NationStates Jolt Archive

So the cost of living is starting to rise quite dramatically, well in my opinion anyway, and its starting to hit my pocket big time. Anyone else feeling the cost of living is started to seriously affect their budget and what do you is contributing to costs, most likely oil supply and demand not meeting again my opinion, and what do you feel can be down to cut costs.

Just saw on the news that petrol/gas prices have risen by 18.7% in the last year.

I love markets.

I haven't noticed it seriously affecting my budget, no.

And as for what to do about rising gas prices? Drive less.

I haven't noticed it seriously affecting my budget, no.

And as for what to do about rising gas prices? Drive less.Eat less, heat less, etc. Most food doesn't magically appear in your supermarket, you know, and even if your home uses natural gas powered heating, those are pegged to the oil price, and it'll be while before the EU clamps down on those.

I haven't noticed it seriously affecting my budget, no.

And as for what to do about rising gas prices? Drive less.

I don't drive due to a lack of car. However the rising cost of oil will have a knock on affect on other prices due to transportation and/or production costs. Even if people don't drive it will still affect them.

It's hitting me with being a student and not having a high monthly income.

Until the Fed starts raising the interest rates again we're going to be stuck in this period of rising prices. Odds are it will continue well into the autumn as there is no reason for the dollar to strengthen significantly until the Elections.

I have a gut feeling that even if McCain wins he'll replace Bernanke. But if the credit card market takes a hit the way the housing market did, say hello to 3-5 more years of this kind of economy. :(

I don't drive due to a lack of car. However the rising cost of oil will have a knock on affect on other prices due to transportation and/or production costs. Even if people don't drive it will still affect them.

It's hitting me with being a student and not having a high monthly income.

Yeah, sorry, I was answering that with an American mindset. The cost of living in England is massive and one way to deal with that is for the government to take action to reduce property prices.

Except they won't because all the people with property will cry about it. Oh well.

Driving less is a great idea. If you can tell me how, I'd love to hear it!

Right now I drive about 12 miles (19km) a day to get to the train which takes me 60 miles (97 km) to the city.
There is no mass transit between me and the station. If I rode a bicycle I'd have to do so on city streets (instead of on the highway) and would have to often do so in snow or rain. Worse, the elevation goes from 5 to 200 feet (1.5 to 60 m) over the half of the trip closest to my home. So a 10 minute drive becomes an hour ride each way, followed or preceeded by an 80 minute train ride.

And, no, moving is NOT an answer. I bought this place 9 years ago and just paid it off. I'm not about to move closer and take on a new $500,000 debt just to be closer to a job which I may or may not keep for the next 5 years.

Get a closer job you say? GREAT idea! Unfortunately, that will require more driving because of the spread out nature of the area. One position i just interviewed for (same pay as NYC, amazingly) is 15 miles (24 km) each way!
So much for drive less!! :(

It is incredibly easy to lower your cost of living. Everyone can find ways to cut their expenses with minimal impact to their standard of living - there is so much waste and inefficiency if you just know where to look.

Buy basic raw ingredients and actually make food from scratch, grow things in a garden if you can, buy in bulk and preserve the excess, drive more efficiently (slow acceleration, don't speed, avoid unnecessary changes in speed, etc), maintain your vehicle (proper air pressure in tires, clean air filter, etc), put on a sweater instead of turning up the heat, open a window instead of turning on the AC, watch less TV (books are better for your mind anyway), or any number of things.

Every one of us leads a wasteful life. We enjoy that waste, but it is not hard to trim it.

Yeah, sorry, I was answering that with an American mindset. The cost of living in England is massive and one way to deal with that is for the government to take action to reduce property prices.

Except they won't because all the people with property will cry about it. Oh well.
Wow. Are you seriously advocating government fixing asset prices well below market value?

Please, for the sake of humanity as a whole, take an economics class.

Driving less is a great idea. If you can tell me how, I'd love to hear it!Car pooling is one solution.

It is incredibly easy to lower your cost of living. Everyone can find ways to cut their expenses with minimal impact to their standard of living - there is so much waste and inefficiency if you just know where to look.

Buy basic raw ingredients and actually make food from scratch, grow things in a garden if you can, buy in bulk and preserve the excess, drive more efficiently (slow acceleration, don't speed, avoid unnecessary changes in speed, etc), maintain your vehicle (proper air pressure in tires, clean air filter, etc), put on a sweater instead of turning up the heat, open a window instead of turning on the AC, watch less TV (books are better for your mind anyway), or any number of things.

Every one of us leads a wasteful life. We enjoy that waste, but it is not hard to trim it.

Thats a bout the strenght of it. Here in the UK, if you want an allotment in which to grow your fruit and veg, there is a nominal waiting less of two years.

I think the goverment should do something about this. During the last great war, great swathes of public land was given over to the war effort of growing the humble spud.

Does this mean i don't get to eat pudding any more?


what i want to know is, is there any conclusive evidence that only cooking with certain types of food, and driving less and using less electricity for PC's and such, will actually have an impact on this environmental and global issue of warming?
This has big implications for my personal life, knowing if there's going to be a pudding after the next dinner. To eat or not to eat pudding.

Does this mean i don't get to eat pudding any more?


what i want to know is, is there any conclusive evidence that only cooking with certain types of food, and driving less and using less electricity for PC's and such, will actually have an impact on this environmental and global issue of warming?
This has big implications for my personal life, knowing if there's going to be a pudding after the next dinner. To eat or not to eat pudding.

Well I don't know about that, but driving less, buying basic instead of processed food, using less energy will save you money, which I think...no ..wait, yes it is, what the thread is about.:p

I love markets.

I vote we all change to robotocracy. All hail the metal overlords!

Wow. Are you seriously advocating government fixing asset prices well below market value?

Please, for the sake of humanity as a whole, take an economics class.

hmmm... is this another Chicago Boy shivering at the thought of a controlled economy. Living is definetely becoming increasingly expensive. Free market has done nothing for prices. Privatizing the energy market in europe hasn't achieved the promised price drop for instance. Ofcourse these days, it's all because of the oil, easy excuse.
Not a user myself, but I'm in an environment where I get confronted with it, and the only product that I know of that has gotten cheaper are narcotics. Beer prizes for instance, a comparable product but a free market, have sky rocketed, while on the other hand cocaine is a lot cheaper than it was ten years ago.
And for those who would argue that the drug market is uncontrolled, try to explain the concept of a free market and free competition to your avarage columbian drug lord. A horses head will be your reward I think

Well I don't know about that, but driving less, buying basic instead of processed food, using less energy will save you money, which I think...no ..wait, yes it is, what the thread is about.:p

what happens if i don't drive, but i buy lots of processed food, does it cancel itself out?
Or if i drive but i eat healthy organic (or whatever the damn pc term is for 'good food') food, does it cancel out again?

