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Debate House Prices
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The Last 5 Major Uk Recessions
Comments
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setmefree2 wrote: »I'm interested in his/her answer:D.....maybe it's me being thick:p
No it's not you.
He likes to put a show on for the HPC masses.
We all know house prices are falling but to make up stuff or wishing for higher rates is madness.
PS I borrowed your BOE link from yesterday. Great link.
We do not have historicaly low rates we have just had very high rates for the last 40 years.:beer:0 -
setmefree2 wrote: »!!!!!!? how do you define "inflation"? It seems to be only in relation to the CPI or RPI you seem to ignore "money supply & credit circulating in the economy" in your definition?
Almost all analysts agree that if there is not an improvement in liquidity then the UK will suffer from massive deflation from the impact of massively falling money supply. I'm not sure that if a packet of cornflakes goes up 2p that this matters, IMHO.
My personal measure is the amount of money in the economy relative to useful product.
Price increases are just symptoms of inflation.
Credit is being withdrawn due to the financial criss, that's a major downward pressure and represents the market restoring equilibrium.
However, the government's stated objective is to restore credit availability to the stupid peak levels of 2007 and so far they have shown a real determination to at least try to bombard the banking system with lots of money to that end.
Whether they succeed or fail, its bad news given their tactics of chucking public cash at the banks to restore those lending levels.
ie. Succeed in restoring 2007 level credit availability - rampant inflation. Maybe even hyperinflation if things aren't brought to heel, if they even can be brought to heel by that stage.
Fail - recession lasts for even longer (due to all the public money wasted on liquidity measures and sucked out of our future earnings) and we probably see stagflation due to the currency collapsing.
What they need to do is set sensible rates and control the descent into recession so that it happens quickly enough to let the economy recover ASAP, but not so quickly that the thing slides out of control into a deep depression. Debt/credit has to be destroyed, we will have to swallow the bitter pill. Dodging it won't work.
They need to stop looking to a lax, cheap credit economy as being the way forward and develop strategies for sustainable growth and development instead.--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
Oh it must have been my car the tank must have shrunk.:rolleyes: My end of October price was cheaper to fill up!
The average is always going to look less if prices are going up and opposit on the way down.:rolleyes:
Considering it takes up to 3 months for drops and increases to go through the system you are totaly for inflation going through the floor then.
No, I'm simply giving you the stats. According to the AA survey, prices had increased between Oct 2007 and Oct 2008. The Oct 2008 stats were the most recent I could find.
You may well have noticed a price drop locally compared to 12 months back but can you actually remember the exact price of fuel that you were paying in November 2007 by the way? I can't - I just remember that it started to rocket around Nov/Dec all the way through to a couple of months back.
I would say that my diesel now is still more expensive than one year ago but I couldn't quote you what I was paying in Nov 2007. That's where the AA figures come in.--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
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No, I'm simply giving you the stats. According to the AA survey, prices had increased between Oct 2007 and Oct 2008. The Oct 2008 stats were the most recent I could find.
You may well have noticed a price drop locally compared to 12 months back but can you actually remember the exact price of fuel that you were paying in November 2007 by the way? I can't - I just remember that it started to rocket around Nov/Dec all the way through to a couple of months back.
I would say that my diesel now is still more expensive than one year ago but I couldn't quote you what I was paying in Nov 2007. That's where the AA figures come in.
Yes it was the first time my tank as been under £70:( I purchased the car end of last sept)0 -
No in the 70s. We got stagflation.
Except that in the 70s we could handle stagflation as Britain was a major exporter and the devaluation of the pound helped export industry who could then afford to pay workers more to compensate for the higher prices of stuff. In fact, it was great news for mortgage holders as debt was rapidly eroded by higher incomes and there were still plenty of jobs around.
1) I thought that the UK has run a trade deficit in 'visibles' since the 1971
2) We were a net importer of oil until about 1980
3) It is invisibles, where the UK has consistently had a surplus.
I don't think we could "handle" stagflation in the 70's at all - I am surprised that you would say that. In fact, although the trigger for the dismal 70's was the 2 oil price shocks, it was exactly because of wage rate spirals that inflation became engrained.
The wage rate spirals could be ascribed to high union membership, inflexible labour force, poor management, weak government or high relative employment.
I have never seen it said before that the high level of exports "allowed" employers to pay their employers more.
You make it sound almost like a benign environment. I thought you were old enough to have remembered what it was like.US housing: it's not a bubble
Moneyweek, December 20050 -
I think that is where you go wrong. I don't like labour but to me the 2007 is the amount of funds available not the ease of which to get it.
The funds should be available for safe bets in a recession.
'Safe bets' ought to be able to still get credit, but they must expect to pay market rates.--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
the 2007 is the amount of funds available not the ease of which to get it.
I think the "Getting back to 2007 levels" is just a typical politicians, all things to all men, type of quote.
They need to make Joe Public think that the Banks aren't getting a free ride...........but not even a complete economic illiterate like Broonie can't really believe that the lending criteria and availablity of 2007 are a good thing.'In nature, there are neither rewards nor punishments - there are Consequences.'0 -
I think historicly when times are hard people overpay their debts so low rates could help liquidity over time as I am sure many like me will use the opertunity to get their mortgages paid down.
If they can keep their job or find another job with the same wage. Hard times are coming.
On this thread, an IT contractor has lost his well paid job and could only find a lower paid job, which is giving his poor family all sorts of financial problems with their mortgage.
http://forums.moneysavingexpert.com/showthread.html?p=15548825#post15548825RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
Read the sticky on the House Buying, Renting & Selling board.0
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