Why do both parents have to work nowadays?

esforum · 18-03-2016 10:47pm

ezra_pound wrote: »

The maximum difference should be about 6430 I think. Either way the government don't like the idea of stay at home parents. It would be interesting to see a model of the property bubble adjusted for non tax individualisation. I'd doubt it would have been boomy enough for bbbb Bertie.

You would think they would encourage stay at home parents, while the working numbers wouldnt go up, the dole numbers would go down.

ezra_pound · 18-03-2016 10:50pm

esforum wrote: »

You would think they would encourage stay at home parents, while the working numbers wouldnt go up, the dole numbers would go down.

Fg's make work pay plans would make the situation better for stay at home parents but democracy just said no.

Wanderer78 · 18-03-2016 10:53pm

ezra_pound wrote: »

Fg's make work pay plans would make the situation better for stay at home parents but democracy just said no.

what was their child care plan?

....and thank god for democracy!

Arkady · 18-03-2016 10:57pm

Can't see how a career is more important than your Children and family.

Geuze · 18-03-2016 10:59pm

esforum wrote: »

2007 was 9 years ago, things change.

http://www.revenue.ie/en/tax/it/leaflets/it1.html#section1

Married person tax credit is now the exact same as 2 person single credits, its that way on purpose. So single and double income families are equal.

While the basic personal tax credit [1650] is transferable, however the married one-earner tax band is not double the single tax band.

The tax bands are not fully transferable, they have been partially individualised.

SRCOP:

single = 33,800

married one earner = 42,800

married two earners, up to 67,600

ezra_pound · 18-03-2016 10:59pm

Wanderer78 wrote: »

what was their child care plan?

....and thank god for democracy!

Amen.

I'm just saying that democracy brought in tax individualisation and retained it since throughout the ff days and on. Likewise it voted against a progressive scheme for more fair treatment of low to medium income single income families in this recent election. It's kind of relevant to this thread.

my teapot is orange · 18-03-2016 11:20pm

I think people want more stuff nowadays. When I was a kid many of the kids in my class came from homes where only one parent worked. Most of them did not go on foreign holidays or have many treats. They might have had one car or none in family. They made all their own food and rarely ate out. School books clothes etc. were handed down. You could probably still live that lifestyle nowadays on one income, but you would feel deprived relative to others who have all those things and far more treats in todays world.

CelticRambler · 19-03-2016 12:13pm

Elizabeth Warren in the video posted at the start of the thread explains away all the "consumerism" red-herrings. In real terms, we're spending less on "stuff" (including holidays) than before. For those who can't be bothered to watch it, she points out that the difference between then and now is that as more families decide to live a two-income lifestyle, they drive house prices up, and as when they have children, they drive house prices (and the cost of healthcare & childcare) up even more. Their disposable income, on the otherhand, has gone down - which incidentally contributes to the falling cost of consumer products and services.

I saw that happening all around me when I lived in Kent in the 90s, first as a single guy, then married, then with children. We had opted for the (self-employed) one-income lifestyle and could see our two-income peers struggling to pay for things we got "for free" on account of having one adult always available to take advantage of the best offers. At the time I bought my (what became our) house, I resisted the bank's invitation to borrow right up to my multiple-of-salary limit. The only thing that interfered with our flexibility was putting the children into school, then wanting to take holidays during term time.

We (I :rolleyes: ) fought the school on this point for a few years (Dtr's only six, FFS ... but she's spent three months learning Italian at home while the rest of the class are learning one letter a week, so you can feck off with your "bad for her education" argument. :mad: ) before we sold up, paid off what was left of the small mortgage, bought a house in France for cash and had a decent pot left over.

We've never lived on two incomes (but have lived on "less than one" for a while), and our four children are never been short of cultural or educational experiences. Quite the opposite - they've been more places and done more things than most of their peers.