Car pooling is one solution.

If people whom live near you are going to the same location working roughly the same hours.
I'm all for it, but this unfortunatley happens less than one might hope. Even if we could get 1 in 10 the cars off the roads in this manner its only going to help so much with all the gas wasted in traffic.

Thats a bout the strenght of it. Here in the UK, if you want an allotment in which to grow your fruit and veg, there is a nominal waiting less of two years.


If you are lucky. I know that in some areas they've closed the allotment lists for the forseeable future.

I think the goverment should do something about this. During the last great war, great swathes of public land was given over to the war effort of growing the humble spud.

I agree. Even though I know it is unlikely, especially since the opposite is happening.

what happens if i don't drive, but i buy lots of processed food, does it cancel itself out?
Or if i drive but i eat healthy organic (or whatever the damn pc term is for 'good food') food, does it cancel out again?

What are you on about man? Either you spend less money of things or you don't.

The point is we can all do things to save a few quid, however you do it, it can be done. For those who do drive, for example, they can save money by not driving.

Those who only eat processed food can save money by buying normal food and making thier own meals.

I have no idea what point you are trying to make, why don't you make me understand.

If people whom live near you are going to the same location working roughly the same hours.
I'm all for it, but this unfortunatley happens less than one might hope. Even if we could get 1 in 10 the cars off the roads in this manner its only going to help so much with all the gas wasted in traffic.Considering that I'd never heard of whole lanes being reserved for cars with more than one person, I'd imagine it would do a lot. But generally, Americans are screwed. First off, there's the problem with low population density resulting in larger distances. Secondly, the car and tire industries banded together to smash public transportation and succeeded.

What are you on about man? Either you spend less money of things or you don't.

The point is we can all do things to save a few quid, however you do it, it can be done. For those who do drive, for example, they can save money by not driving.

Those who only eat processed food can save money by buying normal food and making thier own meals.

I have no idea what point you are trying to make, why don't you make me understand.

I was saying, maybe i can make a deal where i spend money on certain things while saving on others ending with a balance. would it still have an effect?

See the thing is, if i did make a point i'm sure i'd fall off it because i'm not entirely certain of what point i am trying to make, at least insofar as to use the point for anything useful is difficult to understand in itself. Still i'll try a cylinder if that helps?

I was saying, maybe i can make a deal where i spend money on certain things while saving on others ending with a balance. would it still have an effect?If you end up with no effect, then its obviously not going to have an effect.

I was saying, maybe i can make a deal where i spend money on certain things while saving on others ending with a balance. would it still have an effect?

See the thing is, if i did make a point i'm sure i'd fall off it because i'm not entirely certain of what point i am trying to make, at least insofar as to use the point for anything useful is difficult to understand in itself. Still i'll try a cylinder if that helps?

Well the answer to that question would also be a question. Do you have more or les money in your pocklet than when you started?

Of course with the point, if you made it a point on a circle then you could just turn it sideways and stand on the edge huh!

Considering that I'd never heard of whole lanes being reserved for cars with more than one person, I'd imagine it would do a lot. But generally, Americans are screwed. First off, there's the problem with low population density resulting in larger distances. Secondly, the car and tire industries banded together to smash public transportation and succeeded.

HOV lanes work on larger highways, but are impractical on smaller roads.
Yep, that's about the size of it, though it's not so much that public transportation was smashed as the US has a hard time running its interstate railroads. The mass transit systems in cities (DC Metro, NYC Subway, Boston T) are all very efficient and as good as any European system (ie: Prague, London or Vienna). But as you post, it's the longer distance routes that the car is king in the US.

If you end up with no effect, then its obviously not going to have an effect.
actually a balance doesn't necessarily have no effect, it may have a lesser one than a more unbalanced cause. if you see what i mean.

Well the answer to that question would also be a question. Do you have more or les money in your pocklet than when you started?

Of course with the point, if you made it a point on a circle then you could just turn it sideways and stand on the edge huh!
what's a pocklet?
is it like a minature pocket that can't hold larger items, i get that all the time with my stuff so i carry a bag around with me.

But then you'd fall off the circle because a proper circle would be pretty smooth.
So if i made multiple points could i call that a jagged edge of reason? then i could hold on to more edges if it was turned on it's side rather than fall off with the circle idea.
then again with a circle you could use it to go further and roll it forward.
hmmm, maybe it's better to have a rectangular reason for now.

actually a balance doesn't necessarily have no effect, it may have a lesser one than a more unbalanced cause. if you see what i mean.


what's a pocklet?
is it like a minature pocket that can't hold larger items, i get that all the time with my stuff so i carry a bag around with me.

But then you'd fall off the circle because a proper circle would be pretty smooth.
So if i made multiple points could i call that a jagged edge of reason? then i could hold on to more edges if it was turned on it's side rather than fall off with the circle idea.
then again with a circle you could use it to go further and roll it forward.
hmmm, maybe it's better to have a rectangular reason for now.

A Pocklet is like a pocket but holds only money, and a circle is not a sphere.

HOV lanes work on larger highways, but are impractical on smaller roads. The point isn't that HOV lanes are a good idea, it's that the whole concept struck me as absurd, as I wasn't used to there being more cars with only one occupant than not. That they even have HOV lanes should show you that there's plenty of potential for saving gas via carpooling.
Yep, that's about the size of it, though it's not so much that public transportation was smashed as the US has a hard time running its interstate railroads. The mass transit systems in cities (DC Metro, NYC Subway, Boston T) are all very efficient and as good as any European system (ie: Prague, London or Vienna). But as you post, it's the longer distance routes that the car is king in the US.Oh, no, it actually was. The industries banded together and bought up a lot of public transportation companies, only to run them out of business. Got convicted of it in a criminal court too. Fined the price of about two small family cars as a result.

A Pocklet is like a pocket but holds only money, and a circle is not a sphere.

maybe circles evolve into sphere's later on.
unless of course you're talking about the innate circularity of all lifeforms, then things get complicated.
Would environmentally friendly cars be a good idea to reduce the price of oil?

actually a balance doesn't necessarily have no effect, it may have a lesser one than a more unbalanced cause. if you see what i mean.If you balance out what you save by spending it elsewhere, you will indeed have no effect on what you spend.

The point isn't that HOV lanes are a good idea, it's that the whole concept struck me as absurd, as I wasn't used to there being more cars with only one occupant than not. That they even have HOV lanes should show you that there's plenty of potential for saving gas via carpooling.
Oh, no, it actually was. The industries banded together and bought up a lot of public transportation companies, only to run them out of business. Got convicted of it in a criminal court too. Fined the price of about two small family cars as a result.

I understand, but I think that given most of the HOV lanes don't carry much traffic (and are only HOV at certain times of day) mean that they aren't as useful as they were thought they should be. Even with gasoline having tripled in two years, they aren't being used all that much by comparison.

I recall the streetcars in many cities going out in such a manner, but they were also desired to leave so that the subways could be built. What systems do you mean?

If you balance out what you save by spending it elsewhere, you will indeed have no effect on what you spend.
sure but it may have an effect on other things further down the line, which may effect other people.

HOV lanes work on larger highways, but are impractical on smaller roads.
Yep, that's about the size of it, though it's not so much that public transportation was smashed as the US has a hard time running its interstate railroads. The mass transit systems in cities (DC Metro, NYC Subway, Boston T) are all very efficient and as good as any European system (ie: Prague, London or Vienna). But as you post, it's the longer distance routes that the car is king in the US.

I don't think subways and buses could ever work as well as cars for most of America. There are too many people going long distances in many directions. Cars work best for that. America already has such a large and extensive road system, hybrid cars are better solution to rising gas prices.

I understand, but I think that given most of the HOV lanes don't carry much traffic (and are only HOV at certain times of day) mean that they aren't as useful as they were thought they should be. Even with gasoline having tripled in two years, they aren't being used all that much by comparison. I don't think you did. I'm not in favor of HOV lanes at all. I'm in favor of HOVs. That there even are HOV lanes shows that a lot less HOVs exist, ergo, there could be more, lessening the overall amount of cars on the road, and consequently, the amount of gasoline being consumed.
I recall the streetcars in many cities going out in such a manner, but they were also desired to leave so that the subways could be built. What systems do you mean?Read up on it a couple years ago, need to look it up again. The whole mess happened a few decades ago, and now the damage has been done.

sure but it may have an effect on other things further down the line, which may effect other people.
You can't effect things. It's grammatically impossible.

I don't think you did. I'm not in favor of HOV lanes at all. I'm in favor of HOVs. That there even are HOV lanes shows that a lot less HOVs exist, ergo, there could be more, lessening the overall amount of cars on the road, and consequently, the amount of gasoline being consumed.
Read up on it a couple years ago, need to look it up again. The whole mess happened a few decades ago, and now the damage has been done.

Yes, I took it to mean that you found HOVs absurd when you said so. :)
Adding more HOV lanes would just funnel more traffic onto lesser road systems. It won't solve anything. As you said, the country is very spread out.

You can't effect things. It's grammatically impossible.

what?
I'm saying if i buy a certain item, further down the line the people who made that item will recieve demand for it and make more if they need to supply that demand. and so they might make more or less money, and so on with a knock on effect to other people.
I'm not sure how grammar effects this.

what?
I'm saying if i buy a certain item, further down the line the people who made that item will recieve demand for it and make more if they need to supply that demand. and so they might make more or less money, and so on with a knock on effect to other people.
I'm not sure how grammar effects this.They might be affected, but never, ever effected.

They might be affected, but never, ever effected.

:rolleyes:
...

You can't effect things. It's grammatically impossible.

I wouldn't know about MHIJ (AFAIR, they are grammatically unable to do many things I think I can do), but I for one certainly can effect things. For example, quite recently I effected a huge row in my flat when I brought up the issue a how to properly wash the dishes. That row, by the by, effected even worse dish-washing quality in my flatmates than existed before.

etc...

I don't think subways and buses could ever work as well as cars for most of America. There are too many people going long distances in many directions. Cars work best for that. America already has such a large and extensive road system, hybrid cars are better solution to rising gas prices.

Yes, exactly right.
Hybrids at this point aren't doing squat for gas prices. Too few, too expensive, and too low a capacity but a good first try. I'm glad they exist and are being worked on, but we really won't see big energy gains until Gen 3 or 4 in about 8-12 years. When they solve the altitude, heat generation (or more precisely lack thereof) and battery recharge timing problems it'll be a big win.

Wow. Are you seriously advocating government fixing asset prices well below market value?

Please, for the sake of humanity as a whole, take an economics class.

Please, for your own sake, and for the sake of other people's patience, get out of the habit of making such ridiculous assumptions.

Driving less is a great idea. If you can tell me how, I'd love to hear it!

Right now I drive about 12 miles (19km) a day to get to the train which takes me 60 miles (97 km) to the city.
There is no mass transit between me and the station. If I rode a bicycle I'd have to do so on city streets (instead of on the highway) and would have to often do so in snow or rain. Worse, the elevation goes from 5 to 200 feet (1.5 to 60 m) over the half of the trip closest to my home. So a 10 minute drive becomes an hour ride each way, followed or preceeded by an 80 minute train ride.

And, no, moving is NOT an answer. I bought this place 9 years ago and just paid it off. I'm not about to move closer and take on a new $500,000 debt just to be closer to a job which I may or may not keep for the next 5 years.

Get a closer job you say? GREAT idea! Unfortunately, that will require more driving because of the spread out nature of the area. One position i just interviewed for (same pay as NYC, amazingly) is 15 miles (24 km) each way!
So much for drive less!! :(

Well, moving house after "only" nine years actually is an answer, just one you aren't interested in.

So the cost of living is starting to rise quite dramatically, well in my opinion anyway, and its starting to hit my pocket big time. Anyone else feeling the cost of living is started to seriously affect their budget and what do you is contributing to costs, most likely oil supply and demand not meeting again my opinion, and what do you feel can be down to cut costs.

Just saw on the news that petrol/gas prices have risen by 18.7% in the last year.

Have you seen Newsnight last night? If not watch it on BBC iplayer... it has a section about this.

Well, moving house after "only" nine years actually is an answer, just one you aren't interested in.

Having already paid off my mortgage, I have no desire to take on another one for twice as much (yes, even in this economy!) just to move closer.

