Wednesday, 18 December 2013

the housing bubble

Christmas is only a week away; it’s almost on top of us, and I can imagine many a parent, up and down the country wishing that it was delayed or even postponed in such hard times of so-called austerity. Just how do you tell a child that Santa Claus, the legendary patron saint of children has had to make a few cutbacks to the presents he brings?

I am of course reminded, that one of the upshots and consequences of the recession that you don't hear a lot about is the record number of children descending into poverty. At Christmas 2013, the UK is a land more riven and split by inequality than at any period in modern times, with a mortifying upsurge of poverty and homelessness that, coupled with invidious “reforms” of its welfare system, is tearing at our social fabric.

With no compassion in their make-up, only loyalty to their class, David Cameron and his cabinet routinely conduct government on the basis of diversionary tactics and outright fabrication. Cameron’s self-satisfied colleague, Chancellor of the Exchequer George Osborne, boasts that Britain is enjoying the fastest growth of any advanced country; he exults that the economic damage done by the previous Labor government is being reversed thanks to his unswerving commitment to fiscal austerity. Yet almost certainly the main cause for Britain’s recent growth is that the chancellor has stimulated a boom in the housing market with a government-backed “help-to-buy scheme,” which has precipitated a spurt of consumer spending. Osborne’s “recovery” is founded on little more than the resumption of the reckless lending that plunged the British economy into crisis in the first place.

In truth, the boom in the housing market is largely confined to the south east of England. On top of this, first-time buyers in London whom the government purports to wish to help are being priced out of the market by overseas investors who are amassing property holdings in the British capital on an unprecedented scale. The deepening housing crisis is bound up with the unthinkingly enthusiastic commitment of successive British governments (including Labour) to the free market. It is decades since Britain had what could be properly called a national housing policy. While London property values have been allowed to shoot up to even - dizzier heights there has been little more than a token effort to build the 300,000 new homes per annum the country needs.

I was wondering is the housing market signing a sweet tune, or will the bubble soon burst when interest rates are put up, which seems to be the aim of both government and Bank of England, this in turn explains the drive to get the unemployed of the register and tighten the rules for immigrants claiming benefits in the new year.

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