The election 2015

Grey said:
I'm not following, clivex.

I was pointing out that the Irish central bank seem to believe that if you place a limit on the amount that house purchasers can borrow that it will slow down rising house prices.

I have often thought myself that many people choose to spend too much of their income on housing. They borrow the maximum allowed to them and buy something with it. When they are able to, they trade up and repeat the process. All this is based on a belief that houses are a good investment and that money paid in rent is dead money.

This creates a competitive spiral which results in everybody having to pay more for housing. But the quality of the houses themselves hasn't changed, if anything it's declining because newer units are meaner in size, and often in quality as well. If unchecked, this process ends in tears, as we all saw in Ireland.

The main mechanism governing all this is the amounts that people are able to borrow. By placing reduced limits on loan amounts the Irish central bank hopes to prevent prices from rising too quickly as the economy continues its recovery.

It seems logical to me and, in the short term at least, it seems to be working.
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i see now but I don't agree with it in the longer term. I don't know how the limits are imposed but if it's a proportion of income then I don't agree. I see no reason why someone on a very high salary should be restricted to sets aside a big proportion to buy property.
 
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Over time, money invested in bricks-and-mortar generally is a good investment and rent is dead-money, Arthur. Average house-prices have recovered, and in most cases now exceed the level they were at during the depths of the 2008/2009 financial crisis.

The removal of 100% mortgages, and the demand for a large deposit to secure a mortgage, is a more efficient handbrake on the housing market, than legislating how much people can borrow.....in my view.
 
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clivex said:
Petrol is one of the two main expenditures. . I don't fcking think so
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It's the third highest expenditure in my household behind the mortgage and the beer.

As for the discussion as a whole - it seems to me that both sides are unwilling to agree that either side has anything accurate to say (and I include myself in that), and as a result there is some stunning lack of understanding on show in this thread. As such, it's a fairly pointless discussion.
 
That was the market responding rather than outside controls. I think it's too restrictive myself. I don't deal with residential mortgages but broker some commercial and the ltv on those properties is currently an awful 60% or so, which is hardly helping business

intervention may have short term effects which are considered positive but In the longer term I'm very sceptical. It's akin to rent controls. All they achieve is less willingness by developers to build rentable properties which in turn restricts the supply.
 
simmo said:
It's the third highest expenditure in my household behind the mortgage and the beer.

As for the discussion as a whole - it seems to me that both sides are unwilling to agree that either side has anything accurate to say (and I include myself in that), and as a result there is some stunning lack of understanding on show in this thread. As such, it's a fairly pointless discussion.
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benny and myself pointed directly to unsidputed data and facts. The "other side " did not other than petrol. I think any economist that based the prosperity of the population on the price of petrol would be sectioned

its so simple. If people want to spout of like overgrown students then I'm not interested but it's takes seconds to find this

http://www.ons.gov.uk/ons/rel/socia...s-41/social-trends-41---income-and-wealth.pdf

disposable income per household was two and half times in 2009 what it was in 1979'in REAL TERMS. That is a massive massive change .

if posters cannot absorb basic accepted financial data or even bother to look at it, that's their problem
 
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clivex said:
I think any economist that based the prosperity of the population on the price of petrol would be sectioned
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As a matter if interest, what would you do to one who used football attendances as a proxy indicator? Incidentally, 1949 saw the highest average attendances in the top division, and I doubt anyone would describe austere post war Britain as a hive of economic prosperity
 
Revenue in real terms per match would be indicator. Of course. Also there were very few alternatives then so you compare more realistically with 1989 say

not only are crowds bigger but they are paying in real terms far more per spectator than ever before
 
Grasshopper said:
Over time, money invested in bricks-and-mortar generally is a good investment and rent is dead-money, Arthur. Average house-prices have recovered, and in most cases now exceed the level they were at during the depths of the 2008/2009 financial crisis.

The removal of 100% mortgages, and the demand for a large deposit to secure a mortgage, is a more efficient handbrake on the housing market, than legislating how much people can borrow.....in my view.
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I don't disagree, Nick, housing is a safer investment for ordinary people than placing our savings in the grasping hands of the corporate world, but we'd all be better off if we could stop the market from overheating.

As for your second paragraph, I don't see the big difference. The banks have been told to limit mortgages to 80%, the balance to come from a deposit and repayments to be limited to a maximum multiple of income. No special legislation was needed.
 
as you seem to like the ONS stats Clive

here are some more figures by them..and shows that taking averages..as in the link Benny posted..is a little flawed when wealth is as skewed as it in this country..its very simple really and i would have thought you would have spotted this..but if two people have an average income of 200,000..and one of them earns 10,000 and the other one 390,000..it doesn't make the one earning 10k wealthy...only when an average figure is taken does that lead you to that false conclusion...stats eh Clive?

http://www.theguardian.com/uk-news/2014/may/15/britains-richest-1-percent-own-same-as-bottom-55-populatio
 
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EC1 said:
as you seem to like the ONS stats Clive

here are some more figures by them..and shows that taking averages..as in the link Benny posted..is a little flawed when wealth is as skewed as it in this country..its very simple really and i would have thought you would have spotted this..but if two people have an average income of 200,000..and one of them earns 10,000 and the other one 390,000..it doesn't make the one earning 10k wealthy...only when an average figure is taken does that lead you to that false conclusion...stats eh Clive?

http://www.theguardian.com/uk-news/2014/may/15/britains-richest-1-percent-own-same-as-bottom-55-populatio
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Isn't using the average an entirely appropriate measure of this kind of thing, EC1.

