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TheBlueCat

Protect yourself!

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Prompted by Kurt's thread about persuading his Mrs not to buy a house...

This is worth a read to start with:

https://musealoudblog.wordpress.com/2017/06/27/why-is-corbyn-pro-brexit/

So, under PM Corbyn, what is the economic future of the UK? At the macro level it's clearly dire but what about at the level us normal folks (well, you normal folks - I moved all my assets to Canada barring whatever residual value my UK state pension may have a couple of years back) have to deal with?

First up, inflation. True socialism causes inflation every time. Once JC and JM have run out of other people's cash in the form of tax, they will have no option but to start printing. Not the weird QE type of printing where it sort of gets paid back so is sort of accepted by other government bond holders but the straightforward creation of cash from nowhere to meet the government payroll and benefits bill at the end of each month. 

-> Don't hold cash, it'll inflate to nothing very quickly. Even 10-20% inflation (not at all unusual back in the 70s) will rapidly erase the value of that nest egg you spent so many years saving. And don't think that higher interest rates and therefore returns will help - you'll pay tax, at ever increasing rates, on all that income.

Next, private pensions. Socialists hate private pensions with a passion so expect any private pension savings you have to be taken over by the government in some way. The first encroachment is likely to be forcing private pensions to be held in the form of government bonds (e.g. Argentina, Hungary, Russia and others). Down the line, that will turn into straight forward confiscation based on some kind of "swap" for units in a government scheme of some kind.

-> If you have any choice at all in the matter, put your pension savings into an ISA for the time being - that way you can access them quickly if needed.

Third, shares, funds, etc. Mass nationalisation "paid" for in debased GBP puts UK company shares in the same category as cash. It may start OK with, say, the nationalisation of a few utility companies but initial success will embolden them and, very rapidly, that will expand across different sectors (see Venezuela for examples) leading to chaos. 

-> Again, if you have any choice, don't invest in UK based companies (UK listed foreign companies are probably OK).

Foreign assets of one sort or another. It's a foregone conclusion that there will be extensive exchange controls put in place to prevent capital flight (for all the reasons just discussed, the smart money will be on a one way trip abroad once the next election is called) so get in there now. Over time, expect laws to be brought in requiring all foreign assets owned by individuals repatriated, but that's complex and would likely breach a number of foreign treaties giving you some breathing space.

-> Ideally, open brokerage accounts in safe third countries and move your cash there. You can have that cash invested in UK assets still for the time being to avoid any exchange rate risks. 

Fourth, gold and precious metals. As per the last time all this crap kicked off, private ownership of these sorts of assets will be made illegal.

-> if you must, buy physical gold and silver and bury it in the garden or something.

Finally, houses! Back in the 70s, the value of houses fell (in real, not nominal, terms) but, compared to everything else you could own legally, not as much. Although JC and PM are very keen to suggest the expropriation of the houses of rich people to house their favoured special interest groups, they would not, I think, dare go for the houses of the much larger groups of people they'd be relying on for support (e.g. public sector employees, BBC staff, Islingtonites, etc.). This means that, of all the available asset classes I can think of, a private house that you live in is likely the safest way to preserve wealth.

-> Put all your cash into bricks and mortar. Sad, eh?

 

-> I hj

 

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Surely high inflation will lead to high interest rates ,something that will cause this country's economy and house prices to collapses 

And on another point from what i can make out most of jezzas new found following are youngsters which are priced out ..how to square that circle will be telling 

Edited by Long time lurking

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1 minute ago, Long time lurking said:

Surely high inflation will lead to high interest rates ,something that will cause this country's economy and house prices to collapses 

And on another point from what i can make out most of jezzas new found following are youngsters which are priced out ..how to square that circle will be telling 

yes, eventually.

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9 minutes ago, Long time lurking said:

Surely high inflation will lead to high interest rates ,something that will cause this country's economy and house prices to collapses 

And on another point from what i can make out most of jezzas new found following are youngsters which are priced out ..how to square that circle will be telling 

50% of the original value of your house is better to have than 10% of the value of your cash or 0% of the value of your pension....

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Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

“By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

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22 minutes ago, Chewing Grass said:

Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

“By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

It's all planned  isn't it. 

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28 minutes ago, Chewing Grass said:

Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

“By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

Never going to happen. It might be what the wankers at the So-Called BBC would like to impose on us but even their socialist pet students are foaming at the mouth wanting to rip their smug faces off.

