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UK House prices: News & Views


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Perhaps you should take at the comment section in the Home.co.uk report.

http://www.home.co.uk/asking_price_index/

Inflation is destroying house values in real terms. :o

 

Asking Prices and Inflation

Market expectations are for a seasonal decline in pricing and activity over the coming

months. UK property sales are slow in most regions: both typical and average times

on market are longer than in October last year. By way of contrast the current stock

of property for sale is essentially static year on year. Consequently, asking prices

continue to suffer downward pressure. In September, sellers cut UK asking prices by

a total of £1.4 billion pounds.

Whilst nominal home prices have been losing ground very slowly over the last

3 years, inflation continues to severely erode capital invested in property. Comparing

ONS August figures and the YoY change in asking prices for the same month shows

that asking prices continue to fall, in real terms, by 7.1% per year relative to the RPI

(ex. housing). The HAPI for England and Wales now stands at 97.4 [May04 = 100].

 

THAT MAKES SENSE

Rising price of "essentials" (food, energy) at a time when incomes are stagnant, leaves less money for building a deposit, and for future mortgage payments.

 

This puts a lie to that hoary old chestnut that house prices rise with inflation. Wrong, wrong, wrong. You need falling rates and/or rising incomes to push up home prices. This looks unlikely at the moment.

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This puts a lie to that hoary old chestnut that house prices rise with inflation. Wrong, wrong, wrong. You need falling rates and/or rising incomes to push up home prices. This looks unlikely at the moment.

 

I always assumed everyone knew it was wage inflation that had this effect?

 

I suppose some might look at property as a hedge in high inflationary times, just as they look at other commodities?

 

Wage inflation currently at 2.8% average in the UK at present.

 

10 year fix rate mortgage at 4% results in a >30% discount over the ten years, even with these paltry wage increases.

 

That would cover a rather large fall in house prices, would it not?

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I always assumed everyone knew it was wage inflation that had this effect?

 

I suppose some might look at property as a hedge in high inflationary times, just as they look at other commodities?

 

Wage inflation currently at 2.8% average in the UK at present.

 

10 year fix rate mortgage at 4% results in a >30% discount over the ten years, even with these paltry wage increases.

 

That would cover a rather large fall in house prices, would it not?

 

 

You need BOTH nominal and real wages to rise to guarantee house prices to rise, at least in the long term. Generally of course this is what has happened, with noticeable exception periods (eg right now). Nominal rises alone cannot sustain increasing house prices if they are not keeping up with inflation and real wages are falling, and even rising real wages alone cannot sustain increase house prices if it comes about as a result of price deflation (Japan?).

 

 

 

 

 

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Like it or not, people are getting scared, and this time, it is directly attributable to the dithering politicians.

 

I think it has more to do with the media than the politicians. If I don't watch the news for a few days - I look out the window, the sun is shining, so far, so good, on the work front, family all well and those old enough to work are in work ... I feel pretty optimistic about life and the future.

 

I listen to the news and I'm ready to slit my wrists.

 

I think the media should be banned - apart from good news stories. If something bad happens in the Eurozone that is going to affect me in a serious way - the government should write to me. Other than that they should all shut up and stop scaring the hell out of everyone.

 

As Roosevelt said - "the only thing we have to fear is fear itself" - people are never going to have the confidence and optimism to work ourselves out of the debt hole we are in if, every time they read a paper or look at the television or go on a web site, someone is standing telling them the world is about to end.

 

I say the above a little 'tongue in cheek' but I really am sick to the back teeth with the prophets of doom delivering the news. In our house now even my kids (without any prompting from me) say 'turn it over' whenever the news comes on.

 

 

Edit: From today's Telegraph web site ...

"A dramatic fall in confidence over the economy has prompted small firms to lay off staff as costs rise and revenues decline.

 

More companies are now pessimistic about their prospects than bullish and intend to sack staff in an attempt to reduce costs and save cash."

 

Why are they pessimistic? Is it because orders have fallen, or enquiries are down or something tangible? Or is because every time they listen to the media they are told - over and over again - 24/7 - that the economy stands on the verge of collapse.

