Tuesday 28 January 2014

Fun Online Poll

For a given size of an economy, which would you choose:
pollcode.com free polls 

Sunday 26 January 2014

Good comment thread at The Telegraph

Emailed in by MBK, from The Telegraph:

London's soaring property market generated more wealth than the entire New Zealand economy last year as the value of homes in the capital surged by more than £100 billion, according to new research.

The astonishing scale of property wealth in the capital means the 10 most upmarket boroughs alone are valued at £609 billion – more than all the houses in Scotland, Wales and Northern Ireland added together.

Booming demand for flats and houses last year added £106 billion to the total worth of London’s increasingly precious property, now estimated to be worth a record £1.24 trillion, a study by estate agents Savills reveals…

And so on and so forth.

Here's a flavour of what they got in the comments:

Plantersnuts • Amazing, a zero sum game is now seen as wealth creation, the balance sheet has two sides which these "financial experts" and estate agents seem to be ignoring, nothing has been created, god help us, I weep for our children I really do.

Bill Jackson @ Plantersnuts • It helps the government and estate agents though as they take a cut based on the value.

Plantersnuts @ Bill Jackson • A bit like a casino running a poker game and raking the pot.

Pastaface • Sub-editors note: For"wealth" please read "debt"

Plantersnuts @ Pastaface • No doubt these financial "experts" will spin a line by claiming that the only difference between the two is semantics and you should should get with the new paradigm you dinosaur.

rudolphreindeer • If this is wealth creation, dont bother to work anymore. Multiply all properties by 100 in value and retire in luxury.

Plantersnuts @ rudolphreindeer • And import cheap labour, no one need work in the UK, job done.

Jonathan Burkitt • What goes up, must come down? It is just insane, we need to stop this growth it's out of control.

yoyoegg • Who said Thatcher wrecked manufacturing in England - we're manufacturing oodles of cash.

itsafunnyoldworldsaint • Confusing house price inflation with creating goods and services people want. The houses in question do not provide space for any more people than they did one, two, three or ten years ago, That is their worth is the same merely the price (not the value) has risen. Just another example of the UK's crazy economics that is touted as recovery.

SteveInVienna • "London's soaring property market generated more wealth than the entire New Zealand economy last year as the value of homes in the capital surged by more than £100 billion, according to new research"

I've just valued my house at £210 billion and therefore it has generated more wealth than the entire London property market last year. Beat that!

Tuesday 21 January 2014

Cause and effects

From the FT, 17 January 2014:

Britain’s growing army of private landlords have been the biggest winners from recent rises in property prices, according to new research for the FT showing housing wealth concentrated in fewer hands.

The vast bulk of the equity gains from Britain’s rising housing market over the past decade has gone to landlords and wealthier individuals who own their homes outright, the research conducted by estate agent Savills shows...

Landlords’ total equity has more than doubled from £384bn a decade ago to £818bn today, thanks to rapid growth in the private rented sector and the fact that professional investors tend to buy property in housing hotspots.

But households who bought their home with a mortgage, often in poorer parts of the UK, have seen their share of Britain’s housing wealth drop over the same period.

From Oxfam.org.uk, 20 January 2014:

Wealthy elites have co-opted political power to rig the rules of the economic game, undermining democracy and creating a world where 85 richest people own the wealth of half of the world's population, worldwide development organisation Oxfam warns in a report published today.

Working For the Few, published ahead of this week's World Economic Forum in Davos, details the pernicious impact that widening inequality is having in both developed countries and in developing countries, helping the richest undermine democratic processes and insist on policies that promote their interests at the expense of everyone else.

The report says that there is a growing global public awareness of this power-grab. Polls carried out for Oxfam in the UK, Brazil, India, South Africa, Spain and US show that most people in all six countries believe that laws are skewed in favour of the rich. The UK polling carried out by Research Now, found that two-thirds of people thought 'the rich had too much influence over the direction the country is headed' and only one in ten disagreed. The UK is one of the most unequal countries in the OECD club of rich nations.

From the BBC, 21 January 2014

The Office for National Statistics (ONS) said more than 3.3 million adults between the ages of 20 and 34 were living with parents in 2013, 26% of that age group.

The number has increased by a quarter, or 669,000 people, since 1996. This is despite the fact that the number of 20 to 34-year-olds in the UK remains almost the same, the ONS said. The ONS suggested the trend of living at home might be due to the recent economic downturn.

Karen Gask, senior research officer at the ONS, said: "I think one of the main reasons is housing affordability, and that's been cited by several academics who've looked into it. It's hard for young people to get on the housing ladder."

The ratio of house prices paid by first time buyers to their annual incomes has risen from 2.7 to 4.47 in the period from 1996 to 2013, she added...

"There are wider implications for things like fertility rates, as people often look to move out of the parental home before having children."

Monday 20 January 2014

Meet the new bastard, same as the old bastard

From The Guardian 5 December 2013:

Unemployed teenagers who leave school without basic English and maths will be forced to go back to the classroom for 16 hours a week or lose their benefits under new rules announced by George Osborne.

The chancellor said he wanted to get rid of a "culture of worklessness" among some school-leavers...

OK, so that's what The Blue Wing has to offer, and The Red Wing finally hit back today, from Politics Home:

Labour will challenge the Conservatives' dominance of welfare issues today, with a pledge to strip jobseekers of benefits if they turned down classes in English, numeracy or IT.

The plans, set to be unveiled in a first major outing for Rachel Reeves as shadow work and pensions secretary at the centre-left IPPR think tank, would see the party force jobseekers to sit a skills test within six weeks of claiming benefits.

Anyone without basic skills would be forced to take a course and face losing their benefits if they refuse.


It has long been a rule in the UK welfare system that if you are doing more than a certain number of hours doing GSCEs or A-Levels that you are no longer "available for work" and hence that you are not entitled to welfare.

We used to have more or less free university and student grants, the Red, Blue and Yellow Wings have gradually phased in an idiotic tuition fee system and reduced student grants to a derisory level.

Those two measures, whatever their merits or demerits, discourage people from getting "skills".

The Blue-Yellow Wings got rid of the Educational Maintenance Allowance, a very modest payment to people doing A-levels, shortly after getting into government.

So we've now gone round the clock and are taking away welfare from people who don't go to school or college as well.

No doubt they'll square the circle of contradictions by denying welfare payments to people who do have some "skills" on the basis they can't be trying hard enough to get a job, so how's about an unpaid work placement or something?

Thursday 9 January 2014

Friday meet-up

Same time, same place.

i.e. Friday evening (10 January) from about 5.20 pm onwards at The Brewmaster pub near Leicester Square Tube station.

Wednesday 8 January 2014

Max Keiser - Episode #546

The first half is a great summary of how Home-Owner-Ism works and who is behind it. Replacing taxes on earnings, output and employment with Land Value Tax will sort all that out: