[FieldingMellish]

Originally Posted by NFS

The USA and Ireland chose to underwrite the banks debt. I personally believe that was a mistake because taxpayers money was thrown at the problem, with no upside.

In contrast the UK Government became a major stakeholder in most banks. The Tories are talking a load of arse in respect of the debt this will pass on to our children. Because the Govt has in effect 'part nationalised' the banking system, when it starts working properly again, the taxpayer will see an upside on their investment. It's also unlikely that the maximum investment that has been discussed will actually be pumped into the system.

In reality, what you are suggesting has already happened. It's just that the Govt has stopped short of full ownership of individual banks. I think that's right because further nationalisation will only make the real problem worse.

The issue now is that some of our banks are technically insolvent. But we don't know the depth of the problem because the Govt cash is still washing around the system making everything look OK.

For this reason other economies are not going to go any further than us. This is as good as it's going to get in terms of measures to improve liquidity.

I think we will now see situations where the Govt act as funds themselves (ie as banks) for major infrastructure projects (road, rail, schools etc.).

This is what Obama is proposing in the US and because it will get money into the system directly without involving the banks I think it will become quite important in the next few months.

Bang on, NFS.

BUt when you say "...the banking system, when it starts working properly again, the taxpayer will see an upside on their investment...." you surely agree that this is the hoped for, rather than the guaranteed or even expected, outcome?

It's interesting that in the US last week, Omaba's govt had to reign in one of the major banks (Citigroup was it?) who are receiving Billions of dollars of public money to bail them out, from going ahead with the purchase of another corporate jet to ferry their fat cat execs around, at a cost of $50 million. Imagine the arrogance of that! Personally i can't understand why people aren't angrier about all this sort of thing?

Yes, what has already happened can legitimately be viewed as 'part nationalisation', but you have to whisper that 'n' word, whisper it softly....

[Hotcoupe]

Originally Posted by FieldingMellish

Well Mrs Thatcher famously declared that there is no such thing as society, and that statement was much more than a provocative soundbite - it reflected the social policies of that generation of Tory politician.

Mass unemployment was a deliberate element of Moneterism...

Oh come on Feilding, you're sounding like Alan Davies on Qi, shirley you can do better than that!

So what did: "there is no such thing as society mean", and what in particular in regards social policies of the Tories was Maggie/Tories in general referring to in that provocative soundbyte, to you?

I can quote labour soundbytes, like I did earlier, "no more boom and bust", "British jobs for British workers" et al, we could play ping pong with quotes until the snow melts.

Put some meat on the bone, please.

"Mass unemployment was a deliberate element of monaterism"

I don't think it was deliberate, if that statement were to carry weight, I would argue that it was an unfortunate consequence.

How was the journey in?
You must work quite local too.

[NFS]

Originally Posted by FieldingMellish

Bang on, NFS.

BUt when you say "...the banking system, when it starts working properly again, the taxpayer will see an upside on their investment...." you surely agree that this is the hoped for, rather than the guaranteed or even expected, outcome?

The economy will recover, that's an unstoppable part of the economic cycle.

The Govt have effectively bought shares in the banking system at a time when it's value was at a 100 year low. There will be an upside at some point, it's only a matter of time.

Part of the issue here is understanding how the banks operate. At any given time the UK banks hold less than 8% of the total amount deposited with them in 'central bank funds'.

So if you have £100k in HSBC, they set £8k aside in case you want to withdraw something and invest the rest. They have invested some in securitised debt and have taken a kicking as a result, but they have also invested in shares and property.

Ordinarily if they were underwater with a particular asset they could borrow short term from other banks to maintain liquidity. Unfortunately ALL banks are now underwater with pretty much ALL assets.

For instance I know of a situation where one bank is effectively £12 billion down because of the drop in share price of a single company (no names will be given ).

They won't lend to each other, because the don't know who to trust, they can't get liquidity without taking a major loss on an asset, so they are stopping lending because that's the easiest option open to them.

If they don't get some liquidity back and there is a run of withdrawls, they end up insolvent like Northern Rock and Lehman Bros.

When they start to get some liquidity, they will be fighting for market share. At that stage demand for property and car loans will be low, so expect to get a good loan or fixed mortgage interest rate later in 2009 (i.e. sub 3% APR).

[NFS]

Originally Posted by Hotcoupe

I can quote labour soundbytes, like I did earlier, "no more boom and bust", "British jobs for British workers" et al, we could play ping pong with quotes until the snow melts.

