EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty. If he had made the announcement next year then the squeals here and elsewhere may have had made more sense. Likewise, commercial landowners have close to two years notice of Labour plans for their sector.
Utilities were privatised because it was supposed to be the best way to deliver services to consumers at the best possible price. Shareholders benefited from the monopoly. But if it's not working out a government has every right to look again at the arrangements. In the same way, private ownership of the land in the country we all live in is based on consent. If the way in which that ownership is exercised does not benefit the country then it is perfectly reasonable to look again at current arrangements.
Far from being opportunistic, Ed's announcements strike me is very significant breaks with what has been a 30-year market-driven political consensus in which the priorities of institutional investors, big companies and big finance have been seen as mirroring the best interests of all of us. Ed is challenging that consensus. I am not sure I fully agree with him, but he is spot on in saying what we have had under both Tory and Labour administrations since the 80s is not a model that works anymore. We need a new one.
And if the market price of energy inputs goes down during the price freeze, I'm sure Ed will be giving the Big 6 lots of notice when he decides actually he doesn't like the freeze and they must all put their prices down right now.
The energy companies' willingness to pass on the reductions in wholesale prices to end users has been consistent and widely-applauded, of course.
Well dodged.
The only certainty Ed's provided is that his freeze will become a cap the second it suits him, and from there no one has a scooby doo what our benevolent would be dictator of energy prices will decide.
Pamela Nash survives reselection in Airdrie & Shotts but with a considerable opposition (55 voted for reselection, 37 against, 8 abstentions) www.scotsman.com/news/politics/top-stories/how-mp-pamela-nash-escaped-labour-selection-battle-1-3117295?utm_medium=twitter&utm_source=dlvr.it
So far 2 MPs (Tories Ann McIntosh and Crispin Blunt) didn't get automatic reselection. No definitive deselection though.
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
Mike K. What a load of Tory tosh. Ed Miliband has done the morally right thing to promise to repeal the evil bedroom tax and freeze utility charges for two years. This will help millions of hard up people. Seemingly, you think its okay for disabled, and poor people to lose their homes and that the rest of us should pay huge increases in utility charges, so that the parasites who run those industries can take home fat bonuses and unearned profits. People like you have no morals or compassion.
Mr Teddy,
Is "Ed" going to reverse the same subsidy that is imposed upon benefit-claimants within the private-sector? Or are you of the faith that believes that casual discrimination cannot be evil if it supports a narrow political agenda...?
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
"The UK government is considering handing the Scottish Parliament the power to scrap the bedroom tax if Scots vote to remain in the UK...
Ministers in David Cameron’s government are believed to be increasingly concerned about how the bedroom tax has become a toxic issue for the coalition.
... On the issue of what new powers could be given to Holyrood if Scots vote against independence in next year’s referendum, a senior government insider told Scotland on Sunday that devolving housing benefit is now a strong possibility.
“I think there is a feeling that as far as non-financial matters are concerned, there is not much more that can be devolved and the balance is about right,” he said.
“That leaves taxation and welfare, and we have to look at where we can feasibly devolve more. There is an argument for devolving income tax further because the principle of devolving is in place with the most recent reforms.
“It is difficult to see how welfare could be devolved, but housing benefit is a possibility given the issues that have been raised about it recently.”
How long is it until the toxicity of the Lib-Con coalition taints Darling's Bitter Together outfit?
hand out the bits they have poisoned , just what you would expect from these dullards. Hopefully Salmond will debate with Darling and when wiping the floor with him will ask how a failed , millionaire flipping back bench LABOUR MP is representing the UK government on what it can and will do on Independence. Meanwhile big cowardy custard will be hiding behind the couch. The fact that cowardly Cameron chose a Labour MP to represent the UK government rather than the hapless Scottish Secretary says it all about the unionists.
All depends how you view the priorities. Mr Crosby needs to make more of this.
Robert Halfon MP @halfon4harlowMP Tories have focused on #costofliving: fuel duty & council tax freeze, restoring pension link to earnings & cutting tax for lower earners
'EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty'
At least consumers will know that part of their price increases this year & next will be to offset the effect of the 20 month price freeze and be able to thank Ed accordingly..
"The UK government is considering handing the Scottish Parliament the power to scrap the bedroom tax if Scots vote to remain in the UK...
“That leaves taxation and welfare, and we have to look at where we can feasibly devolve more. There is an argument for devolving income tax further because the principle of devolving is in place with the most recent reforms.
“It is difficult to see how welfare could be devolved, but housing benefit is a possibility given the issues that have been raised about it recently.”
How long is it until the toxicity of the Lib-Con coalition taints Darling's Bitter Together outfit?
hand out the bits they have poisoned , just what you would expect from these dullards. Hopefully Salmond will debate with Darling and when wiping the floor with him will ask how a failed , millionaire flipping back bench LABOUR MP is representing the UK government on what it can and will do on Independence. Meanwhile big cowardy custard will be hiding behind the couch. The fact that cowardly Cameron chose a Labour MP to represent the UK government rather than the hapless Scottish Secretary says it all about the unionists.
I am afraid you cannot use that old canard, Salmond represents the government of Scotland , Darling as stated by Cameron is the UK governmnet spokesman on the the referendum. Pro independence Scots have Blair Jenkins as their spokesman. darling as the UK government appointed fall guy will take the kicking and cowardly cameron can then blame it on Labour. LOL.
Reminds me of something I meant to ask. At the Labour stand there was an apparently anti-independence stand with lots of "Better together" signs. However, there were also some "Blether together" signs. To me, "blether" sounds mildly derogatory. There were no staff. Couldn't decide if this was a satire (expensive to pay £1000+ for a stand to make an obscure pun) or "blether" is a Scottish word meaning something non-derisive, or what. I see they have a website which does the same: http://bettertogether.net/blog/entry/blether-together . Can anyone explain?
Blether can be a noun & verb (fairly neutral), a/to chat, or a noun (derisive), rubbish, 'you're spikkin' a lot o' blethers'. I assume the signs were intended to indicate the former, somewhere to have a chat about the issues. I may have a different view of course!
If it's okay for the government to intervene in the mortgage market why is it not okay for it to do the same with energy prices.
Methinks there's a lot of hypocrisy about.
What the government is doing with the Help to Buy guarantee scheme is to provide banks with insurance against the risk of catastrophic house price falls. Such falls would result in the security banks have taken failing to cover the value of their loans. The scheme involves the banks paying a premium to the government in return for the insurance cover against loss from house prices falling. The alternatives for the bank are to only offer mortgages with a maximum of 75% Loan to Value (generally what they have been doing since the financial crisis), or, to raise additional capital to meet regulatory requirements for higher risk mortgage lending. The government are not imposing the Help to Buy guarantee scheme on the banks. Banks are entirely free to buy in to the scheme or not. However as the scheme is structured and costed in a way which is advantageous to banks they have adopted it enthusiastically.
Everyone benefits. Banks are able to grow their mortgage books without having to raise capital from the markets. Households who don't have 25% of a property's value to post as a deposit can now get loans. House construction companies have stable demand for increasing their output. The economy as a whole benefits as consumer confidence engendered by stable house price growth underpins general demand. The government benefits by providing a solution which enables wider property ownership and which protects the value of most voters principal asset.
Now compare this to Miliband's proposal to fix prices in the household energy supply market. It is compulsory and imposed on the industry against their wishes. It has already knocked £2billion off their combined share value reducing the ability of and/or increases the cost to the companies of raising market funds for new investment. It promises to reduce their profitability by £4.5 billion, once again reducing their capacity to fund investment from retained profits. It increases uncertainty in the development of the sector thereby providing a disincentive for new market entrants. It imposes the risks of global pricing volatility onto the energy suppliers without giving them the ability to adjust domestic pricing to changes in input prices (either up or down). It fails to address the real causes of energy price inflation: global commodity pricing and environmental intervention. It increases rather than reduces catastrophic risk of blackouts. It runs counter to all known experience and theory on the ineffectiveness of price controls to deliver original objectives.
Perhaps if Miliband had followed Osborne's approach he might have been able to come up with a proposal for energy prices which aligned the interests of all stakeholders in the issue. He didn't. Like on Syria, he played for short term party political gain at a cost of jeopardising the country's strategic interests and economic success.
