Concrete Jungle Posted February 10, 2011 Report Share Posted February 10, 2011 I started out wondering about houseprices, now I wonder if the UK is the place for me over the next 10 - 20 years. Houseprices seem almost trivial in comparison to the bigger picture. Link to comment Share on other sites More sharing options...
G0ldfinger Posted February 10, 2011 Author Report Share Posted February 10, 2011 I started out wondering about houseprices, now I wonder if the UK is the place for me over the next 10 - 20 years. Houseprices seem almost trivial in comparison to the bigger picture. A thought I had quite some time ago. I guess Norway or Canada would be some of the best places to live in terms of natural resources etc. But then you don't make such a decision in a vacuum. Link to comment Share on other sites More sharing options...
chazza Posted February 10, 2011 Report Share Posted February 10, 2011 Ahh, the ultimate fallacy of the banking crisis - that if nothing had been done Britain would have ceased to function as a nation and somehow just sunk into the sea. +1 The banks should have been left to fail/placed in run-down Link to comment Share on other sites More sharing options...
marceau Posted February 10, 2011 Report Share Posted February 10, 2011 A thought I had quite some time ago. I guess Norway or Canada would be some of the best places to live in terms of natural resources etc. But then you don't make such a decision in a vacuum. Canada would be a no-brainer were it not for its troublesome neighbor. Looking into my crystal ball I see great quotes of the future: 'How dare Canada hoard it's resources while Americans starve' 'A united continent is in everyone's best interests' Link to comment Share on other sites More sharing options...
John Doe Posted February 10, 2011 Report Share Posted February 10, 2011 Ahh, the ultimate fallacy of the banking crisis - that if nothing had been done Britain would have ceased to function as a nation and somehow just sunk into the sea. I always thought it would have been far better to give everyone in the country an interest free loan (or very very low IR) of about £20,000 to be paid back over 20 years (maybe through the tax system). Some would have spent it, helping the economy. Some would have put it in the bank, helping recapitalise and enable lending. Either way, we would have benefitted from the loan, not the banksters, as they have, while we still have to pay back the debt! Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 Ahh, the ultimate fallacy of the banking crisis - that if nothing had been done Britain would have ceased to function as a nation and somehow just sunk into the sea. I guess you've forgotten the queues around the block as people waited to empty Northern Rock of every penny of their savings. If nothing had been done - this would have spread and, yes, Britain would have ceased to function as a nation. Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 I dont think you can be serious. The government cannot be short of money to lend to nationalised banks in a deflationary crisis. 2008 was a bank run. There cannot be a shortage of government cheques to satisfy all depositors. In the scenario you outline, money would have no value. You're into wheel-barrow territory. Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 +1 The banks should have been left to fail/placed in run-down And how would the bank runs have been dealt with? And the riots when the government passed emergency legislation forbidding you from taking your money out of the bank. And the fact that, overnight, everyone would demand their wages in cash? If bank failure/run-down was a viable option, don't you think the cowardly politicians would have taken it? Link to comment Share on other sites More sharing options...
frizzers Posted February 11, 2011 Report Share Posted February 11, 2011 Well, I've just come back from Norway and I effing loved it Link to comment Share on other sites More sharing options...
LauraB Posted February 11, 2011 Report Share Posted February 11, 2011 I started out wondering about houseprices, now I wonder if the UK is the place for me over the next 10 - 20 years. I could say 'I thought that too today' as I was walking along this deserted beach on the spice isle, but I'd be telling an untruth. In truth , I was thinking how much I was missing Portugal & could I really cope with a whole month at the isolated end of a beautiful island with a year-round near-perfect climate. Sic, & surprising as I thought I would be loving this experience. UK considerations, other than avoidance, are a non-starter. (BTW:- the owner of the house I'm staying in tells me his 'council tax' is about 30 .... gbp/year) Houseprices seem almost trivial in comparison to the bigger picture. Drifting around Europe in a home on wheels for some years (& not mixing with too many ex-pats) had that effect on me. UK group-think programming does mess with the mind. It penetrates the aura no matter how much resistance you think you are putting up. I'm serious. In a more advanced culture those responsible would banished for life. EDIT:- anyone else suffering from italics button failure? Link to comment Share on other sites More sharing options...