As Elizabeth Warren points out - and I see it in my siblings and friends - for all their material/consumerist wealth, two-income families live a precarious existence with little room for manoeuvre. When something goes wrong (house, job, health), it goes very wrong.

esforum · 19-03-2016 5:25pm

CelticRambler wrote: »

but she's spent three months learning Italian at home while the rest of the class are learning one letter a week, so you can feck off with your "bad for her education" argument.

Your daughter only learns Italian in school?

armabelle · 19-03-2016 7:00pm

bb12 wrote: »

it's simply transference of wealth from the poorer and working classes to the wealthy. our standards of living have been steadily decreasing; people now have to work longer and harder than ever before and our children and grandchildren will have it even worse. this documentary gives a great overview of where it all has gone wrong for the ordinary person in the street.

https://www.youtube.com/watch?v=d3mfkD6Ky5o

Thanks, I will watch this for sure

You are right about what you said too.... you know with all this new technology why are we not working less hours? we are working more hours and both parents are doing it. Crazy days.

armabelle · 19-03-2016 7:03pm

Arkady wrote: »

Can't see how a career is more important than your Children and family.

when it is the only way you can put a decent roof over their head then it is, which seems to be the case nowadays

it is sad because after this whole thread it seems like parents can either provide for their kids or be with them but not both

armabelle · 19-03-2016 7:14pm

CelticRambler wrote: »

Elizabeth Warren in the video posted at the start of the thread explains away all the "consumerism" red-herrings. In real terms, we're spending less on "stuff" (including holidays) than before. For those who can't be bothered to watch it, she points out that the difference between then and now is that as more families decide to live a two-income lifestyle, they drive house prices up, and as when they have children, they drive house prices (and the cost of healthcare & childcare) up even more. Their disposable income, on the otherhand, has gone down - which incidentally contributes to the falling cost of consumer products and services.

I saw that happening all around me when I lived in Kent in the 90s, first as a single guy, then married, then with children. We had opted for the (self-employed) one-income lifestyle and could see our two-income peers struggling to pay for things we got "for free" on account of having one adult always available to take advantage of the best offers. At the time I bought my (what became our) house, I resisted the bank's invitation to borrow right up to my multiple-of-salary limit. The only thing that interfered with our flexibility was putting the children into school, then wanting to take holidays during term time.

We (I :rolleyes: ) fought the school on this point for a few years (Dtr's only six, FFS ... but she's spent three months learning Italian at home while the rest of the class are learning one letter a week, so you can feck off with your "bad for her education" argument. :mad: ) before we sold up, paid off what was left of the small mortgage, bought a house in France for cash and had a decent pot left over.

We've never lived on two incomes (but have lived on "less than one" for a while), and our four children are never been short of cultural or educational experiences. Quite the opposite - they've been more places and done more things than most of their peers.

As Elizabeth Warren points out - and I see it in my siblings and friends - for all their material/consumerist wealth, two-income families live a precarious existence with little room for manoeuvre. When something goes wrong (house, job, health), it goes very wrong.

I found most of what she said in the video spot on but I don't know if I buy the "two parents having more income drove up property prices" part of her video because she speaks specifically about parents wanting to move near schools but if you look all over the rental market, everything is mad expensive and not just the places next to schools. In fact, even one bedroom apartments are just crazy expensive here in Ireland right now and families don't need those do they? If what EW said is true, one beds would be much cheaper and they arent. There is something else...

ezra_pound · 19-03-2016 8:05pm

armabelle wrote: »

I found most of what she said in the video spot on but I don't know if I buy the "two parents having more income drove up property prices" part of her video because she speaks specifically about parents wanting to move near schools but if you look all over the rental market, everything is mad expensive and not just the places next to schools. In fact, even one bedroom apartments are just crazy expensive here in Ireland right now and families don't need those do they? If what EW said is true, one beds would be much cheaper and they arent. There is something else...