If it's okay for the government to intervene in the mortgage market why is it not okay for it to do the same with energy prices.
Methinks there's a lot of hypocrisy about.
What the government is doing with the Help to Buy guarantee scheme is to provide banks with insurance against the risk of catastrophic house price falls. Such falls would result in the security banks have taken failing to cover the value of their loans. The scheme involves the banks paying a premium to the government in return for the insurance cover against loss from house prices falling. The alternatives for the bank are to only offer mortgages with a maximum of 75% Loan to Value (generally what they have been doing since the financial crisis), or, to raise additional capital to meet regulatory requirements for higher risk mortgage lending. The government are not imposing the Help to Buy guarantee scheme on the banks. Banks are entirely free to buy in to the scheme or not. However as the scheme is structured and costed in a way which is advantageous to banks they have adopted it enthusiastically.
Everyone benefits. Banks are able to grow their mortgage books without having to raise capital from the markets. Households who don't have 25% of a property's value to post as a deposit can now get loans. House construction companies have stable demand for increasing their output. The economy as a whole benefits as consumer confidence engendered by stable house price growth underpins general demand. The government benefits by providing a solution which enables wider property ownership and which protects the value of most voters principal asset.
[to be continued ...]
You miss the point that, to the extent that house prices are increased above their market norm (not a bubble, which I don't expect) that is not a productive use of capital
What the Energy markets need are more price transparency (why can the companies not simply tell me how much they charge per unit?), and more real competition.
Energy industries are capital intensive major pieces of infrastructure with a long term view. If the UK energy market was such a lucrative source of profits we would want to encourage new entrants, and the smaller niche companies such as Good Energy to invest and expand. A price fix is a very blunt instrument, as if there is a spike in the wholesale price the costs of providing the retail power could make for highly leveraged losses. A stable low risk investment environment becomes a high risk one.
This will be a bar to new entrants, and much riskier for new entrants than the big six, who can sustain losses in the short term.
Millibands policy will consolidate the position of the big six by knackering their potential competitors. In the long run this will lead to higher retail prices, Milliband is only interested in the short term, so this may suit him. All tactics but no grand strategy.
'EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty'
At least consumers will know that part of their price increases this year & next will be to offset the effect of the 20 month price freeze and be able to thank Ed accordingly..
why can the companies not simply tell me how much they charge per unit?)
If what they're charging you reflects the variation in the cost of getting power to you at various different times in the day the answer to that question should be a little bit complicated.
adamfleming @adamfleming Hurrah the @daily_politics has secured a set of the must-have Labour/Unions top trumps cards #cpc13 pic.twitter.com/TXik7ut5JY
why can the companies not simply tell me how much they charge per unit?)
If what they're charging you reflects the variation in the cost of getting power to you at various different times in the day the answer to that question should be a little bit complicated.
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
Mike K. What a load of Tory tosh. Ed Miliband has done the morally right thing to promise to repeal the evil bedroom tax and freeze utility charges for two years. This will help millions of hard up people. Seemingly, you think its okay for disabled, and poor people to lose their homes and that the rest of us should pay huge increases in utility charges, so that the parasites who run those industries can take home fat bonuses and unearned profits. People like you have no morals or compassion.
If you go down to the woods today, You're sure of a big surprise. If you go down to the woods today, You'd better go in disguise. For every bear that ever there was Will gather there for certain because Today's the day the teddy bears have their picnic.
Picnic time for teddy bears; The little teddy bears are having a lovely time today. Watch us catch them unawares, And see them picnic on their holiday. See them gaily gad about. They love to play and shout, They never have any cares. At six o'clock their mummies and daddies Will take them home to bed Because they're tired little teddy bears.
Reminds me of something I meant to ask. At the Labour stand there was an apparently anti-independence stand with lots of "Better together" signs. However, there were also some "Blether together" signs. To me, "blether" sounds mildly derogatory. There were no staff. Couldn't decide if this was a satire (expensive to pay £1000+ for a stand to make an obscure pun) or "blether" is a Scottish word meaning something non-derisive, or what. I see they have a website which does the same: http://bettertogether.net/blog/entry/blether-together . Can anyone explain?
Blether can be a noun & verb (fairly neutral), a/to chat, or a noun (derisive), rubbish, 'you're spikkin' a lot o' blethers'. I assume the signs were intended to indicate the former, somewhere to have a chat about the issues. I may have a different view of course!
"Better Together" is usually satirised as "Bitter Together".
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
How does that compare with Osborne economiclly illiterate mortgage boost plan? I'd suggest they are both wrong but Tories on PB at least feel unable to crticise the latter
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
If they do not want to operate in the UK they will sell their UK interests to people who do. If they do want to operate in the UK they will accept a not/very-draconian, temporary measure introduced by the country's democratically elected government. What they won't do, because it will be suicide commercially, is turn the lights out. Though, of course, they will squeal all the way to the day a freeze begins. The idea that there is a free market in energy is just silly.
If it's okay for the government to intervene in the mortgage market why is it not okay for it to do the same with energy prices.
Methinks there's a lot of hypocrisy about.
What the government is doing with the Help to Buy guarantee scheme is to provide banks with insurance against the risk of catastrophic house price falls. Such falls would result in the security banks have taken failing to cover the value of their loans. The scheme involves the banks paying a premium to the government in return for the insurance cover against loss from house prices falling. The alternatives for the bank are to only offer mortgages with a maximum of 75% Loan to Value (generally what they have been doing since the financial crisis), or, to raise additional capital to meet regulatory requirements for higher risk mortgage lending. The government are not imposing the Help to Buy guarantee scheme on the banks. Banks are entirely free to buy in to the scheme or not. However as the scheme is structured and costed in a way which is advantageous to banks they have adopted it enthusiastically.
Everyone benefits. Banks are able to grow their mortgage books without having to raise capital from the markets. Households who don't have 25% of a property's value to post as a deposit can now get loans. House construction companies have stable demand for increasing their output. The economy as a whole benefits as consumer confidence engendered by stable house price growth underpins general demand. The government benefits by providing a solution which enables wider property ownership and which protects the value of most voters principal asset.
[to be continued ...]
Hint: "He is a man of few words" is often meant as a compliment. (I know, I can't talk.) "tlnr" is a relevant internet abbreviation.
How does that compare with Osborne economiclly illiterate mortgage boost plan? I'd suggest they are both wrong but Tories on PB at least feel unable to crticise the latter
Mike K. What a load of Tory tosh. Ed Miliband has done the morally right thing to promise to repeal the evil bedroom tax and freeze utility charges for two years. This will help millions of hard up people. Seemingly, you think its okay for disabled, and poor people to lose their homes and that the rest of us should pay huge increases in utility charges, so that the parasites who run those industries can take home fat bonuses and unearned profits. People like you have no morals or compassion.
Dont take my name in vain! I don't know what the F**k you're talking about. and I'm certainly NOT a Tory. Vote UKIP!
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
How does that compare with Osborne economiclly illiterate mortgage boost plan? I'd suggest they are both wrong but Tories on PB at least feel unable to crticise the latter
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
If they do not want to operate in the UK they will sell their UK interests to people who do. If they do want to operate in the UK they will accept a not/very-draconian, temporary measure introduced by the country's democratically elected government. What they won't do, because it will be suicide commercially, is turn the lights out. Though, of course, they will squeal all the way to the day a freeze begins. The idea that there is a free market in energy is just silly.
The 'democratically elected government' phrase is sensible. What we should be doing is pointing out the pros and cons of this debate rather than shouting it down, so that people can at least make an informed decision.
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
If they do not want to operate in the UK they will sell their UK interests to people who do. If they do want to operate in the UK they will accept a not/very-draconian, temporary measure introduced by the country's democratically elected government. What they won't do, because it will be suicide commercially, is turn the lights out. Though, of course, they will squeal all the way to the day a freeze begins. The idea that there is a free market in energy is just silly.
No. plain silly is pretending Miliband knows anything about how an economy works. Anyone who can make Osborne look good is not fit for purpose.