'No more boom and bust' was a response to the Tory history of a rapidly fluctuating economic cycle. Very strong boom followed just a few years later by deep depression.

Labour attempted to smooth that cycle with quite considerable success. We've all had the benefit of that in recent years.

Unfortunately they couldn't manage the property bubble. Because they couldn't balance supply and demand for property. The history of that goes all the way back to Mrs Thatchers policy of creating a nation of homeowners.

The problem is that there are not enough homes to allow that to happen and it should have also been the case that there was not sufficient affordable credit. Unfortunately, the credit continued to flow as demand outstripped supply and so prices soared.

[FieldingMellish]

Originally Posted by Hotcoupe

I don't think it was deliberate, if that statement were to carry weight, I would argue that it was an unfortunate consequence.

He he. You would argue wrong! It was not an unfortunate consequence at all, if by unfortunate you mean 'accidental'.

Originally Posted by Hotcoupe

Oh come on Feilding, you're sounding like Alan Davies on Qi, shirley you can do better than that!

I;ve never watched 'QI' so I don't know how much of an insult that is!

Originally Posted by Hotcoupe

Put some meat on the bone, please.

Were you around at the time? If so then surely I don't need to expand on what Lady T meant by no such thing as society. And if I did then this thread would never end!

Originally Posted by Hotcoupe

How was the journey in?
You must work quite local too.

I work in Knutsford, drive in from Cheadle every day, either take the M56 then A556, or take the A34 then through Mobberly etc. nice little roads. Came in by the motorway today, very uneventful journey, no snow about. How about you?

[Hotcoupe]

[quote=NFS;4397705]

Labour attempted to smooth that cycle with quite considerable success. We've all had the benefit of that in recent years.

Unfortunately they couldn't manage the property bubble. Because they couldn't balance supply and demand for property. The history of that goes all the way back to Mrs Thatchers policy of creating a nation of homeowners.

The problem is that there are not enough homes to allow that to happen and it should have also been the case that there was not sufficient affordable credit. Unfortunately, the credit continued to flow as demand outstripped supply and so prices soared.[/quote]




I’ll agree with your first paragraph Simon, but as you stated in an earlier comment all booms are followed by busts, the busts varying in consequence of course.
Through history, both Labour and Tory parties have been in power and suffered both spectres, and have also suffered the bust after the boom, and the boom after the bust
One could argue that when Labour came to power in 97 with a landslide election victory, that the country was in a fairly healthy state, economically, and the reasons for the landslide victory was as result of other factors: Tory sleaze etc.

Yes, Labour on the face of it have managed the economy reasonably well over the last 11 odd years, but you could also argue that this has been because of global factors, the very reason that Labour are now using the same argument (global factors) in their defence of the UK recession.

Your second paragraph begs the following question:[/font]
What is wrong with encouraging people to seek independence from the state and buying their own home?

I see nothing wrong in positively influencing people to aspire to something that in a lot of people’s minds is a better way of life.

I am of course referring to the sale of council owned housing, which the Tories encouraged, and were later heavily criticised for.
In a lot of ways, either buying publicly or privately rented property for a lot of people makes sense, and in my opinion should be encouraged with the proviso of course, that it can be afforded.

This brings me onto your third paragraph:

Your right, it makes no sense to sell off Local Authority housing without replacing the old with new. This is where it went wrong. If the receipts from the sale of local authority housing had been used as intended, for building newer and better social housing, the situation in the local authorities would not be as woefully inadequate as it is today.

Ok you could blame the Tories for this, however as all local authorities are elected by the local people, the policies from authorities vary from region to region in the respect of housing, and for that reason all of the main three parties are culpable of blame in that respect.
The subject of credit, and its availability, or how irresponsible Banks/Building Societies were in making it available , back then, hardly merits comment.



Not sure what happened there, apologies for the crap font etc.

[Hotcoupe]

Originally Posted by FieldingMellish

He he. You would argue wrong! It was not an unfortunate consequence at all, if by unfortunate you mean 'accidental'.




I;ve never watched 'QI' so I don't know how much of an insult that is!





Were you around at the time? If so then surely I don't need to expand on what Lady T meant by no such thing as society. And if I did then this thread would never end!



I work in Knutsford, drive in from Cheadle every day, either take the M56 then A556, or take the A34 then through Mobberly etc. nice little roads. Came in by the motorway today, very uneventful journey, no snow about. How about you?

Sorry did I not write 'accidental', slip of the fingers, perhaps.

Fielding, no insult intended, just a flippant remark, that had you watched Qi would possibly have resulted in a smirk at least.

