August 21, 2012 at 8:18 am #57010
Britain’s economic catastrophe in the year 2015
The British economy will collapse in the year 2015 and the collapse will be much worse than the meltdown that occurred in the last recession of the early 1990’s and it will leave the economy devastated for at least twenty years. The cause of the 2015 depression is a Sterling Crisis, a run on the Pound, in which the Pound suffers a dramatic fall in value on the foreign exchange markets because of a dramatic loss of confidence by the financial markets in the state of the British economy due to the economic imbalances and the massive quantity of money in circulation as a consequence of too much borrowing and spending and high house prices and the money printing by the Bank of England called Quantitative Easing. The fall in the value of the Pound will cause inflation to rise which if left unchecked will destroy the financial basis of the country. The Government will be forced to restore the value of the Pound on the financial markets in a desperate bid to control rising inflation and the only way to restore the value of the currency is by contracting the money supply, taking money out of the economy, making money scarce, which is a recession. Rising inflation is an indication that there is too much money in circulation in the economy and this will mean that the money supply in the economy will have to be continually contracted in a desperate attempt to squeeze out every last drop of inflation out of the economy.
The 2015 recession will leave the economy completely devastated and in ruins. The economy will have shutdown and be at a complete standstill. Consumer confidence will have disappeared causing massive consumer retrenchment, people will be afraid to spend money, the streets will be deserted, shopping centres empty, little traffic on the streets, many businesses will have gone bankrupt, factories closed and many people made redundant resulting in mass unemployment. House prices will have collapsed leaving some ordinary working class people in negative equity by as much as £200,000. Many people will struggle to cope with servicing their debts in the face of an economy that has collapsed and many will not manage to keep up their mortgage payments and will have their homes repossessed. People will be terrified about losing their jobs and will be wary of the future. There will come over an eerie feeling of impending doom and gloom about the economy with no prospect of an end in sight. People will be wandering around, dazed and confused, not knowing when the misery will end, bereft of hope and fearful of the future. The recession will be the worst in living memory and it will be so severe that it will make some people compare it to the Great Depression.
The current boom started in 1996 and will end in 2015 making it a approximately a twenty year long boom and it will be followed in 2015 by a twenty year long depression. All trace of the current twenty year long boom that started in 1996 will have to be unwound and erased until no trace of the boom remains. The depression of 2015 will cause a rise in bankruptcies, factory closures, mass unemployment, repossessions. There will be much sorrow, misery and despair as the economy falls into the abyss and ends in ruins. The future will be a living Hell.
The UK housing market is a gigantic Ponzi scheme or pyramid selling scam which requires an increasing amount of money and people to enter the scheme in order to keep it going but it is mathematically impossible to sustain indefinitely because it would require an infinite amount of money to feed the scam which is impossible and so eventually it collapses when no more money and people can feed the scam. The UK housing market is being propped up on historically low interest rates but this cannot be sustained because it is inflationary and when the inflationary effects start to appear the flow of cheap money will come to an end and the entire UK Ponzi housing scam will come crashing to an end.
There are numerous warning signs that the UK housing market is out of control and clearly overheating: the ratio of house prices to incomes stands as high as ten which is much higher than the more sustainable ratio of three times income. In fact the ratio of house prices to average incomes, which in the past has never let us down as a warning indicator, is as high as, or even higher than, before the previous crash. The history of markets is that, like a piece of stretched elastic, they eventually snap back and hurt the unwary. Housing booms in Britain have never ended without economic pain. In the Eighties house prices needed to fall by 26 per cent to line up with historic trends. In the end they actually dropped by 37 per cent. If this level of over-correction were repeated during this cycle, prices would fall by 75 per cent. The history of markets teaches us that when someone says “new paradigm” or “it’s going to be different this time” then you should get worried. The property market is like a Pyramid selling scheme based on greed and speculation where people are piling in for fear of missing out on the boom. Lenders talk of a ‘gradual slowdown’ in the housing market but this has never happened in the UK.
