Im off.

[scose-no-doubt]

Yes, I concede. I underestimated just how many idiots there are in the world. Esp in seats of power.

 

[Pazienza]

Yes, I concede. I underestimated just how many idiots there are in the world. Esp in seats of power.

That's the thing. As a trader you don't need to be thinking like that, it is all about dealing with reality. There are many idiots in the world, so trade accordingly.

There was never any way there wasn't going to be more QE, and there was never any way that we weren't heading for serious inflation.

That is the only way governments are going to sort out their debts. They will not consider anything else.

 

[TheBramble]

That is the only way governments are going to sort out their debts. They will not consider anything else.

Greece isn't going to go for the inflation option.

 

[scose-no-doubt]

I know it's stupid now but I really thought we'd see coordinated restructures with financial institutions taking the brunt.

 

[Pazienza]

Greece isn't going to go for the inflation option.

Only because they haven't got that option. If they could, they'd inflate the sh1t out of that debt. Anything to avoid reality.

 

[Atilla]

I know it's stupid now but I really thought we'd see coordinated restructures with financial institutions taking the brunt.

I would guess that is happening to a large extent behind the scenes but I'm sure they keep it quiet. To give it the illusion of market demand when there is none.

Frankly - I would dispute anything we are told by our governments. The whole system is in the pockets of vested interests with money flying around.

 

[counter_violent]

Lot of people on here contradicting themselves...as usual ! So what is the reason for continued manipulation and throwing money around like it's confetti...oh yeah to halt deflation. You can bet your a55 they are more worried about that than any inflation. By the way...in the real world..house prices still dropping..unemployment still going up...production down...retail sales down..it's all about confidence and there isn't any.

 

[Pat494]

.unemployment still going up...production down...retail sales down..it's all about confidence and there is'nt any.

The European and USA economies are senile. They have seen better days. The top hogs have been overpaying themselves for too long and under them are the brown nosing yes men. Well with that sort of configuration no wonder there isn't much confidence.

Our economy is like British Leyland/Rover that was. Going down the tubes. The top lot on 7 figure salaries just hope it doesn't fall apart before the end of their term in office.

 

[Atilla]

Lot of people on here contradicting themselves...as usual ! So what is the reason for continued manipulation and throwing money around like it's confetti...oh yeah to halt deflation. You can bet your a55 they are more worried about that than any inflation. By the way...in the real world..house prices still dropping..unemployment still going up...production down...retail sales down..it's all about confidence and there is'nt any.

Only bankers worried about deflation nobody else. They need liquidity to save their bonuses.

Have been saying inflation is the 'policy objective' to wipe out the debt? It still remains that way what ever politicians will say to you.

House prices will rise as it is the only possible outcome with so much money sloshing in the system.

Whilst nationaly it is marginally down -1.2%, in London and South East they are considerably up +9% approx based on land registry sold house prices. In some areas they are upto 13% down. However - the doomsters predictions of housing price crash has not materialised. There is a great deal of pent up demand too. Housing market is pretty much dead still.

The 15% - 25% even 35% drop in property prices highly unlikely imho. Rise in house prices the more probable outcome soon enough when recovery kicks in the next year or or so.

 

[Pazienza]

The 15% - 25% even 35% drop in property prices highly unlikely imho. Rise in house prices the more probable outcome soon enough when recovery kicks in the next year or or so.

This is just off the top of my head, so take it with a pinch of salt (and it seems you know far more than I do about this) but have average prices not come off about 20% from the peak? I thought I read somewhere that the average peak was just over £200K, now the average is just over £160K? Is that right?

Obviously there are big regional differences as you identified.

A friend told me that East London is particularly strong. I wondered whether there might be a speculative 2012 effect there though?

You're right about deflation though. It was never going to happen. Governments like ours need inflation otherwise they''ll never be able to pay back lol what they owe. In this climate they also need low interest rates to keep the masses subdued, but of course that can only help as far as ramping up inflation goes.