Yes,I was around at the time.I possibly have more of my life behind me than in front, I would say sadly, but life constantly springs surprises, and there is time enough left to be surprised some more (I hope).

I purchased my first home in 1981, so interest rates of 15% have been and gone, read the book and lived the movie.

Me I live in the apparently affluent South East, travel here there and everywhere, but have the M25 (2 miles away) as a constant reminder of with perceived affluence comes shite

Fielding, we perhaps live on opposite sides of the fence politically, but put us together in a bar, you with your pint of local ale, me with a Jack Daniels, and I bet you a packet of crisps, our aims,ambitions,aspirations and what we see as a good society to live in, would be tha same.

Fair?

[Raja Ventureshield]

things are not looking too good on this side of the pond either guys.

I know so many people are out of jobs and last week they announced another 60,000 job cut in major companies. It gets depressing every week.

I also lost my job and looking for a new one. Times are really tough to say the least.

[NFS]

[QUOTE=Hotcoupe;4398132]

Originally Posted by NFS

I’ll agree with your first paragraph Simon, but as you stated in an earlier comment all booms are followed by busts, the busts varying in consequence of course. ............Not sure what happened there, apologies for the crap font etc.

I've not quoted your whole post because of the formatting etc .. but your point about boom and bust is a fair one.

It seems to me that what Labour tried to do is smooth the cycle, creating more stable growth interspersed with less destructive and less regular depressions that we had seen in the rapid economic cycle that defined the Tory years.

I think that this would have continued to work, were it not for the housing bubble, which should have been lanced some years ago and the global factors, which we have to accept are much deeper than anything we could have foreseen.

I don't blame Mrs Thatcher for her Council House sell off. But I do think this is where the property boom began.

Before then people had a choice, relatively secure rental from the state, leasehold or freehold purchase.

If Mrs T had simply encouraged people to buy then all would have been well, but the mechanism that achieved this also led to the first option (council house rental) being all but removed for the majority of people.

So now we either have to buy or rent from private landlords, with short term leases and minimal security of tenure.

There are not enough houses for everybody, so demand will always outstrip supply and prices will always rise. The only restriction to this is the availability of credit, which should control the rate of rise so that it remains affordable.

The liquidity crisis has suddenly restricted this credit forcing a rapid contraction in the market.

Since demand continues to outstrip supply, if and when credit does begin to flow again prices will recover and continue to grow.

[Zk1]

I was going to have a ten page rant on this and give my bits on labour and tories, but in short they're all bad for us and not really helping me out.

It's like jim hensons muppet workshop.. these days with government

[RockIt]

OFF TOPIC...

Originally Posted by lons

As an aside to RockIt - We're going to NZ and Australia in November. If your sisters' guest house is anywhere near Christchurch, we've booked flights but not yet accommodation so could be interested

It's actually in Picton, (210 miles away) at the North of the South Island!...but have a look at the website anyway

http://www.sennenhouse.co.nz/

[Hotcoupe]

[quote=NFS;4398276]

Originally Posted by Hotcoupe

I've not quoted your whole post because of the formatting etc .. but your point about boom and bust is a fair one.

It seems to me that what Labour tried to do is smooth the cycle, creating more stable growth interspersed with less destructive and less regular depressions that we had seen in the rapid economic cycle that defined the Tory years.

I think that this would have continued to work, were it not for the housing bubble, which should have been lanced some years ago and the global factors, which we have to accept are much deeper than anything we could have foreseen.

1.I don't blame Mrs Thatcher for her Council House sell off. But I do think this is where the property boom began.

2.Before then people had a choice, relatively secure rental from the state, leasehold or freehold purchase.

3.If Mrs T had simply encouraged people to buy then all would have been well, but the mechanism that achieved this also led to the first option (council house rental) being all but removed for the majority of people.

So now we either have to buy or rent from private landlords, with short term leases and minimal security of tenure.

There are not enough houses for everybody, so demand will always outstrip supply and prices will always rise. The only restriction to this is the availability of credit, which should control the rate of rise so that it remains affordable.

The liquidity crisis has suddenly restricted this credit forcing a rapid contraction in the market.

4.Since demand continues to outstrip supply, if and when credit does begin to flow again prices will recover and continue to grow.