Herd instinct and confidence and record low interest rates is holding up the property market but in the long run, that won’t work. The dangers are very severe, Britain cannot avoid a serious drop in house prices. There will be a giant ripple effect, starting in London and then spreading to the Home Counties, which will be hit very hard, then the Midlands, the South West and the North.
No overvaluation of the kind we have seen in the UK housing market has ever been corrected without a crash. Everyone is hoping for a soft landing but we don’t have soft landings in things like this, ever. When a market goes up and up, there is a perception that it can never go down and it always does. House prices were unlikely to fall gently as they had risen so rapidly and it will all end in tears with prices tumbling by 75% from peak to trough in the year 2015.
The rise in inflation that will occur in 2015 when the economic and debt bubble finally bursts will cause the Bank of England to raise interest rates dramatically to control inflation and the Government will be forced to contract the economy bringing about a devastating depression. This together with Spain dropping out of the Euro by 2015 will mean that people owning properties in both Britain and Spain will experience the double whammy of collapsing house prices both in the UK and Spain. When Spain drops out of the Euro and adopts the Peseta in 2015 this will lead to a massive devaluation of the Peseta and anybody owning property in Spain will be owning an asset that will be priced in worthless Pesetas. The collapsing UK economy and crash in UK house prices will cause the British demand for holiday homes in Spain to drop sharply resulting in even further falls in Spanish house prices.
August 21, 2012 at 8:33 am #111656angieBlocked
Jakey thank you for that advance warning, as we speak I’m converting Sterling into rice, is that a good move, you are indeed a wise old sage. 😉
Now I don’t know what to do because you sign your posts with ‘don’t buy a property in Spain’ just as I was about to buy it up, then you warn us that the French property market will collapse by 80%, now the UK is facing Armageddon where should we stash all our cash that’s under the bed?
Is there a Bank of Jake somewhere which pays 10% on deposits?
Some advice urgently needed? 🙄
August 21, 2012 at 9:02 am #111658
Seems to me there will be copyright problems for Mark if this stuff he posts in full doesn’t have a link. It doesn’t read like the posters own words.
There is always some “expert” trying to talk housing markets up/down. Some have been talking the UK market down for at least 20 years and it never happened as bad as they predicted. We recently sold this house withing a week and for more than the asking price. Ok. it is a blue chip village with a direct line to Waterloo but it takes 50 mins! 2 months ago 2 new semis went on the market, little boxes with a carpet sized garden, albiet nice views over fields and forest. They were sold within 1 month at £525,000 each 🙄 Some places such as Hull are in the doldrums but friends from the North recently sold within 2 months at a good price. Buyers are just more choosy on locations. The main problem now seems to be the 20% deposit required which is hitting first time buyers and lack of confidence but that won’t always be so.
One reason for Brits not buying into the Spanish market is the majority just aren’t interested anymore. The ones who are tend to live in council houses and dream……
Mortgage lending in the UK was up compared with last July.
August 21, 2012 at 9:05 am #111659IgurisuParticipant
Hmmm, now I start to get it Jake 🙂
I think you should consider the sources of your information and how credible they really are.
He (Peter Schiff) predicted that the NASDAQ would fall to 500 and predicted and predicted that the Dow Jones Industrial Average would fall to “between 2,000 and 4,000, but it might go below 2,000.”
With the Dow currently hovering over 8,000, Schiff needs another 50% drop before his 2002 predictions come to fruition.
I could find articles and post links as you do about how the spanish market is ripe for investment at the moment, trust me, you shouldn’t believe evrything you read on t’internet 🙂
August 21, 2012 at 9:51 am #111660
Not, only you should not believe what you read you not be spreading it about without atleast your own stance on it however wise, prudent or absurd !!!!!
August 21, 2012 at 12:15 pm #111663
Always look on the bright side of life……. 🙂
August 21, 2012 at 12:33 pm #111665GarySFBCNParticipant
Jakey thank you for that advance warning, as we speak I’m converting Sterling into rice, is that a good move, you are indeed a wise old sage.