Schaublin Posted February 11, 2011 Report Share Posted February 11, 2011 I could say 'I thought that too today' as I was walking along this deserted beach on the spice isle, but I'd be telling an untruth. In truth , I was thinking how much I was missing Portugal & could I really cope with a whole month at the isolated end of a beautiful island with a year-round near-perfect climate. Sic, & surprising as I thought I would be loving this experience. UK considerations, other than avoidance, are a non-starter. (BTW:- the owner of the house I'm staying in tells me his 'council tax' is about 30 .... gbp/year) Drifting around Europe in a home on wheels for some years (& not mixing with too many ex-pats) had that effect on me. UK group-think programming does mess with the mind. It penetrates the aura no matter how much resistance you think you are putting up. I'm serious. In a more advanced culture those responsible would banished for life. EDIT:- anyone else suffering from italics button failure? Indeed, it can be extremely difficult to stand back from whatever type of insanity is currently gripping the general population. Living in a cave helps No, but I often have trouble with the zip on my jeans coming open by itself Edit: Laura, I thought the whole purpose of going on holiday was to make you appreciate home more - seems to be working out fine but I would recommend 2 weeks in Aberystwyth for maximum effect. Link to comment Share on other sites More sharing options...
chazza Posted February 11, 2011 Report Share Posted February 11, 2011 And how would the bank runs have been dealt with? And the riots when the government passed emergency legislation forbidding you from taking your money out of the bank. And the fact that, overnight, everyone would demand their wages in cash? If bank failure/run-down was a viable option, don't you think the cowardly politicians would have taken it? The world would not stop turning. Agreed bank run down would be a difficult process and harder than bailing out, hence why the politicians (inevitably) took the easier option. As you say they are cowards, anything to 'protect' us (themselves) from hardship. Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 Drifting around Europe in a home on wheels for some years (& not mixing with too many ex-pats) had that effect on me. UK group-think programming does mess with the mind. It penetrates the aura no matter how much resistance you think you are putting up. I'm serious. In a more advanced culture those responsible would banished for life. That is absolutely spot on. After about 7 years renting I bought a few months ago (landlord was selling up and couldn't face: finding a suitable house to rent again paying about £400 a month more for a similar house finding a long term landlord finding one who would accept cats I think the UK is a nuthouse. I think house prices are ludicrously high. I really want them to fall so my kids can spend their lives without a millstone of debt around their necks ... but I find myself looking at other houses on the market and thinking 'did I get a good deal' and 'wonder what we'll get for this after we've done it up' ... and 'is it worth extending, will it add value' ... But you're absolutely right. It's like a bloody virus - some mass indoctrination that is really hard to break free from. I feel like I'm stuck in the mud again and being sucked down into a morass of house price data and property porn. Link to comment Share on other sites More sharing options...
John Doe Posted February 11, 2011 Report Share Posted February 11, 2011 Never been a better time to buy.......to let http://www.lovemoney.com/news/property-and...?source=1000550 I feel like I'm stuck in the mud again and being sucked down into a morass of house price data and property porn. Thats the point. So do many others and as long as that is the case, you can forget the 50% (nominal) drop some hope for. Link to comment Share on other sites More sharing options...
marceau Posted February 11, 2011 Report Share Posted February 11, 2011 I guess you've forgotten the queues around the block as people waited to empty Northern Rock of every penny of their savings. If nothing had been done - this would have spread and, yes, Britain would have ceased to function as a nation. Completely wrong - the process of reallocating the assets and liabilities of banks in liquidation would have taken a year at most. In the meantime other more competent and better capitalised organisations would have taken up the slack. Would there have been disruption? Of course. Would it have been catastrophic? Absolutely not. Your queues around the block will still come, but they'll now be for jobs, or worse still food and shelter. Link to comment Share on other sites More sharing options...