 

Well the economy is not on the verge of collapse - that is total bunkum. We really are talking ourselves into this. The media helped create the boom by kidding everyone that property would rise forever and was a one way bet to millionaire status - now they are doing the opposite. Damn depressing listening to the muppets.

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I think it has more to do with the media than the politicians. If I don't watch the news for a few days - I look out the window, the sun is shining, so far, so good, on the work front, family all well and those old enough to work are in work ... I feel pretty optimistic about life and the future.

 

I listen to the news and I'm ready to slit my wrists.

 

I think the media should be banned - apart from good news stories. If something bad happens in the Eurozone that is going to affect me in a serious way - the government should write to me. Other than that they should all shut up and stop scaring the hell out of everyone.

 

As Roosevelt said - "the only thing we have to fear is fear itself" - people are never going to have the confidence and optimism to work ourselves out of the debt hole we are in if, every time they read a paper or look at the television or go on a web site, someone is standing telling them the world is about to end.

 

I say the above a little 'tongue in cheek' but I really am sick to the back teeth with the prophets of doom delivering the news. In our house now even my kids (without any prompting from me) say 'turn it over' whenever the news comes on.

 

 

Edit: From today's Telegraph web site ...

"A dramatic fall in confidence over the economy has prompted small firms to lay off staff as costs rise and revenues decline.

 

More companies are now pessimistic about their prospects than bullish and intend to sack staff in an attempt to reduce costs and save cash."

 

Why are they pessimistic? Is it because orders have fallen, or enquiries are down or something tangible? Or is because every time they listen to the media they are told - over and over again - 24/7 - that the economy stands on the verge of collapse.

 

Well the economy is not on the verge of collapse - that is total bunkum. We really are talking ourselves into this. The media helped create the boom by kidding everyone that property would rise forever and was a one way bet to millionaire status - now they are doing the opposite. Damn depressing listening to the muppets.

 

There's a lot of truth in that BaB, but the press will always go for the big problem story and blow it up to get more watchers.

 

However, part of the problem this time has been the politicians, who have also been talking the economy down in order to get their austerity budgets through without the population shouting too much against it.

 

Problem is, this affects confidence, this is exacerbated by the media, then the consumer stops spending and the markets start acting like the end of the world as it becomes self fulfilling.

 

Then it's back to the politicians to come up with bigger solutions in order to sort it out.

 

Talk about vicious circles :blink:

 

Also, things might be OK at the moment where you are, but it aint so good here :( .

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There's a lot of truth in that BaB, but the press will always go for the big problem story and blow it up to get more watchers.

 

However, part of the problem this time has been the politicians, who have also been talking the economy down in order to get their austerity budgets through without the population shouting too much against it.

 

Problem is, this affects confidence, this is exacerbated by the media, then the consumer stops spending and the markets start acting like the end of the world as it becomes self fulfilling.

 

Then it's back to the politicians to come up with bigger solutions in order to sort it out.

 

Talk about vicious circles :blink:

 

Also, things might be OK at the moment where you are, but it aint so good here :( .

 

Sorry that things are not so good for you - I wonder how much of that - in a macro sense - is down to the general doom and gloom.

 

It got so bad a couple of weeks ago that I was seriously thinking of taking 5k out of the bank and sticking it under the mattress - I did that in 2008 when the banking crisis was in full flow and only found out later that we were within half an hour of closing the cash machine network.

 

This 27/7 media nonsense has a lot to answer for. I have done it so many times lately - I go into the lounge and watch the box for an hour at about 9.00 ish - and then the 10 o'clock news comes on. Boing! The Eurozone is collapsing. Boing! The public sector is going on strike. Boing! Nurses are starving old people. Boing! David Cameron says this. Boing! Ed Milliband says that. Boing! The governer of the Bank of England says the end is nigh!

 

By which time I'm either on a repeat of Two and a Half Men or on my way to bed.

 

It really is getting beyond a joke. I like current affairs. If I watch News at Ten and then Newsnight - I'm ready for an overdose by the time I go to bed. So I've stopped watching and I feel a whole lot better.