As the Swiss economy seems OK, you may want to invest in electric fondue sets.
August 21, 2012 at 12:41 pm #111666
August 21, 2012 at 12:46 pm #111667angieBlocked
Fondue Sets Gary? I might get my fingers burnt, and what if people go off fondues, and the market drops, they might be the rage now but what if? 😕
I just love Jakey’s optimism on every market, it gives me great hope 8) There you go Jake, what about Persimmon on katy’s link, the UK is now safe 😛
August 21, 2012 at 3:25 pm #111675IgurisuParticipant
Fondue Sets Gary? I might get my fingers burnt, and what if people go off fondues, and the market drops, they might be the rage now but what if?
Fondue sets will crash in value in the year 2014 when they will be lower in Switzerland than in Italy. People may buy Fondue sets in Italy now, but in 2014 when they are only going to be worth 0.001% of their current value. I will invest in one or two in Switzerland. I refuse to pay more than €1.00 but expect I will be able to buy the best for €0.50.
August 21, 2012 at 4:04 pm #111678ChoperaParticipant
I’m not going to buy a fondue set until they can be picked up for £20,000 each
August 21, 2012 at 7:31 pm #111682GarySFBCNParticipant
Well, Angie’s rice comment had me spitting out my morning coffee with laughter. I wanted to return the favor. I didn’t realize that so many of you are so quick-witted. Thanks for the laughs!
August 22, 2012 at 8:40 am #111686
Jakesuper’s posts or should I say copied bollocks are the most hilarious joke. He/she simply copies any written texts which suits an obsecure purpose. We should name him ‘Jake the Obscure’ with apologies to Thomas Hardy.
Mark for gawds sake ban Jakesuper. Think I’ll start a campaign on Facebook. 👿
If anyone could predict with any accuracy how the British, French or any other economy will perform in 2015 they would either reside on a cloud with a long grey beard playing a harp or be considered a total idiot.
Multi – national companies employ at huge salaries ‘experts’ to predict how markets will perform in a few months time. Even that is inaccurate but it’s done simply to calculate investment risk.
Ask anyone of these experts, and some are very clever people how a particular economy or market will perform in 2015 and they will tell you it’s impossible to predict with any degree of accuracy. Some things in life are just unknown thank the gods.
Imagine if we knew when natural disasters, economic catastrophes or personal calamities were due to occur. It would be a very changed world and one which I would not wish to live in. The unexpected makes life worthwhile.
We have one more unknown here Jakesuper’s reason for being! Speculation please. 😆
August 22, 2012 at 9:28 am #111688
Mark for gawds sake ban Jakesuper. Think I’ll start a campaign on Facebook.
If anyone could predict with any accuracy how the British, French or any other economy will perform in 2015 they would either reside on a cloud with a long grey beard playing a harp or be considered a total idiot.
So you want this forum to just consist of people wanting to talk up the Spanish property market. It is obvious when you look at the property websites like rightmove, idealista, fotocasa, kyero and so on that the Spanish properties on sale are still way over priced and the asking prices that you see are clearly absurd and should be 50% to 70% lower than advertised to be more realistic given the disasterous economic situation of Spain.
All I am doing is warning people not to buy property in Spain because property prices are still way too high despite the recent falls and anyone buying now is buying into a falling market. There is so much over supply of property available that this combined with the dire economic situation in Spain means that properties should be on sale at a lot lower price than they currently are. I am also warning people of the poor build quality and shoddy workmanship of many properties that were built during the boom. People should steer well clear of buying property in Spain for at least three to four years because by then property prices will have become more realistic to reflect the harsh reality of life in Spain.
August 22, 2012 at 9:41 am #111689
You not only warn against buying in Spain you are a doom sayer for the entire EU continents economies and probably elsewhere if I could be bothered to read through the rubbish you copy and paste on here.
We can all read that nonsense on the web if we choose to. That and ‘the end of the world’ is nigh as well and any other cobblers the human mind can dream up.
A forum only has any value if posts are made by people on the ground and are or have been involved in the process. Primary sources. Your posts mean nothing.
