Bubble Warning from senior economist

TruckerT

Loughton_Monkey wrote: »

I have never had what you might call 'certainty'. Who (apart from civil servants until recently) has?

So even civil servants no longer have any kind of certainty?

Like you, I have no problem with uncertainty. But most people seem to have enormous problems with the uncertainty of the value of their house, the uncertainty of their employment, the uncertainty of their pension - and there is no longer much certainty that they will be 'bailed-out' by the welfare state.

Like you, I struggle to understand why so many people are unable to organise their own lives in the same way that I organise mine.

But the fact is that, in a 'civilised' society, the able will make sacrifices in order to assist the unable.

TruckerT

wotsthat

grizzly1911 wrote: »

How many people get means tested benefit? Presumably we don't pay them benefit so they can save (at anything other than a rainy day level)?

Then their are those on a living wage who through there budgetary skill just mange to provide some rainy day savings. How many are in that category?

There will be more who can save but it will never really make a material difference to their retirement prospects - it may even leave them in the poverty trap?

I would suggest that there are quite a number who live at or very near their income simply because they don't have a choice.

There will be a substantial number of higher earners who choose to live to 100%+ of their average earnings.

Seems like we're struggling to differentiate between a need and want.

Living in one of the world's wealthiest nations can do that for you.

Buying into the message that the government can take away the hard decisions that individuals should be taking isn't helpful either.

wotsthat

TruckerT wrote: »

But the fact is that, in a 'civilised' society, the able will make sacrifices in order to assist the unable.

TruckerT

Civilised is a word politicians used to justify intrusive central planning.

Sorry, just reading 'the road to serfdom' as recommended by Generali. The first thing intrusive governments do is to ensure they use the same words but give them a different meaning i.e. affordable rent/ houses.

grizzly1911

wotsthat wrote: »

Seems like we're struggling to differentiate between a need and want.

Living in one of the world's wealthiest nations can do that for you.

Buying into the message that the government can take away the hard decisions that individuals should be taking isn't helpful either.

wotsthat wrote: »

Civilised is a word politicians used to justify intrusive central planning.

Sorry, just reading 'the road to serfdom' as recommended by Generali. The first thing intrusive governments do is to ensure they use the same words but give them a different meaning i.e. affordable rent/ houses.

I have not read the Road to Serfdom in full only key exerts. I know it was its principles were very much taken on board by Thatcher.

Does it matter what things are called surely what they are and for what purpose they were designed is more important. Whether that design and purpose is still relevant is a separate argument. The world has moved on.

Having read said book I suggest you broaden your reading base for a sense of balance.

Loughton_Monkey

TruckerT wrote: »

.....Like you, I have no problem with uncertainty. But most people seem to have enormous problems with the uncertainty of the value of their house, the uncertainty of their employment, the uncertainty of their pension - and there is no longer much certainty that they will be 'bailed-out' by the welfare state.

Like you, I struggle to understand why so many people are unable to organise their own lives in the same way that I organise mine.

As an 'old hand' I refuse to accept that the degree of uncertainty is any higher, these days, than during my economically active life (1972-2005). 20%+ inflation? For virtually the whole period 1981 to 1997 unemployment was higher than the current ~8% rate.

And I hope you are not going to tell me that benefits were generally higher in those days than after Gordon Brown got to work!

TruckerT wrote: »

But the fact is that, in a 'civilised' society, the able will make sacrifices in order to assist the unable.

TruckerT

This is a whole new topic isn't it? Doesn't mean very much until you define exactly the word "unable".

You might argue that we are already the most "civilised" country in the world as measured by the way we tax high to spend on "benefits" including giving people houses...

When the family earning £30K (say £25K Net) see the family next door earning nothing, but getting £24K tax free, how 'civilised' do they feel? If we were to increase those benefits to £30K tax free does that make us more 'civilised'?

You will have read that the government has 'sanctioned' up to 400,000 benefits claimants for (basically) causing their own unemployment by not even trying.... [Let's not befuddle this with the handful of cases the media has found who appear to have been wrongly sanctioned]. But was it 'civilised' to tax you, me, and millions of others to pay significant money to these people? Would it have been more civilised to have paid them even more? There is a line below which we would be uncivilised, and a line above which we create a society that is simply mollicoddled, lacking any sense of self-responsibility, and downright unfair to those who work hard.

grizzly1911

Loughton_Monkey wrote: »

You will have read that the government has 'sanctioned' up to 400,000 benefits claimants for (basically) causing their own unemployment by not even trying.... [Let's not befuddle this with the handful of cases the media has found who appear to have been wrongly sanctioned].

If you change the definition of "trying" then you can sanction as many as you want.

In the period you hi light as been economically active their was a greater chance, due to breadth and nature of employment, for a greater proportion of people, for continuous employment or even jobs for life, with built in career advancement, as long as you continued to perform.