Would you willingly move closer to your job (which you probably won't keep forever) if it meant giving up half your pay every month for the next 20 years?

The answer for traffic issues/higher fuel prices is not to move people's homes. The same problems would just reappear since the population doubles every 30 years or so anyway.

You can't effect things. It's grammatically impossible.
Of course you can. If a substantial group of people suddenly decided to buy local produce rather than that of foreign origin, they would effect a positive upturn in the finances of local farmers.

http://xkcd.com/326/

what happens if i don't drive, but i buy lots of processed food, does it cancel itself out?
Or if i drive but i eat healthy organic (or whatever the damn pc term is for 'good food') food, does it cancel out again?
I am not entirly sure "PC" has anything to do with the "organic" label

More so marketing then anything

Why do people atribute the craziest things to "PC"?

Having already paid off my mortgage, I have no desire to take on another one for twice as much (yes, even in this economy!) just to move closer.

Couldn't you sell your house and buy your new one for that amount? I don't understand why this requires a new mortgage.

Couldn't you sell your house and buy your new one for that amount? I don't understand why this requires a new mortgage.

The average house in Stamford, CT costs $567,500.
The houses in my town go for about $280,000.

Say I did get $280,000. I'd still need a mortgage of $280,000 for the other half. For which, I'd likely pay $280,000 in interest to the bank over 30 years. So that $567,500 house actually costs $851,250 when all is said and done if a mortgage goes to full term. That's $2400 a month. AND I haven't paid taxes on it yet!!

Boggles the mind, doesn't it? :(

Then there are closing costs, moving expenses, realtors fees... I just spent 8 years living well below my means in order to pay off a 15 year mortgage in 8. I can't do that again. Or we COULD go into a 1 bedroom apartment... Thanks, no.

Nah. I'm a student, so I'm pretty damn well insulated from price increases.

The average house in Stamford, CT costs $567,500.
The houses in my town go for about $280,000.

Say I did get $280,000. I'd still need a mortgage of $280,000 for the other half. For which, I'd likely pay $280,000 in interest to the bank over 30 years. So that $567,500 house actually costs $851,250 when all is said and done if a mortgage goes to full term. That's $2400 a month.
That's a fucked up interest rate.



Then there are closing costs, moving expenses, realtors fees... I just spent 8 years living well below my means in order to pay off a 15 year mortgage in 8. I can't do that again. Or we COULD go into a 1 bedroom apartment... Thanks, no.
You could if you had to, what you mean is you choose not to, which is to say, you shouldn't be complaining.

I am suprised that most everone here thinks that the cost of living is going up just because of gas prices going up. Now of course this is just for the US. But the minimun wage going up has a large affect on the cost of living going up, and it is supposed to go up again this summer. For us small bussiness owners that means having to release employes or raise our prices to compensate.

That's a fucked up interest rate.
Time to do the numbers because that doesn't seem bad at all, depending on the term.

I am suprised that most everone here thinks that the cost of living is going up just because of gas prices going up. Now of course this is just for the US. But the minimun wage going up has a large affect on the cost of living going up, and it is supposed to go up again this summer. For us small bussiness owners that means having to release employes or raise our prices to compensate.
That's baloney. First, almost no one makes minimum wage. Second, prices for items other than gas are going up. You need to buy a week's worth of groceries.

No, the costs aren't rising, not for me anyways. Let's see why:
-Shower once a week
-No deoderant
-No car
-Bicycling
-Public transport
-Microgenerated Energy (Solar Panels!)
Et cetera.

That's baloney. First, almost no one makes minimum wage. Second, prices for items other than gas are going up. You need to buy a week's worth of groceries.

I agree with the second half... but lots of people make minimum wage. I did in my last job, and I wasn't the only person working there...

In SOME places, maybe no one makes minimum wage. But lots of people, especially in rural areas are getting minimum wage, or less.

No, the costs aren't rising, not for me anyways. Let's see why:
-Shower once a week
-No deoderant
-No car
-Bicycling
-Public transport
-Microgenerated Energy (Solar Panels!)
Et cetera.

Costs of public transport have increased around here. I wish I could live without food, that's a neat trick.

Until the Fed starts raising the interest rates again we're going to be stuck in this period of rising prices. Odds are it will continue well into the autumn as there is no reason for the dollar to strengthen significantly until the Elections.
I would advise against relying on the Fed to magically fix it. That institution is in a rather deeper crisis than most people realise and until that is fixed, normal monetary policy isn't going to suddenly come back.

And even if it did, there are still a lot of underlying causes for food and petrol price rises that it can't do a whole lot about. A stronger dollar would help a little, but I'm afraid it would also stop the slow reversal in the trade deficit that we're just beginning to see now and therefore fail to start repairing the dollar's long-term problems. The weak dollar and higher import prices are painful, but ultimately necessary to get the US back on a somewhat more sustainable relationship level with the rest of the world economy.

The first point of call should be the elimination of the biofuel subsidies. They're pork-barrel spending with little environmental benefit, and they're doing what economists keep warning governments about: they have unintended consequences that markets themselves wouldn't have seen, but were caused by the reactions to the intervention.

Well get used to it. It's the inevitable outcome of all the 'economic stability' centrists have been touting.

Well get used to it. It's the inevitable outcome of all the 'economic stability' centrists have been touting.
Have a look at that pdf link in my signature, it's so worth it: http://www.economics.harvard.edu/faculty/rogoff/files/This_Time_Is_Different.pdf

I particularly like the whole thing about government-made inflation in times of gold- and silver currency. Puts a big fat hole into the whole anti-fiat money argument.

Or we COULD go into a 1 bedroom apartment... Thanks, no.

You're right, you could. It's your decision not to and that's fine but there's a price to pay for that.

Well I don't know about that, but driving less, buying basic instead of processed food, using less energy will save you money, which I think...no ..wait, yes it is, what the thread is about.:p
I don't drive at all. Since I live in a small city with no public transport, it sucks.

I particularly like the whole thing about government-made inflation in times of gold- and silver currency. Puts a big fat hole into the whole anti-fiat money argument.

Really, though, everybody does have to remember that this decade has also been the most prosperous for the world economy since the 1960's, when the US, USSR and especially Japan and Europe were all in the midst of their postwar growth boom. There is a lot of underlying strength driving the world economy forward. That being said, I am firmly convinced the vast majority of price increases in the past couple of years are increasingly due to speculation rather than any kind of fundamentals.