If you read back through my posts I have consistently warned people of the calamity which is the Spanish property market long before it actually became a serious issue.
August 22, 2012 at 10:01 am #111690
” i couldent go to spain because they decided to embark on a crazy and barmy housing boom “
” denied me the right to own a home of my own and have a family of my own and deny me the right to have children “
clearly the thoughts of someone with great financial knowledge and the ability to take control of there own future !
the only person that denied you anything is yourself ……. i take it you will be opening a lot of ” short positions ” for the fast approaching arnagedden … ??
August 22, 2012 at 10:29 am #111692
Probably he is posting from a secure unit 😆 😆
August 22, 2012 at 10:35 am #111693
August 22, 2012 at 11:14 am #111694
a padded cell may stop you from doing things ! my appolagies .
August 22, 2012 at 5:33 pm #111700
well jake didn’t predict my sudden downfall today or predict just how much crawling i would have to do, all he had to do was remind me it was my wedding anniversary
August 23, 2012 at 8:09 am #111702
The current economic boom in Britain that started in 1996 and that will end in 2015 will have lasted roughly twenty years which makes it four times longer than the duration of the Lawson boom of the late eighties which lasted five years starting in 1985 and ending in 1990. This together with the fact that house prices are four times higher than those achieved at the peak of the Lawson boom in 1989 combined with all the quantitative easing that has taken place means that the current boom is at least four times bigger than the Lawson boom all of which means that the recession which is due to start in 2015 will be four times worse than the recession which followed the Lawson boom that lasted five years starting in 1991 and ending in 1996.
August 29, 2012 at 8:34 am #111846
I agree with a lot of what Jake says, however it is not possible to predict major economic events with such certainty, especially the timing of them. Governments have a sickening knack of finding new ways to kick the can down the road. It is astonishing to me that things have held together for as long as they have when just about everything seems completely unsustainable. Yet in my home town in the south of England property seems to be booming again, totally contrary to my expectations. The gap between rich and poor is widening massively, and I don’t like to think about where that is leading.
I have correctly predicted booms and busts in the past, but I’m not making any predictions any more. Like Jake, I do expect it all to end badly, but making predictions about how and when is just not possible, and I don’t think it is right to put one’s life on hold waiting for any particular outcome. Yes, house prices might crash to near zero, but if hyper-inflation wipes out your debt, what does it matter? You might as well buy a nice house and enjoy it rather than stash your cash under the mattress.
August 29, 2012 at 10:00 am #111855
There are various ways in which the UK could turn things around (although I agree it’s in a mess – too many economically inactives, surfing the web and gossiping about Spain 😉 )
I actually feel the proposed scheme to promote the nhs brand abroad could be a big winner. With luck, and the right policies at home, perhaps we can get foreigners to pay for nhs treatment abroad, instead of sneakily getting it for free in the UK.
A lot of talk about airport expansions and a possible Boris Island – problem is it will take billions that the UK govt doesn’t have. The answer? Set up a tax-free port and get outside investors to build an estuary city (a bit like Hong Kong) with airport and fast links to both London and Paris (via the Chunnel).
There are possible ways to get things moving. But can the UK get its act together quickly enough?
August 29, 2012 at 1:12 pm #111866
Yet in my home town in the south of England property seems to be booming again, totally contrary to my expectations. The gap between rich and poor is widening massively, and I don’t like to think about where that is leading.
