The papers are full of articles suggesting that the house price bubble might be about to burst soon. Experience tells us that they are jumping the gun and the next bust is due in 2025 or 2026.
What nobody is talking about yet, but will be from 2025 or 2026 onwards is the next financial crisis. I've found a chart here showing that UK banks' balance sheets have expanded by one-third over the past six years (I tried clicking 25 years, but it won't go further back than 2010). That is about 2.5 times GDP, about £65,000 per capita for every UK resident, entirely unrelated to economic growth and highly correlated with house price increases. You can't say which causes which, they are two sides of the same coin:
Friday, 15 July 2022
The other side of the UK house price/credit bubble
Subscribe to:
Post Comments (Atom)
7 comments:
Police surveilleing me at night because Georgist:
https://www.youtube.com/shorts/xY9XyPcZkhU
Messages in music:
https://www.youtube.com/watch?v=9HIy0OuoM0Y&t=14s
Wow. You post a few seconds of shaky footage of the Moon and get 900 views. My lovingly crafted pop songs get on average 100.
The problem with the banks being liable to go tits up once again together with land prices is where do you put your money? You don't want to end up like my cousin, who sold his house and a lot of land at the top of the market in 2007, then put the money into bank shares...
B, don't ask me for investment advice.
In my view, if in doubt, have cash. Sure, you will lost 10% a year to inflation, but that's as bad as it can get. And inflation erodes everything else by 10%, so big deal.
That was more a general query than a request for investment advice.
I suppose if by cash you mean wads of fifties, then that's pretty safe against any bank collapsing, and there's always gold, I suppose.
B, I mean cash in any bank account that's covered by the £85k guarantee. Physical cash can get lost, stolen, go past its use by date etc. Plus if you try paying with it you get the money laundering people coming down on you.
Gold might sky rocket or plummet, what do I know?
If the gov't had to choose between bailing out the bankers and bailing out the account holders, which do you think they'd go for?
Post a Comment