 

[Atilla]

This is just off the top of my head, so take it with a pinch of salt (and it seems you know far more than I do about this) but have average prices not come off about 20% from the peak? I thought I read somewhere that the average peak was just over £200K, now the average is just over £160K? Is that right?

Obviously there are big regional differences as you identified.

A friend told me that East London is particularly strong. I wondered whether there might be a speculative 2012 effect there though?

You're right about deflation though. It was never going to happen. Governments like ours need inflation otherwise they''ll never be able to pay back lol what they owe. In this climate they also need low interest rates to keep the masses subdued, but of course that can only help as far as ramping up inflation goes.

Yes they did come off by 15-20% - early 2009. However, prices have also recovered since the bottom of the market.

Although quite a few people by then were pencilling in and arguing for another 15-25% drop. Since then prices have recovered.


Interesting stats and charts in the Housing blog for anyone interested.

I'm still very much bullish on property as a way of beating inflation. I appreciate inflation is eroding house value but that spring back will come soon enough.

 

[Pat494]

Inflating one's way out of debt is a really cowardly way of tackling the problem. It is promising to pay back on borrowed money and then only partly paying back in value terms. Cheating the lenders in fact. This merry-go-round of borrowing off each other and then welshing on the value of the debts is about what one would expect of national govts these days.

A really POOR show and akin to thieving

 

[TheBramble]

This is just off the top of my head, so take it with a pinch of salt (and it seems you know far more than I do about this) but have average prices not come off about 20% from the peak? I thought I read somewhere that the average peak was just over £200K, now the average is just over £160K? Is that right?

That's about the size of it.

http://www.bbc.co.uk/news/mobile/business-14020457?SThisEM

 

[Pat494]

Inflating one's way out of debt is a really cowardly way of tackling the problem. It is promising to pay back on borrowed money and then only partly paying back in value terms. Cheating the lenders in fact. This merry-go-round of borrowing off each other and then welshing on the value of the debts is about what one would expect of national govts these days.

A really POOR show and akin to thieving

Somebody once said that history repeats itself

Well in inflationary terms its looking like the Weimar Republic and that was a total disaster. Some US politicians are stupid and greedy won't do the proper thing and settle their own debt crisis.

The writing is on the wall for the Western economies. It's move over has-beens or the BRIC countries will squash ya flat. Only they can't admit it yet. :whistling

 

[TheBramble]

Somebody once said that history repeats itself

Well, you just did. So I guess it does.

The stupid and greedy US politicians won't do the proper thing and settle their own debt crisis.

They're not necessarily greedy or stupid, well, not all of them at any given time anyway.

Start Party Lines
The Republicans want to force Obama to renege, even if only a little bit, on his Democratic ambitions to provide those who can't afford an average lifestyle with an average lifestyle, paid for by those who manage to achieve an above average lifestyle. The Democrats want to do this because the people who vote for Democrats like them to do things like this.

The Democrats would rather carry on doing things that Democrats do. Which is what Greece has been doing for the last decade. Paying more out in lavish social benefits than they could ever hope to pull in revenue which isn't an issue when you can borrow the gap, and more, on the promise of paying back with a bit on top. Hopefully.

The Republicans are being a bit pointy about it in insisting the debt ceiling deal is only going to be done through significant reduction in federal spending rather than a combination of a little reduction in federal spending with a big increase on taxing the wealthy. They want to do this because they are Republicans and the people who vote for Republicans like them to do things like this.
End Party Lines

The writing is on the wall for the Western economies. It's move over has-beens or the BRIC countries will squash ya flat. Only they can't admit it yet. :whistling

Unless BRIC only plan on trading with each other they need a reasonably adjusted rest-of-world to sell into. That was the whole European Union rationale in expanding to include the poorer nations except BRIC won't directly subsidise the laggards, they'll do it through segmented marketing.

Which means, if would make sense for the UK (and any other country for that matter) to get really poor and exist at the lower regions of the Big Mac index, buy all the BRIC output at bargain basement levels while quietly accumulating.