That’s alright then, so are shops and restaurants. Can hardly get a table anywhere for a Saturday unless booking by Wednesday. 😉 😆
August 30, 2012 at 11:39 am #111910
When in 1997 the then Chancellor of the Exchequer Gordon Brown relinquished control of setting interest rates and passed that responsibility to the Bank of England’s MPC (Monetary Policy Committee) what it meant was that the Bank of England effectively has the biggest and most important mechanism of controlling the economy and has thereby diminished quite drastically the power the Chancellor has over the economy. Therefore, it is the Bank of England that controls the economy not the Chancellor. All the Chancellor can do is determine tax rates and allocate Government spending to various departments. The Bank of England and in particular the MPC that sets interest rates is not publicly accountable and the MPC members meet in secret and pretty much do what they like. The remit for handing the setting of interest rates to the Bank of England was for the specific purpose of controlling inflation and not for targeting growth. However, the actions of the Bank of England seems to suggest that they couldn’t care less about inflation and are more interested in making sure that economic growth occurs which is not their remit. The Bank of England is clearly out of control. They failed to spot the banking crisis of 2008 and were asleep at the wheel, they lowered interest rates to half a percent even though inflation at one point reached five percent and worse than all of this they embarked on a crazy economic experiment by starting a course of reckless money printing called quantitative easing as a way of helping their rich friends in the city of London to get bigger bonuses by speculating more free money on the stock exchange whilst all the time savers and pensioners get slaughtered. It is the savers who are helping to subsidise the borrowers by having to accept a paultry rate of interest on their savings. The Bank of England is trying to encourage Banks to lend more to businesses but it was too much lending by the banks in the first place that caused the financial crisis in the first place.
The quantitative easing program of the Bank of England is the Rubert Mugabe-isation of the money supply and is just adding inflation to the economy which will only have to be reversed when inflation eventually takes off. If the Bank of England was so keen on controlling inflation they would not have dropped interest rates to the ridiculous level of half a percent which resulted in the Pound losing a third of its value against most other currencies and they would not have allowed a crazy house price boom to take off which is clearly inflationary and will only have to be rolled back through a painful recession.
The recession will occur at some point in the year 2015 when the Bank of England is finally caught printing too much money and the markets panic at the huge imbalances and distortions in the economy as a result of too much money circulating in the economy and they will cause a run on the Pound sending the Pound spinning into the abyss on the foreign exchange markets resulting in a devastating depression.
More recently the Bank of England and in particular Mervyn King claimed that they were unaware of the Libor rate fixing scandal that involved Barclays bank. The Bank of England is out of control and Mervyn King and his band of cronies of the MPC are to blame for all the imbalances and distortions in the UK economy that will require a devastating depression to put right.
August 30, 2012 at 3:17 pm #111917
I like the way Jake is so specific about the year 2015.
If it does happen, he can say “I told you so!”
August 30, 2012 at 4:33 pm #111920
His stuff is about as reliable as the mayan calendar prediction for 2012 😆 😆
September 2, 2012 at 10:41 am #111963
I’m not so sure anymore. 🙁
We’re so close to disaster in the UK – yet Gideon n’ Dave can’t seem to come up with determined policies to avoid the catastrophe.
September 3, 2012 at 9:16 am #111973
The economist at the University of Warwick called Andrew Oswald, who correctly predicted the last UK housing crash that occurred in 1989, said in his paper “The Great 2003-2005 Crash in Britain’s Housing Market” that there would be a UK property crash in the year 2003-2005. Well it turned out that he was wrong. The economist and Government advisor Fred Harrison, who wrote the book “The Power of the Land” that correctly predicted the 1989 property crash, wrote in his book “Boom Bust: house prices, banking and the Depression of 2010” that the Uk housing crash will occur in 2010. Well he turned out to be wrong as well.
I am predicting that the UK housing crash will occur in the year 2015. I am 100% sure that my prediction of a UK housing crash occurring in 2015 will be accurate and spot on whereas the other commentators analysis turned out to be completely wrong because they failed to see that it is the growth in the money supply and not house prices that causes a crash. By 2015 the Bank of England will have run out of ammunition to stimulate the economy and Quantitative Easing will have come to an end and when you can no longer feed a pyramid selling scam the whole things collapses and that is what the entire UK economy and housing market is, a gigantic pyramid selling scam that will come to an end in the year 2015.
September 3, 2012 at 9:41 am #111976
Eeer…didn’t you post the same stuff last week, boring as reading last months newspaper.
BTW UK house prices increased 1.3% last month 8)
September 3, 2012 at 1:31 pm #111980
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