Unfortunately, the way it'll probably play out (again) is that Labour spend us into huge debt, then lose an election and the Tories have to get us out of Labour's spendthrift poop (again), so they get the blame for the pain the measures that are needed out of that poop. After a while, people associate the pain with the measures, and the government that implemented them, not the government and/or policies that made them necessary in the first place.Originally Posted by j1979
But whoever is in charge you still pay tax on:
What you earn
Business profits
State and private pensions
Jobseeker's Allowance
Carer's Allowance
Incapacity Benefit
You also pay National Insurance contributions
Bank and building society interest
Dividends from shares
Rents from any investment properties you own
UK dividends
Certain types of transaction
Capital Gains Tax if you sell or give away assets
Stamp Duty when you buy property or shares
Inheritance Tax on your estate when you die
Value Added Tax on everyday purchases
Fuel Duty on petrol, diesel and LPG
Excise Duty on alcohol
Excise Duty on tobacco
Excise Duty on vehicles
General Betting Duty
Council Tax
Even Dick Turpin wore a mask.
Last edited by santa claus; 10-08-2008 at 11:46 PM. Reason: contribution by j1979
dont forgetBut whoever is in charge you still pay tax on:
What you earn
Business profits
State and private pensions
Jobseeker's Allowance
Carer's Allowance
Incapacity Benefit
You also pay National Insurance contributions
Bank and building society interest
Dividends from shares
Rents from any investment properties you own
UK dividends
Certain types of transaction
Capital Gains Tax if you sell or give away assets
Stamp Duty when you buy property or shares
Inheritance Tax on your estate when you die
Value Added Tax on everyday purchases
Fuel Duty on petrol, diesel and LPG
Excise Duty on alcohol
Excise Duty on tobacco
Excise Duty on vehicles
General Betting Duty
Even Dick Turpin wore a mask
Council tax
Yikes, it just gets worse eh? Thanks for that, list updated
you don't pay tax on state benefits!
(things like job seekers allowance, disabled persons allowance etc)
obviously the people who are in recipt of these will pay tax on alcohol, tabaco and sky tv.
What is very important is the fact that the removal or sugestion of a removal of stamp duty, can course a major slump in the market, almost like a reverse dividend taper where no one wants to buy. The strange thing is as bad as this might be in the short term, if turns out to be true (this chancelor has already proved how he likes to fold fast) then we will see another mini-bulble possibly, as everyone rushes to buy all of a sudden, there will be a shortage of good proeprties, and prices will rise agian....
As i've said before interfering with the free market is a folly, it assumes a level of understanding far beyond what any one person can muster, when there are millions of variables at stake.
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While I agree with you up to a point, I'd just point out that there's no such thing as a completely free market. It's just a case of the extent of any restraints or interventions, and the mechanism. Those mechanisms include the tax regime, banking regulatory systems, anti-insider trading legislation, interest rate controls, estate agency legislation, and so on. It's not a case of if, but rather, when, how and by how much .... and when to alter the balance.
A drop in prices will also bring out the investors; those with money sloshing around who see an opportunity of a better return via bricks and mortar. No stamp duty could facilitate that sort of deal. These people aren't first time buyers; they are the people first time buyers will deal with in a while when the market stabilises. It's a sea full of sharks.
Those are about controling the interaction of parties, often making it 'freeer' by providing a level of trust, making it less likely to be a lemon market etc.
The difference is that they don't try to control the outcome.
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Im 99.9% sure you do pay tax on Job seekers. but the long term won't be affected as there not gonna get over personal allowance. But if you were say, only out of work and claiming for 1 month, that will count towards the years earnings and will be tax accordingly.
But there's a mix of measures. Some, like the insider-dealing stuff is certainly aimed at interaction of parties, but others are directly aimed at influencing markets. We used to have mandatory asset reserve ratios in UK banking but now the scheme is voluntary. It could be reintroduced as mandatory, and the rates hiked. That would reduce the ability of banks to lend out deposits .... and affect money supply, via the multiplier. Not a good idea right now, perhaps, but a few years ago?
And then there's the current Special Liquidity Scheme. If the government pumping billions in liquidity isn't an attempt (and note I said attempt) at at least influencing if not controlling outcomes, I don't know what is. It's a blatant attempt to reintroduce liquidity after the sub-prime fiasco froze the markets pretty-much solid, and to kick-start inter-bank activity. Miserably unsuccessful as it may have been, given the scale of the problem, it was certainly an attempt.
There are many ways in which governments can and do, at least at a macro level, seek to influence market outcomes.
Miaow!
Yeah, but why did they 'scrimp and save' and go 'out on a limb' to buy? Clearly, the only reason to take a massive risk on overexetending your finances to buy is if you think that prices will carry on going up forever. So you 'jump on the ladder' to avoid being left behind.How is it a bad situation? It's a terrible situation for those that scrimped and scraped, and went out on a limb, to be able to get on the housing ladder, only to find that shortly afterwards, the price of the house they've just taken a whopping great mortgage on fell to less than the mortgage.
And screw anybody else who is too late. I'm all right Jack!
Right- so they couldn't be expected to read the small print when they're signing a deal for several tens of thousands- or hundreds of thousands- of pounds?And then there's those people that took out fixed rate mortgages a couple of years ago, and are now finding that that deal is ending, that the rates at the same company are excessive because they want shot of that type of business, and that because 120% mortgages are now longer available anywhere, they can't remortgage anywhere else.
What?
Well, they should have thought of that, should they not?Then to top it all off, house prices fall and they find themselves in negative equity so they can't even sell it and clear the mortgage.
Why is it my problem? I'm smart enough not to rubbishrubbishrubbishrubbishrubbish my money on overpriced commodities. And I've been vocal in telling my friends and relatives as much.