aliveandkicking Posted February 11, 2011 Report Share Posted February 11, 2011 In the scenario you outline, money would have no value. You're into wheel-barrow territory. In the scenario you outlined money doubled in price relative to house prices, and you claimed this would collapse the banking system. You are outlining a hugely deflationary period Link to comment Share on other sites More sharing options...
Jake Posted February 11, 2011 Report Share Posted February 11, 2011 Completely wrong - the process of reallocating the assets and liabilities of banks in liquidation would have taken a year at most. In the meantime other more competent and better capitalised organisations would have taken up the slack. Would there have been disruption? Of course. Would it have been catastrophic? Absolutely not. Your queues around the block will still come, but they'll now be for jobs, or worse still food and shelter. Good (and scary) post. I agree, though it might not be a 'queue' around the block rather something far more violent. I think (and half hope) it is coming for the banks despite this lengthened prologue. And I think they know it, too. Link to comment Share on other sites More sharing options...
hockeyplayer Posted February 11, 2011 Report Share Posted February 11, 2011 70% drop in remortgaging since the boom. Is that not a Crash? I mean 70% is a pretty big number. http://uk.finance.yahoo.com/news/Remortgag...497930.html?x=0 Figures from the Council of Mortgage Lenders said that the number of people remortgaging fell to a 13-year low of just 313,200, compared with 408,000 during 2008, and a typical level of over 1 million during the housing boom of the last decade. 1 million at peak. 313,200 now. That’s a 70% drop!!!! In my book that's a crash Link to comment Share on other sites More sharing options...
neil324 Posted February 11, 2011 Report Share Posted February 11, 2011 70% drop in remortgaging since the boom. Is that not a Crash? I mean 70% is a pretty big number. http://uk.finance.yahoo.com/news/Remortgag...497930.html?x=0 Figures from the Council of Mortgage Lenders said that the number of people remortgaging fell to a 13-year low of just 313,200, compared with 408,000 during 2008, and a typical level of over 1 million during the housing boom of the last decade. 1 million at peak. 313,200 now. That’s a 70% drop!!!! In my book that's a crash Sadly it's a crash in sales, but if it continues then prices will be set at the margins, death,divorce,un-employment. Then all the kite flyers will be stuck. Link to comment Share on other sites More sharing options...
John Doe Posted February 11, 2011 Report Share Posted February 11, 2011 70% drop in remortgaging since the boom. Is that not a Crash? I mean 70% is a pretty big number. It used to be that people remortgaged at the end of their fixed or tracker rate deal so they could get a new deal (which was less than the SVR they had moved on to). Who needs to remortgage when the SVR rates they now get moved on to are so low? Of course, before, a lot also looked at the new value of their house and decided to take a bigger new mortgage. Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 Completely wrong - the process of reallocating the assets and liabilities of banks in liquidation would have taken a year at most. In the meantime other more competent and better capitalised organisations would have taken up the slack. Who, exactly, would have been willing to take on the liabilities of banks in liquidation? "Here you are, roll up, here's a bank ... there's some CDOs and MBSs and a load of other things they invented that means even their directors had no idea what was actually going on ... look as far as we know they've lent 2x against assets worth x ... but, to be honest, we've no idea ... how many of the loans are risky ... no idea ... nor did they ... it's all a bit tricky .... capital wise ... you'll need the mother of all capital positions before you take it on ... otherwise you'll be bankrupt too ... form an orderly queue ... what do you mean there's no-one in it ... just a guy from the Treasury ... is that all?" Haven't noticed other more competent and better capitalized organizations taking up the slack so far. Link to comment Share on other sites More sharing options...