There are lots of different factors which impact on property prices. Some mainly impact on supply, others on demand. Aggregate demand obviously increases when families are incentived to have both parents working. This obviously would have a more pronounced effect on classic family homes but it would affect the demand for all properties as well. The main issue affecting I've bed houses at the moment is supply. There simply isn't enough if them. This is particularly the case since bed sits were banned.
Nobody is saying that tax individualisation since 2002 or dual income families are the sole cause for high property prices since then. The existence of other factors that the FF PDs devised were also to blame but it's been a major factor in the demand side.

PS I haven't watched that video so I'm not specifically referring to it.

armabelle · 19-03-2016 8:26pm

bb12 wrote: »

it's simply transference of wealth from the poorer and working classes to the wealthy. our standards of living have been steadily decreasing; people now have to work longer and harder than ever before and our children and grandchildren will have it even worse. this documentary gives a great overview of where it all has gone wrong for the ordinary person in the street.

https://www.youtube.com/watch?v=d3mfkD6Ky5o

This was a very good documentary and it reminds me of one of the "Zeitgeist" movies which also explained the fractional reserve banking system. This documentary does explain why housing is so expensive at the moment and indeed why two incomes are necessary as a result thereof. It is funny that nobody in this thread has mentioned anything about it or about the banks. Why do you think that is? Is it because it is hard to follow the concept do you think?

Wanderer78 · 19-03-2016 9:17pm

armabelle wrote: »

This was a very good documentary and it reminds me of one of the "Zeitgeist" movies which also explained the fractional reserve banking system. This documentary does explain why housing is so expensive at the moment and indeed why two incomes are necessary as a result thereof. It is funny that nobody in this thread has mentioned anything about it or about the banks. Why do you think that is? Is it because it is hard to follow the concept do you think?

errr emm i did and im fairly sure others did to. yea our financial system is very difficult to understand. ha-joon chang believes even the people that are trying to manage our financial systems dont even really know whats going on particularly in relation to complex things such as derivatives. but its all pointing towards, we re in trouble! this is why i like the public banking system as it looks like the private banking system is knackered

armabelle · 20-03-2016 8:38am

Wanderer78 wrote: »

errr emm i did and im fairly sure others did to. yea our financial system is very difficult to understand. ha-joon chang believes even the people that are trying to manage our financial systems dont even really know whats going on particularly in relation to complex things such as derivatives. but its all pointing towards, we re in trouble! this is why i like the public banking system as it looks like the private banking system is knackered

Yes I apologize, you did mention the debt aspect but not that the banks are directly responsible for it in the way the video explains it. And even then, you were the only one out of all these people. Do you think that is because people don't believe these things or simply choose to be ignorant to it? Or do you think that they feel helpless and as a result choose to be ignorant because they feel they can do nothing about it?

ezra_pound · 20-03-2016 8:44am

Are you two suggesting that banks are lending far too much money at the moment in Ireland with the new CB rules and that this is fueling high property prices?

regi3457 · 20-03-2016 8:53am

bb12 wrote: »

it's simply transference of wealth from the poorer and working classes to the wealthy. our standards of living have been steadily decreasing; people now have to work longer and harder than ever before and our children and grandchildren will have it even worse. this documentary gives a great overview of where it all has gone wrong for the ordinary person in the street.

https://www.youtube.com/watch?v=d3mfkD6Ky5o

Surely this can't be right... I mean even though the politicians don't understand the system as the economists in the video suggest, surely the finance ministers (do you get those in Ireland?) or people in the economic sector would see these flaws and there would be outrage at this? If this really is true, it can't go on can it?

armabelle · 20-03-2016 9:10am

ezra_pound wrote: »

Are you two suggesting that banks are lending far too much money at the moment in Ireland with the new CB rules and that this is fueling high property prices?

I don't know about the CB rules but the economist in the video says that banks create trillions of new pounds (this is in the UK but probably wont be much different here or anywhere else in the 1st world) which they create out of thin air and as a preference throw it into the housing sector. They do this for their own profit and as a preference to putting the money into say, new businesses or other areas which may need the investment more, benefit society more, but may seem riskier. To a bank, lending so some guy can start a business is riskier than giving a loan for a house because the loan is tied to an asset. Another guy also says that this huge input of money into the housing sector is non-GDP based which means that all this money is coming into the market with no actual economic activity being created which causes inflation in the property market which makes people need to work more (both parents need to work more) to afford the commodity. it is very well explained in the video so do watch it if you can spare an hour. It should be at the top of this thread because it really does answer the OP. I would love some economists opinion about this though as it is hard to believe that banks can just do this and that there can be such a conflict of interest, and that we the public should pay for it.

KomradeBishop · 20-03-2016 12:18pm

Most economists would be of the opinion, that banks don't create money out of thin air as you say - as by and large, the textbooks say something completely different (making most economics textbooks and economists wrong about that) - that's only recently become a mainstream view, in the last couple of years.

If something as fundamental and basic to economics as that - how banks and money work - can be successfully kept out of economic teaching and awareness among economists, with them being taught something completely wrong instead (and failing to see that...), for almost a whole century, then just imagine how more easily misled the public is.

esforum · 20-03-2016 12:59pm

How do they keep these trillions off the books and wouldnt pumping that much into an economy cause massive inflation?

KomradeBishop · 20-03-2016 2:04pm

I don't know what the video was referring to, didn't watch it, I was commenting just on the specific part of the post that touched on money creation.

Victor · 20-03-2016 2:22pm

ezra_pound wrote: »

Married single earner 75k take home €51,968.00

Married two earners 50k + 25k take home€59,409.00

The other beauty of our tax system is that the single earner could have 6 kids and the dual income family none.

Someone with 6 children will get €10,080 per year in child benefit, untaxed. http://www.citizensinformation.ie/en/social_welfare/social_welfare_payments/social_welfare_payments_to_families_and_children/child_benefit.html

esforum wrote: »

You would think they would encourage stay at home parents, while the working numbers wouldnt go up, the dole numbers would go down.

Not necessarily - some people whose spouse is on a low income are entitled to unemployment benefits. Regardless, the live register is a poor measurement of unemployment - unemployment is where people want jobs but can't get them.

Arkady wrote: »

Can't see how a career is more important than your Children and family.

Is that you Éamon de Valera?

If someone has a skill, they should be encouraged to use it.

CelticRambler wrote: »

two-income families live a precarious existence with little room for manoeuvre. When something goes wrong (house, job, health), it goes very wrong.

But they are still in a better position that a one-income family where that person loses their employment.

Arkady · 20-03-2016 3:41pm

Victor wrote: »

Is that you Éamon de Valera?

If someone has a skill, they should be encouraged to use it.

Don't be a dick. Rearing children into responsible caring loving adults and members of society, able to live their lives to the full, is one of the most skilled professions there will ever be, regardless of whoever tries to run it down. and anyone who wants to, can do several professions in their life.

yqtwqxqm · 20-03-2016 3:55pm

Funny. I was just discussing this with my brother the other day.
They have 2 children.
It is actually cheaper for them for my sister in law to give up work.
After they sat down and worked out the child care costs, the working costs (lunch, transport, sundries), the one income vs two income tax situation, it turns out that they are better off with his wife or himself giving up work altogether and raising the children.
After crunching the number, about 9 months ago my sister in law gave up work (she wanted to have more time with the children more than he did) and my brother remained working.
They are actually better off financially and quality if life wise, and in every other way now.
Its funny though, a lot of people never even think of crunching the numbers and quality of life like this. If they did they might find that one of them is working for nothing, or worse actually paying to work.

Maybe everyone should visit a financial advisor and crunch their own numbers to see what they could be doing.