Essentially, much of the housing bubble was caused by a combination of greed and fear. Greed, on the part of BTL investors, who though they could leverage their existing wealth to profit from the housing needs of young people. Fear, on the the part of those young people who didn't have the gumption to stand up proclaim the whole situation to be a crock of ****. In their fear, they ran to join the ranks of the owning elite and screw the consequences for their less well off peers.
So screw all these selfish people.
I liken the housing situation to NEw Labour's utter betrayal on tuition fees. Their 1997 manifesto said that they wouldn't introduce them, and within 6 months they'd done a 180 degree u-turn. So, 10 years down the line, students are graduating with 10-20k debts before they've even got a job. I said it then (and I did march in '97/'98, even though I wasn't personally affected), and I say it now: who in the current Labour cabinet graduated with a massive debt having paid for their education?
It's yet another example of a systematic policy of transferring wealth from the young to the old.
No doubt. So if house prices had carried on going up forever everything would be fine would it? If they'd just evened out the fact that most of our expanding consumer economy was based on borrowing would not have been a problem?Next, there's the fact that the damage this mess has caused to consumer confidence has clobbered spending patterns, and many retailers are finding things very hard. No doubt, some will end up going out of business.
When exactly were we going to start paying back out debts?
Erm- what? Anyone who starts a small business in a downturn is a fool.So spare a thought for those that struggle to open a business only to find that the economic climate wrecks it for them, probably costing them a lot of money.
They'll be the same BTL investors who sold out at the top of the bubble then?So house prices falling are good news for you. Bully for you. It's certainly not bad news for me either, for reasons I outlined earlier. Nor is it bad news for speculators that will wait for the appropriate moment and then cherry-pick the riper property plums as soon as the situation looks to change.
Well, yes, a lot of stupid people will get screwed. But then stupid people will always get screwed. A little speculative story in a paper will not, in the fullness of time, greatly affect the extent to which they get screwed.But it is a very bad situation for a lot of people that find themselves in a mess over this, in some cases in despair over this, because they've ended up loosing their homes or jobs, or both, because of it. If you can't see how this is a bad situation for a lot of people, just because it happens to work in your favour, then you're a lot more selfish than I thought you were.
In the meantime, there's just a chance that we'll get some way back to having an economy which profits from selling valuable goods and services to the world, rather than an economy which profits from selling each other houses and Starbucks coffee on borrowed money.
And if it means I end up living in a tent in my mum's back garden while scrounging food from supermarket bins that's fine by me.
In my life I've eaten plenty of food from supermarket bins. A lot of it was pretty tasty.
A lot of that I agree with. A lot of people have got themselves in trouble through a mix, in various degrees, of stupidity, naivety and greed. Should they have seen some of this coming? Perhaps. Though it was the US sub-prime situation and the banks greed in their securitisation deals that were the trigger and most people could not reasonably have foreseen that. They could, however, have reasonably foreseen that the situation we had was unsustainable for ever, and probably unsustainable for too much longer, regardless of sub-primes or securitisation. So, in my view, they could have and probably should have foreseen something happening.
However, you asked
Even if people were naive, or stupid, that doesn't mean that they deserved to find themselves in the situation a good many now do. After all, the vast majority weren't out to make a killing in property speculation. They simply wanted to buy a home, and saw prices accelerating away faster than they could save, so figured they'd better jump in now (whenever "now" was) because if they left it much longer, they wouldn't be able to afford to jump in at all.
That's why I said that the world wasn't centred about you. Regardless of how stupid and/or naive people have been, they don't (IMHO) deserve the mess a lot now find themselves in .... or will before the dust settles on this one. So .... you asked "How?" In my opinion, that's how.
Rave you seam to be getting a them and us thing going on, on one hand hating BTL investors and people who bought along with them because they price people out, yet at the same time clearly expect to be able to afford a place once house prices have fallen. (obviously that means pricing out someone else)
You live in london.
House prices in my area haven't fallen yet, they're not even stagnant rising at slightly above base.
So we know the problems we will see if house prices fall on the wider economy? That is bad.
Now are you a cash rich FTB? Do you have lots of cash money so you can get a <=75% mortgage at a good rate? If and only if you meet those criteria will you be able to afford a house. In most parts of london there is no glut of housing. So there is too little supply to meet the demand, as such people get priced out. Live with it. I can't afford to live in mayfair where i work, no chance, ever. My skill set means that i'll never be earning enough. If house prices crash too a 3rd of their original value, then i'd be able to afford too, but obviously so would everyone else. Thankfully i've made peice with never going to be a sloney.
So rave if you fall into that catagory, then yes the time will soon come when it benefits you. But guess what, there are plenty of cash rich investors who are going to do the same! Whilst bottom pickers get stinky fingers, i'm in an industry that traditionally performs best during times of recession, my wage keeps doubling every 18 months. I'll be snapping up property investment left right and center, if i think its under-valued, its a very tax friendly investment. But i'm not going to be a cock about it, to people who didn't see the amazing credit crunch coming, or understand the nock on effect.
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Out of curiosity what's your post code or a post code nearby if you don't mind obviously.
It would be interesting to see how much properties are going at in your area on rightmove and
the land registry.
A house, and for that matter anything else, is only worth what someone else is willing to pay for it. . The problem in the housing market has been caused by greedy bankers, estate agents and investors.
And government. Don't forget government. They could have taken action to dampen down the bubble years ago, and didn't. At the very least, they colluded by inaction. And when we ask ourselves why they didn't suppress the bubble, we need to keep one cynical eye firmly on the vast revenues they've made from house price inflation.
If it looks like a duck, walks like a duck and quacks like a duck ...... well, it's probably pretty safe to assume it's a duck.
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