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
What Miliband has realised is that the interests of big business, big finance and institutional investors do not necessarily align with the interests of end-users. That is a very important realisation and also one that is correct. Now the Tories need to either explain why the current settlement is the best we can do and is for the best, or they have to come up with alternatives which show they too understand new ways of doing things are required.
Reminds me of something I meant to ask. At the Labour stand there was an apparently anti-independence stand with lots of "Better together" signs. However, there were also some "Blether together" signs. To me, "blether" sounds mildly derogatory. There were no staff. Couldn't decide if this was a satire (expensive to pay £1000+ for a stand to make an obscure pun) or "blether" is a Scottish word meaning something non-derisive, or what. I see they have a website which does the same: http://bettertogether.net/blog/entry/blether-together . Can anyone explain?
Blether can be a noun & verb (fairly neutral), a/to chat, or a noun (derisive), rubbish, 'you're spikkin' a lot o' blethers'. I assume the signs were intended to indicate the former, somewhere to have a chat about the issues. I may have a different view of course!
"Better Together" is usually satirised as "Bitter Together".
Indeed. Perhaps in the non-threatening safety zone of the conference of the UK's premier Unionist party, all that bitterness just drained away. Ah hae ma doots!
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
What Miliband has realised is that the interests of big business, big finance and institutional investors do not necessarily align with the interests of end-users. That is a very important realisation and also one that is correct. Now the Tories need to either explain why the current settlement is the best we can do and is for the best, or they have to come up with alternatives which show they too understand new ways of doing things are required.
Er that's his big epiphany ? That producers and consumers don't have the same interests ? That's sort of chapter one of economics.
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in energy supply companies are willing to halt long-term investment because of a two-year prize freeze, a period in which they will still generate substantial profits, that merely serves to illustrate the failure of the current model.
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
If they do not want to operate in the UK they will sell their UK interests to people who do. If they do want to operate in the UK they will accept a not/very-draconian, temporary measure introduced by the country's democratically elected government. What they won't do, because it will be suicide commercially, is turn the lights out. Though, of course, they will squeal all the way to the day a freeze begins. The idea that there is a free market in energy is just silly.
No. plain silly is pretending Miliband knows anything about how an economy works. Anyone who can make Osborne look good is not fit for purpose.
This economy is not working. It is not fit for purpose. The Tory solution - higher prices, less employee protection, lower salaries, lower taxes - is not going to work either. I am no fan of Ed's, but at least he has realised there is no natural alignment between the priorities of big business, big finance and institutional investors, and the aspirations of ordinary voters.
How does that compare with Osborne economiclly illiterate mortgage boost plan? I'd suggest they are both wrong but Tories on PB at least feel unable to crticise the latter
Leaving aside the petty irony of "economiclly illiterate " I have concerns about this new boost to the market but let's also remember:
1. Inside the M25 property market is v v different to the rest of the UK. Too much London-centric a view is being taken.
2. The banks have gone from 125% LTV extremes pre-crash too far the other way in pricing their mortgages at a massive range between those wealthy with large deposits and those starting out or with only limited equity
3. The 15% or less deposit/equity property buyer/owner faces a risk premium which is very large in my opinion and reflects the capital constraints etc put on the banks now by the Regulators, shrinking balance sheets etc
4. This is a market pricing failure with risk switched from too lax pre 2008 to now risk-averse, we've gone from 1 extreme to another. Arranging a mortgage these days is a complete nightmare as the banks want so much evidence and arse-covering that I'd rather not write the business when it comes up.
5. The Govt scheme is essentially nudging the banks to narrow that now excessive risk premia they are charging between the equity wealthy and those who are not....
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
What Miliband has realised is that the interests of big business, big finance and institutional investors do not necessarily align with the interests of end-users. That is a very important realisation and also one that is correct. Now the Tories need to either explain why the current settlement is the best we can do and is for the best, or they have to come up with alternatives which show they too understand new ways of doing things are required.
Er that's his big epiphany ? That producers and consumers don't have the same interests ? That's sort of chapter one of economics.
I agree completely. Miliband seems to be the first senior politician in this country to have grasped this rather obvious fact though.
You miss the point that, to the extent that house prices are increased above their market norm (not a bubble, which I don't expect) that is not a productive use of capital
Charles
Using Nationwide's long term index of real house prices, you can see the gap between today's house prices and where real house prices would be today if they had grown since the crash at a stable and moderate rate. This is easier to see in a graph but absent the ability to post datawrapper charts in comments (or equivalent) this table will have to suffice.
What the table clearly shows is the crazy bubble blown by Brown between 2003 and 2008 (the lending boom was between 1998 and 2002, so the price gap is the lagging effect).
It also clearly shows that house prices today are further below where they should be, if they had grown at the rate of inflation, than at any time since 1997.
It is going to be some time before house prices are increased "above their market norm" regardless of the HTB schemes.
What happens when interest rates go up, wages have not risen sufficiently and people can no longer afford to pay their government-backed mortgages? Does the magic money tree cancel the state-owned bad debts?
EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty.
Certainty that none of the £100bn investment that Ed said we need will happen in the next 4 years.
Genius.
If those running and investing in
You're normally quite sensible so it's rather depressing to see you come out with such rubbish.
Pretending tha real world consequences shouldn't exist is just la la land.
If they do not want to operateis just silly.
No. plain silly is pretending Miliband knows anything about how an economy works. Anyone who can make Osborne look good is not fit for purpose.
This economy is not working. It is not fit for purpose. The Tory solution - higher prices, less employee protection, lower salaries, lower taxes - is not going to work either. I am no fan of Ed's, but at least he has realised there is no natural alignment between the priorities of big business, big finance and institutional investors, and the aspirations of ordinary voters.
Ed seemed quite happy with the disconnect between voters and business when he served in a government that was relaxed about the "filthy rich".
As ever we have a load of bollocks from a bloke who has never done a days work outside the politics bubble. It's quite noticeable that economic politics is becoming all about how to slice and dice the economic cake rather than how to make it bigger. Simply put that's because all the main parties have a similar background and understand bugger all about how to get real growth back in to the economy.
So while Ed twerks about his latest distribution of wealth plan only an idiot would maintain it has any economic advantages. If sorting out this non-functioning sector is so easy then why didn't Miliband do it when he was in DECC ?
Last week a lender told me that if providing information from a client which they had sent to me by email, I needed to print out the client email, certify it with a company stamp/signature etc as a true copy of the original, then scan it and then upload it to their processing website.
This is far beyond the normal stuff of certifying pay slips, P60's, passports, IDs etc which is to be expected.
What is a PBTory? A simple question that hopefully a semi-sentient may be able to profer a literate, comprehensible answer too.
Am I am "PBTory", or AntiFrank? Maybe Wee-Timmy is too: How about Junior...?
All are sensible folk who share a broad approach to politics (if not my scrumpy-fuelled delivery) and politics that covers most of the aspects of mine.* No: What matters is an accepted, gutter-found ability to define an acceptable insult: I think there are many on here who required "font-size:4pt; font-family:comic-sans-serif;font-color: red;" warning....
* Apart from Junior I'd suggest I agree most with: JohnLilburne, Richard Tyndall and - eek - Dr Fox [itS]. Oh, and Professor Nabavi, of course....
What happens when interest rates go up, wages have not risen sufficiently and people can no longer afford to pay their government-backed mortgages? Does the magic money tree cancel the state-owned bad debts?
You are right - we mustn't let Labour back in to power in 2015 to risk that.
Seriously though - this policy is to help people who haven't the equity but who are demonstrably strong enough in affordability! These are the 2 vital risks a lender looks at, deposit/equity and affordability . Your point above makes no sense and is economiclly illeterate.
The latter isn't just based on the initial mortgage deal either when judging ongoing affordability and the lenders are being thrashed by the FCA to ensure they are checking that - this scheme is to help where the lack of equity/deposit is the barrier both in terms of deals available and the pricing of those deals which are.
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
What Miliband has realised is that the interests of big business, big finance and institutional investors do not necessarily align with the interests of end-users. That is a very important realisation and also one that is correct. Now the Tories need to either explain why the current settlement is the best we can do and is for the best, or they have to come up with alternatives which show they too understand new ways of doing things are required.