NIMAN · 20-03-2016 3:57pm

I'm in no doubt it would make financial sense for some people to give up work, especially those paying a fortune for childcare and who are basically working to pay the minder or creche, but there is also the fact that some parents might still want to keep some sort of career outsdie the home alive, continue their social connections etc, even if it isn't paying them fincancially to do so.

yqtwqxqm · 20-03-2016 4:08pm

NIMAN wrote: »

I'm in no doubt it would make financial sense for some people to give up work, especially those paying a fortune for childcare and who are basically working to pay the minder or creche, but there is also the fact that some parents might still want to keep some sort of career outsdie the home alive, continue their social connections etc, even if it isn't paying them fincancially to do so.

My sister in law has no problem at all doing any of those things you mention.
And she can go back do work if she feels like it at any time.
But she says shes much happier now. In fact you can tell just from visiting them, the whole family are much happier than they were. I never really noticed it until lately, but they have definitely done the right thing for their family. I wouldnt hesitate if I was in that position.

iguana · 20-03-2016 5:09pm

Victor wrote: »

Someone with 6 children will get €10,080 per year in child benefit, untaxed.

Regardless of how many, if any, parents work. So it's neither a disincentive nor an incentive for a parent to stay home or go to work.

Victor wrote:

But they are still in a better position that a one-income family where that person loses their employment.

That's often a fallacy based on over simplification and is the point made by economists like Warren. If both parents work and the family has debts that require both of those salaries then losing one salary means that they can no longer meet those debts. They are then basing all their hopes of getting back on their feet on the chances of that parent getting a new job of near equivalent salary.

But if a family has one income and their debts reflect the single income and they lose that single income they have numerous avenues to ensure they can continue to meet their financial obligations. The original earner can get a new job. The stay at home parent can find a job. Both parents can get part-time work at opposing hours. They aren't in a great position but the more options you have to get back on your feet, the greater the chance you have of doing so. If you only have one option, you limit the odds of recovery.

That's not even going into situations like work place disputes and long strikes. In this case the working parent still has a job and does not want to find a new one if they can help it, perhaps to maintain maximum pension benefits. As long as they only need one salary to cover all their outgoings the other parent can take temporary work and their income will remain closer to normal. A family reliant on two salaries doesn't have this option. Having two salaries only improves the financial security of a family if the first income is enough to cover all essential outgoings except for childcare. If any of the second salary is necessary to maintain housing, essential utilities, food and unavoidable health and education costs then that family may be in a much more precarious state than a single income family.

Arkady · 20-03-2016 6:21pm

yqtwqxqm wrote: »

Funny. I was just discussing this with my brother the other day.
They have 2 children.
It is actually cheaper for them for my sister in law to give up work.
After they sat down and worked out the child care costs, the working costs (lunch, transport, sundries), the one income vs two income tax situation, it turns out that they are better off with his wife or himself giving up work altogether and raising the children.
After crunching the number, about 9 months ago my sister in law gave up work (she wanted to have more time with the children more than he did) and my brother remained working.
They are actually better off financially and quality if life wise, and in every other way now.
Its funny though, a lot of people never even think of crunching the numbers and quality of life like this. If they did they might find that one of them is working for nothing, or worse actually paying to work.

Maybe everyone should visit a financial advisor and crunch their own numbers to see what they could be doing.

A no brainer in that situation, and and lets face it, and most of all, their kids childhood will be a lot better off for it as well.

esforum · 20-03-2016 7:04pm

Victor wrote: »

Someone with 6 children will get €10,080 per year in child benefit, untaxed.

So what? They get it regardless so its a non runner in this regard.

Victor wrote: »

Not necessarily - some people whose spouse is on a low income are entitled to unemployment benefits. Regardless, the live register is a poor measurement of unemployment - unemployment is where people want jobs but can't get them.

No arguement but I wasnt mesuring unemployment. I was measuring the amount of people getting the dole. If it was more financially viable for one parent to stay at home, more would. Not all of course but as per the sister in law of the above user, some would. Those jobs given up can in theory go to someone still looking for work thus in some cases, probable the majority, people would come off welfare.

