"Oversupply the cause of house price crashes"

shortchanged_2

HAMISH_MCTAVISH wrote: »

Expand your mind shorty.....

Do you think there may be another explanation? Like the cumulative demand growth from the booms that precede recessions drives oil to high levels?

For example, it wasn't the price of oil that caused the global meltdown in 2007, it was the credit crunch, which was caused by the fraudulent mis-allocation of risk ratings on American RMBS.

Sub-prime slime sold as bullet-proof AAA securities. Not high oil prices.

High oil prices were the spark that ignited the fire tartan boy.

IveSeenTheLight

nearlynew wrote: »

McTittish, you still don't even know the difference between demand and desire.


You silly boy.

I'm sure IIRC that this was explained to you before.

Demand = Desire and Ability.

chucky

shortchanged wrote: »

High oil prices were the spark that ignited the fire tartan boy.

maybe try to define a "high oil price" - $75, $100, $125, $150, $200?

when you can define a high oil price maybe you'll be able to say it will push the economy into recession, until then you'll have to depend on your crystal ball and tea leaves.

DervProf

RenovationMan wrote: »

I must admit I was amazed when I saw his argument (I have him on ignore but can see the text when people quote him), it makes me wonder why he acts the teen village idiot all the time when he could actually join the debate?

I guess its a sign of lacking in confidence to just throw insults and act the fool instead of trying to debate sensibly. Hopefully he will realise that generally they are a decent lot on here and will engage more.

I thought you were ignoring him.

System

DervProf wrote: »

I thought you were ignoring him.

You can still read anything people quote.

DervProf

RenovationMan wrote: »

I have him on Ignore but as I said in the post, if someone quotes him I can see his text.

Why do you care? Remember I have you on my radar as you having geneer as your AE, this type of post doesnt decrease my suspicions.

I have my eye on you..... :cool:

oooooh, I better watch out then.

And if you really do think I`m geneer, then my suspicions about you have been confirmed.

shortchanged_2

chucky wrote: »

maybe try to define a "high oil price" - $75, $100, $125, $150, $200?

when you can define a high oil price maybe you'll be able to say it will push the economy into recession, until then you'll have to depend on your crystal ball and tea leaves.

Statisically it is anything over $104.67472387218236582387 and a 1/2

But then it depends on inflation, interest rates, house prices, exchange rates etc, etc.

Basically chucky oil prices are high when they seriously start to hit people hard in their pockets.

purch

For example, it wasn't the price of oil that caused the global meltdown in 2007, it was the credit crunch, which was caused by the fraudulent mis-allocation of risk ratings on American RMBS

You no doubt are also of the opinion that the assassination of Arch-Duke Franz Ferdinand was the sole and only reason for WW1.

Neither opinion is necessarily correct.

P.S. As the Oil Price was between 60-70 USD in 2007, I doubt whether any sane person could make a credible case for Oil being any part of the 2007 crisis.

shortchanged_2

purch wrote: »

P.S. As the Oil Price was between 60-70 USD in 2007, I doubt whether any sane person could make a credible case for Oil being any part of the 2007 crisis.

purch if you google high oil prices and links with recession there are plenty of articles that support the link between high oil prices and it's effect on economies.

What happened in 2007? We had peak house prices in the summer of that year. 2008 was the weakening of the economy when funnily enough oil hit $147 a barrel that year.

Conrad

Even if we agree that high oil prices lead to a slow down, the result of that will be falling oil prices and even if higher prices were sustained over an extended period, the knock - on reduction in property prices would be negligible in a nation where the total demand for shelter exceeds supply.

I must admit though that I think rents could slide some if this area is anything to go by, as it would appear housing benefit is being reduced over the next 21 months and also those under 35 are being forced to take shared accomodation now. But the effect on property values will be miniscule in the round.