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Not so sure....when was the last time you saw the news without a politician appearing on it somewhere?

 

For some light relief, switch to ch85 and watch the Keiser report :)

 

But I've never heard David Cameron say 'the end of the world is nigh' - on the contrary - he says things are serious, we have a lot of money to pay back, which is why we've got to get our heads down, remove the shackles from business blah, blah - it might be all words but he does strike an optimistic note on the whole.

 

The newscasters, by comparison, you't think they were bringing good news the way they shout the headlines. Eurozone in CRISIS! Why not - Eurozone Finance Ministers meed today to discuss latest tranche of Greek bailout. But, no, it has to be ... BOING! EUROZONE IN CRISIS!

 

Stuff it, I am not listening to them any more.

 

If you had a mate who spoke to you all the time in the way that newscasters do ... have you heard the lates on this, did you hear about that ... we all know people like that and avoid them like the plague because they bring you down. Well that's what the media is doing to the whole country.

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The newscasters, by comparison, you't think they were bringing good news the way they shout the headlines. Eurozone in CRISIS! Why not - Eurozone Finance Ministers meed today to discuss latest tranche of Greek bailout. But, no, it has to be ... BOING! EUROZONE IN CRISIS!

 

Stuff it, I am not listening to them any more.

 

:lol: I know what you mean.

 

So in the interests of balance, here is some good news (well, sort of, from Bellway)

 

Bellway raises dividend by 30pc as profits jump

 

http://uk.finance.yahoo.com/news/Bellway-raises-dividend-30pc-tele-410851075.html?x=0

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...More companies are now pessimistic about their prospects than bullish and intend to sack staff in an attempt to reduce costs and save cash."

 

Why are they pessimistic? Is it because orders have fallen, or enquiries are down or something tangible? Or is because every time they listen to the media they are told - over and over again - 24/7 - that the economy stands on the verge of collapse.

 

Well the economy is not on the verge of collapse - that is total bunkum...

Sadly, I cannot buy that.

 

The reason that the global economy is in crisis, is two-fold:

 

+ Extreme short-term focus

+ Lack of discipline, especially amongst politicians

 

The way to fix it, is through facing up to reality, and taking the pain needed to make major adjustments in the way we live. That is not happening, not yet. And I think much more bad news will need to come out before reality is faced, and needed adjustments are made.

 

No amount of rosy thinking is going to change:

 

1/ That most of society is living beyond its means

2/ People's living arrangements and expectations assume that "things will get better"

3/ Peak oil is real, and the world is running out of cheap oil, and today's living arrangements are nothing like what they will be when the world faces this reality

4/ Water and other commodities will also be scarcer

 

The mainstream media may seem pessimistic to you, but to me, it seems that they are in cloud-kuku-land focused on entertaining the masses, and telling them lies that will keep the current wasteful regime in power.

 

=== === ===

 

TIME FOR A POLL?

http://www.greenenergyinvestors.com/index.php?showtopic=15468

 

I made one after the above postings.

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Sadly, I cannot buy that.

 

The reason that the global economy is in crisis ...

 

I don't buy your basic premise - the global economy is not in crisis.

 

But if you repeat it often enough, it will become true.

 

If I buy a house when I'm young and borrow a load of money to do it - it doesn't mean I have a crisis. It just means I've borrowed a load of money and need to pay it back.

 

In this country we need to pay down our debts and make more and import less. It's not a crisis.

 

No doubt some debt forgiveness will be involved globally. Maybe the political and banking classes that run things will learn something.

 

One thing is for certain - we need to positive and optimistic.

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I don't buy your basic premise - the global economy is not in crisis.

 

But if you repeat it often enough, it will become true.

 

If I buy a house when I'm young and borrow a load of money to do it - it doesn't mean I have a crisis. It just means I've borrowed a load of money and need to pay it back.

 

In this country we need to pay down our debts and make more and import less. It's not a crisis.

 

No doubt some debt forgiveness will be involved globally. Maybe the political and banking classes that run things will learn something.

