The 70% club

adr0ck

dopester wrote: »

You might not be able to do so now - but you may easily be able to in 1 to 5 years time, as deflation takes hold. You are so used to inflation you just can't get your head around deflation.

Look at developers now... writing down the value of their land banks. It has only just begun. Deflation brings about lower wages (not for absolutely all) but also brings down the costs of other goods as well.

When there is less credit in the system, and less people with money about, the prices of goods in general (maybe not all imported goods) falls.

Values for items can be agreed by the market - but existing debts are real. That is why deflation might scare those who've lived the life of debt, if we move further into a deflationary environment and wages fall and prices fall as well.

so basically you are agreeing with me that you cannot do it

therefore as i said you were talking out of your backside (i'm glad you agree with me that you were)

adr0ck

dopester wrote: »

You might not be able to do so now - but you may easily be able to in 1 to 5 years time, as deflation takes hold. You are so used to inflation you just can't get your head around deflation.

that comment proves that you really have no idea what you are talking about

in 5 years time social landlords will have to be building to code for sustainable homes level 6

kingspan have built a recent model to this standard

do you have any idea of the cost involved?

adr0ck

dopester wrote: »

You might not be able to do so now - but you may easily be able to in 1 to 5 years time, as deflation takes hold. You are so used to inflation you just can't get your head around deflation.

Look at developers now... writing down the value of their land banks. It has only just begun. Deflation brings about lower wages (not for absolutely all) but also brings down the costs of other goods as well.

When there is less credit in the system, and less people with money about, the prices of goods in general (maybe not all imported goods) falls.

Values for items can be agreed by the market - but existing debts are real. That is why deflation might scare those who've lived the life of debt, if we move further into a deflationary environment and wages fall and prices fall as well.

dopester and neverdespairgirl

even if all workers were paid minimum wage and material costs halved you still could not do it

please note a lot of material costs (stone, sand, concrete, tarmac etc) are still going up

thats right prices are still going up even in this market

stop talking out of your backside

dopester

adr0ck wrote: »

so basically you are agreeing with me that you cannot do it

therefore as i said you were talking out of your backside

Not perhaps immediately of course, if that comforts you - but it is the direction that looks most likely to me.

It might be a rapid decent in to deflationary depression for those conditions.

Look how rapidly the property market changed in the last 16 months. Especially over the last 8 months. And the economy with it. Bank after bank hitting trouble, being nationalised, bailed out with BoE liquidity, and now businesses around the country gasping for life. The government can't bail out everyone. Sterling would collapse.

There may soon come a point where Government is forced not to bail out, or spend more and add more debt to an incredible debt pile, but is forced to cut public spending and let the economy and markets more or less try and sort out some of the problems out on their own.

adr0ck

as i siad there simply won't be any new homes built whatsover if prices fall 70%

there won't be any housebuilders left

there won't be any social landlords left

adr0ck

dopester wrote: »

Not perhaps immediately of course, if that comforts you - but it is the direction that looks most likely to me.

It might be a rapid decent in to deflationary depression for those conditions.

Look how rapidly the property market changed in the last 16 months. Especially over the last 8 months. And the economy with it. Bank after bank hitting trouble, being nationalised, bailed out with BoE liquidity, and now businesses around the country gasping for life. The government can't bail out everyone. Sterling would collapse.

There may soon come a point where Government is forced not to bail out, or spend more and add more debt to an incredible debt pile, but is forced to cut public spending and let the economy and markets more or less try and sort part of the problems out on their own.

you are ignoring my comments dopester

you cannot and will not be able to build a new home to Code for sustainable homes level 3 now or in the future for £56k

in a couple of years time it will be code for sustainable homes level 4

followed by 5

followed by 6

costs of housebuilding are going to rocket (this is a given)

adr0ck

come on dopester and neverdespairgirl guess the cost of building a home to level 6 in todays prices and then tell me the percentage that build costs will need to fall to be able to build it for £56k

its a lot more than 70%

dopester

You've had my clear explanation on how it can very easily happen, with the logic behind it. Examine other crashes in history for evidence on how it has happened before. Realities come crashing down for people who've placed their bets just in one direction. Mind-melting consequences.

I can't engage you any more on the subject. I actually now have to list something on ebay as a favour for someone struggling to raise funds, and now liquidating some prized possessions, but as he knows, prices are coming down in the market for his possessions because others are doing the same with theirs for exactly the same reasons, and there are less people with disposable income. Quite a big earner too, in a safe job for now.

StevieJ

adr0ck wrote: »

as i siad there simply won't be any new homes built whatsover if prices fall 70%

there won't be any housebuilders left

there won't be any social landlords left

I wouldn't worry, they are not going to fall by 70%.

StevieJ

dopester wrote: »

You've had my clear explanation on how it can very easily happen, with the logic behind it. Examine other crashes in history for evidence on how it has happened before. Realities come crashing down for people who've placed their bets just in one direction. Mind-melting consequences.

I can't engage you any more on the subject. I actually now have to list something on ebay as a favour for someone struggling to raise funds, and now liquidating some prized possessions, but as he knows, prices are coming down in the market for his possessions because others are doing the same with theirs for exactly the same reasons, and there are less people with disposable income. Quite a big earner too, in a safe job for now.

Wait a minute, are you saying this mate of yours is loaded but he hasn't got any money? You will have to stop reading that Faber guy.