

  1. Default.

     

    Good read: http://www.marketoracle.co.uk/Article14712.html

     

    The Government Will Default on Its Debts

    Quote:

    The governments of every major nation are going to default on their debts. There are two relevant questions: (1) How? (2) When?

     

    Ultimately, it is either the great depression or the Zimbabwe option. Ludwig von Mises called this the crack-up boom. It means the destruction of money and the collapse of the division of labor. It would mean devastation.

     

    I think central banks will at some point refuse to fund governments any longer. They will bail out the largest banks instead. Foreign politicians may force hyperinflation on their central banks, as agents of the government. But as long as the Federal Reserve System maintains its selective independence, it will not adopt hyperinflation as a policy. That would not be in the interest of the largest banks. It would also not be in the interest of central bankers. Their retirement promises would die.

     

  2. FWIW , those curves are exponentials on a log plot! - it's an exponential of an exponential... buckle up!

     

    Yes, you are right! Exponential growth is the minimimum level!!! We need to catch up with the 'fiat' printers, they have been running at full speed for far too long! :huh:

  3. Hmmm, Mar 10 isn't that far out for such a slow moving asset class. Interesting. Does that reflect the fact that this isn't a terribly well evolved sector of financial derivatives or simply that no-one dare offer something further out than that. Why can't you just buy a 'spot' house price derivative?

     

    Because then house prices would be like gold prices and kept artificially low. That's not part of the plan.

     

    Have you tried betfair? I am sure you should be able to bet on there.

     

     

     

     

  4. Sitting in Hong Kong, I am less aware of such (dangerous) policies.

    Do you agree with my assessment of the possible moral hazard, and chances for cheating?

     

    This is only 1 policy in a whole host of dangerous policies. There are many more such as deferrment of Student Loans if you are on benefits, etc, etc.

     

    Have a quick look here and see what's on the menu: http://www.direct.gov.uk/en/MoneyTaxAndBen...ncome/index.htm

     

    Yes, I 100% agree with you that this is wrong and encourages people to abuse the system. Some of the advice I have given people who have been recently made redundant is to go and get their teeth done as it will be 'free' for them.

     

    How did a 'safety-net' turn into this matrix of moral hazard? I beleive it is down to fiat money, which encourages malinvestment. So now we are back on topic to uk houses!

     

     

  5. Can THIS be true ?

     

    ... from an SP posting ...

     

    That is an interesting comment.

     

    Especially this part:

     

    " You may not be aware but the government will pay interest on the first £200k of your residential mortgage once you have been out of work for 13 weeks.This should put a stop to repossessions permanently for many."

     

    I presume that is a TEMPORARY program. When does it expire?

     

    If they leave it in place, it is full of awesome moral hazard. People who are concerned about losing their jobs have a strong incentive to buy a £200k property that they may not be able to afford, because if they then lose their job, the government to pay their mortgage interest. If they were prudent, and remained as renters, would the government pay the rent? It think not.

     

    This is typical of the truly breath-taking arrogance and stupidity of the present UK government. They are doing everything they can to encourage property speculation, and reckless behaviour. ( In fact, they may have already wrecked Britain's future - the fear that they were doing so, was one important reason that I left the UK.) The sooner that Brown and his cronies are put into history's dustbin, the sooner the country can get back on its feet. A country with so much of its economy dependent on speculation in overvalued property, and transfer payments, is a disaster waiting to happen. And the disaster has now overtaken the UK.

     

    /See SP-post#913517 : http://www.singingpig.co.uk/forums/3/91351...ead.aspx#913517

     

    Yes, its true - I thought this was common knowledge?

     

    However, it's not all roses as you have to pass certain criteria and lasts for 2 years. Obviously, some are better at passing the criteria than others!

     

    More here: http://news.bbc.co.uk/1/hi/business/7956015.stm

     

    Broken Britain in action - Either work hard at being honest, or work hard at being dishonest. Either way this country is deferring the pain.

  6. How very depressing. 2013. Sometimes I wish I was American. Well, in times like this. The UK is so married to their damn houses they will be hanging on when they are getting flushed down the loo, denying it all the way.