The investors that got burned in the dot-com bubble moved in to housing and commodities, and now that housing is in the tank they're migrating to commodities. Seriously, it seems way more than coincidental that oil prices suddenly reversed their stagnant trend and started zooming upward in early 2007...right at the same time the housing bubble was deflating. You see this in copper, metals, food...all starting to accelerate dramatically right when the housing bubble collapsed regardless of the actual inventory or demand situation, which is really not all that bullish.

Is the standard of living declining as well?

Really, though, everybody does have to remember that this decade has also been the most prosperous for the world economy since the 1960's, when the US, USSR and especially Japan and Europe were all in the midst of their postwar growth boom. There is a lot of underlying strength driving the world economy forward. That being said, I am firmly convinced the vast majority of price increases in the past couple of years are increasingly due to speculation rather than any kind of fundamentals.

The investors that got burned in the dot-com bubble moved in to housing and commodities, and now that housing is in the tank they're migrating to commodities. Seriously, it seems way more than coincidental that oil prices suddenly reversed their stagnant trend and started zooming upward in early 2007...right at the same time the housing bubble was deflating.

A lot of people have got rich at the expense of a lot of other people. A lot of spending has continued despite being based on nothing.

Welcome to the new Depression.

Is the standard of living declining as well?

When you have to choose between heat or food, I'd say yes.

A lot of people have got rich at the expense of a lot of other people. A lot of spending has continued despite being based on nothing.

Welcome to the new Depression.

Depression? We'll see; with any luck, the kind of financial meltdown that could have produced a serious contraction was averted, but I do feel we'll be seeing depressed growth for at least a few years in to the future. It's hard to argue that the tipping point hasn't been reached; overall inflation is running at 4.0%, and although core CPI is still in healthy shape, it's likely those food and energy prices will bleed through pretty soon.

Reiterating my previous arguments, like any bubble, commodities are going to crash. My primary concern is the pension funds and retirement savings being funneled in to commodities, which are far more vulnerable to downside risks than any stock or bond...when they crash, they crash hard and it takes far longer for their prices to recover. I think we're going to see a lot of corruption and manipulation in these markets after all is said and done, and it will lead to some pretty revolutionary changes in the financial system at least as comparable to those seen in the aftermath of the S&L and Black Monday crises back in the 1980's.

When you have to choose between heat or food, I'd say yes.

Agreed.
*prods government*

Agreed.
*prods government*

Shit, the best idea they have is a gas-tax holiday. They are so afraid of a PR backlash that they have no choice but to parrot asinine schemes that won't help anything...after all, recall Jimmy Carter's advice to conserve? I don't think we can count on them too much at this juncture.

Shit, the best idea they have is a gas-tax holiday. They are so afraid of a PR backlash that they have no choice but to parrot asinine schemes that won't help anything...after all, recall Jimmy Carter's advice to conserve? I don't think we can count on them too much at this juncture.

We should get the document and rewrite it to give lots of funding to alternative energies ending with a millenium long gas holiday.

In the end it comes down to the people though. We all have to do our own part I suppose.. though it isn't really motivating when the government just sits there and does nothing on its part.

We should get the document and rewrite it to give lots of funding to alternative energies ending with a millenium long gas holiday.

In the end it comes down to the people though. We all have to do our own part I suppose.. though it isn't really motivating when the government just sits there and does nothing on its part.

Well, I'm happy to hear that Ohio has passed a Renewable Portfolio Standard; although 12.5% by 2020 is a pretty mild goal, it'll do wonders for our economy. Other states are passing similar measures, so hopefully there will be progress on that front.

However, we need to realize that 72% of US oil demand is for transportation, and of that 85% is in light-duty vehicles. This is a problem that we can address and solve if we put the effort in to it.

Well, I'm happy to hear that Ohio has passed a Renewable Portfolio Standard; although 12.5% by 2020 is a pretty mild goal, it'll do wonders for our economy. Other states are passing similar measures, so hopefully there will be progress on that front.

However, we need to realize that 72% of US oil demand is for transportation, and of that 85% is in light-duty vehicles. This is a problem that we can address and solve if we put the effort in to it.

Hell yea. (http://www.youtube.com/watch?v=DspcTcVslsI&feature=related)

why is everyone so concerned with the cost of living? what about the cost of dying? has anyone checked funeral plot and coffin prices lately? ridiculous!

Depression? We'll see; with any luck, the kind of financial meltdown that could have produced a serious contraction was averted, but I do feel we'll be seeing depressed growth for at least a few years in to the future.

Given that we've been in recession for what... 3 years, at least... and the government still tries to avoid the issue... or find some euphemistic alternative... I think Depression is inevitable.

Given that we've been in recession for what... 3 years, at least... and the government still tries to avoid the issue... or find some euphemistic alternative... I think Depression is inevitable.

Well, I wouldn't say we've been in recession for three years; going by the NEBR definition, which is better than the "two consecutive quarters of negative growth" commonly used, we clearly hit recession territory in the last quarter of 2007. That being said, this entire business cycle has been rather mediocre, especially on the employment front when compared to the 1990's. Growth was decent, but wages and job growth simply didn't keep up and that obviously contributes to the generally low consumer confidence of the past seven years. But that's not entirely surprising. The 1990's, for all of the excess of the NASDAQ bubble, was fundamentally driven by technological change and the ability of the United States to capture and dominate that change, with subsequent effects on our economy. Given the weakness in many parts of the world during that time, the US's performance was downright excellent.

That raises the question, of course, what about the 2000's? Where did our growth come from?

Government deficit spending and the housing bubble are the only things I can think of, and I don't know about you but neither of those are from my perspective a solid foundation for continued prosperity. We can only shuffle houses between each other for so long before we run out of greater fools...I mean, most industries did well (IT bounced back, and healthcare is great), but none of them have had the kind of push behind them to really drive growth like telecoms and IT back in the 1990's.

Time to do the numbers because that doesn't seem bad at all, depending on the term.

What kind of freak actually takes 30 years to pay off a 30 year mortgage anyway? I'll have mine paid off in 8 years, 10 tops.

That raises the question, of course, what about the 2000's? Where did our growth come from?


Home equity withdrawal. Lot's of people 'pulling cash out' based upon dubious house price increases, then spending it.