Loughton_Monkey

grizzly1911 wrote: »

If you change the definition of "trying" then you can sanction as many as you want.

In the period you hi light as been economically active their was a greater chance, due to breadth and nature of employment, for a greater proportion of people, for continuous employment or even jobs for life, with built in career advancement, as long as you continued to perform.

I don't buy that. That may have been true for my father's generation. He worked for 51 years at the same factory, without promotion. Even he didn't feel secure since when I was 3, he deliberately moved from a company-tied house to a council house [at higher rent] for fear of hiom ever losing his job and thus losing the home.

During the 70's to 90's do you really believe we had job security? We certainly didn't have 'unfair dismissal' laws for a lot of that time. I started work for a 'Blue Chip' and was headhunted away after 9 years. OK, I wasn't going to be fired, but nor was I going to be promoted because of a 'bulge' of similar aged people looking for management positions.

My next company was a well known "Hire and Fire" one, which (later, long after I left) became the biggest crash in the industry and the CEO ending up doing 7 year's bird for fraud!

From mid 80's onwards, I was in positions where I, myself, was doing an awful lot of the firing as we improved processes, computerised, and streamlined.....

The only thing I do recognise is that there were probably quite a few of my peers in the first 'Blue Chip' who managed to keep their heads down.... did a reasonable job.... followed the tide.... and yes, they may well have retired with their 40/60ths pension. But I bet it was on a salary of probably 30% of what I was earning when I retired.

If there are any other 65-ish posters out there.... I'd be interested if any of them would back up that you could easily have worked 1970 to 2010 on a 'job for life' basis.

wotsthat

grizzly1911 wrote: »

Does it matter what things are called surely what they are and for what purpose they were designed is more important. Whether that design and purpose is still relevant is a separate argument. The world has moved on.

Quite - it's always different this time. Those who fail to learn from history are doomed to repeat it.

What things mean are more important than what they're called. However, it can create confusion when politicians assign new meaning to a definition which means something else to 99% of the population.

Do you want more affordable housing? That seems pretty straightforward - we all think we know what it means and would probably be supportive. Politicians use the same word but assign a different meaning. i.e....

Do you want more housing which is built by the taxpayer to accommodate people who, for reasons good and bad, have been selected to live in said housing, potentially, for free?

I think my answer to the first question is yes but to the second no so we need to be very aware of the meaning of words and to the propensity of politicians to twist them for their own means.

I'm always bemused by people who have such a low opinion of politicians clinging to the belief that they are better placed to make an increasing number of decisions on our behalf.

Loughton_Monkey

wotsthat wrote: »

.......

I think my answer to the first question is yes but to the second no so we need to be very aware of the meaning of words and to the propensity of politicians to twist them for their own means....

Agreed.

I always laugh (and cringe) at buzz words the creep in. 'Organic' was one. Yes, that does have some vague standards, but an awful lot of loopholes and grey areas.

But other culprits are "Fair Trade", "Sustainable", "Local Produce"... I listened to a Radio 4 food program some while ago waxing lyrical about the resurgence of "local produce" and booming of local markets etc. I believe they went to Kent, and the BBC are too dim to notice that the interviewed sausage maker was boasting that he'd been there 3 years, now, and he's got regular customers that come from as far as Peterborough to buy his excellent sausages......

On the assumption that he lets his pigs breed before slaughtering them, and as long as we pay what he wants, and as long as we live in Kent, then he is genuinely a "Fair Trade, sustainable, local supplier".

Personally, I'd just call him a butcher!

PS: On which note I see the sun has gone down over the yardarm. My gin was made in London, but travelled all the way to Istanbul where I bought it in duty free and carted it home. Is that 'Local Produce'? Over and out!

Loughton_Monkey

Triffid wrote: »

You Daily Mail readers.....always the same....'If I can do it anyone can do it' tosh! The 'us and them' divide. The 'deserving and undeserving' poor. You always look to the extremes, (family earning 30k and next door neighbours on 25k benefits) to prove your points.......while up and down this country good people are suffering. I'm not... I have a profession and live in the South East...but I am not smug and I don't go on about having a swimming pool. I have eyes and I travel around. I see the poverty of lives in the inner cities, in the north, Wales and Scotland etc.Of course we should have self responsibility....but even more important is compassion...something sadly lacking on this board!
http://www.theguardian.com/commentisfree/2013/nov/08/duncan-smith-poverty-benefit-sanctions-easterhouse

I do not read the Daily Mail.

If you want to see "suffering" or "poverty" I can point to 99 other places outside UK where you might begin to understand what these terms really mean.

I don't know how you consider a family on £30K as "extreme" nor a family on £24K as "extreme". It is quite common. £10K housing benefit. £14K Child benefit/tax credit for 4 children is "extreme"?