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A "full-scale property boom will begin in 2014"
Comments
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And once more, as GD keeps rabbiting on about 'stimulus'.
This isn't 'stimulus'.
This is emergency medical treatment, helping the still seriously ill mortgage markets to function.
And the course of treatment is still only a small fraction of the way through.
Eventually, the treatment course will be complete, and the patient will be healed and able to function normally without it.
We can then remove the medical treatment.
Doing so at this stage would be ill-advised and reckless to the health of both the mortgage market and wider economy.
To continue the medical analogy....
The US mortgage market was like a crack cocaine addict that had a heart attack.
The UK mortgage market was the innocent victim standing on the side of the road that got hit by the bus the US market was driving at the time it had that heart attack. Mr UK Market might have sipped a bit of red bull that morning, but it wasn't that which caused him to be admitted into intensive care, nor would it have been had he not been hit by a bus.
Completely different scenario.“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 -
OffGridLiving wrote: »Thanks Thrug, this was the answer I was going for. Some people seem to think that ending stimulus means not just turning off the taps, but tipping out the water. As you rightly say, the stimulus will unwind naturally and over a sustainable duration.
In my view, each stimulus package will be halted at a point in time when the economy can support that. The 'taps' will be slowly turned off and the bathwater will slowly evaporate over the years, until it's all out of the system and the bath is empty.
There will be no financial Armageddon because everything is halted overnight, why would the government want that when they can go for a soft landing? The guys who think that we'll have a collapse when the 'props' are taken away are the same ones who were amazed that the government stepped in in the first place to prop up the economy. Do they never learn?
Let us all hope the stimulus has evaporated before the next set of global/euro problems. Then we can fill the bath up again."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
OffGridLiving wrote: »I do believe that stimulus to encourage the building of more houses will increase supply and therefore help to reduce house prices.
I think you will be dissapointed. I am sure it will encourage the building of more properties, at higher prices and I doubt the volume they alone provide will have reduce comparative prices."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »Let us all hope the stimulus has evaporated before the next set of global/euro problems. Then we can fill the bath up again.
Or we could get a bigger bath...“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 -
Which will fall through the floor like last time, due to insufficient infrastructure to support it.HAMISH_MCTAVISH wrote: »Or we could get a bigger bath...
(Wonder what other metaphors we can come up with?)0 -
grizzly1911 wrote: »I think you will be dissapointed. I am sure it will encourage the building of more properties, at higher prices and I doubt the volume they alone provide will have reduce comparative prices.
Perhaps, but as we found shortly after the credit crunch, a lot of houses were suddenly dumped onto the market and prices fell. Subsequently, when fewer houses were put on the market, prices stabalised and then climbed. It's a fairly standard model for demand/supply and nothing new.
House builders reduced their supply partly because of difficulty in arranging credit, but also to help inflate house prices.
The only way I can see to reduce house prices is to increase supply. I might be wrong, but hopefully we'll get to find out.
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Graham_Devon wrote: »And theres nothing more to it than that, eh?
Really is pointless arguing this when you are going to such lengths to be so utterly obtuse.
There's not much more to it really.
Say you listed your props in order of 'stimulation' and then considered a) a reportedly huge shortage of supply and b) a willingness of buyers and sellers to ignore what you think is the 'right' price - do (a) and (b) trump your props?0 -
There's not much more to it really.
Say you listed your props in order of 'stimulation' and then considered a) a reportedly huge shortage of supply and b) a willingness of buyers and sellers to ignore what you think is the 'right' price - do (a) and (b) trump your props?
It's not about what trumps what.
The market will find it's own level. If stimulus helps the market, obviously a different level will be found to the level that would have been without said stimulus.
I really fail to see why I am having to explain this.
It's a fact that stimulus is out there. It's therefore a fact that it is distorting the natural market.
I agree with you that the price is made up of what one person offers and the other excepts. But when we are talking specifically about stimulus, throwing this line in suggests you want to ignore all stimulus, which, appears to have been your aim throughout, either ignore or trivialise.
I genuinely don't know why you do this as there is little point trying to water stimulus down when clearly there is more and more being thrown in.0 -
OffGridLiving wrote: »
The only way I can see to reduce house prices is to increase supply. I might be wrong, but hopefully we'll get to find out.
I agree but I think it it needs a much bigger dose of supply to actually hold or reduce prices in any meaningful way that will be of benefit."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
HAMISH_MCTAVISH wrote: »Or we could get a bigger bath...
Unfortunately we can't afford to to fill the one we have got.."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
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