Er that's his big epiphany ? That producers and consumers don't have the same interests ? That's sort of chapter one of economics.
I agree completely. Miliband seems to be the first senior politician in this country to have grasped this rather obvious fact though.
No Miliband's just the first senior politican in about a quarter of a century who thinks old solutions will work in a modern economy. If political fiat solves all problems people would have done it years ago.
You miss the point that, to the extent that house prices are increased above their market norm (not a bubble, which I don't expect) that is not a productive use of capital
Charles
Using Nationwide's long term index of real house prices, you can see the gap between today's house prices and where real house prices would be today if they had grown since the crash at a stable and moderate rate. This is easier to see in a graph but absent the ability to post datawrapper charts in comments (or equivalent) this table will have to suffice.
What the table clearly shows is the crazy bubble blown by Brown between 2003 and 2008 (the lending boom was between 1998 and 2002, so the price gap is the lagging effect).
It also clearly shows that house prices today are further below where they should be, if they had grown at the rate of inflation, than at any time since 1997.
It is going to be some time before house prices are increased "above their market norm" regardless of the HTB schemes.
It is a little painful to read your yellow box (mostly because I bought my current house in Q1 2007- at the peak, albeit with quite good equity).
So house prices are in real terms as cheap as in 2002 seems to be the conclusion. There is a lot of regional variation, but the East Midlands are close to the median.
Doesn't sound too unhealthy to me.
Anecdote time: in 1992 as a newly wedded junior Doctor I had a good income, with good prospects of that increasing, and bought my first house at the bottom of the 90's housing market. I had income, but no capital, so the deposit was the problem. Osbornes scheme would have been Manna to me. As it was I had to get a personal loan at higher rates than the mortgage in order to make the deposit.
You miss the point that, to the extent that house prices are increased above their market norm (not a bubble, which I don't expect) that is not a productive use of capital
Charles
Using Nationwide's long term index of real house prices, you can see the gap between today's house prices and where real house prices would be today if they had grown since the crash at a stable and moderate rate. This is easier to see in a graph but absent the ability to post datawrapper charts in comments (or equivalent) this table will have to suffice.
What the table clearly shows is the crazy bubble blown by Brown between 2003 and 2008 (the lending boom was between 1998 and 2002, so the price gap is the lagging effect).
It also clearly shows that house prices today are further below where they should be, if they had grown at the rate of inflation, than at any time since 1997.
It is going to be some time before house prices are increased "above their market norm" regardless of the HTB schemes.
Miliband's a fool or a knave. And yes, I disagree with the house-lending shenanigans of Osborne as well. But just because he's got a splinter in his eye doesn't mean the beam in Miliband's should be glossed over.
@Alanbrooke Your argument seems to be that because Ed got stuff wrong in the past - and, yes, I agree he did - he is disqualified from doing or suggesting anything different in the future. That makes no sense to me.
Er that's his big epiphany ? That producers and consumers don't have the same interests ? That's sort of chapter one of economics.
You mean:
"When the producers are state-owned, manned by public-sector unions (who funnel taxes into the Labour Party) they are good; consumers of such services should bow-down in praise of their magnificence, and
"When the are private - nay owned by foreign-states who have invested their workers' pensions in the UK energy-supply - or a bunch of UK muffly-closeted pension-funds (whose money only goes to Tory voters and we - the Labour Party - have already spent most of those future earnings; '"Badger's"' bringing 'expenditure forward' was a larf) then of course, the Labour Party, we will support those lickle folk who are subject unto law (unlike us tax-advisers and Friends-of-Silvio 'Free the Berlusconi One'; provider of watches and Finemeccanica roles)!
"Well, until we get to power and reverse our lies through the 'common-purpose' courts...."
Sadly some people fall for such gaff. A nation - nay, "One Nation" - full over over-accreditted and under-educated fules....
Last week a lender told me that if providing information from a client which they had sent to me by email, I needed to print out the client email, certify it with a company stamp/signature etc as a true copy of the original, then scan it and then upload it to their processing website.
This is far beyond the normal stuff of certifying pay slips, P60's, passports, IDs etc which is to be expected.
Try Russia Scrapheap.
Original documents all need to be notarised.
Still they look good with their sealing wax, stamp and pretty ribbon.
@Alanbrooke Your argument seems to be that because Ed got stuff wrong in the past - and, yes, I agree he did - he is disqualified from doing or suggesting anything different in the future. That makes no sense to me.
If people learn from their mistakes, and do not repeat them, good for them. Does this apply to everyone?
@Alanbrooke Your argument seems to be that because Ed got stuff wrong in the past - and, yes, I agree he did - he is disqualified from doing or suggesting anything different in the future. That makes no sense to me.
He's entitled to change his mind of course ( but no mea culpa I note ). However I would simply note that a man who has failed to take action on energy markets when he could have might be worth treating with a pinch of salt on latest outing; and opprtunism while at times good politics doesn't make for good economics.
Last week a lender told me that if providing information from a client which they had sent to me by email, I needed to print out the client email, certify it with a company stamp/signature etc as a true copy of the original, then scan it and then upload it to their processing website.
This is far beyond the normal stuff of certifying pay slips, P60's, passports, IDs etc which is to be expected.
Try Russia Scrapheap.
Original documents all need to be notarised.
Still they look good with their sealing wax, stamp and pretty ribbon.
Are you saying this is what Red will need me to do post 2015?
He's entitled to change his mind of course ( but no mea culpa I note ). However I would simply note that a man who has failed to take action on energy markets when he could have might be worth treating with a pinch of salt on latest outing; and opprtunism while at times good politics doesn't make for good economics.
Worth watching Caroline Flint earlier. While acknowledging that a significant portion of high energy costs are due to Ed's carbon tears in the last Government, they have no plans to reverse any of that.
He's entitled to change his mind of course ( but no mea culpa I note ). However I would simply note that a man who has failed to take action on energy markets when he could have might be worth treating with a pinch of salt on latest outing; and opprtunism while at times good politics doesn't make for good economics.
Worth watching Caroline Flint earlier. While acknowledging that a significant portion of high energy costs are due to Ed's carbon tears in the last Government, they have no plans to reverse any of that.
hardly a surprise, while in reality you could make an argument for scrapping the lot.
Good to see the talk from Marr and on twitter that the election debates are likely to go ahead and will be spaced out across early 2015 - the Tories need a long election campaign to nail down Labour and sell what they've done to a sceptical electorate. Not many people are paying attention in meantime, apart from the occasional eye-catching policy (like Miliband's).
In the mean time, the odd bit of Tory eye-candy, a radical and competent government, and 20 months of growth and reducing unemployment to sell when the time is right.
What happens when interest rates go up, wages have not risen sufficiently and people can no longer afford to pay their government-backed mortgages? Does the magic money tree cancel the state-owned bad debts?
You are right - we mustn't let Labour back in to power in 2015 to risk that.
Seriously though - this policy is to help people who haven't the equity but who are demonstrably strong enough in affordability! These are the 2 vital risks a lender looks at, deposit/equity and affordability . Your point above makes no sense and is economiclly illeterate.
The latter isn't just based on the initial mortgage deal either when judging ongoing affordability and the lenders are being thrashed by the FCA to ensure they are checking that - this scheme is to help where the lack of equity/deposit is the barrier both in terms of deals available and the pricing of those deals which are.
Not sure it's economically illiterate to worry that mortgages people can afford to pay now will not continue to be affordable when interest rates have risen, but wages have not to the same degree. Should that happen, the government - you, me and all other taxpayers - will be left carrying the can as far as I can see. But perhaps you can explain why that's wrong.
What is a PBTory? A simple question that hopefully a semi-sentient may be able to profer a literate, comprehensible answer too.
Am I am "PBTory", or AntiFrank? Maybe Wee-Timmy is too: How about Junior...?
All are sensible folk who share a broad approach to politics (if not my scrumpy-fuelled delivery) and politics that covers most of the aspects of mine.* No: What matters is an accepted, gutter-found ability to define an acceptable insult: I think there are many on here who required "font-size:4pt; font-family:comic-sans-serif;font-color: red;" warning....