The investors that got burned in the dot-com bubble moved in to housing and commodities, and now that housing is in the tank they're migrating to commodities. Seriously, it seems way more than coincidental that oil prices suddenly reversed their stagnant trend and started zooming upward in early 2007...right at the same time the housing bubble was deflating. You see this in copper, metals, food...all starting to accelerate dramatically right when the housing bubble collapsed regardless of the actual inventory or demand situation, which is really not all that bullish.

Well I dont know about all that, but the principal reason why commidties prices are now booming is due to the fact that China and to a lesser extent but still has influence have placed huge demands on commodities which has increased prices. This counts for oil, coal, copper, silver, urainium amongst others. Once the China boom starts to slow then we will see a lot less pressure on commodity prices. Oil did not suddenly go up in 2007 this problem of higher oil prices has been around for the past few years.

The world is sitting on the cusp of a recession, depending on how governments act will depend on how much of an effect it has, but the fact of the matter is that we are almost at the top of the cycle and soon will have to go cascading down. If dealt with correctly then we will come out of it a liitle worse for wear. If not then we could see a war break out principally from China, which also why we must ensure China does not get a controlling stake in BHP Billiton.

Nah. I'm a student, so I'm pretty damn well insulated from price increases.

Please tell me this is sarcasm

The reason why the cost of living has gone up, including fuel is as follows. Oil is bought and sold ONLY in U.S dollars. Since the dollar isn't back by gold, and the Federal Reserve prints as much paper money as it wants, the value is plummeting. Consequently, it takes more of those dollars to buy the same amount of gas, hence, higher fuel prices. The Federal Reserve is a group of private bankers who control our money supply, which only congress has the right to do, according to the constitution. Look up "Fractional Reserve Banking." When you deposit $1.00 in the bank, they write it down as $9.00 and then loan it out at interest. This, as any ecomonics student can tell you, causes supply and demand. If there is a hight demand for a product the prices go up to accomidate that demand. The problem is that the market can keep up with the amount of currency in the market. If your were to peg the dollar to a gold standard, then oil would still be the same price it used to be back in the 40's! Check out the book, or youtube.com for "Creature from Jekylle Island."

Well I dont know about all that, but the principal reason why commidties prices are now booming is due to the fact that China and to a lesser extent but still has influence have placed huge demands on commodities which has increased prices.
I would agree in principle, though with the subprime thing, the turbulence in share markets and the fall in the dollar you'd have to say that a lot of money flowed from shares and dollar-denominated bonds into commodities. Remove them and commodity prices would still trend upwards, but not nearly as quickly as they are at the moment.

If not then we could see a war break out principally from China, which also why we must ensure China does not get a controlling stake in BHP Billiton.
There's not gonna be a war in China. Even in the worst case scenario, if somehow the Chinese economy went through some sort of super-collapse, the Chinese would simply blame the communist party and remove it from power. They wouldn't divide the country or find any other reason to use guns.

As for BHP, they don't want a controlling stake. They just want to make sure they don't end up with a Rio-BHP super-company dictating prices to them. They quite like the setup with Vale, and it's only the competition between Rio and BHP that makes it work. That's why they have such a problem with the merger, and why they'll undoubtedly do whatever they can to interfere with it.

The first point of call should be the elimination of the biofuel subsidies. They're pork-barrel spending with little environmental benefit, and they're doing what economists keep warning governments about: they have unintended consequences that markets themselves wouldn't have seen, but were caused by the reactions to the intervention.Indeed. One of them is that the land being used for biofuels is leading to less land being used for food, another factor in driving up the food prices.

I would advise against relying on the Fed to magically fix it. That institution is in a rather deeper crisis than most people realise and until that is fixed, normal monetary policy isn't going to suddenly come back.

And even if it did, there are still a lot of underlying causes for food and petrol price rises that it can't do a whole lot about. A stronger dollar would help a little, but I'm afraid it would also stop the slow reversal in the trade deficit that we're just beginning to see now and therefore fail to start repairing the dollar's long-term problems. The weak dollar and higher import prices are painful, but ultimately necessary to get the US back on a somewhat more sustainable relationship level with the rest of the world economy.

The first point of call should be the elimination of the biofuel subsidies. They're pork-barrel spending with little environmental benefit, and they're doing what economists keep warning governments about: they have unintended consequences that markets themselves wouldn't have seen, but were caused by the reactions to the intervention.

Agreed, but until the $ strengthens (which won't happen at 2% interest rates), they hold if not all the cards a good number of 'em.

Biofuel subsidies need to go for sure, as do about half the farm subsidies. There is NO reason why corn farmers are getting subsidies with record prices paid per bushel.

The trouble is that most people in government have no clue about economics. I suspect that most Senators and Congressional Reps are just charismatic fools.

That's a fucked up interest rate.




You could if you had to, what you mean is you choose not to, which is to say, you shouldn't be complaining.

Actually, it's normal. On most any mortgage the issuing bank will get back their money + 100% if you pay it off over the number of months required. I paid mine off at money +55% because I paid it off in just over half the time. The only way to lessen the interest you pay is to make regular extra payments to shorten the term (or increase what you pay per month).

I've worked damned hard for the past 15 years. That I could afford to pay for a 1 br apartment by selling my house does not make me rich or well off. It just means that I've reached a point in life other's haven't yet. I'm 35. That's not particularly young or old. (At least I hope not!!). I chose not to carry credit card debt, take extravagent vacations... I've had a 91 buick which I sold in 00 for a new Chrysler which I've maintained and still drive. My clothes are from after-holiday sales at JCPenny and Burlington Coat Factory. I heated the place while I was home with WOOD I split. Etc.

So please don't say my desire to not move out of a house into a 1BR appartment (with a family) is a selfish act, eh? :D Kids need more stuff than I do. I can't just keep the house at 50 degrees like I did before when I wasn't home (which was most of the time as I was working all the time).

the price of oil is still no where near its real cost in human suffering.

but it isn't so much costs that are soaring as it is that something called the fed, that the u.s. treasury is subcontracted to, is devaluing the dollar by printing more of them to cover the backsides of wild and ignorant miscalculations that ought to have been alowed to perish of their own ignorance.

thus essentially the government is doing what amounts to counterfitting, and thus devaluing, its own currency.

i know this is an old argument, that used to be a favorite of real, pre-neo, conservatives. except this time, it really is.

the money market is just being flooded with relatively worthless paper, so of course, with more dollars chaising the same amount of goods, it takes more of them to represent the same purchasing power.

sort of basic economics 101.

of course there's more afoot then that. we shall see what we shall see what we shall see.

the whole thing might collapse tomarrow, or it might never. i'm not expert on that. i'm just seeing some of the little parts of it though, and those don't look as healthy as the holy writ from on high would have us to believe.

i still measure economic health in terms of how many hours of labour equals how many months of durability of shoe leather, and in those real terms, i do see continued worsening with no end to its doing so in sight.

but looking on the bright side, i DON'T see economic conditions as the begining and end of anything other then economic conditions. if they bring down governemts or they don't, isn't the end of the world.