 

One thing is for certain - we need to positive and optimistic.

 

 

Sorry matey, don't agree. The figures involved ARE catastrophic.

 

And even if they weren't, it appears you think that paying down debt is just an issue of time. Even at a supra-national level, let alone household, that's simply not the case.

 

Leaving aside the (killer) issue of interest, that debt burden will rob Western economies of fresh capital for decades. That's less money for business, innovation, welfare and a million other things we take for granted that the rest of the world doesn't have. That capital was our edge, it was that capital that kept us ahead, gave us time, allowed for innovation, broadened our horizons - and now we've not merely consumed it, we've also consumed the next generation's worth of it.

 

So, even assuming the level of debt isn't high enough to cause systemic failure (which it is), every year we spend paying it down sends us closer to the worldwide average - and that's a hell of a long way down from where we are at the moment.

 

You're correct when you say the media are dead wrong - but it's because they're UNDERSTATING the problem, having failed to understand it. Positive thinking, fairies and rainbows will make no difference. The best case is that we write it off and start from scratch. The worst case doesn't bear thinking about. We've eaten the larder clean and we've already started to eat ourselves.

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Sorry matey, don't agree. The figures involved ARE catastrophic.

 

And even if they weren't, it appears you think that paying down debt is just an issue of time. Even at a supra-national level, let alone household, that's simply not the case.

 

Leaving aside the (killer) issue of interest, that debt burden will rob Western economies of fresh capital for decades. That's less money for business, innovation, welfare and a million other things we take for granted that the rest of the world doesn't have. That capital was our edge, it was that capital that kept us ahead, gave us time, allowed for innovation, broadened our horizons - and now we've not merely consumed it, we've also consumed the next generation's worth of it.

 

So, even assuming the level of debt isn't high enough to cause systemic failure (which it is), every year we spend paying it down sends us closer to the worldwide average - and that's a hell of a long way down from where we are at the moment.

 

You're correct when you say the media are dead wrong - but it's because they're UNDERSTATING the problem, having failed to understand it. Positive thinking, fairies and rainbows will make no difference. The best case is that we write it off and start from scratch. The worst case doesn't bear thinking about. We've eaten the larder clean and we've already started to eat ourselves.

 

It's all justs zeroes and ones in a computer. You're taking it all way too seriously.

 

The larder might be clean ... yet the supermarkets are full of food and most people can afford to eat, clothe themselves and keep warm. At least, that's how it looks to me.

 

What do you suggest people do? You talk about systemic failure - I wonder what on earth that means? Should people get up in the morning and go to work - or is the whole thing about to fall apart (whatever that may mean).

 

We had all this in the late 80s when the housing market tanked - recession - lots of people lost their jobs in areas where that had never really happened before - i.e. London and the South East. I was one of them. We had it in the 70s with the energy crisis and the 3 day week. Lots of people were muttering about crises then, and systemic failure, and the end of our economy/society etc. Yet, weirdly, we got through all that.

 

And we'll get through this a lot better if people stop using phrases like 'systemic failure' without a coherent explanation of what it means, why it will happen and what will happen when it happens. Because, one way or another, we will get through this.

 

Surely we've already seen that when we're short of capital, we can just create some. Again, that's how it looks to me anyway.

 

Edit: Just noticed another word you used. "The figures are CATASTROPHIC". In what way do the figures mean we are to suffer a catastrophe. A catastrophe to me is a flood, or an earthquake. What do you mean by a catastrophe? Meanwhile, in a high street near me someone is spending 50k refurbishing their pub. Why are they bothering? I'd say it's because after they re-open (new menu, of course) they'll be heaving for a year and recoup their investment and a lot more. Or are you saying they won't?

 

Edit: Just noticed this: " Positive thinking, fairies and rainbows will make no difference" - why do you try to equate my point that the endless diet of bad news from the media - the same news repeated over and over again, day in, day out, endlessly - has a very negative effect on many people and is, in fact, contributing to the problem - with fairies and rainbows? I didn't mention a belief in fairies. I met someone the other night who believes in angels - but, hey, each to their own.