Also, its highly unlikely that a two income family that find themselves better off as a result of becomming a one income family would qualify for benefits. Again, maybe the odd one here or there but not most.

armabelle · 20-03-2016 8:03pm

KomradeBishop wrote: »

Most economists would be of the opinion, that banks don't create money out of thin air as you say

No but they actually do

armabelle · 20-03-2016 8:05pm

esforum wrote: »

How do they keep these trillions off the books and wouldnt pumping that much into an economy cause massive inflation?

it does... that is exactly the point. Housing is so expensive (inflated) because of that. According to the first video in this thread housing is between 50% and 100% more expensive than in 1970

armabelle · 20-03-2016 8:10pm

yqtwqxqm wrote: »

But she says shes much happier now. In fact you can tell just from visiting them, the whole family are much happier than they were.

yes that is because it is normal... a society that has both parents working the whole time is just wrong IMO. Take away all the modernity of our times, we are still mamals

armabelle · 20-03-2016 8:13pm

KomradeBishop wrote: »

I don't know what the video was referring to, didn't watch it, I was commenting just on the specific part of the post that touched on money creation.

Ok so since you seem informed and knowledgeable about these matters, please will you give us a primer on money creation... I would appreciate that since I desperately don't want to believe the 1hr documentary posted above as it would mean that the world is a dark and scary place for us all

dubrov · 20-03-2016 9:03pm

Look up the wiki page on fractional reserve banking. It will give you a better idea as to how the monetary system works

ezra_pound · 20-03-2016 9:06pm

armabelle wrote: »

it does... that is exactly the point. Housing is so expensive (inflated) because of that. According to the first video in this thread housing is between 50% and 100% more expensive than in 1970

The ECB target an interest rate of 2% inflation. It can regulate the amount of money creation in the commercial banking system and believe you me, if there was the slightest risk of inflation surpassing its targets there would be major clampdowns on the banking system.

So... Regardless of any conspiracy theorisation going on in this site the fact remains that money creation is at a level which is resultant in extremely low inflation.

Of more significance is the reluctance of banks in this country in this decade - that is in the here and now- to actually lend money. They're not doing enough of it in general. They're certainly not creating a credit bubble and even more certainly not creating money at levels which the ECB disapprove. Furthermore the Irish CB are placing reasonably strict controls on mortgage lending.

armabelle · 20-03-2016 9:25pm

ezra_pound wrote: »

The ECB target an interest rate of 2% inflation. It can regulate the amount of money creation in the commercial banking system and believe you me, if there was the slightest risk of inflation surpassing its targets there would be major clampdowns on the banking system.

But housing in Ireland goes up at least 2% every week and has done for the last year.

KomradeBishop · 20-03-2016 9:45pm

armabelle wrote: »

Ok so since you seem informed and knowledgeable about these matters, please will you give us a primer on money creation... I would appreciate that since I desperately don't want to believe the 1hr documentary posted above as it would mean that the world is a dark and scary place for us all

TLDR - yes, banks create money from nothing - but a more detailed explanation:

Explaining the whole line of money creation through the banking system, and the limits on it, is tricky enough, but the very basics of it are pretty simple - banks use 'double entry bookkeeping' for their accounting, where they list Assets (deposits, money in peoples accounts) and Liabilities (peoples debt) - all Assets have to be matched by Liabilities (so that Assets - Liabilities = 0).

Page 3 here gives a better visualization, but e.g. when somebody takes out a loan of €100, the bank just notes this in their accounting balance sheets (*):
Assets|Liabilities||Sum||Money Created
+€100|-€100||€0||+€100

That's pretty much how money is created - someone at the bank just types in on a computer, +€100 Assets and -€100 liabilities - money is created from thin air.

Rest below is skippable - skip if bored

However, there are restrictions on this - after giving out a loan, banks have to make sure they can meet reserve requirements, and capital requirements - in practice, they can never fail to meet reserve requirements, because the central bank will always act as 'lender of last resort' to help them meet reserve limits - and capital requirements don't really present much of a limit, because a loan on a mortgage is backed by the capital of the house bought.