=^^=
.../\...

The reason why the cost of living has gone up, including fuel is as follows. Oil is bought and sold ONLY in U.S dollars. Since the dollar isn't back by gold, and the Federal Reserve prints as much paper money as it wants, the value is plummeting. Consequently, it takes more of those dollars to buy the same amount of gas, hence, higher fuel prices. The Federal Reserve is a group of private bankers who control our money supply, which only congress has the right to do, according to the constitution. Look up "Fractional Reserve Banking." When you deposit $1.00 in the bank, they write it down as $9.00 and then loan it out at interest. This, as any ecomonics student can tell you, causes supply and demand. If there is a hight demand for a product the prices go up to accomidate that demand. The problem is that the market can keep up with the amount of currency in the market. If your were to peg the dollar to a gold standard, then oil would still be the same price it used to be back in the 40's! Check out the book, or youtube.com for "Creature from Jekylle Island."

The dollar hasn't been backed by gold for 75 years, and when it was it a nightmare with inflation booms and deflationary busts. That's why the Federal Reserve and the Central Banks were set up in the first place!

There would also be almost NO credit, since the total amount of gold ever mined is finite (and far less than the amount of money in the US, much less the world). That means things like homes would be beyond most everyone's reach, just like back before the Great Depression.

Look around the planet. What currency is backed by specie? NONE of the majors.
The Swiss Franc is supposedly .2oz gold, but they have 1,290 tonnes of gold and 43,834.99 million Francs in circulation... so they're x7 over their coverage.

All a return to the gold standard would do is collapse the planetary economy. I'll pass, thanks. :)

What kind of freak actually takes 30 years to pay off a 30 year mortgage anyway? I'll have mine paid off in 8 years, 10 tops.

You'd be shocked then to learn that there are many, many people with TWO mortgages out on the same property or have a mortgage too large for their income.

Heck, consider most people are too stupid to pay off their credit cards every month. Do you really think they'll pay off a mortgage early? :(

Rasta-dom;13691102']why is everyone so concerned with the cost of living? what about the cost of dying? has anyone checked funeral plot and coffin prices lately? ridiculous!

Well, you think thats bad, how about the cost of the living dead? When Dubya was elected, there was a massive downward re-estimating of the total mass of brains in the developed world. And with the election of Boris Johnson as London Mayor, there has been a further shock to the market. It is just too expensive to keep a zombie fed nowadays. Markets across the world have collapsed, as investors shift to the growing trade in vampires. Won't somebody please think of the zombie traders?

What kind of freak actually takes 30 years to pay off a 30 year mortgage anyway? I'll have mine paid off in 8 years, 10 tops.
I hope you do. But you shouldn't count on it. Anything could happen over those 10 years - a couple of kids, major illness, car written off, losing your job.
Not trying to sound horribly negative and dismissive here, but you should never count on the status quo remaining unchanged over that length of time and so you shouldn't be so ready to dismiss others who haven't managed to pay their mortgage off.

That said, some people in the UK and USA are right morons. Banks were offering up to 150% mortgages! This is one of the reasons the subprime is hitting so hard. These people have got mortgages way above their property's value. What the hell were they thinking? Did they really think their house was going to be worth 1/2 as much again in just a couple of years, so they could sell it and pay off their mortgage?
Getting a mortgage is one thing, but that's just shear folly.

Yeah, sorry, I was answering that with an American mindset. The cost of living in England is massive and one way to deal with that is for the government to take action to reduce property prices.

Except they won't because all the people with property will cry about it. Oh well.
They won't because they can't. What do you expect them to do? Suddenly announce all house and land values are worth 1/2 what they were last week and anyone trying to sell their house for more than the new value will be shot?

At any rate, they don't need to. We're seeing massive falls in house prices world-wide. US house prices have fallen 15-20% over the last year or so. Considering they were rising by 10-15% annually over the past 5-8 years, this is a relative drop on 30+%. That's significant.
The rest of the world is falling too, though not as hard (except maybe Spain). NZ house prices have fallen by 5% over the last year after 8 years of 15-20% annual rises. But even this fall isn't telling the whole story.
Last time I checked, there were houses being offered for below Government Valuation (GV) - one was on sale at $100,000 below GV! GVs have always lagged behind the market rate by 10-20%, so selling below GV means the markets dropped (and is still dropping) by a good 20, maybe 25%.

They won't because they can't. What do you expect them to do? Suddenly announce all house and land values are worth 1/2 what they were last week and anyone trying to sell their house for more than the new value will be shot?

No, I expect them to build more houses.

No, I expect them to build more houses.

in the UK the government builds houses?

The average house in Stamford, CT costs $567,500.
The houses in my town go for about $280,000.

Say I did get $280,000. I'd still need a mortgage of $280,000 for the other half. For which, I'd likely pay $280,000 in interest to the bank over 30 years. So that $567,500 house actually costs $851,250 when all is said and done if a mortgage goes to full term. That's $2400 a month. AND I haven't paid taxes on it yet!!
what the hell is the mortgage rate there? 10%? ridiculously high. The greedy bastards.
Here it's 2.8%. A 30 yr mortgage like you describe would cost $1150 /month totaling $410k paid back to the bank. A 10 yr mortgage would cost $2650 /month and total just an extra $40k in interest.

This - and the fact house prices are going up by 20% a year here - is why I'm really wanting to get a place.

what the hell is the mortgage rate there? 10%? ridiculously high. The greedy bastards.
Here it's 2.8%. A 30 yr mortgage like you describe would cost $1150 /month totaling $410k paid back to the bank. A 10 yr mortgage would cost $2650 /month and total just an extra $40k in interest.

This - and the fact house prices are going up by 20% a year here - is why I'm really wanting to get a place.
Standard is 5.75% I think, maybe a bit higher. I got a lower than standard rate on my mortgage so I don't know. We are sitting under 5%. It's not uncommon for people to have 7% and higher interest on their mortgage, especially if they don't have pristine credit.

