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Debate House Prices
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Quarter of mortagage 'SVR'
Comments
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HAMISH_MCTAVISH wrote: »It the same reason that 50% falls across the board are impossible. It would cause every major bank to fail. It would put millions more deep into NE. It would cause insolvency of all the major homebuilders. Housebuilding industry would cease to exist, unemployment would skyrocket, etc, etc, etc.
It's the same reason that 500,000 repo's are impossible. That many homes being repo'd and sold would cause 50% price falls, which would cause the banks to fail, etc etc etc.
All of it, is the modern day economic equivalent of the old MAD nuclear deterance theory.
Neither banks nor government can afford to pursue courses of action that would ensure their own destruction in the process.
Therefore house prices cannot drop 50%. Repo numbers cannot reach hundreds of thousands.
.
I do admire your optimism that something unpleasant simply "will not be allowed to happen" somehow.
I'm afraid the real world doesn't quite work like that.
If the government were so powerful as to be able to dictate house prices, lending etc, do you think we'd be in this mess now?
Sorry to break it to you, but they're largely along for the ride too. They might have their hand on the tiller as HMS British Economy shoots the rapids, but there are no brakes...Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Max_Headroom wrote: »I do admire your optimism that something unpleasant simply "will not be allowed to happen" somehow.
I'm afraid the real world doesn't quite work like that.
If the government were so powerful as to be able to dictate house prices, lending etc, do you think we'd be in this mess now?
Sorry to break it to you, but they're largely along for the ride too. They might have their hand on the tiller as HMS British Economy shoots the rapids, but there are no brakes...
Yes, and many a bear was saying exactly that same thing back in January/February/March.....
QE won't work, governments can't have any impact, the markets are all powerful, etc etc etc ad nauseum ad infinitum.....
Except of course QE and other government interventions did work. Prices have risen for the last 6 months. Economic meltdown has been avoided.
We are all participants in a game. Governments set the rules of the game. To understand how things will play out, we need look no further than the political reality of the day. Allowing asset prices to fall 50%, or 75%, or 90%, in nominal terms is political suicide.
"We have this technology, it's called a printing press"
“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
Theres only a few thousand STR's around.
Yeah..........and all 'few' thousand of them post on here !!!!! :eek:'In nature, there are neither rewards nor punishments - there are Consequences.'0 -
HAMISH_MCTAVISH wrote: »Yes, and many a bear was saying exactly that same thing back in January/February/March.....
QE won't work, governments can't have any impact, the markets are all powerful, etc etc etc ad nauseum ad infinitum.....
Except of course QE and other government interventions did work. Prices have risen for the last 6 months. Economic meltdown has been avoided.
We are all participants in a game. Governments set the rules of the game. To understand how things will play out, we need look no further than the political reality of the day. Allowing asset prices to fall 50%, or 75%, or 90%, in nominal terms is political suicide.
"We have this technology, it's called a printing press"
Oh I see.
So why then did they let the recession happen? Why the huge housing slump? Why all the redundancies?
Surely according to you all they ever needed to do was crank up the printing presses?
Worked ok for Zimbabwe didn't it...? Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Max_Headroom wrote: »Oh I see.
So why then did they let the recession happen? Why the huge housing slump? Why all the redundancies?
Surely according to you all they ever needed to do was crank up the printing presses?
Worked ok for Zimbabwe didn't it...?
:rolleyes:
They cannot prevent the game being played.
But they can change the rules half way through to influence the result.
How many bears in 2004/5/6/7/8 were predicting QE? Or predicting nationalised banks preventing reposessions? Or predicting a vendors strike that exacerbated an already low supply?
How many bears predicted that the "spring" bounce would last til the end of summer?
Oh wait, thats right, none of them.;)
All we have heard from bears is that NOTHING can stop the all powerful crash.
Yet something clearly did.......“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
Max_Headroom wrote: »
So why then did they let the recession happen? Why the huge housing slump? Why all the redundancies?
Governments are by nature large and unwieldy organisations.
They also do not have a crystal ball.
Like any large organisation, they can be slow to respond. But once they do, they have a great deal of ability to influence the outcome.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »
All we have heard from bears is that NOTHING can stop the all powerful crash.
Yet something clearly did.......
Ok firstly what year are you posting from, because back here in 2009 it's still very much going on.
And can you let me have the lottery numbers for the rest of the year? I'll cut you in for 10%! (If you suddenly find you're massively rich it worked, because obviously I'll have to pay it into your account in 2009 which is clearly a few years behind where you are).Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
HAMISH_MCTAVISH wrote: »Governments are by nature large and unwieldy organisations.
They also do not have a crystal ball.
Like any large organisation, they can be slow to respond. But once they do, they have a great deal of ability to influence the outcome.
I really do admire your ability to absorb government spin.
It's like having a conversation with someone deeply religious, blind to logic, but impressive in faith.
Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Max_Headroom wrote: »Ok firstly what year are you posting from, because back here in 2009 it's still very much going on.
Really?
Perhaps you can show me the last 5 or 6 months of Nationwide price falls?
No?
OK then, surely you can prove to me that the price last december was higher than the price today on Nationwide's index?
No?:rolleyes:
So then perhaps you'd like to explain where you lost your crash.....;)
Did you just misplace it?
Or did it run away?:rotfl:“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
Max_Headroom wrote: »I really do admire your ability to absorb government spin.
It's like having a conversation with someone deeply religious, blind to logic, but impressive in faith.
So you are denying that governments have the ability to influence the markets?
Interesting.:rolleyes:“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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