* Apart from Junior I'd suggest I agree most with: JohnLilburne, Richard Tyndall and - eek - Dr Fox [itS]. Oh, and Professor Nabavi, of course....
What is a PBTory? A simple question that hopefully a semi-sentient may be able to profer a literate, comprehensible answer too.
Am I am "PBTory", or AntiFrank? Maybe Wee-Timmy is too: How about Junior...?
All are sensible folk who share a broad approach to politics (if not my scrumpy-fuelled delivery) and politics that covers most of the aspects of mine.* No: What matters is an accepted, gutter-found ability to define an acceptable insult: I think there are many on here who required "font-size:4pt; font-family:comic-sans-serif;font-color: red;" warning....
* Apart from Junior I'd suggest I agree most with: JohnLilburne, Richard Tyndall and - eek - Dr Fox [itS]. Oh, and Professor Nabavi, of course....
What happens when interest rates go up, wages have not risen sufficiently and people can no longer afford to pay their government-backed mortgages? Does the magic money tree cancel the state-owned bad debts?
You are right - we mustn't let Labour back in to power in 2015 to risk that.
Seriously though - this policy is to help people who haven't the equity but who are demonstrably strong enough in affordability! These are the 2 vital risks a lender looks at, deposit/equity and affordability . Your point above makes no sense and is economiclly illeterate.
The latter isn't just based on the initial mortgage deal either when judging ongoing affordability and the lenders are being thrashed by the FCA to ensure they are checking that - this scheme is to help where the lack of equity/deposit is the barrier both in terms of deals available and the pricing of those deals which are.
Not sure it's economically illiterate to worry that mortgages people can afford to pay now will not continue to be affordable when interest rates have risen, but wages have not to the same degree. Should that happen, the government - you, me and all other taxpayers - will be left carrying the can as far as I can see. But perhaps you can explain why that's wrong.
The biggest risk to mortgage borrowers is that a Labour government gets in in 2015 and Marx and Spender (credit:fitalass) ramps up government borrowing. The markets will then push up the UK's sovereign borrowing costs with knock on impact on mortgage rates.
Property prices will then crash and Labour will be left having to pick up the Help to Buy guarantee costs.
The very best aspect of Osborne's Help to Buy guarantee scheme is that it will act as a constraint on Miliband's spend and borrow tendencies if the country is so misguided as to elect Labour in 2015.
Last week a lender told me that if providing information from a client which they had sent to me by email, I needed to print out the client email, certify it with a company stamp/signature etc as a true copy of the original, then scan it and then upload it to their processing website.
This is far beyond the normal stuff of certifying pay slips, P60's, passports, IDs etc which is to be expected.
Try Russia Scrapheap.
Original documents all need to be notarised.
Still they look good with their sealing wax, stamp and pretty ribbon.
Are you saying this is what Red will need me to do post 2015?
It will be red sealing wax and pink ribbons.
Russians also seal their office doors overnight in order to detect unauthorised entry while they are out of the office.
Ed Miliband doesn't care about whether the lights go out. He Just wants power. And he knows the X factor generation is pretty gullible and apt to go for simple, sparkly politics. Privately, I reckon the cleverer labour people are terrified of what this man might do to the country and their party.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
How does that compare with Osborne economiclly illiterate mortgage boost plan? I'd suggest they are both wrong but Tories on PB at least feel unable to crticise the latter
Tory views on Help to Buy have ranged from outright criticism, through grudging acquiesance. Avery is the only non-critical poster I'm aware of.
Mr. Charles, indeed. One suspects Labour sorts might consider how many of them have criticised MIliband's 1970s price controlling, land grabbing socialism.
Another reason why "Doctors" writings need a chemist to understand them methinks: Another correlation =/= causation episode.
Dr Foxscribled positied:
My thoughts are the same as Fluffy's</>[sic]
I think it was a rush-to-his-head: Maybe this would be more accurate:
Fluffy think's that we share similar thoughts!
Again: The ability to read is one thing. We all need to be able to comprehend what we read. [E.g.: What does "6% alcohol: No more than 21-units" mean in the context of a Sunday morning...?]
Not sure it's economically illiterate to worry that mortgages people can afford to pay now will not continue to be affordable when interest rates have risen, but wages have not to the same degree. Should that happen, the government - you, me and all other taxpayers - will be left carrying the can as far as I can see. But perhaps you can explain why that's wrong.
SO = you are missing the point still. Affordability calculations are not just being taken on current low rates (unless its a fix for 5 years or more maybe) but on the reversion rate, or if rates go up too. Affordability has to be carefully assessed and not just on assuming low interest rates forever but on more normal rates too.
HTB isn't about the affordability calcs of borrowers - full stop. It is about whether they have a deposit or not to put down. If they are renting currently paying say £1,000pm, it's damn hard to save a 15%+ deposit even if they are comfortably affording that rent.
Just to illustrate the regulatory costs which are skewing the lending market:
"Capital requirements mean that lenders have to hold roughly six times more capital for loans at 90 per cent LTV or over than they do on loans under 60 per cent LTV."
"Should that happen, the government - you, me and all other taxpayers - will be left carrying the can as far as I can see. But perhaps you can explain why that's wrong"
Sorry - can't resist - and of course that didn't happen with Lloyds, Northern cRock, Bradford & Bungley, RBS et al when Labour were in prower..
I've found tim... Darling for PM campaign is growing.
Tim Shipman (Mail)@ShippersUnbound52s Badger huggers yelling outside Tory conference. Pictures of Dave and Paterson as 'badger butchers'. O-Patz will be delighted
Philip Aldrick @PhilAldrick @faisalislam average FTB deposit 1988 - 12.4pc, 1996 - 9.9pc, 2006 - 16.4pc, 2012 - 23pc. ONS stats (table 38) ons.gov.uk/ons/publicatio…
I have always wasted money upon various public, international and bank insurances: Mortgage, loans, credit-cards; health-and-social costs and the like. I have never claimed against any: How many on the left complaining about Ozzies current house-building insurance-scheme could say the like...?
Mr. Jessop, I couldn't really get into Fallout 3. I disliked the fact it had an end (unlike Skyrim or Oblivion), and the whole world is just too bland. Not a bad game by any stretch, it just never grabbed me.
Mr. Jessop, I couldn't really get into Fallout 3. I disliked the fact it had an end (unlike Skyrim or Oblivion), and the whole world is just too bland. Not a bad game by any stretch, it just never grabbed me.
I've never played Fallout. In fact, I don't play many computer games - I spend enough time sitting in front of my computer screen as it is. However I did get rather addicted to the on-line empire-building game Travian, but I'm over that now. ;-)
Mrs J has all the Fallout expansion packs, and plays them religiously.
Some of the Command and Conquer series were good. But to be honest, I'd rather go for a walk if I have any spare time ...
Mr. Jessop, I couldn't really get into Fallout 3. I disliked the fact it had an end (unlike Skyrim or Oblivion), and the whole world is just too bland. Not a bad game by any stretch, it just never grabbed me.
I've never played Fallout. In fact, I don't play many computer games - I spend enough time sitting in front of my computer screen as it is. However I did get rather addicted to the on-line empire-building game Travian, but I'm over that now. ;-)
Mrs J has all the Fallout expansion packs, and plays them religiously.
Some of the Command and Conquer series were good. But to be honest, I'd rather go for a walk if I have any spare time ...
The Elder Scroll games by Bethesda eg Morrowind, Oblivion and Skyrim were (and are) some of the best RPG's in the computer game world. I'm now waiting for the Elder Scrolls Online to begin and it looks like it's going to be fantastic. ---------------- Now another matter to ponder. All the major parties should be very wary of UKIP:
This is my point really although if I hear HWP again this week, I may scweam.
Sajid Javid MP@sajidjavid12m Help To Buy is for hard working people who can afford a mortgage, but don't have enough savings for a big deposit. We're on your side #cpc13
It looks like Ed is certainly getting a boost. Presumably these YouGov findings are with the new methodology as well. Have any other pollsters responded to the Lab conference? This seems to be the biggest shake up since Cameron had his veto moment at the end of 2011. I also think Ed will have been strengthened by the Lib Dem conference and Clegg's rather vacuous speech (we'll do pretty much anything to stay in government and promise to rein in the others).