There are other restrictions on lending too - such as limiting lending to being 3.5x of a persons income - but pre-crisis, such restrictions were either non-existant, too lax, or simply not enforced - which is what led to the housing boom.

When excessive loans/credit are easy to obtain, in a relatively unrestricted lending environment like there was pre-crisis, then this mean there is much more money that can be made available for buying houses - which can quickly bid-up the price of houses citywide or even throughout the country, forcing everybody who wants to buy a house, to either go without (rent), or go into excessive debt to buy one.

This has also created a long-lasting legacy of Private Debt in the economy - which is very destructive, holding back recovery - and you can see how rises in house-prices/private-debt are linked (first chart only goes back so far):
ireland-households-debt-to-gdp.png?s=irelandhdtg&v=201603142308n&d1=19160101&d2=20161231

ireland-households-debt-to-gdp.png?s=irelandhdtg&v=201603142308n&d1=19160101&d2=20161231

* Simplified. This article explains the whole chain better, but it's complicated. Liabilities listed as minus, so the row sums up more easily.

KomradeBishop · 20-03-2016 9:46pm

dubrov wrote: »

Look up the wiki page on fractional reserve banking. It will give you a better idea as to how the monetary system works

Fractional reserve isn't actually how it works in the end - both links above (here and here), explain it well.

KomradeBishop · 20-03-2016 9:48pm

armabelle wrote: »

But housing in Ireland goes up at least 2% every week and has done for the last year.

Ya but the reasons are different now - there aren't enough houses being built now, and government is very sluggish about building social housing (in fact, some private developers are even taking the government to court at an EU level, to try and block some efforts at building social housing, on competition grounds!).

Victor · 20-03-2016 9:57pm

esforum wrote: »

So what? They get it regardless so its a non runner in this regard.

In the context of the tax system taking about €9,000 off someone, it is incredibly important.

armabelle wrote: »

it does... that is exactly the point. Housing is so expensive (inflated) because of that. According to the first video in this thread housing is between 50% and 100% more expensive than in 1970

But the interest rates are 3% instead of 15%, so for the vast majority of people things are balanced out.

Carlos Orange · 20-03-2016 10:31pm

armabelle wrote: »

But housing in Ireland goes up at least 2% every week and has done for the last year.

Who says housing goes up 2% a week?

KomradeBishop · 20-03-2016 10:32pm

Victor wrote: »

In the context of the tax system taking about €9,000 off someone, it is incredibly important.

But the interest rates are 3% instead of 15%, so for the vast majority of people things are balanced out.

Well, when the interest rate was 15%, inflation was also really high - here are the real inflation-adjusted interest rates:
ireland-real-interest-rate-percent-wb-data.png?s=%2fireland%2freal-interest-rate-percent-wb-data.html&lbl=0&v=201603310000n&d1=19160101&d2=20161231

ireland-real-interest-rate-percent-wb-data.png?s=%2fireland%2freal-interest-rate-percent-wb-data.html&lbl=0&v=201603310000n&d1=19160101&d2=20161231

If you average that out over a long time, considering we're talking about decades-long mortgages, then (after some back of the envelope estimates) the drop in compounded interest costs don't make up for the increased cost of houses now - things haven't really balanced out, they've gone way out of balance.

Wanderer78 · 20-03-2016 11:03pm

armabelle, apologies but im a little busy at the moment to respond to some of your posts but KomradeBishop is doing a fantastic job of explaining whats going on with our banking system, better than i would anyway.

id recommend this irish documentary on our boom and bust. it came recommended to me by stephen kinsella himself(hes in it), and does a great job of explaining the whole thing.

i really would recommend ellen browns work on money creation. her main book is called web of debt.

best of luck with researching this subject matter. its great to see people doing it.

