Piliger wrote: » Only really really stupid people try to win arguments and persuade people by being angry, aggressive and offensive.
steamengine wrote: » It's the ready acceptance of the continuing austerity that I fail to understand. As Jean Kennedy said 'Irish people lack a healthy sense of protest'. Clearly there's a few on here that almost laud austerity, The signal that sends out to government is that the screws can be turned another few revolutions. Property is on the up again and pro rata the property tax will rise also. Good luck to the AAA in the elections, they have my support as Labour seem to have dropped the baton somewhere along the line.
Geuze wrote: » http://www.bankofengland.co.uk/banknotes/pages/about/history.aspx This may help answer your questions.
Piliger wrote: » This post had been deleted.
Permabear wrote: » This post has been deleted.
KyussBishop wrote: » No - the way giving easier access to credit, leads to house prices being bid up, is a factual one.
Piliger wrote: » Wrong. The discussion I was responding to concerns blame, not facts.
KyussBishop wrote: » This is not a moral argument Piliger, it is a factual one: When private debt is low, and access to excessive credit/loans is freed up, then - unless there are other restrictions in place - this will lead to house prices getting bid up. This is well known among economists - this isn't something any individual borrower can control.This places responsibility for preventing excessive credit issuance, firmly with the banks/central-bank and government.
KyussBishop wrote: » Money-as-debt is the problem - think about it: If all money starts out 1:1 with debt, and if Debt carries interest, then the ratio of Debt:Money is going to grow forever - with the total stock of Debt growing many multiples the size of Money, 10x, 40x, 100x etc.; this is unsustainable. In such a monetary system, the only possible way to reduce the Debt:Money ratio, is to lend out more money (introducing new money/debt at a 1:1 ratio, bringing Debt:Money closer to that ratio) - and this (for complicated reasons) requires accelerating economic growth, forever, which is a physical impossibility since the planet has finite resources.
Iwasfrozen wrote: » Why? The house prices wouldn't rise if people weren't willing to pay the higher prices.
Frank Lee Midere wrote: » What kind of moral or economic argument is that? People spent money during the boom. Result ? The ratio of debt to GDP is 120%.
Permabear wrote: » This post had been deleted.
Frank Lee Midere wrote: » And this is where I part company with well intentioned leftwingers. The carrying capacity of the earth depends on technology. Malthusians disregard this. But the earth can feed more people than Malthus could have imagined. Food has been growing faster than population growth, which is dramatically slowing, and the limit of energy we can harvest is the sun and our own nuclear reactions. Rare minerals are abundant in the solar system. The limits to growth are not technological.
KyussBishop wrote: » It only requires some people to start getting house prices bid up, and then you get appraisers raising the price of houses in entire areas (pricing out otherwise prudent potential buyers, or forcing them to consider bigger loans). The house prices wouldn't rise, if the credit wasn't give out so cheap to those people bidding up prices in the first place. Cheap credit is something you can easily do something about - some people bidding up house prices, is something you can't do anything about (short of cutting the ease with which they get credit).
Iwasfrozen wrote: » What's the alternative? Stop banks giving people money so they can't pay a price they would otherwise be willing to?
Piliger wrote: » I am very happy with austerity. We are sill spending money that we don't have and I abhor the attitude of entitlement that some people have, where they believe that we are entitled to spend more than we have. After going independent last time I am voting FG this time. They are doing an excellent job in general and the coalition is working very well imho.
Iwasfrozen wrote: » The point I'm making is that if a person is willing to pay X euros for a house where X is an inflated price from Y then the house must surely be worth at least X euros to the person making the transaction, if it wasn't they wouldn't be willing to buy it at that price. It's alright saying the house prices wouldn't rise if the means of buying the house i.e cheap available credit was deprived to the buyer but that ignores the other half of the story. House prices wouldn't be able to go up if buyers weren't willing to pay higher prices, since they are willing to pay higher prices clearly houses are under priced.
KyussBishop wrote: » The alternative, is to prevent excessive loans that bid up house prices, and to hold the banks/central-bank and government responsible/accountable, for ensuring that this is policed properly.
KyussBishop wrote: » Just because you can massively overprice houses beyond the sustainable affordability of much of the population, because of cheap credit, doesn't mean it's ok just because 'some' people will buy them. You're ignoring that you only need some people (different to 'people' - as in, people in general) to bid up house prices, and that this then affects everybody looking to buy a house. You're fishing for a moral argument for pinning blame on the buyers here, when still the only actual policy change that can prevent/fix any of this, is in the hands of the banks/central-bank and government - this puts responsibility firmly in the hands of those institutions. What's your argument for fixing it? "Tell the population not to buy overprices houses"? That's not an argument for fixing it, that's an argument for trying to assign blame. If only one argument can actually fix it - setting restrictions on credit - then that's where the primary responsibility lies, as it's the only practical way to put a check on this problem.
KyussBishop wrote: » Just because you can massively overprice houses beyond the sustainable affordability of much of the population, because of cheap credit, doesn't mean it's ok just because 'some' people will buy them.
You're ignoring that you only need some people (different to 'people' - as in, people in general) to bid up house prices, and that this then affects everybody looking to buy a house.
You're fishing for a moral argument for pinning blame on the buyers here, when still the only actual policy change that can prevent/fix any of this, is in the hands of the banks/central-bank and government - this puts responsibility firmly in the hands of those institutions.
Iwasfrozen wrote: » But why blame the banks who are only providing people with the means to spend what they consider the house to be worth? Surely if there is blame it rests with both parties?
KyussBishop wrote: » Whoa hold up here: You have no problem with banks offering excessively cheap credit - even when you know this leads to house prices being bid up? Allowing that, and then being surprised at house prices being bid up, is like giving the population easy access to guns, and being surprised that the murder/gun-injury/successful-suicide rate goes up - then ignoring the massive societal problem that creates, and then just blaming it on the population, not on the easy access to guns.
Convexity wrote: » Imagine an economy of just 2 people and 1 euro. The only two products in the economy are strawberries and grapes. Even though there is only 1 euro in the economy the GDP can be thousands of euro, and that is healthy, do you understand this?
Frank Lee Midere wrote: » No. Buyers are 50% responsible. At least. The problem is there is no moral hazard. Banks are too big to fail. Mortgage holders are too "what about the famine" to repossess.
Convexity wrote: » Banks should be allowed to give cheap credit, but if they go bust they should suffer the consequences and not be saved by the tax payer.