I remember Cameron's veto moment and being perplexed by why it seemed to boost his poll ratings. However Michael Portillo pointed out that Cameron had done the 'unthinkable' and said No to Europe. Has something similar happened with Ed? For the first time in a long time a senior party leader has said No to big business. The problem for Cameron was that he couldn't really follow up his big 'veto' moment because, well, he doesn't want to leave the EU. So he can't really keep saying no. Message for Ed is that he's got to remain consistent, keep challenging the fat cats and show he's on the public's side.
This is my point really although if I hear HWP again this week, I may scweam.
Sajid Javid MP@sajidjavid12m Help To Buy is for hard working people who can afford a mortgage, but don't have enough savings for a big deposit. We're on your side #cpc13
It's pushing up prices, or at least it is stopping them falling so can we please give this policy it's proper name - Help to SELL. This really is wonderful for all those older people who've been wanting to downsize for years.
What really angers me is that politicians never ask WHY people are so desperate to get on the housing ladder. If they really want to show themselves on the side of ordinary people they'd do something to boost tenancy rights. However that might not please their buy to let supporters. Meanwhile we get people to take out 90-95% mortgages whilst interest rates are really low and then watch the fun unfold as rates rise.
HTB isn't about the affordability calcs of borrowers - full stop. It is about whether they have a deposit or not to put down...
"Capital requirements mean that lenders have to hold roughly six times more capital for loans at 90 per cent LTV or over than they do on loans under 60 per cent LTV."
Some thoughts on this. First of all, it's disingenuous to quote reg cap requirements for 60% vs 90% since HTB isn't getting from on to the other. Second, accepting your (correct) point that the risk-weighted assets attributable to higher LTV home loans are disproportionately higher, leading to less affordable mortgages, you'd have to ask why. Two possible answers: (a) the reg capital framework has got it wrong, and 90%+ LTV's aren't a greater risk to the institution. In that case HTB is a sensible bridging policy whilst this flaw is sorted out. Or (b) the risk to the institution of making loans at this level increases in a non-linear fashion, meaning that the pricing is a sensible reflection of the risk. Personally I'd go with (b) but I've not done any reg capital work for 3 years and I might be missing a known problem in the system.
Assume it's (b). The government is taking on the nasty end of the risk curve so that borrowers with a riskier scenario can get lower rate loans (remember, it's not that these mortgages don't exist without state intervention, they just cost more). If you went shopping for an equivalent guarantee on the market, then it would cost you quite a lot - in fact the difference between the 75% and 95% mortgage or whatever. Assuming the free market is pricing this risk correctly - a reasonable Tory assumption, right? - then the policy is simply a mortgage interest subsidy for purchase. Fine. I mean, there's no money left, but leaving that aside it might be a good way to spend more of the money we don't have.
However, what happens when the buyer wants to remortgage? They probably have a rate that won't look too smart in 3-5 years. Either the government continues this subsidy; or mortgage payments go up sharply. The only way out for the government is to engineer house price inflation big time so that this year's 95% mortgage is 2016's 75% mortgage. It's that; or deferring price crash and repossessions; or providing open-ended subsidy. None of these are good.
And people complain that 20 months of energy price-capping could have unintended consequences....
Re Tory policy announcements, I'm pleased to see that police will no longer be able to give a caution to robbers. I once caught someone who snatched a girl's phone. I chased him for 100 yards, brought him down and treated him as civilly as you can when you are kneeling on them. When the police arrived I made it clear that I would go to court and give evidence, so I was very annoyed to find out later that the mugger had been let off with a caution. It clearly wasn't the first time he'd done it and I then wished I'd taken the chance to grind his face into the pavement and leave him with a proper memento rather than the trite letter he'll have got from the old bill.
If it's okay for the government to intervene in the mortgage market why is it not okay for it to do the same with energy prices.
The government is not intervening in the price of houses, unlike Miliband's proposal on energy.
Or should Miliband propose a freeze on house prices too?
Both moves are intervention into the market.
I dislike both of them but your sort of partisan response is just rubbish. Just like you trying to compare numbers from one polling company with another and then claiming a trend.
And your response rises above 'partisan rubbish'?
All governments intervene in markets, one way or another.
Only foolish governments attempt to control prices - unless you've got examples of that succeeding?
And when have I compared polling numbers across companies?
I am delighted Ed Miliband is right leader for Labour Leader and Britain needs to turn to left .
We want Social Democracy Centre Left Policies.
He is right Price Freeze and keeping NHS as free Public Health Service not Private Health Services paying fees like America.
I feAr the worst if David Cameron and Tories win outright General Election 2015 Victory this would cause Social Unrest and poor, Working Class and lower Middle Class would suffer.
The top Upper wealthy people would do well.
I hope for Labour and Lib dem Coalition we need Electoral reform PR we need and elected Senate place unwanted unelected House of. Lords.' Devolved English Parliament in Birmingham .
Come on Labour beat the Tories and prove them wrong Win election to prevent the country going too far right.
I am delighted Ed Miliband is right leader for Labour Leader and Britain needs to turn to left .
We want Social Democracy Centre Left Policies.
He is right Price Freeze and keeping NHS as free Public Health Service not Private Health Services paying fees like America.
I feAr the worst if David Cameron and Tories win outright General Election 2015 Victory this would cause Social Unrest and poor, Working Class and lower Middle Class would suffer.
The top Upper wealthy people would do well.
I hope for Labour and Lib dem Coalition we need Electoral reform PR we need and elected Senate place unwanted unelected House of. Lords.' Devolved English Parliament in Birmingham .
Come on Labour beat the Tories and prove them wrong Win election to prevent the country going too far right.
Would there also be tax breaks for people like yourself who are incapable of stringing a coherent sentence together?
Comments
The only certainty Ed's provided is that his freeze will become a cap the second it suits him, and from there no one has a scooby doo what our benevolent would be dictator of energy prices will decide.
www.scotsman.com/news/politics/top-stories/how-mp-pamela-nash-escaped-labour-selection-battle-1-3117295?utm_medium=twitter&utm_source=dlvr.it
So far 2 MPs (Tories Ann McIntosh and Crispin Blunt) didn't get automatic reselection. No definitive deselection though.
Is "Ed" going to reverse the same subsidy that is imposed upon benefit-claimants within the private-sector? Or are you of the faith that believes that casual discrimination cannot be evil if it supports a narrow political agenda...?
Pretending that the likely next PM breaking with the principals of free markets should not affect investment decisions of companies which can easily go to other countries which now have significantly lower political risk is just risible and should be beneath you. By all means argue the situation is serious enough to warrant this action, but pretending the real world consequences shouldn't exist is just la la land.
hand out the bits they have poisoned , just what you would expect from these dullards. Hopefully Salmond will debate with Darling and when wiping the floor with him will ask how a failed , millionaire flipping back bench LABOUR MP is representing the UK government on what it can and will do on Independence. Meanwhile big cowardy custard will be hiding behind the couch. The fact that cowardly Cameron chose a Labour MP to represent the UK government rather than the hapless Scottish Secretary says it all about the unionists.
Robert Halfon MP @halfon4harlowMP
Tories have focused on #costofliving: fuel duty & council tax freeze, restoring pension link to earnings & cutting tax for lower earners
'EdM has given energy companies 20 months notice of the price freeze plan and a defined period of time that it will last. That is a pretty decent level of certainty'
At least consumers will know that part of their price increases this year & next will be to offset the effect of the 20 month price freeze and be able to thank Ed accordingly..
I am afraid you cannot use that old canard, Salmond represents the government of Scotland , Darling as stated by Cameron is the UK governmnet spokesman on the the referendum. Pro independence Scots have Blair Jenkins as their spokesman.
darling as the UK government appointed fall guy will take the kicking and cowardly cameron can then blame it on Labour. LOL.
I assume the signs were intended to indicate the former, somewhere to have a chat about the issues. I may have a different view of course!
What he said on Marr is that Darling is the Scottish leader of the No campaign.