1. Yes Simon I agree with you.
However it was as a result of the way it was administered. Discounts were given to tenants on the length of their tenure to date, and those discounts were often hugely advantageous to the tenant.
This practice was overlooked unfortunately at the outset, and should not have been allowed to happen.The Authority should have had some sort of clawback agreement if the property was sold within a certain amount of years, and should have insisted on a percentage of the resultant massive increase of value.
There were several high profile cases of ex-tenants making huge profits at the expense of ultimately the taxpayer.
The profits used did start to fuel the property boom, as others saw the opportunity of making a quick buck, and plenty did.

2. I don't think council tenants had 'The right to buy', prior to this period, although I could be wrong.
State rental was of course readily available and fairly abundant.

3. So are you saying that the only option now is to buy council property?

4. Bang on the money, and at last the beginning of the end. Amen.

[NFS]

Originally Posted by Hotcoupe

3. So are you saying that the only option now is to buy council property?

I'm saying that the option to rent council property no longer exists for most of us.

The Govts recent attempts at achieving 'affordable housing' provision through planning gain is a bit of a failure.

Private developers have also built the wrong type of property (loads of identikit flats, which have appealed to buy to let speculators, but which do not address the things that the majority of people want in a home.

In effect, little has been achieved in the last ten years in terms of increasing supply to match demand.

With that still in play, it's only affordability that is restraining house price growth.

I also agree that a lot of public money was squandered on the right to buy.

[roofer]

Never has, never will.

[FieldingMellish]

Originally Posted by roofer

Never has, never will.

That's the Saatchi ad which was credited with helping get Thatcher into power. What a wonderful time the 1980s were eh? And how wonderfully the hyper-deregulated free market economics forged during that era have worked out for us all now.

Come on, roofer, I'm no (New) Labour fan, but the Tories are far worse. They're worse because their economic policies lead to boom (for some) and bust (for all). And they're worse because their social policies are mean spirited and aimed at worsening and entrenching social (and economic) divisions. They are a party who actively seek to cosset the rich while punishing the poor. They set out to serve the well-off and the strong, and to crack down on the weaker and more vulnerable elements in society.

The Thatcher government gave us recession after recession, the Miners' Strike (and associated destruction of whole communities which not uncoincidentally were never going to be Tory voters so f*ck em), the erosion of the fabric of society, the enshrinement of greed as a guiding ideology for a generation, the decimation of Britain's manufacturing industry, the ERM debacle, Black Wednesday, Norman Tebbit, Jeffrey Archer, Cecil Parkinson, Neil Hamilton (feeling sick yet?), sleaze, the poll tax, a deliberate worsening of the problems in Northern Ireland (leading to the current situation where the most extreme elements have power, including many 'former' terrorists), they enthusiastically propped up teh Apartheid regime in South Africa, they emasculated teh unions - meaning it's now a tad tricky to ensure 'British Jobs for British Workers' - and of course they gave birth to the Yuppie, with his mobile phone, big bonus, and devil-may-care attitude towards long-term financial stability, which, er, led to a collapse in the banking system, which led to teh current crisis, which led to the current thread.

As someone put it a couple of years back: voting for New Labour is like wiping your @rse - it might not be a very enjoyable process, but things will get a lot more unpleasant later on if you don't do it.

By the way, I wonder what Alistair Mcintosh would think of you taking the Saatchi image from his website to make your point here? :-)

[FieldingMellish]

Originally Posted by Hotcoupe

Sorry did I not write 'accidental', slip of the fingers, perhaps.

Fielding, no insult intended, just a flippant remark, that had you watched Qi would possibly have resulted in a smirk at least.

Yes,I was around at the time.I possibly have more of my life behind me than in front, I would say sadly, but life constantly springs surprises, and there is time enough left to be surprised some more (I hope).

I purchased my first home in 1981, so interest rates of 15% have been and gone, read the book and lived the movie.

Me I live in the apparently affluent South East, travel here there and everywhere, but have the M25 (2 miles away) as a constant reminder of with perceived affluence comes shite

Fielding, we perhaps live on opposite sides of the fence politically, but put us together in a bar, you with your pint of local ale, me with a Jack Daniels, and I bet you a packet of crisps, our aims,ambitions,aspirations and what we see as a good society to live in, would be tha same.

Fair?

Yes, mate, fair enough. Glad we can debate without descending into schoolyard unpleasantness and hostility.

You're on for that drink, just make mine a Guinness.

[RockIt]

Originally Posted by FieldingMellish

That's the Saatchi ad which was credited with helping get Thatcher into power. What a wonderful time the 1980s were eh? And how wonderfully the hyper-deregulated free market economics forged during that era have worked out for us all now.