 

[Pat494]

Unless BRIC only plan on trading with each other they need a reasonably adjusted rest-of-world to sell into. That was the whole European Union rationale in expanding to include the poorer nations except BRIC won't directly subsidise the laggards, they'll do it through segmented marketing.

Which means, if would make sense for the UK (and any other country for that matter) to get really poor and exist at the lower regions of the Big Mac index, buy all the BRIC output at bargain basement levels while quietly accumulating.

Have to disagree on the last bit Bramble. If your industry has gone down the tubes it is unlikely to re-emerge in the near future i.e. the UK car industry. Now we put togethor other people's cars.

While the Western nations still have some life and capital left they ought to do everything possible to compete and beat the BRICS. Lying back and asking to be raped is not a solution, it's just pathetic fatalism.

 

[TheBramble]

Have to disagree on the last bit Bramble. If your industry has gone down the tubes it is unlikely to re-emerge in the near future i.e. the UK car industry. Now we put togethor other people's cars.

While the Western nations still have some life and capital left they ought to do everything possible to compete and beat the BRICS. Lying back and asking to be raped is not a solution, it's just pathetic fatalism.

We can't (and shouldn't) compete with the BRICS. They are currently best at what they are doing, which is precisely why they are doing so well. There's nothing noble in competition for competition's sake.

The smart way is to do the best with what you've got and sell it for the highest price you can get.

Apart from services and small pockets of innovative excellence in some technologically diverse and rather niche fields, I'm not sure what else that currently is for the UK, but mass manufacturing certainly isn't one of them.

 

[Atilla]

Well, you just did. So I guess it does.

They're not necessarily greedy or stupid, well, not all of them at any given time anyway.

Start Party Lines
The Republicans want to force Obama to renege, even if only a little bit, on his Democratic ambitions to provide those who can't afford an average lifestyle with an average lifestyle, paid for by those who manage to achieve an above average lifestyle. The Democrats want to do this because the people who vote for Democrats like them to do things like this.

The Democrats would rather carry on doing things that Democrats do. Which is what Greece has been doing for the last decade. Paying more out in lavish social benefits than they could ever hope to pull in revenue which isn't an issue when you can borrow the gap, and more, on the promise of paying back with a bit on top. Hopefully.

The Republicans are being a bit pointy about it in insisting the debt ceiling deal is only going to be done through significant reduction in federal spending rather than a combination of a little reduction in federal spending with a big increase on taxing the wealthy. They want to do this because they are Republicans and the people who vote for Republicans like them to do things like this.
End Party Lines

Unless BRIC only plan on trading with each other they need a reasonably adjusted rest-of-world to sell into. That was the whole European Union rationale in expanding to include the poorer nations except BRIC won't directly subsidise the laggards, they'll do it through segmented marketing.

Which means, if would make sense for the UK (and any other country for that matter) to get really poor and exist at the lower regions of the Big Mac index, buy all the BRIC output at bargain basement levels while quietly accumulating.

What is required for US economy imho.

1. Raise taxes
2. Cut spending

What on earth are they arguing about???

THEY NEED TO DO BOTH!

 

[Pazienza]

What is required for US economy imho.

1. Raise taxes
2. Cut spending

What on earth are they arguing about???

THEY NEED TO DO BOTH!

Maybe some tax rises in the short term. But the US is already fairly heavily taxed (obviously this varies from state to state). Tax rises are detrimental and utterly counter-productive in the long term, as everyone knows. To properly resolve their problems they need to become more competitive and learn to live within (or at least closer to ) their means. This requires:

1. Cut taxes.
2. Cut spending.

Alternatively, they could just bomb the sh1t out of, and half-heartedly invade, China. That would also work.

 

[TheBramble]

What is required for US economy imho.

1. Raise taxes
2. Cut spending

What on earth are they arguing about???

THEY NEED TO DO BOTH!

Or neither.

They could just default.

TITANIC