John Doe

Oh we tried that before, have you not read Dickens? The sad thing is that a lot of the people on these “sink” estates are actually quite decent. It’s a relatively small group that drag everyone else down. There is a real prejudice that arises purely from your home address if you’re from certain estates in some areas. Even if you try to escape, the odds are stacked against you. That said, there are a fair number of wasters too. The problem is that now it is engrained in the psyche. 3rd generation unemployed with no prospects and, as a consequence, no hope or ambition. How to break the cycle? After many years thinking about it, I believe the only option is to invest s**t loads into the infant-primary-secondary school system in these areas. Get them at a very young age and show the kids that there is an alternative to the c**p they see at home and all around them every day, instead of letting them grow up thinking it's all normal. Cutting the parents benefits etc will only hurt the innocent kids. That’s not tough love, that’s punishment for being born to asshole parents.

http://www.bbc.co.uk/iplayer/episode/b00sj713/The_Scheme_Episode_1/ http://www.dailyrecord.co.uk/news/scottish-news/2010/05/18/new-bbc-documentary-the-scheme-lifts-lid-on-life-on-housing-estate-86908-22266589/ How the other half live

Or, from a TA perspective, a possible bounce off the channel line or even off the previous peak as a support perhaps? You're all heart Bubb Good job you didn't watch "the scheme" about an estate up here in bonnie scotland that was on the tv last night!

Funny you should say that But seriously, I am trying to commercialise some of my research at present to get back into the private sector (always the aim since coming into the public sector some years back). The lifetime research academics job seems to consist primarily of more and more researchers chasing a smaller and smaller pot of funds. Aint that the truth! I think?

Quite right, spread the wealth

Well I can’t speak for the whole public sector, but I can confirm the following in the University sector where I now work. There are several increments per grade (and then another 3 or 4 discretionary). At the top of the grade you need a promotion to go to the next (another several increments then until the need for the next promotion). These are not just the low paid, having just checked, these include rates up to £57k (not including 16% pension contribution - another £9k!) While promotion used to be quite difficult, a few years ago they changed the criteria from having to meet all the requirements laid out in the promotion process, to just having to meet the majority of them (i.e. just over half). Since then I have not (personally) known of a single case where someone has not been promoted when they reached the top of their grade. As for the tail end pay deals, ours and many of these type ended a few years ago at the end of a 3 year deal that was to pay the higher of RPI or 2.5% as the last instalment. RPI hit 5% that month, so that's what was given. That was in 2008 http://news.bbc.co.uk/1/hi/education/5188664.stm Our latest deal was 0.5% There might be a lot of fiction about, but there is also a lot of fact.

While the one off tax change will affect quite a few, it is only for 1 year and it just isn't the case for everyone anyway. For the lower paid - and many medium paid for example (under ~ 40k) - after tax income is rising due to the TAX threshold going up. Also, people forget that in the public sector, in addition to yearly pay increases, most people also get an annual increment (going up the pay scale), usually worth ~2 to 3%. So even in a year with a 2% pay rise, these people are keeping up with inflation. Just to cheer you up more, I found this shocking story on HPC about someone who has given up a £60k job and has bought a place in Wales to become "self sufficient" - largely from benefits it appears! http://www.housepricecrash.co.uk/forum/index.php?showtopic=163690 More importantly, one of the comments....

Never said anything about wages rising in line with inflation, just said they were rising (which they are, and for some sectors quite sharply) and, therefore, if you have a fixed interest debt, it will be eroded by the rise in incomes, whether that rise is above or below inflation. Also, if you believe everyone else will just sit on their hands and let prices keep rising while there is NO rise in wages for an extended period of time, then, frankly, you are dreaming. Threats of job losses or not, unions get a huge gain in support in these circumstances. People are starting to reach the point of max pain and before too long there will be strikes if either inflation isnt damped or wages arent improved. This is the evil genie of inflation they really want to keep in the bottle. Take the other points though.

I know that, but I never said the debt halves, rather the deficit halves. However, if you are inflating the money supply (through QE or whatever other means), your debt indeed reduces in real terms. QE is amazing in this respect, printing money then using it to buy bonds to keep the yields low (which of course would normally rocket if you started printing money). It's genius really! A lot of people don't seem to get that. Also, income is not unchanged. It is, and will keep on, rising. If inflation gets higher, so will the call for wage rises. The population will not sit on their hands forever.

We’ve already had this conversation. It's Government debt. As has been stated by many commentators, the UK deficit will halve over the term of the parliament with an RPI of just 5%. "Cuts by the back door" As you know, it erodes debt in real terms. Besides, talking of personal debt, wages have been, and will continue to rise (average ~ 2.8% currently. 5 years of that is ~15% off your mortgage, which would just about cover the loss on your property between now and then ).

