Blimey: the Bank of England are printing money...

[WilfSell]

...Or quantitative easing as they call it.

We'll be inviting Berlusconi to run the NHS next. And paying 2 million pounds for bread.

Ho hum.

As long as they spend it on public works, I don't mind.

This is the same Bank of England that has got absolutely every single decision wrong for the past year... I wouldn't place much trust in them getting it right this time. AND I gather we are losing/have lost Danny (David) Blanchflower from the Monetary Policy Committee - the ONLY one who got things right and voted repeatedly to lower interest rates, pointing out that inflation was not the key problem.

Honestly, all this mob are paid so much fucking money and given so much authority, yet don't seem to have the faintest understanding of history and lessons such as the South Sea Bubble or the Great Depression.

Gordon saved the world, didn't you know.

The reality is that no-one predicted that things would unravel this fast or this far - I stand to be corrected but if anyone can give me one source that says (before 2007 when things started to fall apart) we'd be in this sort of recession in 2009 I'm all ears.

And by the way saying that, for example, finding someone who said house prices are too high doesn't really count as predicting the depth of the current recession - house prices have arguably been too high since 1980 on most metrics and people have talked about over-priced property values for as long as I can remember.

Why so sarky, I was only asking

I agree with Sorrento.

I sold my house in mid 07 because it was widely predicted that house prices would crash.

the house I sold is probably worth 20% less now - and that is, of course, if you could find anyone to buy it.

ALl of this won't make me go and spend more money. Not a chance of it.

Too be fair though if we play this carefully as in the 70's we should all now basically get a free house and all our debt wiped out, just make sure the larder is full and the freezer.

I am always amused when people say that they predicted the current situation .... of course they did .... the economy boom nd bust ALWAYS happens so it is really not rocket science to predict it. TIMING IT RIGHT is the problem.

A friend of mine predicted the housing market crash .... sold his house and moved into rented in 2002. He still can't afford to buy back his old house (although I am sure he will, soon).

Seriously a lot of property developers were bailing out as early as 2006 so it was predicted.I have always only had one house at a time but they were all telling me to sell up at xmas 06 so i did and thankfully I listened

When this first started that Australian chap who used to be on Dragon's Den quite correctly stated that one of the main problems is that the confidence is gone. People have no faith in the economy, no faith in the PM, no faith in the short-term future.

No amount of printing money, cutting interest rates, etc. seems to be changing that.

It's like a natural disaster: over time, people have realised that best way for hte landscape to heal after one of these is to leave it the hell alone and let it correct itself.

But they just keep on meddling . . .

I sold in mid 07, and, TBH, I was a bit shocked I got the asking price for the house cos by then there were LOTS of stories going round about house prices...

Haribo we completed that spring too Just in time!

Shame GB didn't see it coming in any way. I seem to recall him gloating for a number of years as Chancellor that his genius had presided over "the end of boom and bust".

Printing money is the last desperate act of an incompetent failure, and it will just makes things even worse for future generations.

There is one economic theory that says that if everybody is bearish, this is a sign that we have reached the bottom of the market.

I am very encouraged by this thread

In that case, justaphase, that will have been the shortest recession on record.

In other words: I doubt we've seen the end of the market.

The US has had more recessions in recent years than the UK, but they tend to be shorter than the British ones.

By justaphase on Thu 05-Mar-09 14:38:43
I am always amused when people say that they predicted the current situation .... of course they did .... the economy boom nd bust ALWAYS happens so it is really not rocket science to predict it. TIMING IT RIGHT is the problem.

Of course you are right, however compared to the many many people I know who were convinced the bubble would never pop and lent money to their sons and daughters to get on the ladder and encouraged them to borrow 5 x their salaries for a 2 bed flat I feel entitled to say I was right.
On the other hand there's no pleasure in being right.

just love revisionist history - everyone now saw this coming and yet no-one did anything to stop it. Um, actually, no they didn't, neither the experts or people in general. Again, please prove me wrong.

For example, more than 50% of people believed that the current economic situation (as of June 2007) would continue for the next year and 20% actually believed it would get even better so that's 70% of people who called it completely wrong for starters (according to the TNS Consumer Confidence Survey).

And at the start of who exactly predicted a house price crash at the start of 2007. Um, again no-one that I can see. This quote from The Independent in January 2007 summarises the prevailing attitude at the time.
"So, could 2007 be the year the housing market's 10-year bull run comes to an end? Not if those analysts brave enough to make forecasts are to be believed. The various estate agents, mortgage lenders, housing specialists and think tanks that have made specific predictions about house prices all forecast further gains at the bottom end of predictions is the long-time housing market bear Capital Economics, which expects prices to rise by 3.5 per cent this year. At the top end, one online estate agency is predicting rises of. A minority are ae anxious though. In a poll of economists in the Financial Times this week, 11 of 41 analysts described the housing market as suffering from "irrational exuberance". That's not quite the same as predicting a market downturn, let alone a crash, but their concern is, at the very least, food for thought." If you fancy googling further, you'll find that the IMF, OECD and The Economist amongst others were positive on house prices well into 2007.

expat: yes, let's just let it all work it's way through and hey, if the price of that is mass unemployment, repossesions, personal bankruptcies, corporate insolvencies and the collapse of key industry sectors then well I guess that's just the price we have to pay - we'll only have to live with it for a decade or so and then we can try to salvage something from the wreckage.

Well low interest rates and more cash in the system plus gordons feel good public speaking is going to encourage a bit of a mini boom which will only end in disaster

no, cestlavie, let's just bail everyone and everything out with money we don't have and let our kids' and grandkids' generations deal with all the mess we leave behind.

oh, yeah, noddy, gordon's such a confidence booster. when he speaks, people feel like he's really got his finger on the pulse of reality. he couldn't inspire a weasel on speed.

Is it possible, cestlavie, that the estate agents et al had a vested interest in talking up a market that relies on confidence? And is that the same IMF who was saying for years that the UK housing market was over priced?

Sadly, I agree with expat. Its not a matter of wanting things to be like that, but basically we (the west) have borrowed and spent too much and now we'll have to pay it back, whether that be by inflation or deflation. The next 5 years are going to be harder regardless. Looks like its going to be inflation now.

Yes, but none of the measures are going to stop any of that, are they? It's all rubbish. This stupid model has crashed and is about to brun - no amount of geeing us all up to take out mortgages and loans will change that - the aim seems to be solely to reinflate the stupid, avaricious credit culture. It's beyond mornic and short-sighted.

Thank crap our car loan is finished next month, and for my wardrobe full of baked bean tins.

When I was six I decided that the bank should make more notes to help everyone to buy more things. I'm so glad they have finally taken my advice .

Gordon had repeated warnings in the 90s about house price increases and lending following the collapse in the eastern markets.But he kept going with his no boom and bust low inflation low interest crap and now look.He is edging in that direction again as he knows it is the only way he will get into power the legitimate way.Feelgood britain on its way until he gets elected then armageddon

peppamum: the IMF had said that house prices were over-priced versus historic data (as various organisations had said). They did not predict a crash or even a revaluation and certainly nothing of this magnitude - as I recall, the first organisation to call a real likelihood of a crash was S&P in mid 2007. And the FT survey was of 41 economists, not estate agents.

expat: tell me, what exactly do you think would happen to the country if we didn't do anything?

expat I agree he's an arse but the public are desperate to hear that their houses are going to sell and they can get a nice new ford focus on the never never