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It's all justs zeroes and ones in a computer. You're taking it all way too seriously.

 

The larder might be clean ... yet the supermarkets are full of food and most people can afford to eat, clothe themselves and keep warm. At least, that's how it looks to me.

 

What do you suggest people do? You talk about systemic failure - I wonder what on earth that means? Should people get up in the morning and go to work - or is the whole thing about to fall apart (whatever that may mean).

 

We had all this in the late 80s when the housing market tanked - recession - lots of people lost their jobs in areas where that had never really happened before - i.e. London and the South East. I was one of them. We had it in the 70s with the energy crisis and the 3 day week. Lots of people were muttering about crises then, and systemic failure, and the end of our economy/society etc. Yet, weirdly, we got through all that.

 

And we'll get through this a lot better if people stop using phrases like 'systemic failure' without a coherent explanation of what it means, why it will happen and what will happen when it happens. Because, one way or another, we will get through this.

 

Surely we've already seen that when we're short of capital, we can just create some. Again, that's how it looks to me anyway.

 

Edit: Just noticed another word you used. "The figures are CATASTROPHIC". In what way do the figures mean we are to suffer a catastrophe. A catastrophe to me is a flood, or an earthquake. What do you mean by a catastrophe? Meanwhile, in a high street near me someone is spending 50k refurbishing their pub. Why are they bothering? I'd say it's because after they re-open (new menu, of course) they'll be heaving for a year and recoup their investment and a lot more. Or are you saying they won't?

 

Edit: Just noticed this: " Positive thinking, fairies and rainbows will make no difference" - why do you try to equate my point that the endless diet of bad news from the media - the same news repeated over and over again, day in, day out, endlessly - has a very negative effect on many people and is, in fact, contributing to the problem - with fairies and rainbows? I didn't mention a belief in fairies. I met someone the other night who believes in angels - but, hey, each to their own.

 

Have to say you're right, it's not the end of the world and I can see your points BaB.

 

Some of the younger folk here maybe don't realise that there have always been big problems, there have always been big debts (e.g. after the 2nd world war the UK owed s**tloads, and only paid the last bit off recently), but that didn't stop the expansion of the 50s and 60s.

 

The late 70's and 80s seemed far worse to me than what is happening at the moment, the country practically ripped itself apart during the miners strikes etc and I'm certain the 40's were way worse than that (i.e. world war, bombs dropping on your house, firestorms that decimated my home town etc).

 

So looking at it like that does put it in perspective. I mean, we aren't going to starve. And the PTB can, as you point out, just make some more money, or use debt jubilee or many other “emergency” measures should TSHTF.

 

However, that said, I think things could get worse before they get better and for the guy who has lost his job and house and savings (and sometimes family from the stress etc) it’s going to feel pretty s**t.

 

There is also the danger that if some of the problems now aren’t dealt with correctly, it could result in wars down the road like after the depression.

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You're forgetting the effect those zeros have on people's lives. Yes collectively the Western world will muddle through, but that isn't the point, it's the suffering people have to endure to muddle through that's the problem. Have you ever been unemployed when you don't know whether to spend your last tenner on food to fill your stomach or buy yourself a few pints to cheer yourself up? Life can be bleak even during economic prosperity and not talking about something doesn't make it go away. You're right to be positive about the future, but that shouldn't be at the expense of appreciating the gravity of the present situation. The reason you think this crisis isn't a real problem, is because for most it hasn't happened yet.

 

It's all justs zeroes and ones in a computer. You're taking it all way too seriously.
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Why draw that distinction? Everything is the summary of it's parts...

 

Because, as you point out, there are many that haven't felt (or won't feel) any effects of the recession.

 

To them, life goes on as normal, blissfully unaware of what's happening to others.

 

Some of my in-laws, for example, didn't feel any effects of the late 80's early 90's downturn (living in the country), whereas I and many friends in my home city suffered the full effects at that time.

 

Lead to a few heated debates when I first met them, they just had no idea of what had happened :D

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That sounds like a catastrophe to me.

