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Halifax -3.6% MOM - largest monthly fall ever?


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Why?

 

I am long gold. What's you position?

I'l let you know when I go short, but I am continuing to lighten up as we go

 

The stupidly complacent bullishness goes with the seasonal top, I suppose.

 

Today (Oct.7th) is the ideal day for a seasonal top, as I have mentioned.

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(Now Goldfinger is attacking me for "doubting" gold)

Teasing you a little, not attacking. It's a trader/investor thing, I suppose. :)

 

I am long gold. What's your position?

Pretty long too.

 

The stupidly complacent bullishness goes with the seasonal top, I suppose.

Bullishness in gold is neither stupid nor complacent IMHO.

 

Today (Oct.7th) is the ideal day for a seasonal top, as I have mentioned.

Could become a great call for traders. We'll see.

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Typical that we get the biggest MoM fall in house prices and DrBubb is banned from HPC :/

 

Oh well, haters gonna hate, sucks to be them (like LP)!

 

BTW, I don't think base interest rates will rise. We could see 0.5% base rate for another 3 or so years because the spending cuts pain has not even started yet. That and I foresee more money printing by the BoE in the form of "QE part deux - gilty as charged".

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good job I've got half my savings in Gold and Silver then,

 

but i've just realised I could get hammered for capital gains tax...

 

 

is there any way around this, how long would you have to leave the country for to avoid

 

I believe gold sovereigns don't attract CGT, but need to confirm this.

 

You'd need to leave for 7 years at a minimum.

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Won't happen. That's why Bubb's deflation scenario of rising rates does not work.

 

I couldn't agree more. Falling prices + public sector redundancies = 2nd banking bailout

 

If interest rates increased a surprisingly high % of UK borrowers would default

 

The bankers are in charge, so there will be negative real interest rates

 

Therefore it makes sense to hold foreign currency and, erh, GOLD!

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One day my fellow bears... one day B)

bear-house-11.jpg

The photo made me laugh.

Great looking place, black and white contrast, and a truly pathetic and unconvincing fear suit

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Has anyone considered the possibility that there might be some sot of aberration here? It's such a big number, perhaps we'll see rises from this next month?

 

Sure, a small bounce is likely.

But if this price report has broken the bullish psychology, then the old "crash cruise mentality" may take over, where people will insist on a "discount to market" as a reason to buy.

 

Remember how we discussed this a few years ago:

UK House Prices to fall up to 50% / CWR pt.3

"People are reading about price falls... the only real reason that people will buy is if they think they are getting a bit of bargain.

Today's bargain is tomorrow's market price... And the first round of price cuts, induces another... (and so forth.)"

 

The only thing that broke that downwards biased psychology was the huge cut in rates, to near zero. But that option is now "off the table" since interbank rates, and rates paid to savers are already near zero. If the BofE tries to go any lower, people will just take their money out of the banks, and stuff it into a mattress, or buy gold - and that makes capital totally unproductive. And the economy less efficient, and less able to grow. Some level of rates need to be paid to savers, or the economy will go ex-growth, like Japan.

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GEI traffic has crept up to above a sliding SP website

 

zzzzw.png

 

/source: http://www.alexa.com/siteinfo/greenenergyinvestors.com

 

The BTL brigade on SP must be under some serious stress !

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FROM SOMEPLACE in a parallel universe, far far away:

 

London Leads U.K. Home Prices to Two-Year High as Market Peaks, Groups Say

 

By Scott Hamilton - Oct 8, 2010

 

U.K. house prices rose to a two-year high in September as demand picked up in London and the property market showed signs of peaking, research company Acadametrics Ltd. and LSL Property Services Plc said.

 

The average price of a home in England and Wales rose 0.2 percent from August to 223,965 pounds ($357,000), the highest since July 2008, the companies said in an e-mailed statement in London today. Values were up 7 percent from a year earlier.

 

The International Monetary Fund said this week that U.K. house prices look “high” and may face a “correction,” and Lloyds Banking Group Plc’s Halifax unit said yesterday that home values dropped the most since at least 1983 last month. Analysts in today’s report predicted that their index will show annual declines in most of England and Wales by December.

 

“People know that imminent public-spending cuts will hit their household finances,” David Brown, commercial director of LSL Property Services, said in the statement. “While we won’t see a ‘double-dip’ in the housing market, we don’t expect market activity or house prices to continue their upwards march in the short term.”

 

The increase in house prices last month came as the number of transactions rose 3.4 percent from August to about 66,000, according to the report. That’s an increase of 11 percent from a year earlier, Acadametrics and LSL said.

 

“Historically, transactions slow in September, but there has been a welcome increase in activity this year compared to last,” Brown said. “The London market has been particularly active, with sustained investment from foreign investors and cash-rich buyers fuelling an increase in transactions.”

 

Halifax, IMF

 

Recent reports have indicated that the British housing market may face renewed weakness as the government prepares the biggest budget squeeze since World War II. Halifax said yesterday that house prices plunged 3.6 percent in September, and the IMF said on Oct. 6 that policy measures might not be enough to support the market.

 

There is “little evidence” of an expected seasonal upturn in transactions before the end of the year as concerns over tax increases, job cuts and credit availability curtails demand from potential buyers, Acadametrics Chairman Peter Williams said in the statement. A reluctance to accept lower selling prices is also deterring sellers from putting their properties on the market, he said.

 

“There is little to suggest an upturn in activity or prices while all of this works through,” Williams said.

 

Acadametrics uses methodology employed by the U.S. S&P/Case-Shiller price index, combining initial housing transaction data from the Land Registry and results from other price measures to produce an estimate for the most recent month. That number is then revised in following months.

 

/see: http://www.bloomberg.com/news/2010-10-07/l...trics-says.html

 

*therefore, I believe the use a 3 months moving average

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Here is an extract on the Real Estate Sector from the IMF World Economic Outlook.

World_Economic_Outlook___Real_Estate_Report.pdf

EXCERPT

Double Dip in U.K. and U.S. Real Estate Markets?

 

Comparing current and past housing cycles in the United States reinforces these observations (fifth

figure). Residential investment remains severely depressed compared with past cycles, which can at

least partially be explained by the pattern in house prices and household outstanding debt. The bleak

outlook for house prices slows deleveraging for the household sector as mortgages remain underwater

(that is, with debt exceeding the market value of the property). The problem is compounded because, in

this recession, U.S. states where the house price bust was more pronounced are also where unemployment

has increased the most. This relationship likely reflects the importance of the construction sector in

these states’ economies as well as lower labor mobility resulting from problems in the housing sector.

 

In both the United Kingdom and the United States, tax measures temporarily increased activity,

but housing demand fell and prices receded after the recent expiration of these incentives (sixth

figure).5 Although this was anticipated, the drop was larger than expected. Especially in the United

States, given the limited success of mortgage modification programs and the shadow inventory from

foreclosures and delinquencies, this has renewed fears of a double dip in real estate markets.6 A lot

will depend on the path of economic recovery: if employment creation remains low, risks of a double

dip in housing naturally increase.

 

There are other threats to the fragile stabilization.

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