(UK EURO THREAD) UK POLITICS MK2

[Keckers]

Is this the end of boom and bust as we know it?!

[Lallante]

That but unironically, but I think you are on the wrong side of that quote without realising it ("This time it's GOT to be a housing bubble, for sure!")

[Siv]

That but unironically, but I think you are on the wrong side of that quote without realising it ("This time it's GOT to be a housing bubble, for sure!")

I don't think it's a speculation bubble but when interest rates start rising (there has been a lot of debt taken on and QE), furlough comes to an end (employer contributions start from next month) and the inevitable reduction in jobs attached there might be a lot of home owners struggling to make ends meet. Combined with reintroduction of stamp duty on houses under 500K means that house price rises should slow (although down in Devon currently the housing market is bonkers, houses selling the day they are put up quite often without viewing).

[Lallante]

That but unironically, but I think you are on the wrong side of that quote without realising it ("This time it's GOT to be a housing bubble, for sure!")

I don't think it's a speculation bubble but when interest rates start rising (there has been a lot of debt taken on and QE), furlough comes to an end (employer contributions start from next month) and the inevitable reduction in jobs attached there might be a lot of home owners struggling to make ends meet. Combined with reintroduction of stamp duty on houses under 500K means that house price rises should slow (although down in Devon currently the housing market is bonkers, houses selling the day they are put up quite often without viewing).

People have been saying that since 1999. Many people have taken out and paid off long term mortgages entirely within that timeframe.

You're not wrong on interest rates but it's neither inevitable nor imminent. The inflationary pressures simply arent there.

[Siv]

That but unironically, but I think you are on the wrong side of that quote without realising it ("This time it's GOT to be a housing bubble, for sure!")

I don't think it's a speculation bubble but when interest rates start rising (there has been a lot of debt taken on and QE), furlough comes to an end (employer contributions start from next month) and the inevitable reduction in jobs attached there might be a lot of home owners struggling to make ends meet. Combined with reintroduction of stamp duty on houses under 500K means that house price rises should slow (although down in Devon currently the housing market is bonkers, houses selling the day they are put up quite often without viewing).

People have been saying that since 1999. Many people have taken out and paid off long term mortgages entirely within that timeframe.

You're not wrong on interest rates but it's neither inevitable nor imminent. The inflationary pressures simply arent there.

I think the end of Furlough, significant lay offs and austerity mk 2 are round the corner though.

[Lallante]

That but unironically, but I think you are on the wrong side of that quote without realising it ("This time it's GOT to be a housing bubble, for sure!")

I don't think it's a speculation bubble but when interest rates start rising (there has been a lot of debt taken on and QE), furlough comes to an end (employer contributions start from next month) and the inevitable reduction in jobs attached there might be a lot of home owners struggling to make ends meet. Combined with reintroduction of stamp duty on houses under 500K means that house price rises should slow (although down in Devon currently the housing market is bonkers, houses selling the day they are put up quite often without viewing).

People have been saying that since 1999. Many people have taken out and paid off long term mortgages entirely within that timeframe.

You're not wrong on interest rates but it's neither inevitable nor imminent. The inflationary pressures simply arent there.

I think the end of Furlough, significant lay offs and austerity mk 2 are round the corner though.

which means low interest rates indefinitely

[Keckers]

The inflationary pressures simply arent there.

One weird trick to beat inflation: Give all the money to rich people who can only buy so much bread and see 'inflation' hit assets instead of consumer goods.

Maybe it's just as well none of the wealth trickled down after all.

[Lallante]

The inflationary pressures simply arent there.

One weird trick to beat inflation: Give all the money to rich people who can only buy so much bread and see 'inflation' hit assets instead of consumer goods.

Maybe it's just as well none of the wealth trickled down after all.

Not wrong

[Shaftoes]

The end of furlough is going to be a bloodbath.

It's essentially propping up the whole of the UK economy right now, and there will be a reckoning coming for sure. We'll also start to see some of the true impact of brexit.

[Lallante]

Interestingly the last 12 months have had the fewest company insolvancies in 20+ years. The next 12 is likely to be one of the worst.

[mewninn]

The end of furlough is going to be a bloodbath.

It's essentially propping up the whole of the UK economy right now, and there will be a reckoning coming for sure. We'll also start to see some of the true impact of brexit.

Only a blood bath for the people who were on furlough

Expanded unemployment has already been cancelled in half the US and the economy is still ramping up because we're both built around a class of expendables who provide the goods to a privileged class of consoomers. The end of furlough will mean resolving significant staffing shortages as people are forced to take any shit service job they can find. As with the Republican state govts, your Tory govt wants to make sure employers don't have to *compete* for labor as reopening continues

Still, this may bog down the demand side as it did 12 years ago, but the people in charge are obviously ok with that and may even prefer it because of their hierarchical nature

[Smegs]

Agreed. Doesnt make it a bubble in any sense. It's a supply-restricted market with a huge premium on amenity and easy access to very cheap debt allowing demand interest to have an enormously elastic impact on price.