    FWIW-You have made me want to puke for the second time today. Though I sadly accept your analysis, esp when considering the British attitudes to 'their' homes.

     

    What is TPTB btw? Go on, cheer me up.

     

    What was it that made you puke the first time?

     

    TPTB = The Powers That Be.

     

    I know what you mean about brit's holding onto houses - I do that analysis and you would think I would be STR'ing straight away. However, I will not be STR'ing as I like where I live and am concentrating on getting rid of the smallish mortgage asap.

     

    My house is my home, my investments are my speculations, and my gold is my money.

     

  7. As posted on the HPC Merryn & Affordability thread

     

    The usual downturn is 3-5 years after the peak.

     

    But this one could be 5-6 years because of the error in money policy which has created the current strong Dead Cat Bounce, and it will be "as if" the downturn is restarting from a second peak in 2009.

     

    Many now see a need to regulate lending, and enforce LTV maximums, and Price-to-Income measures. This may help to bring down the market. But the real problem is the artificial level of interest rates, which will not last as long as CEBR expects. (Low rates until 2014 is a complete joke, don't these guys understand what that would do to Sterling - $0.75? $0.50?)

     

    Also, banks are not the sole driver of property price levels. Not everyone is a "knee-jerk idiot" who will buy just because some misguided bank will lend them the money.

     

    In fact, I think the losses that people are going to suffer in the next 2-3 years will greatly reduce the population of Knee-Jerks in the UK, and buyers themselves will begin to regulate what they will pay for properties, and 3-3.5x income may again be seen to be the limit of a sensible price.

     

    Presently, the very low interest rates - lowest in Britain's future - have distorted people's thinking about what is a sensible price to pay for housing. The UK moentary authorities have miscalculated. The boom they have engineered is just storing up problems, and will help to create a bigger property crash down the road, when rates rise.

     

    Sterling may be the Achilles Heal in this story. People are fleeing the currency because of the low rates, and continued weakness will bring higher inflation and a need to raise rates. This may happen far sooner than the current (complacent) consensus expects.

     

    5 or 6 years after the peak is optimistic and would make this hpc shorter by 1/2 years than hpc of late 80's - Printing presses would need to be on full speed with no chance of stopping!

     

    My guesses using my fib chart: (If we go to IMF for bailouts, then it will remove the more optimistic guesses)

     

    Optimistic (and 1 year less pain than previous hpc) = 6 years = 2013 bottom

    Middle of the road guess = 8 years = 2015 bottom

    Pessimistic = 12 years = 2019 bottom

    Obliteration of middle class (which is probably the ideal goal for TPTB) = 13 years = 2020 bottom

     

    2enrxq1.png

  8. Wouldn't take much to see $20 would it. If we get the last hoorah in the inflation trade, gold could go to $1200 and silver to say $22/23 with the ratio near 50.

     

    Every great journey starts with a single step...

     

    I'm not making any predictions, that's the title of the article.

     

    Can you give the inflation vs deflation lectures a rest? You know my view and I respect yours.

  9. News reaches me of a few acquaintances lured in by the bull trap.

     

    The market is a magnificent 'creature'. Even when you know what you know, it still has a powerful 'song' that lures you in.

     

    Also, had a few 'friends' who recently bought and gave me and mrs fwiw guided tours of their newly acquired mansions.

     

    I must say that if it wasn't for my 'hpc with fibs chart' map, I would have crashed too.

     

    Mrs fwiw still thinks i am mad; better to be mad rather than having an enormous milstone round one's neck.

  10. Ready for the next leg-up? :D

    http://www.housepricecrash.co.uk/forum/ind...t&p=2190484

    RBContraIndicator ©

     

    Boy, he really hates gold, doesn't he!? Although to be fair this time he is quoting Jimmy Rogers.

     

    I was just looking at the 15min chart and thinking volatility is coming down a bit...now I just need a pull back and then hopefully a sign to move the market!

     

    That RBContraIndicator is exactly the sign I was looking for!!

     

    lol

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