KomradeBishop, can you recommend others i should be researching regarding these subject matters? ive looked into ellen brown, bill black, ha-joon chang and michael hudson so far. thank you

KomradeBishop · 21-03-2016 3:12am

Wanderer78 wrote: »

armabelle, apologies but im a little busy at the moment to respond to some of your posts but KomradeBishop is doing a fantastic job of explaining whats going on with our banking system, better than i would anyway.

id recommend this irish documentary on our boom and bust. it came recommended to me by stephen kinsella himself(hes in it), and does a great job of explaining the whole thing.

https://www.youtube.com/watch?v=ZSeJITHmDWQ&list=PLT6_eR0Q7wYr3hM7buPNP1YILVvY3Vhjf

i really would recommend ellen browns work on money creation. her main book is called web of debt.

best of luck with researching this subject matter. its great to see people doing it.

KomradeBishop, can you recommend others i should be researching regarding these subject matters? ive looked into ellen brown, bill black, ha-joon chang and michael hudson so far. thank you

Steve Keen (an article of his linked above) has provided the best analysis of the economic crisis that I've seen (he predicted, modelled and warned about the crisis long in advance of it happening), where he emphasised the role of Private Debt (very relevant to homeowners and how dual incomes have been eaten up) as being the most important element and predictor of the crisis (you can see the link in the graphs I post above).

He has a full explanation of the entire cycle of economic crisis, based on Minsky's Debt Deflation explanations of economic crisis - as well as many ideas of how to recover from crisis, with a 'debt jubilee' being one of the more original ideas I've seen - good intro post, plus his blog in general:
http://www.debtdeflation.com/blogs/manifesto/

He is Post-Keynesian, which Bill Black and Michael Hudson are also as well, Stephen Kinsella even identifies as PK too.

I sourced pretty much every one of these people originally, from the Naked Capitalism site - it's the best hub for economic info I know of.

esforum · 21-03-2016 5:11pm

armabelle wrote: »

it does... that is exactly the point. Housing is so expensive (inflated) because of that. According to the first video in this thread housing is between 50% and 100% more expensive than in 1970

I dont think you can introduce that much funding into an economy and only effect a specific area.

I also dont see how the banking sector making up funds would suddenly result in more people being able to buy higher priced housing but not effect wages and goods pricing either directly of via inflation

andrew · 21-03-2016 6:05pm

Please keep the thread on topic - that is, about changes to household income - as opposed to about how banks do, or do not, create money. Any posts about the latter are off topic, have generally not been of the standard expected on this forum, and from here on out will be deleted

armabelle · 21-03-2016 6:13pm

esforum wrote: »

I dont think you can introduce that much funding into an economy and only effect a specific area.

That is exactly what happened in Ireland in 2007 though. THat is why people called it the "property boom"

armabelle · 21-03-2016 6:13pm

KomradeBishop wrote: »

Steve Keen (an article of his linked above) has provided the best analysis of the economic crisis that I've seen (he predicted, modelled and warned about the crisis long in advance of it happening), where he emphasised the role of Private Debt (very relevant to homeowners and how dual incomes have been eaten up) as being the most important element and predictor of the crisis (you can see the link in the graphs I post above).

He has a full explanation of the entire cycle of economic crisis, based on Minsky's Debt Deflation explanations of economic crisis - as well as many ideas of how to recover from crisis, with a 'debt jubilee' being one of the more original ideas I've seen - good intro post, plus his blog in general:
http://www.debtdeflation.com/blogs/manifesto/

He is Post-Keynesian, which Bill Black and Michael Hudson are also as well, Stephen Kinsella even identifies as PK too.

I sourced pretty much every one of these people originally, from the Naked Capitalism site - it's the best hub for economic info I know of.

Thanks, will check him out

Wanderer78 · 21-03-2016 9:07pm

might interest some round here, live interview with ellen brown:

http://amm.streamon.fm/

Why do both parents have to work nowadays?

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