You're just quoting extreme examples at either end of the spectrum, which is even moodier an approach, and therefore hardly helps prove your point.
 
Grasshopper said:
Isn't using the average an entirely appropriate measure of this kind of thing, EC1.

You're just quoting extreme examples at either end of the spectrum, which is even moodier an approach, and therefore hardly helps prove your point.
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it highlights that when there is a disparity..which the stats show in that article..that averages are not representative though..extreme example or not..we have not got an even distribution of wealth..therefore an average is misleading when you have such a small &% holding such a large % of wealth

you'll post something positive in my direction at some point Grass won't you?:)..or are those days over?

my view is that both articles contradict themselves..but i know that Clive loves those stats..i just think they mislead..with such extremes in attendance

just my view..i'll let you all celebrate our wealth in peace now..back to the hosses..its less work:D
 
From a stats perspective, you'd probably consider using something called the 5% trimmed mean. There are certainly societies (the UK isn't the worst example, but it does exhibit some of the traits) where an outrageous amount of wealth is found in the top 1% and this can most definitely skew an arithmetic mean.

This is a frequent mistake in stats when people talk about "the average" 99 times out of 100 (couldn't resist that), they're actually talking about the arithmetic mean, which is just one measure of an average (you all know that) but it's amazing how many times we allow ourselves to get sucked into this error. You might even find the mode is the better indicator in this case

Silly example - but it's often used to illustrate this kind of thing:

How many arms has the average person got?

If you used the mean the answer would be 1.999
If you used the mode it would be 2

If you were manufacturer of shirts and decided to make products based around the average (as defined by the mean) would that be sensible?
 
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I like one stats because they are the real facts . Jesus . This is desperate. You need a stat to prove How wealth is distributed to prove something otherwise and the fact that disposable income has multiplied so much in real terms would simply trump that massively. Anyone can see that

you don't need to go into detail to understand that very fact. Its not increased by 20% it's increased by 250% for chrissake

and that is before we get into increase in net assets which I bet has grown by an even larger real multiple given how property has rocketed in value in that period

quoting the top 1% is barmy. It's doesn't mean for one second that the remainders wealth hasn't grown because theirs has. It is entirely 100% irrelevant

its like saying that if you get a 10% payrise and neighbour gets 15% you are poorer. Socialist thinking and ludicrous . The politics of envy
 
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Sticking to my guns and am backing Cooper at 11/4.

I think she could do a good job for Labour, and looks value at those odds too.
 
clivex said:
quoting the top 1% is barmy. It's doesn't mean for one second that the remainders wealth hasn't grown because theirs has. It is entirely 100% irrelevant

its like saying that if you get a 10% payrise and neighbour gets 15% you are poorer. Socialist thinking and ludicrous . The politics of envy
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Distribution of income most certainly is relevant. An economy with one billionaire and a million serfs will allocate resources very differently from one with less extreme differences. That is to say, markets will price goods and services in an entirely different way in one economy compared to the other.
 
Grey said:
Distribution of income most certainly is relevant. An economy with one billionaire and a million serfs will allocate resources very differently from one with less extreme differences. That is to say, markets will price goods and services in an entirely different way in one economy compared to the other.
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Well that is very very vague and very very debatable for a start. And what are these million serfs? It's not as if we are within a million miles of such an economy

in fact there is abolsutely no logic to what you are suggesting at all unless this mythical billionaire owns all the means of production. Which is frankly a scenario that will simply never happen.

somlomg as you have rigorous competition then goods and services will be priced in accordance with supply and demand. Only intervention by command economies or monopolies can change that.
 
It's not one bit theoretical. The example I gave is simplified in order to get the point across but it's nevertheless true that a society with unequal distribution of income and wealth will allocate goods and services differently to a more equal society. It stands to reason, and it's why the subject taught in university used to be called political economy.
 
I always understood that as being the effect of politcial decisions and the law on the market. A market without interfernce will always find its natural level anyway. Either way it's not relevant to the above because we are talking about the whole growth in disposable income and assets rather than individual pricing
 
Of course it's relevant. Despite the rise in incomes most of those who used to be regular attenders at football matches struggle to afford it nowadays because other people are able to fork out more. Despite the rise in incomes most single income households can forget about buying a house because they are less well off relative to other households than they used to be.

And although incomes have risen income security has not; people are in fear of losing their jobs and are less able to plan their futures.

The statistics about income growth are not wrong, but they are limited in what they can tell us, which is a big part of why the UN and others are trying to develop quality-of-life indexes instead.

And talk of markets without 'interference' finding their 'natural' level sounds easy to understand until you start trying to define what you mean. There's no such thing in real life as a market without interference, but that's a subject for another day.
 
clivex said:
its like saying that if you get a 10% payrise and neighbour gets 15% you are poorer. Socialist thinking and ludicrous . The politics of envy
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Not sure it is - and even if it were, it's far too simplistic. The issue that defines how society subsequently evolves is what happens to the greater disposable incomes held by the richer people (and particularly uber rich) and how their decisions then impact elsewhere
 
What you talking about? If you think that you are poorer because a neighbour got a bigger pay rise than you its a mental issue not financial. Anyone living with that mentality would be best advised to slash their wrists frankly

Billionaire's? Fine art and yachts?

As for football what a rubbish example
Clearly the issue is lack of aupply. They cant exactly expand full stadium's overnight can they? It remains a perfect example of how much higher disposable income across all clasaes can meet the premium charges demanded by limited supply
 
There is one clear example where id your wages are not rising as high as others it can be an issue but only on certain circumstances because it equally likely to work for your benefit. It is an area where supply is often limited
 
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