How did people not see it coming?

benb76

I couldn't see how the property boom would continue at the rate it was, but I didn't predict the credit crunch and reckoned that property prices would stagnate relative to earnings and just rise with inflation. Having said that, the timing of any STRing would have had to have been spot on to realise any profit, and my current mortgage interest is over 3 times less than what I would pay to rent my place. As such it seems I've done ok out of being slightly naive and optimistic.

ash28

Graham_Devon wrote: »

I mean, all this mess....Ireland, insane property booms, the rest of the PIGS nations, our own problems.

I mean, taking a step back, and listening to some of the stuff coming from Ireland at the moment and where the blame lies (massive property boom for instance in ireland), it does make you wonder how on earth these people couldn't see the problem.

But could they? Was the euphoria far more important, and a blind eye was the order of the day?

It seems they all "know" what to do, and all these measures are suddenly put into place to save us all. So did they know what was going to happen...or did those running countries just hope it either wouldn't happen, or wouldn't happen on their patch?

It's also a little amusing listening to the recovery talk, from various nations....it's all based on more lending and more debt. Is there any other option?

In Ireland they have their own Dr Doom, Morgan Kelly, he has called it exactly right, the banking crisis, the cause of the banking crisis, why it would get worse (and it did), property market bust. even up to the IMF/EU bailout - no one listened. He first called the property crash in late 2006 early 2007 - he published a working paper detailing why the market would crash - no one believed that either.

This is from May this year - well worth a read.
http://www.irishtimes.com/newspaper/opinion/2010/0522/1224270888132.html


and the response from the Ministry of Finance saying he was wrong.

http://www.irishtimes.com/newspaper/finance/2010/0524/1224271011035.html

This from a working paper of last year
http://www.ucd.ie/t4cms/wp09.32.pdf

The issue therefore is not whether the Irish bank bailout will restore the Irish banks so that they can function as independent commercial entities: it cannot. Rather it is whether the Irish government’s commitments to bank bond holders when added to its existing spending commitments, will overwhelm the fiscal capacity of the Irish state, forcing outside entities

such as the IMF and EU to intervene and impose a resolution on the Irish banking system.

THE_GHOULS_OF_GREED

ILW wrote: »

Try telling that to an Irishman who a bought 3 properties on 100% mortgages and now finds that he can neither rent nor sell the places and either has to keep making the payments or be declared bankrupt. That is where ever increasing prices can lead.

I never mentioned anything about speculators purchasing x number of properties, I was talking about hard-working families knuckling down and getting on with life.

phil_b_2

amcluesent wrote: »

>some detailed predictions for the next 5 years please.<

www.howitends.co.uk

You need to change your reading material. Get out and see some sun, partake in some sporting activities perhaps?

Asheron

It was all planned this way, nothing in politics happens by accident...

ILW

Asheron wrote: »

It was all planned this way, nothing in politics happens by accident...

Do you honestly think that most of them are that clever?

Percy1983

There is many things anybody with sense could see coming.

I remember saying one line when VAT fell to 15%... "when will it be 20% to make up for it"

Conrad

Graham_Devon wrote: »

I was asking a question as to how the experts couldn't see it coming.

I often muse over how Dr Bubb on housepricecrash really did see it comming. He had threads such as 'the comming credit crunch' way back in 2004.

In fact I'm amazed he hasn't publicised those early threads and posts - I'm sure this would be of interest to newspapers looking to make fools of all those expert economists.

Does any of you know of Dr Bubb from that forum (I did a quick search there but no mention of him now - weird).

benb76

Dr Bubb STR'd in 2003, he'd probably have to pay 25-30% more for his old house now.

Sapphire

I did see it coming, probably around 2006, but no one would listen when I told them that the population - and indeed the country - cannot borrow so much and expect not to pay for it in a big way later. It's just common sense. It makes me so angry. What the hell was the British 'government' doing in relation to our country? There are few countries that have amassed as much debt as Britain and its citizens.