All of you seem to have no real idea what 'a bubble' is. It's not a synonym for 'expensive' or even 'increasingly expensive proportionate to other expenses'. It's not even 'a bubble' if house prices are forced up by foreign demand (as is frequently claimed of London though the effect is hilariously overstated for max xenophobic points)

You seem to be making a number of assumptions, including that bubbles must be speculative and that a bubble is always objectively identifiable before a crash. Most bubbles in history have been rationalised during the bubble by at least a reasonable number of analysts and it's quite often the case that a bubble is only really agreed after it has burst.

A property market that is driven by demand but also being stoked by the government, including using various means to prevent price corrections can be argued to be a bubble. We may reach a point where it turns out that we price so many people out of the market that is becomes increasingly precipitous and something like a small rise in interest rates leads to a very large price correction due to a glut of people no longer able to afford their mortgages, also known as a crash. You may disagree and that's fine, but belittling people you disagree with just makes you look a twat.

Tell me, if a bubble never bursts, was it a bubble in your view?

More to the point if only those in the top ~30% of earners (or asset holders) can afford housing is it a bubble?

Also try to remember that at the last count well over 130 MP's were gaining a considerable part of their income via property portfolios and of the 130, by far and away, the large majority were conservative MP's ....... but theres no conflict of interest there, aparently.

Also Lall, you sound incredibly london centric, and if thats the case, fuck off. If you live outside of london you would notice that the property prices are now well in excess of what avaerage couples can afford unless 1% mortgages are garanteed for the future, as a lot of property is being bought by people with london wages who now no longer need to live in london, pricing local people out of the local market.

The government is now essentially forced to support the UK housing market as a run on property would have a knock on effect on the banks (and many other institutions) .... It's almost like we've seen this before.

[evil edna]

Thats been the case for at least 20 years on the south west coast

[Rodj Blake]

Aren't they likely to also be those demographics most at risk from brexit impacts on financial services?

Some, maybe, but there's also a fair number of people who are, for example, software engineers and there's unlikely to be a shortage of work for them any time soon.

Or corporate lawyers would be another example

[Jack Coutu]

Lall living outside reality non-shocker. I know you have enough money to not care about even considering the financial status of any other than yourself, but if you aren't even mildly aware of the situation looming on the horizon for many people once unemployment ends and foreclosures aren't banned, you are even more dense than I thought, which already was far beyond my normal expectations of a middle class liberal lawyer.

[Joe Appleby]

Lall living outside reality non-shocker. I know you have enough money to not care about even considering the financial status of any other than yourself, but if you aren't even mildly aware of the situation looming on the horizon for many people once unemployment ends and foreclosures aren't banned, you are even more dense than I thought, which already was far beyond my normal expectations of a middle class liberal lawyer.

Isn't unemployment benefits ending a uniquely American thing? Same with the foreclosure bans? And this is the UK thread?

Tapapapatalk

[walrus]

Everything is a bubble

https://en.wikipedia.org/wiki/Bubble_theory

[Rodj Blake]

Lall living outside reality non-shocker. I know you have enough money to not care about even considering the financial status of any other than yourself, but if you aren't even mildly aware of the situation looming on the horizon for many people once unemployment ends and foreclosures aren't banned, you are even more dense than I thought, which already was far beyond my normal expectations of a middle class liberal lawyer.

Isn't unemployment benefits ending a uniquely American thing? Same with the foreclosure bans? And this is the UK thread?

Tapapapatalk

You're only eligible for Jobseeker's Allowance for six months after first claiming it, and after that you have to rely on Universal Credit. But, they upped UC on a temporary basis during the early part of the pandemic and that's due to end soon.

Also, there was an eviction ban in place in the UK, but that's just ended. So obviously Radio 4 on Monday was full of people celebrating finally being able to get rid of their tenants.

[Siv]

Lall living outside reality non-shocker. I know you have enough money to not care about even considering the financial status of any other than yourself, but if you aren't even mildly aware of the situation looming on the horizon for many people once unemployment ends and foreclosures aren't banned, you are even more dense than I thought, which already was far beyond my normal expectations of a middle class liberal lawyer.

Isn't unemployment benefits ending a uniquely American thing? Same with the foreclosure bans? And this is the UK thread?

Tapapapatalk

You're only eligible for Jobseeker's Allowance for six months after first claiming it, and after that you have to rely on Universal Credit. But, they upped UC on a temporary basis during the early part of the pandemic and that's due to end soon.

Also, there was an eviction ban in place in the UK, but that's just ended. So obviously Radio 4 on Monday was full of people celebrating finally being able to get rid of their tenants.

You are eligible for fuck all while being constantly harassed to take any job followed by even less but still with harassment.

In other news, Tim Martin of Weatherspoons and Brexit fame is saying that he should be allowed to recruit staff from Europe. I think he's intentionally taking the piss now.

[Lallante]

Some fun stats:


63% of households in the UK owned their own homes
Only 100,000 of the 23m houses in the UK are owned by overseas investment compani
...and only 3.4m dwellings are privately rented, 94% of which are rented by a private individual landlord
45% of private landlords have only one rental property

Only 4% of landlords do it as a full time business, the rest citing pension/investmen