Come on, roofer, I'm no (New) Labour fan, but the Tories are far worse. They're worse because their economic policies lead to boom (for some) and bust (for all). And they're worse because their social policies are mean spirited and aimed at worsening and entrenching social (and economic) divisions. They are a party who actively seek to cosset the rich while punishing the poor. They set out to serve the well-off and the strong, and to crack down on the weaker and more vulnerable elements in society.

The Thatcher government gave us recession after recession, the Miners' Strike (and associated destruction of whole communities which not uncoincidentally were never going to be Tory voters so f*ck em), the erosion of the fabric of society, the enshrinement of greed as a guiding ideology for a generation, the decimation of Britain's manufacturing industry, the ERM debacle, Black Wednesday, Norman Tebbit, Jeffrey Archer, Cecil Parkinson, Neil Hamilton (feeling sick yet?), sleaze, the poll tax, a deliberate worsening of the problems in Northern Ireland (leading to the current situation where the most extreme elements have power, including many 'former' terrorists), they enthusiastically propped up teh Apartheid regime in South Africa, they emasculated teh unions - meaning it's now a tad tricky to ensure 'British Jobs for British Workers' - and of course they gave birth to the Yuppie, with his mobile phone, big bonus, and devil-may-care attitude towards long-term financial stability, which, er, led to a collapse in the banking system, which led to teh current crisis, which led to the current thread.

Wow! reminds me of my rants at uni back in the day!

[roofer]

What a wonderful time the 1980s were eh?

Yep, great thanks. You grafted and you earned. And kept more of what you earned.

You wasn't inundated by chav scum/freeloading immigrants/tree licking govt policies.

Policy wasn't decided by media coverage, and we didn't bow to Europe. Back door socialism is an excuse for people that think they know everything, to demonstrate they know nothing. Now 'New Labour' has destroyed the fabric of British society, and imported its voters the country is beyond repair. The chinless dork that is Cameron is another media driven policy maker, until we get one with some real balls, instead of a scrotum full of excuses, we've had it.

All people want is a fair days pay for a fair days graft, and not being fleeced for more of that pay with snide taxes. A grafter will always find work, be it with a shovel or a pen. Sometimes the shovel will have to come first, but if the kids are warm, and the roofs intact, thats what you have to do.

Excuses are for lightweights.

[FieldingMellish]

Originally Posted by roofer

Yep, great thanks. You grafted and you earned. And kept more of what you earned.

You wasn't inundated by chav scum/freeloading immigrants/tree licking govt policies.

Policy wasn't decided by media coverage, and we didn't bow to Europe. Back door socialism is an excuse for people that think they know everything, to demonstrate they know nothing. Now 'New Labour' has destroyed the fabric of British society, and imported its voters the country is beyond repair. The chinless dork that is Cameron is another media driven policy maker, until we get one with some real balls, instead of a scrotum full of excuses, we've had it.

All people want is a fair days pay for a fair days graft, and not being fleeced for more of that pay with snide taxes. A grafter will always find work, be it with a shovel or a pen. Sometimes the shovel will have to come first, but if the kids are warm, and the roofs intact, thats what you have to do.

Excuses are for lightweights.

Nice. You sound like you'd be better off with the BNP than the Conservatives.

Space-wasting trees eh? Cut 'em down, I say.

Freeloading immigrants eh? Quite right, shut the borders, England for the English, strong leadership, sieg heil!

[roofer]

Nice. You sound like you'd be better off with the BNP than the Conservatives.

Space-wasting trees eh? Cut 'em down, I say.

Freeloading immigrants eh? Quite right, shut the borders, England for the English, strong leadership, sieg heil!

Standard 'New Labour' response. No answer, so insinuate racism. Wake up and smell the coffee.

[FieldingMellish]

Originally Posted by roofer

Standard 'New Labour' response. No answer, so insinuate racism. Wake up and smell the coffee.

Standard right-wing response. Ignore the facts, ignore what I've said, just sling insults. Read the thread - I'm very much not a fan of New Labour.

No need for insinuations: you exhibit xenophobia. Ranting about tree licking and freeloading immigrants and 'back door' Socialism (whatever that may be) aren't exactly tolerant traits. Neither are you unique, far from it, there are at least a million like you out there still - the people whose worst instincts Thatcher appealed to. Nothing very unusual or interesting there - although your obsession with bulging scrotums is a bit worrying.

Nice for you, grafting away there in the 80s. Lucky you weren't among the millions of unemployed. I'm all right, union jack. Maybe one day, the real ball-possessing strong leader you yearn for will emerge. Maybe it'll be you?

[willhollin]