 

It is a catastrophe. I lost my job in 1990 during the last shindig. Luckily I had seen what was coming and downsized - cut my mortgage in half - and we got by on my wife's earnings. I remember the weird feeling of say driving behind a bloke in a van and thinking 'he's got a job, why haven't I got a job'. I've never forgotten the feeling of hopelessness and uselessness.

 

I lived in a little cul-de-sac at the time - at one point half the men in the close were out of work. Which felt weird to us - in the early 80s we were used to seeing pictures of whole towns in the North blighted by unemployment as whole industries disappeared - but we got a good taste of it in the South in the late 80s/early 90s recession.

 

All I'm saying is - if we all listen to the news 24/7 and get ourselves into the mindset that a catastrophe is in the making - if we all stop spending money and sit around waiting for armageddon then, as sure as night follows day, armageddon will follow.

 

The one thing we really need at the moment is leadership - but our political system - with one side endlessly carping on about the other - does not engender any sense of pulling together etc. We do it in times of war - maybe we need to develop the same mindset.

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Point taken. If I lived in a city now I would probably relocate to the country. It will be felt country wide when it goes off, but I can imagine inner city life to be too bleak to brunt.

 

Because, as you point out, there are many that haven't felt (or won't feel) any effects of the recession.

 

To them, life goes on as normal, blissfully unaware of what's happening to others.

 

Some of my in-laws, for example, didn't feel any effects of the late 80's early 90's downturn (living in the country), whereas I and many friends in my home city suffered the full effects at that time.

 

Lead to a few heated debates when I first met them, they just had no idea of what had happened :D

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Understood, but personally I think it's too late to spend our way out of this one. Let's hope we can rejuvenate the spirit of the Blitz without it coming to war. Any hardship will bring local communities closer together, which I think is good thing.

 

 

 

All I'm saying is - if we all listen to the news 24/7 and get ourselves into the mindset that a catastrophe is in the making - if we all stop spending money and sit around waiting for armageddon then, as sure as night follows day, armageddon will follow.

 

The one thing we really need at the moment is leadership - but our political system - with one side endlessly carping on about the other - does not engender any sense of pulling together etc. We do it in times of war - maybe we need to develop the same mindset.

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It's all justs zeroes and ones in a computer. You're taking it all way too seriously.

 

Unless you live in the wilderness, those zeros are part of the fabric of your existence. Discount their importance at your peril.

 

The larder might be clean ... yet the supermarkets are full of food and most people can afford to eat, clothe themselves and keep warm. At least, that's how it looks to me.

 

The key words here are at present. The supply chains that enable this bounty are fragile, complex and operate on the thinnest of margins. I don't personally expect food shortages, but it is a distinct possibility in a systemic financial collapse, or even just in a severe recession.

 

What do you suggest people do? You talk about systemic failure - I wonder what on earth that means? Should people get up in the morning and go to work - or is the whole thing about to fall apart (whatever that may mean).

 

The world will still turn, people will still work. A whole lot of other things can change and that would still be true. I take it you never buy insurance? Or plan ahead? Or read any of the hundreds of posts on this subject in this very forum?

 

We had all this in the late 80s when the housing market tanked - recession - lots of people lost their jobs in areas where that had never really happened before - i.e. London and the South East. I was one of them. We had it in the 70s with the energy crisis and the 3 day week. Lots of people were muttering about crises then, and systemic failure, and the end of our economy/society etc. Yet, weirdly, we got through all that.

 

Maybe, but for many those times were indeed catastrophic, and IMO we'll be very lucky to get off as lightly. Either way, you're right, we will get through it. That doesn't mean everyone should just look away and whistle happy tunes.

 

And we'll get through this a lot better if people stop using phrases like 'systemic failure' without a coherent explanation of what it means, why it will happen and what will happen when it happens. Because, one way or another, we will get through this.

 

Systemic failure. Your bank no longer exists. Your pension and savings are gone. Your salary is meaningless. Traditional units of exchange are no longer recognized. Governments can't pay their employees. There is no social safety net. International trade ceases along with the flow of goods. Businesses cannot function. Supply chains cannot function. Food and other essentials become hard to obtain. Rioting. Bloodshed. War. Fire and brimstone. Dogs and cats living together.