Everyone benefits. Banks are able to grow their mortgage books without having to raise capital from the markets. Households who don't have 25% of a property's value to post as a deposit can now get loans. House construction companies have stable demand for increasing their output. The economy as a whole benefits as consumer confidence engendered by stable house price growth underpins general demand. The government benefits by providing a solution which enables wider property ownership and which protects the value of most voters principal asset.
[to be continued ...]
Now compare this to Miliband's proposal to fix prices in the household energy supply market. It is compulsory and imposed on the industry against their wishes. It has already knocked £2billion off their combined share value reducing the ability of and/or increases the cost to the companies of raising market funds for new investment. It promises to reduce their profitability by £4.5 billion, once again reducing their capacity to fund investment from retained profits. It increases uncertainty in the development of the sector thereby providing a disincentive for new market entrants. It imposes the risks of global pricing volatility onto the energy suppliers without giving them the ability to adjust domestic pricing to changes in input prices (either up or down). It fails to address the real causes of energy price inflation: global commodity pricing and environmental intervention. It increases rather than reduces catastrophic risk of blackouts. It runs counter to all known experience and theory on the ineffectiveness of price controls to deliver original objectives.
Perhaps if Miliband had followed Osborne's approach he might have been able to come up with a proposal for energy prices which aligned the interests of all stakeholders in the issue. He didn't. Like on Syria, he played for short term party political gain at a cost of jeopardising the country's strategic interests and economic success.
Energy industries are capital intensive major pieces of infrastructure with a long term view. If the UK energy market was such a lucrative source of profits we would want to encourage new entrants, and the smaller niche companies such as Good Energy to invest and expand. A price fix is a very blunt instrument, as if there is a spike in the wholesale price the costs of providing the retail power could make for highly leveraged losses. A stable low risk investment environment becomes a high risk one.
This will be a bar to new entrants, and much riskier for new entrants than the big six, who can sustain losses in the short term.
Millibands policy will consolidate the position of the big six by knackering their potential competitors. In the long run this will lead to higher retail prices, Milliband is only interested in the short term, so this may suit him. All tactics but no grand strategy.
adamfleming @adamfleming
Hurrah the @daily_politics has secured a set of the must-have Labour/Unions top trumps cards #cpc13 pic.twitter.com/TXik7ut5JY
They do their best to have opaque pricing and thereby reduce effective competition.
I think the country will have to go through another 1976 labour bankruptcy before it learns that there is no such thing as a free lunch. Very sad, but true.
You're sure of a big surprise.
If you go down to the woods today,
You'd better go in disguise.
For every bear that ever there was
Will gather there for certain because
Today's the day the teddy bears have their picnic.
Picnic time for teddy bears;
The little teddy bears are having a lovely time today.
Watch us catch them unawares,
And see them picnic on their holiday.
See them gaily gad about.
They love to play and shout,
They never have any cares.
At six o'clock their mummies and daddies
Will take them home to bed
Because they're tired little teddy bears.
As an investor, I'm a contrarian so why not this too!
If they can keep Spurs in the Top 3 then they must be doing something right.
Balls is too scary a Chancellor in waiting....
The deficit cut by a third
1.4 million more private sector jobs
Benefits capped
Crime down
Immigration down
These are their key messages at the end of that process....
Test
Perhaps in the non-threatening safety zone of the conference of the UK's premier Unionist party, all that bitterness just drained away. Ah hae ma doots!
Leaving aside the petty irony of "economiclly illiterate " I have concerns about this new boost to the market but let's also remember:
1. Inside the M25 property market is v v different to the rest of the UK. Too much London-centric a view is being taken.
2. The banks have gone from 125% LTV extremes pre-crash too far the other way in pricing their mortgages at a massive range between those wealthy with large deposits and those starting out or with only limited equity
3. The 15% or less deposit/equity property buyer/owner faces a risk premium which is very large in my opinion and reflects the capital constraints etc put on the banks now by the Regulators, shrinking balance sheets etc
4. This is a market pricing failure with risk switched from too lax pre 2008 to now risk-averse, we've gone from 1 extreme to another. Arranging a mortgage these days is a complete nightmare as the banks want so much evidence and arse-covering that I'd rather not write the business when it comes up.
5. The Govt scheme is essentially nudging the banks to narrow that now excessive risk premia they are charging between the equity wealthy and those who are not....
You miss the point that, to the extent that house prices are increased above their market norm (not a bubble, which I don't expect) that is not a productive use of capital
Charles
Using Nationwide's long term index of real house prices, you can see the gap between today's house prices and where real house prices would be today if they had grown since the crash at a stable and moderate rate. This is easier to see in a graph but absent the ability to post datawrapper charts in comments (or equivalent) this table will have to suffice.
What the table clearly shows is the crazy bubble blown by Brown between 2003 and 2008 (the lending boom was between 1998 and 2002, so the price gap is the lagging effect).
It also clearly shows that house prices today are further below where they should be, if they had grown at the rate of inflation, than at any time since 1997.
It is going to be some time before house prices are increased "above their market norm" regardless of the HTB schemes.
Ed seemed quite happy with the disconnect between voters and business when he served in a government that was relaxed about the "filthy rich".
As ever we have a load of bollocks from a bloke who has never done a days work outside the politics bubble. It's quite noticeable that economic politics is becoming all about how to slice and dice the economic cake rather than how to make it bigger. Simply put that's because all the main parties have a similar background and understand bugger all about how to get real growth back in to the economy.
So while Ed twerks about his latest distribution of wealth plan only an idiot would maintain it has any economic advantages. If sorting out this non-functioning sector is so easy then why didn't Miliband do it when he was in DECC ?
http://blogs.spectator.co.uk/steerpike/2013/09/tories-pale-ale-fail/
Last week a lender told me that if providing information from a client which they had sent to me by email, I needed to print out the client email, certify it with a company stamp/signature etc as a true copy of the original, then scan it and then upload it to their processing website.
This is far beyond the normal stuff of certifying pay slips, P60's, passports, IDs etc which is to be expected.
Am I am "PBTory", or AntiFrank? Maybe Wee-Timmy is too: How about Junior...?
All are sensible folk who share a broad approach to politics (if not my scrumpy-fuelled delivery) and politics that covers most of the aspects of mine.* No: What matters is an accepted, gutter-found ability to define an acceptable insult: I think there are many on here who required "font-size:4pt; font-family:comic-sans-serif;font-color: red;" warning....
* Apart from Junior I'd suggest I agree most with: JohnLilburne, Richard Tyndall and - eek - Dr Fox [itS]. Oh, and Professor Nabavi, of course....
Seriously though - this policy is to help people who haven't the equity but who are demonstrably strong enough in affordability! These are the 2 vital risks a lender looks at, deposit/equity and affordability . Your point above makes no sense and is economiclly illeterate.
The latter isn't just based on the initial mortgage deal either when judging ongoing affordability and the lenders are being thrashed by the FCA to ensure they are checking that - this scheme is to help where the lack of equity/deposit is the barrier both in terms of deals available and the pricing of those deals which are.
It is a little painful to read your yellow box (mostly because I bought my current house in Q1 2007- at the peak, albeit with quite good equity).
So house prices are in real terms as cheap as in 2002 seems to be the conclusion. There is a lot of regional variation, but the East Midlands are close to the median.
Doesn't sound too unhealthy to me.
Anecdote time: in 1992 as a newly wedded junior Doctor I had a good income, with good prospects of that increasing, and bought my first house at the bottom of the 90's housing market. I had income, but no capital, so the deposit was the problem. Osbornes scheme would have been Manna to me. As it was I had to get a personal loan at higher rates than the mortgage in order to make the deposit.
Miliband's a fool or a knave. And yes, I disagree with the house-lending shenanigans of Osborne as well. But just because he's got a splinter in his eye doesn't mean the beam in Miliband's should be glossed over.
https://www.youtube.com/watch?feature=player_embedded&v=I-8fgTOkF2E
Have I helped clarify this HTB scheme and it's not as evil and ilrltyreate as some are presenting it - especially for those outside the M25?
COYS!