Oh I'm not missing it, I actually agree that it depends on GDP growth and if GDP starts falling badly then all bets are off. A very fine line indeed. It's just that GDP is not falling and is not expected to fall (albeit that it is rising slightly less than expected previously). I still believe the master plan is to inflate the debt away, while scaring the population enough with cuts (and moreover, the threat of worse cuts) so that they will not dare demand increased wages. Again, a very fine line, but one which they have managed quite well (depending on your point of view) for nearly 4 years now. Meanwhile, the average debt maturity for the UK is 14 years. In the US it's 4 years! So while an EU bank could be a black swan, the fact the US needs to roll over s**t loads of debt over the next 12-24 months scares me far more.

Actually the debt isn't the highest in the developed world, but, the deficit is and that is what is being cut. I stated that the cuts are not as bad as everyone was saying they would be, and they are not. But that was just government expectation management. Tell them the worst, then it's not so bad when the real numbers come out. The real cuts will get rid of the deficit as they are planning, if they stick to the plan and the markets are happy with this. See for yourself, yields are still falling http://www.yieldcurve.com/marketyieldcurve.asp I agree, and heh, check all my posts, I try to look at both sides and have stated several times I expect prices to fall nominally by about 5 to 10% over a year or so. I just don't see an "end of the world" scenario as some seem to. Does that make me a bull? Oh and, for the record, I think the rise in equities over the last year is about to end. Too much bad news not having any effect. Seems like a good correction is overdue.

They actually say living standards rather than income, however, it seems both incomes and living standards rose above inflation? Sort of knocks the "inflation not eroding the debt" argument a bit . Well that's up to you, but it is what it is. Due to ridiculous planning laws and a builders cartel, the number of new properties built in the UK is pathetically (and historically) low. The numbers pale into insignificance when compared to these other countries, which went mad building everywhere, even where houses were not required, hence all the ghost estates. And that's not just a belief, AFAIK it's accepted universally. Yet immigration still keeps rising, and is very likely to keep doing so. I wouldn't hold your breath for swinging benefits cuts either. Every government talks about this, yet even now they are u-turning and watering down the changes. Small adjustments will be the best you get. Seriously, if you don’t believe me check out the new ruling that means Europeans have just been given the right to come to the UK and sign on immediately, not having to work here for 12 months first as it used to be . There just isn't going to be the "revolution" of changing the benefits system as you hope and expect.

Again, we are NOT Greece or Eire. Nor did we have the huge oversupply of building that US, Eire and Spain had. The UK debt is LONG dated (Twice as long as most others) and the deficit is being taken under control. While it is likely house prices will continue to drift down (real more than nominal), like it or not, the debt crises affecting other countries has been averted here. If the Con-libs keep to their targets, as they appear to be doing, there will not be a sov debt problem in the UK.

Ah, you all worry too much. Asking prices are up and median time on market falling "sharply" http://www.home.co.uk/asking_price_index/HAPIndex_MAY11.pdf However, new numbers coming to market rocketing

Thought you were being bullish then Doc, then realised the 1st non-italic line was still quoting. I wonder what the mix of the data looks like. EG, if a fair number of the mortgages they are now giving out are consisting of a rising proportion of BTL (as has been suggested) and also lower price range flats/houses then the average price will appear lower would it not? Just a thought in the interests of balance

Looks like the 5 to 10% fall (nominal) this year could still be on track. Not sure if London will be hurt so bad though. It's still the old industrial and Northern towns (and the crappy areas that rose stupidly before) that are bearing the brunt. e.g, around here (Glasgow) some areas are collapsing while others (W.End etc) have been flat and even rising It’s a market of many markets.

And (although correct) you would likely be considered a cuckoo, and then arrested (that's the UK for you)!

As they used to say, "it's grim up North"

And the only Hawk is due to depart from the MPC soon. Low rates for a long time yet.

Yes it's very regional, the areas that rose the most seem to be falling the most (as would be expected). Places like Blaenau Gwent in Wales down nearly 20%! These were the areas where even 10 years ago you could get a small terraced house for <£10K. Then they went up to ~£80k!, guess they are coming back to earth with a bang now. Also seems to be type dependant too, with flats being hit hardest. I wouldn't hold my breath, the cuts/caps are being watered down as we speak and many are/will move into "approved" housing over the next year or so. Talking of which, you should have watched Panorama last night, all about council houses, cheats and (apparently) desperate people looking for housing. I even found myself shouting at the telly when people with no jobs were demanding to be given a council house, even though they were offered private (quite nice) accommodation - fully paid for by taxpayers!

Now, that's a bit more like it, and from a better source! -2.3% YoY (nominal) http://www.landregistry.gov.uk/ (Note, this data is delayed, so from sales completed a few months back in the depths of Nov-Dec). North East and Wales hammered YoY! Real crash there!

-6.3% Real YOY, a modest fall yes, but not a crash. For a crash I want to see -20% YOY Oh, and the NSA was up.

Nationwide -0.2%MOM (-1.3%YOY). Static market with small falls expected this year. As expected.

Agreed, I hadn't seen this one before. Question is, is this just showing the end of MEWing and the move towards paying debt down?