The benefit of long-term house-price growth

Generali

StevieJ wrote: »

It is different this time, a new paradigm Where have I heard that before?

Sorry gen.

Well this time it is a new paradigm (to coin a phrase!). We've never had such large numbers of people expecting to retire on large pensions for long periods of time. These pensions simply aren't funded and neither workers, unions, companies nor Government seems prepared to face that fact.

mower5 wrote: »

Nice people my folks I am not having a go at individuals but at the overall effects the generation is having.
I am interested in baby boomers, my thinking is that, 17 million are going to retire in the next few years (if they can afford too as Generali suggests). The boomers in the old saying are the "pig in the Python". That number of people all in their late middle age VOTE in huge numbers, therefore the politicians are going to try and keep on their side. I am simply trying to kick a few ideas around.

No matter how they vote, if the money isn't there the pensioners won't get their money. The only way to ensure they do is to print more money for the private sector pensioners. That doesn't ease the problem of public sector pension promises as they have index linked pensions for the most part.

Old_Slaphead

StevieJ wrote: »

Yes that was when the workforce actually stuck up for themselves instead of being Neutered Lapdogs. At the time it was implied that if the workforce behaved themselves then the future would be very bright :rotfl:

Stood up for themselves and sod everybody else - too right!

bubblesmoney

house prices cant go up indefinitely outstripping inflation or rise in wages. there will always be a relationship between wages and house prices and debt servicing affordability ratios.

if house prices rise much faster than wages, sooner or later there comes a point (without fail) when the bust will happen and prices reset to long term means to achieve that balance with affordability. even if prices notionally rise in number terms, the wages will rise as well to maintain that affordability ratio.

but as with all things human, rationality takes a back seat when covered by optimism which drives the markets. hence with all assets (share prices, houses etc) the prices temporarily grow faster than affordabilty because of people feeding off each others optimism that they can for ever keep making more money out of an asset with the same intinsic value. this is virtually a ponzi scheme that has to go bust and there will be losers who got on the joyride towards the end but there will be winners who got off the joyride before the inevitable bust.

anyone who says house prices will keep rising infinitely disproportionately to wages (be it the wilsons or brown) is a bloody fool. there will be always booms and busts till the end of mankind because of the human elements in monetary transactions.

StevieJ

Old_Slaphead wrote: »

Stood up for themselves and sod everybody else - too right!

The workforce were (more or less) everyone else

Old_Slaphead

StevieJ wrote: »

The workforce were (more or less) everyone else

Dead bodies piling up in morgues, rubbish piling up in streets, power cuts - are you sure the unions were striking for us all 'cos if so, I certainly don't remember it like that.

I recall the left wing militant unions asking for daft payrises to deliberately cause confrontation.

What it happened, they caused virtual closure of the mining, steel and UK car industries. Sure did their members a lot of good did't they.

StevieJ

Old_Slaphead wrote: »

Dead bodies piling up in morgues, rubbish piling up in streets, power cuts - are you sure the unions were striking for us all 'cos if so, I certainly don't remember it like that.

I recall the left wing militant unions asking for daft payrises to deliberately cause confrontation.

What happened, they caused virtual closure of the mining, steel and UK car industries. Sure did there members a lot of good did't they.

No that was the Milk Snatcher

Old_Slaphead

StevieJ wrote: »

No that was the Milk Snatcher

I think you'll find that it wasn't.

Ok it happened under here'reign' but it was all down the simple rules of supply and demand. Basically, those industries priced themselves out of work....ie there was plenty of demand for coal but it was cheaper to bring it in from abroad. Cars made by British car companies were relatively expensive & unreliable. Nobody would invest in these companies because of the militant unions.

a_rather_tall_man

Old_Slaphead wrote: »

I think you'll find that it wasn't.

Ok it happened under here'reign' but it was all down the simple rules of supply and demand. Basically, those industries priced themselves out of work....ie there was plenty of demand for coal but it was cheaper to bring it in from abroad. Cars made by British car companies were relatively expensive & unreliable. Nobody would invest in these companies because of the militant unions.

I'm in my early 30's so have no real recollection of the 70's but with regard to the demise of the UK car industries its fairly obvious to me after doing a bit of reading up that the union led action of that time is largely to blame. Standing around in a field demanding more and more perks and concessions whilst your competitors, from Germany and Japan for example, were busting a gut to make better quality and better value products is business suicide. What was any government to do? How can you reason with that mentality and create a viable company?

StevieJ

Old_Slaphead wrote: »

I think you'll find that it wasn't.

Ok it happened under here'reign' but it was all down the simple rules of supply and demand. Basically, those industries priced themselves out of work....ie there was plenty of demand for coal but it was cheaper to bring it in from abroad. Cars made by British car companies were relatively expensive & unreliable. Nobody would invest in these companies because of the militant unions.

No it wasn't, it was the dash for gas, (you know that stuff that cost a fortune last year), she wanted rid of the miners at any cost.

Old_Slaphead

StevieJ wrote: »

No it wasn't, it was the dash for gas, (you know that stuff that cost a fortune last year), she wanted rid of the miners at any cost.

Try reading a_rather_tall_man's previous post. Seems to sum up the mood of the time.

It was Arthur Scargill that screwed the miner's just as he'd been screwing the country for the previous x years. Unfortunately he more than met his tactical match. Thatcher did want rid of Scargill and the militancy he stood for - and he made it very easy for her to achieve.

FWIW coal was and continued to be imported from Poland (and presumably other places) throughout the 80's.