- "When the producers are state-owned, manned by public-sector unions (who funnel taxes into the Labour Party) they are good; consumers of such services should bow-down in praise of their magnificence, and
- "When the are private - nay owned by foreign-states who have invested their workers' pensions in the UK energy-supply - or a bunch of UK muffly-closeted pension-funds (whose money only goes to Tory voters and we - the Labour Party - have already spent most of those future earnings; '"Badger's"' bringing 'expenditure forward' was a larf) then of course, the Labour Party, we will support those lickle folk who are subject unto law (unlike us tax-advisers and Friends-of-Silvio 'Free the Berlusconi One'; provider of watches and Finemeccanica roles)!
Sadly some people fall for such gaff. A nation - nay, "One Nation" - full over over-accreditted and under-educated fules...."Well, until we get to power and reverse our lies through the 'common-purpose' courts...."
Original documents all need to be notarised.
Still they look good with their sealing wax, stamp and pretty ribbon.
In the mean time, the odd bit of Tory eye-candy, a radical and competent government, and 20 months of growth and reducing unemployment to sell when the time is right.
Feeling optimistic now...
I'm currently getting Senator John Cornyn asking me to help him defund ObamaCare and I'm wondering whether I should click it.
My thoughts are the same as Fluffy's
Nurse, bring me my pills!
My thoughts are the same as Fluffy's</>
How on earth can you tell?
Property prices will then crash and Labour will be left having to pick up the Help to Buy guarantee costs.
The very best aspect of Osborne's Help to Buy guarantee scheme is that it will act as a constraint on Miliband's spend and borrow tendencies if the country is so misguided as to elect Labour in 2015.
No wonder the lefties hate the scheme.
Russians also seal their office doors overnight in order to detect unauthorised entry while they are out of the office.
You'll have to do that too!
Another reason why "Doctors" writings need a chemist to understand them methinks: Another correlation =/= causation episode.
Dr Fox scribled positied: I think it was a rush-to-his-head: Maybe this would be more accurate: Again: The ability to read is one thing. We all need to be able to comprehend what we read. [E.g.: What does "6% alcohol: No more than 21-units" mean in the context of a Sunday morning...?]
Not sure it's economically illiterate to worry that mortgages people can afford to pay now will not continue to be affordable when interest rates have risen, but wages have not to the same degree. Should that happen, the government - you, me and all other taxpayers - will be left carrying the can as far as I can see. But perhaps you can explain why that's wrong.
SO = you are missing the point still. Affordability calculations are not just being taken on current low rates (unless its a fix for 5 years or more maybe) but on the reversion rate, or if rates go up too. Affordability has to be carefully assessed and not just on assuming low interest rates forever but on more normal rates too.
HTB isn't about the affordability calcs of borrowers - full stop. It is about whether they have a deposit or not to put down. If they are renting currently paying say £1,000pm, it's damn hard to save a 15%+ deposit even if they are comfortably affording that rent.
Just to illustrate the regulatory costs which are skewing the lending market:
"Capital requirements mean that lenders have to hold roughly six times more capital for loans at 90 per cent LTV or over than they do on loans under 60 per cent LTV."
Sorry - can't resist - and of course that didn't happen with Lloyds, Northern cRock, Bradford & Bungley, RBS et al when Labour were in prower..
@faisalislam average FTB deposit 1988 - 12.4pc, 1996 - 9.9pc, 2006 - 16.4pc, 2012 - 23pc. ONS stats (table 38) ons.gov.uk/ons/publicatio…
Tim Shipman (Mail)@ShippersUnbound52s
Badger huggers yelling outside Tory conference. Pictures of Dave and Paterson as 'badger butchers'. O-Patz will be delighted
In the meantime, she's playing Fallout on her PC ...
Mrs J has all the Fallout expansion packs, and plays them religiously.
Some of the Command and Conquer series were good. But to be honest, I'd rather go for a walk if I have any spare time ...
----------------
Now another matter to ponder. All the major parties should be very wary of UKIP:
http://blogs.spectator.co.uk/coffeehouse/2013/09/its-not-just-the-tories-who-have-to-fear-ukip-labour-do-too/
Owen Jones@OwenJones8459s
Pantomime boos from the #NHS299 demo as we pass Tory Conference…
Sajid Javid MP@sajidjavid12m
Help To Buy is for hard working people who can afford a mortgage, but don't have enough savings for a big deposit. We're on your side #cpc13
I remember Cameron's veto moment and being perplexed by why it seemed to boost his poll ratings. However Michael Portillo pointed out that Cameron had done the 'unthinkable' and said No to Europe. Has something similar happened with Ed? For the first time in a long time a senior party leader has said No to big business. The problem for Cameron was that he couldn't really follow up his big 'veto' moment because, well, he doesn't want to leave the EU. So he can't really keep saying no. Message for Ed is that he's got to remain consistent, keep challenging the fat cats and show he's on the public's side.
What really angers me is that politicians never ask WHY people are so desperate to get on the housing ladder. If they really want to show themselves on the side of ordinary people they'd do something to boost tenancy rights. However that might not please their buy to let supporters. Meanwhile we get people to take out 90-95% mortgages whilst interest rates are really low and then watch the fun unfold as rates rise.
Twitter
Iain McGill @IainMcGill 3m
Were did my my balls go? #cpc13 pic.twitter.com/aNmBsR6WA3
Matt on form
The Telegraph @Telegraph 3h
Today's Matt... pic.twitter.com/lBuFxFZICH
Marf on tax breaks for the married
I think this is a possibility.
Assume it's (b). The government is taking on the nasty end of the risk curve so that borrowers with a riskier scenario can get lower rate loans (remember, it's not that these mortgages don't exist without state intervention, they just cost more). If you went shopping for an equivalent guarantee on the market, then it would cost you quite a lot - in fact the difference between the 75% and 95% mortgage or whatever. Assuming the free market is pricing this risk correctly - a reasonable Tory assumption, right? - then the policy is simply a mortgage interest subsidy for purchase. Fine. I mean, there's no money left, but leaving that aside it might be a good way to spend more of the money we don't have.
However, what happens when the buyer wants to remortgage? They probably have a rate that won't look too smart in 3-5 years. Either the government continues this subsidy; or mortgage payments go up sharply. The only way out for the government is to engineer house price inflation big time so that this year's 95% mortgage is 2016's 75% mortgage. It's that; or deferring price crash and repossessions; or providing open-ended subsidy. None of these are good.
And people complain that 20 months of energy price-capping could have unintended consequences....
http://youtu.be/zMc_YOYOGtM
All governments intervene in markets, one way or another.
Only foolish governments attempt to control prices - unless you've got examples of that succeeding?
And when have I compared polling numbers across companies?
We want Social Democracy Centre Left Policies.
He is right Price Freeze and keeping NHS as free Public Health Service not Private Health Services paying fees like America.
I feAr the worst if David Cameron and Tories win outright General Election 2015 Victory this would cause Social Unrest and poor, Working Class and lower Middle Class would suffer.
The top Upper wealthy people would do well.
I hope for Labour and Lib dem Coalition we need Electoral reform PR we need and elected Senate place unwanted unelected House of. Lords.'
Devolved English Parliament in Birmingham .
Come on Labour beat the Tories and prove them wrong Win election to prevent the country going too far right.
PS 36.34% (136 chambers controlled)
PS-BE-PND-MPT-PTP-PAN 0.44 (0)
PS-PTP-PND-BE 0.04 (0)
PPD/PSD 16.59% (82)
PPD/PSD.CDS-PP 7.69% (14)
PPD/PSD.CDS-PP.MP 2.08% (0)
PPD/PSD.CDS-PP.PPM 1.94 (2)
PPD/PSD.PPM 1.32 (1)
PPD/PSD.PPM.MPT 0.9 (0)
PPD/PSD.CDS-PP.MPT.PPM 0.49 (1)
PPD/PSD.MPT.PPM 0.41 (0)
PPD/PSD.CDS-PP.PPM.MPT 0.08 (0)
PPD/PSD.MPT 0.04 (0)
CDS-PP 3.04% (5)
CDS-PP.MPT.PPM 0.19 (0)
CDS-PP.PPD/PSD 0.1 (0)
CDS-PP.MPT 0.06 (0)
Communists 11.09% (30)
GRUPO CIDADÃOS (who are they?) 6.66% (11)
Bloco de Esquerda 2.42% (0)