BoldAsBrass Posted February 11, 2011 Report Share Posted February 11, 2011 Sadly it's a crash in sales, but if it continues then prices will be set at the margins, death,divorce,un-employment. Then all the kite flyers will be stuck. And to take just one example ... death ... how many times have you heard people say ... 'we're renting the house out because it's not a good time to sell at the moment'. Maybe you've never heard it - I have. What people can't seem to get their heads around is that not everybody is up a creek without a paddle. It's been a crash in sales for two years now - still no significant price falls in my area. Death, divorce, unemployment, non-existent FTBs, high deposits ... all shrugged off. The whole edifice is underpinned by rent and interest rates. While people will pay £1200 to rent a 3 bed semi and interest rates are low (and they will be for years - collectively we're in too much debt for anything else to happen) - prices are going nowhere. Link to comment Share on other sites More sharing options...
marceau Posted February 11, 2011 Report Share Posted February 11, 2011 Who, exactly, would have been willing to take on the liabilities of banks in liquidation? "Here you are, roll up, here's a bank ... there's some CDOs and MBSs and a load of other things they invented that means even their directors had no idea what was actually going on ... look as far as we know they've lent 2x against assets worth x ... but, to be honest, we've no idea ... how many of the loans are risky ... no idea ... nor did they ... it's all a bit tricky .... capital wise ... you'll need the mother of all capital positions before you take it on ... otherwise you'll be bankrupt too ... form an orderly queue ... what do you mean there's no-one in it ... just a guy from the Treasury ... is that all?" Haven't noticed other more competent and better capitalized organizations taking up the slack so far. That's exactly why liquidation was so important. All the mark-to-fantasy crap would have been sold at true market value and bond/shareholders would have been wiped out. But let's face it, no-one should shed a tear for them. Almost everything on that company's balance sheet would have been taken by someone. Even the dodgiest loans would have had some worth, even if it was only fractions of a penny in the pound. But when the government stepped in and mark-to-fantasy took over, no-one would come in because the asset values were kept artificially high. So we got stuck with the incompetent bloated 'zombies' and the 'competent and capitalised' that would have taken their place would/could not enter the market, because it was rigged. With fair valuation an impossibility, trust and trade ground to a halt and we spiraled down. Govt then steps in again, inflates to hide the mess, which only further erodes trust and the ability to find market value. Vicious circle, rinse, repeat, impoverish. QED. Link to comment Share on other sites More sharing options...
crushtherents Posted February 11, 2011 Report Share Posted February 11, 2011 I always thought it would have been far better to give everyone in the country an interest free loan (or very very low IR) of about £20,000 to be paid back over 20 years (maybe through the tax system). Some would have spent it, helping the economy. Some would have put it in the bank, helping recapitalise and enable lending. Either way, we would have benefitted from the loan, not the banksters, as they have, while we still have to pay back the debt! giving money to the richest people doesnt help anyone. the benefits you talk about can only be achieved by giving the money to the poorest people and this has been happening for years. Link to comment Share on other sites More sharing options...
crushtherents Posted February 11, 2011 Report Share Posted February 11, 2011 Who, exactly, would have been willing to take on the liabilities of banks in liquidation? "Here you are, roll up, here's a bank ... there's some CDOs and MBSs and a load of other things they invented that means even their directors had no idea what was actually going on ... look as far as we know they've lent 2x against assets worth x ... but, to be honest, we've no idea ... how many of the loans are risky ... no idea ... nor did they ... it's all a bit tricky .... capital wise ... you'll need the mother of all capital positions before you take it on ... otherwise you'll be bankrupt too ... form an orderly queue ... what do you mean there's no-one in it ... just a guy from the Treasury ... is that all?" Haven't noticed other more competent and better capitalized organizations taking up the slack so far. CDO and MBS are the assets EDIT: Standard Chartered Link to comment Share on other sites More sharing options...
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