 

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43 minutes ago, Chewing Grass said:

Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

“By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

So no change then...

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18 hours ago, Chewing Grass said:

Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

What's the significant third class that exists presently?

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20 hours ago, Chewing Grass said:

Following on from the OP have a read of this lurking on the So-Called BBC somewhere, bumped into it accidentally when looking for something else.

http://www.bbc.com/future/story/20170418-how-western-civilisation-could-collapse

They know what is coming, those above them know it.

“By 2050, the US and UK will have evolved into two-class societies where a small elite lives a good life and there is declining well-being for the majority,”

 

in the coming 3 decades to 2050, tech will cause more and more people to be essentially surplus to requirements, keeping this in mind, and depending how wealth is distributed we could see a dystopia emerge

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47 minutes ago, Talking Monkey said:

in the coming 3 decades to 2050, tech will cause more and more people to be essentially surplus to requirements, keeping this in mind, and depending how wealth is distributed we could see a dystopia emerge

So, who is going to lead the move underground for the ones who aren't surplus to requirements and when do you think they'll first develop a taste for human flesh?

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13 minutes ago, TheBlueCat said:

So, who is going to lead the move underground for the ones who aren't surplus to requirements and when do you think they'll first develop a taste for human flesh?

we could get Mr Pin to do it, give him an old army General's uniform, tell him to grow a handlebar moustache, make him our leader

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1 minute ago, Talking Monkey said:

we could get Mr Pin to do it, give him an old army General's uniform, tell him to grow a handlebar moustache, make him our leader

All hail Pin, Morlock in Chief!

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23 hours ago, Long time lurking said:

Surely high inflation will lead to high interest rates ,something that will cause this country's economy and house prices to collapses 

And on another point from what i can make out most of jezzas new found following are youngsters which are priced out ..how to square that circle will be telling 

High interest rates are a thing of the past. They will never be raised.

It will come to a personal choice between a massive debt enslavery for life or renting.

I think is that all that will happen is rentals  will go to corporates after S24. Rates will stay low as will rent wI'll stay high. 

A socialist  government will make rules on tenancy more tenant friendly to appease the renters. That's all they can do.

Hpi forever.

Edited by Green Devil

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1 hour ago, Green Devil said:

High interest rates are a thing of the past. They will never be raised.

It will come to a personal choice between a massive debt enslavery for life or renting.

I think is that all that will happen is rentals  will go to corporates after S24. Rates will stay low as will rent wI'll stay high. 

A socialist  government will make rules on tenancy more tenant friendly to appease the renters. That's all they can do.

Hpi forever.

For parts of the country that might be right for my part of the world most of the current rentals will go to FTB the "corporate`s " would not touch them with a barge pole 

Local HA`s have been selling them off for years as they are to old to met current energy ratings the HA`s are building new ,i think this is where the corporate`s will go to and without IR`s going up i cant see much more that 10-20% drop in ex BTL stuff as we are back to 2004`ish prices (the ones selling) which is close to local wage multiples

I would agree on IR`s unless theres and "event" (inflation could be the event) i cant see the base rate going above 2-3% in the next decade or so but mortgage rates can rise without the base rate   

 

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1 hour ago, Long time lurking said:

For parts of the country that might be right for my part of the world most of the current rentals will go to FTB the "corporate`s " would not touch them with a barge pole 

Local HA`s have been selling them off for years as they are to old to met current energy ratings the HA`s are building new ,i think this is where the corporate`s will go to and without IR`s going up i cant see much more that 10-20% drop in ex BTL stuff as we are back to 2004`ish prices (the ones selling) which is close to local wage multiples

I would agree on IR`s unless theres and "event" (inflation could be the event) i cant see the base rate going above 2-3% in the next decade or so but mortgage rates can rise without the base rate   

 

I think the final nail in the coffin or BTL will be one weeks maximum deposit foir tenants. Who is going to want to let a house for 200 quid deposit? 

I suspect this new rule won't apply to corporate Lettings....

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25 minutes ago, Green Devil said:

I think the final nail in the coffin or BTL will be one weeks maximum deposit foir tenants. Who is going to want to let a house for 200 quid deposit? 

I suspect this new rule won't apply to corporate Lettings....

I think you will find that is the holding deposit. The proper deposit is still 1 month.

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