The Economic Delusion Shooting out of Control!

After the boom comes the inevitable crash!
After the boom comes the inevitable crash!

UK – Today the Daily Mail Nazi is trumpeting the fact that in January 1011 houses sold for over £1 million pounds. It goes further that on the last day of January 33 houses worth over the magic million. It then implies that the economy is back on track and that the good times are back again.

It sounds impressive does it not. Well. Not really I got my calculator out and 1011 divided by 31 equals 32.6 sales for each day in the month. So 33 in a day is near enough the statistical average.

How convenient. just in time for the local and EU elections. But who can afford property prices this high? Certainly not Mr and Mrs Average Joe. With the cutbacks in the legal profession and NHS, not Lawyers, Solicitors and Doctors either. So what is really going on?

Well it relates to the stalled economy. Shares are stagnant. Industrial output is down. Wages are down. So the City, foreign investors together with organised crime see the Government’s flagship help to by scheme as a source of revenue. With house price inflation running at 11%, it beats the hell out of gilts. After all it is as safe as houses isn’t it?

Well actually no. All due to our old friend the ski curve. The ski curve is a visual description for the effect of inflation. it is mostly flat at the beginning, but as time goes on the curve gets steeper and steeper.

This goes on until the bubble inflates to a point where price inflation becomes unsustainable. The bubble then bursts. We know it well the old boom and bust cycle.

Back to the housing price bubble. The one thing that we know for certain is that the housing bubble is going to burst. It is only the timing of the crash that is in question.

When the crash happens we will see our old friend negative equity back again and the parasitic banks will be demanding massive bailouts once again. If that is not bad enough it gets even worse.

Because the Government has done everything possible not addressed the problem of the housing market being 35% over price in 2012. Far from it The Government has done everything in its power to make the problem problem worse.

So that as a result the inevitable crash is going to make the crash of 2008 look like childs play.

See also
OECD orders Tories to commit political suicide!
We need rent controls in order for the economy to grow!

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Author: Dr Suusi Watson

Editor of the Bastard

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