 

All of these have happened to a developed country somewhere in the world in just the last 20 years (apart from the last few maybe). Then look back 50 years, then 100, then 200. Systemic financial and associated social crises are so common that historically they're almost the norm.

 

And yes, we'll still get through it. Some better than others - that's the point.

 

Surely we've already seen that when we're short of capital, we can just create some. Again, that's how it looks to me anyway.

 

You have correctly identified current worldwide economic policy. Same result, different route. Possibly different time line (unknown, in case you ask). Google the maths, google historical comparisons. Weep.

 

Edit: Just noticed another word you used. "The figures are CATASTROPHIC". In what way do the figures mean we are to suffer a catastrophe. A catastrophe to me is a flood, or an earthquake. What do you mean by a catastrophe? Meanwhile, in a high street near me someone is spending 50k refurbishing their pub. Why are they bothering? I'd say it's because after they re-open (new menu, of course) they'll be heaving for a year and recoup their investment and a lot more. Or are you saying they won't?

 

Catastrophe is always relative. A flood or earthquake wouldn't appear catastrophic next to a giant meteor strike - ask any dinosaur, preferably a happy one. In the context of a thread about housing and the financial system it shouldn't be too hard to figure out the meaning.

 

Edit: Just noticed this: " Positive thinking, fairies and rainbows will make no difference" - why do you try to equate my point that the endless diet of bad news from the media - the same news repeated over and over again, day in, day out, endlessly - has a very negative effect on many people and is, in fact, contributing to the problem - with fairies and rainbows? I didn't mention a belief in fairies. I met someone the other night who believes in angels - but, hey, each to their own.

 

Maybe I should have used the word Panglossian. Fairies or not, positivity will not trump mathematics. Although I've heard that what you can't see can't hurt you, apparently.

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Unless you live in the wilderness, those zeros are part of the fabric of your existence. Discount their importance at your peril.

 

Millions of people take no notice of the macro economic/political system they live in. They discount their importance and it affects them as much as it affects you. Or do you have a way of not be affected?

 

The key words here are at present. The supply chains that enable this bounty are fragile, complex and operate on the thinnest of margins. I don't personally expect food shortages, but it is a distinct possibility in a systemic financial collapse, or even just in a severe recession.

 

The world will still turn, people will still work. A whole lot of other things can change and that would still be true. I take it you never buy insurance? Or plan ahead? Or read any of the hundreds of posts on this subject in this very forum?

 

What would reading hundreds of posts on this forum achieve - in terms of dealing with what is, allegedly, ahead? Having some gold buried in the garden doesn't sound as though it will be much use. I buy enough insurance to pay the mortgage off if I die. That's it - oh and what I am legally required to have.

 

That doesn't mean everyone should just look away and whistle happy tunes.

You seem unable to resist the temptation to try to portray me as some sort of hippy nutter. But what's your prescription? In fact whistling happy tunes - if this means carrying on as normal and not starting to stockpile food and fuel then I'd say it's not such a bad idea.

 

Systemic failure. This is going to happen? Your bank no longer exists. So, 300 years or more of banking gone up in smoke? Your pension and savings are gone. Sounds like the Wild West is about to happen. Your salary is meaningless. Traditional units of exchange are no longer recognized. Governments can't pay their employees. There is no social safety net. International trade ceases along with the flow of goods. Businesses cannot function. Supply chains cannot function. Food and other essentials become hard to obtain. Rioting. Bloodshed. War. Fire and brimstone. Dogs and cats living together.

 

All of these have happened to a developed country somewhere in the world in just the last 20 years (apart from the last few maybe). Where? Then look back 50 years, then 100, then 200. Systemic financial and associated social crises are so common that historically they're almost the norm. In a country like ours with a stable political system ... when did this last happen and what caused it. 1789 or 1917?

 

I assume from what you have written that you are busy building a bunker and stockpiling food and fuel - hidden away somewhere so the marauding hordes won't find it when everything you predict takes place.

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