Standard is 5.75% I think, maybe a bit higher. I got a lower than standard rate on my mortgage so I don't know. We are sitting under 5%. It's not uncommon for people to have 7% and higher interest on their mortgage, especially if they don't have pristine credit.

1.3% Go Go veterans Affairs Loan.

with anything less then a 4.5% your gaining money due to inflation, as the money you use to pay the loan back ends up being worth less then the money you borrowed.

in the UK the government builds houses?
No, but they can release land for housing and make local councils do the same. They could also streamline the planning process for large housing developments, I suppose. Local councils can build social housing, but since right to buy came in, and the regulations banning councils using money raised from sale of social housing to build more social housing, there's little money for it.

I hope you do. But you shouldn't count on it. Anything could happen over those 10 years - a couple of kids, major illness, car written off, losing your job.
Not trying to sound horribly negative and dismissive here, but you should never count on the status quo remaining unchanged over that length of time and so you shouldn't be so ready to dismiss others who haven't managed to pay their mortgage off.

It would have to be something enormously huge to set us back any. Not something piddly like extra children (nearly impossible btw) or illness or getting laid off again. We can handle those things.

I know most people can't pay off their mortgage early, or even save money, due to having other debts, it's sad but most of them really don't get how stupid they are being with their money. You can't tell them either, they won't listen, they go on and on and on about how credit is good because debt is helping them be rich, it's idiocy.

90% of my clients come in living paycheck to paycheck and thinking that's good because it's the norm. It's the norm to be poor, that doesn't make it good.

No, but they can release land for housing and make local councils do the same. They could also streamline the planning process for large housing developments, I suppose. Local councils can build social housing, but since right to buy came in, and the regulations banning councils using money raised from sale of social housing to build more social housing, there's little money for it.

And - this will be a relief to the capitalists - they can relax some of the regulations. For example, the new mayor of London has said he's going to take action to limit the height of new buildings in the capital. Considering land prices, that's simply crazy.

You'd be shocked then to learn that there are many, many people with TWO mortgages out on the same property or have a mortgage too large for their income.
I'm not shocked, I know that. I know a woman who makes about $4000 a month, her first mortgage is $2500 and her second is $800, she owes minimums on her credit cards of about $600 a month. Just because she's typical doesn't mean she's being smart.

Heck, consider most people are too stupid to pay off their credit cards every month. Do you really think they'll pay off a mortgage early? :(
It's normal. Being normal isn't what makes you rich.

No, but they can release land for housing and make local councils do the same. They could also streamline the planning process for large housing developments, I suppose. Local councils can build social housing, but since right to buy came in, and the regulations banning councils using money raised from sale of social housing to build more social housing, there's little money for it.

interesting.

that isnt a factor in US housing.

And - this will be a relief to the capitalists - they can relax some of the regulations. For example, the new mayor of London has said he's going to take action to limit the height of new buildings in the capital. Considering land prices, that's simply crazy.

what kind of limits is he proposing? is there a good reason to not want skyscrapers in london?

what kind of limits is he proposing? is there a good reason to not want skyscrapers in london?

The argument seems to be that tall buildings are ugly (doesn't seem to have done New York any harm) and that they obscure views of famous older buildings such as St. Paul's Cathedral.

The details are vague at this stage but it seems buildings such as the Gherkin may no longer be allowed and that tall buildings in "viewing corridors" will be banned.

The argument seems to be that tall buildings are ugly (doesn't seem to have done New York any harm) and that they obscure views of famous older buildings such as St. Paul's Cathedral.

The details are vague at this stage but it seems buildings such as the Gherkin may no longer be allowed and that tall buildings in "viewing corridors" will be banned.

i guess its a point of view. i hope it fades away when he leaves office.

Please tell me this is sarcasm

I don't have a car and my entire tuition and most of my room and board is covered by scholarships. Basically, anything I do buy is either textbooks or completely discretionary.

Home equity withdrawal. Lot's of people 'pulling cash out' based upon dubious house price increases, then spending it.

Exactly. There was no real, fundamental driver of US growth during this expansion; it was basically people cashing in on the accrued value of their houses and spending it, with obviously bad consequences.

what the hell is the mortgage rate there? 10%? ridiculously high. The greedy bastards.
Here it's 2.8%. A 30 yr mortgage like you describe would cost $1150 /month totaling $410k paid back to the bank. A 10 yr mortgage would cost $2650 /month and total just an extra $40k in interest.

This - and the fact house prices are going up by 20% a year here - is why I'm really wanting to get a place.

Actually, 6% is about average for 30 years, I've seen 5.3% for 10 years.

At 360 months (30 years), a $280,000 loan at 6% means payments of $1,678.74 per month, with total interest paid at $324,346.93.

$324,346.93 + $280,000 = $604,346.93. UGH!
add in the $280,000 I put down on it in the first place and we get... $884,346.93 which is a bit higher than I originally thought. :(


If you can do it, I highly recommend getting a place, but keep in mind that the upward trend does go down. Real Estate is a very cyclical market. Get in at the wrong time and you might not be able to sell for a decade. But if you're talking about a primary residence it's a little better since you do live there.

i guess its a point of view. i hope it fades away when he leaves office.
He's only just been voted in, so we've got about 4 years of him in charge to go.

He's only just been voted in, so we've got about 4 years of him in charge to go.

yeah but thats not a long time when planning big buildings in london.

although it probably screws those who are halfway through the planning process.

how much power does he have over building regulations in london?

That's baloney. First, almost no one makes minimum wage. Second, prices for items other than gas are going up. You need to buy a week's worth of groceries.

I dont know about where you are but a lot of people here work for minimum wage. The whole point was that everything is going up in price, but its not just because of fuel!

yeah but thats not a long time when planning big buildings in london.
Four years is quite a while, really.
although it probably screws those who are halfway through the planning process.
They should be fine.
how much power does he have over building regulations in london?
Hard to say. He can't declare new taxes etc., because that would require a change in the law, something he can't do. Not sure how much building regulations in London will need to be agreed on in the Houses of Parliament.

The whole point was that everything is going up in price, but its not just because of fuel!
Just remember that your goods don't appear in the shops by magic. Transportation costs go up with fuel prices, and that hits you down at the grocer's etc.

yeah but thats not a long time when planning big buildings in london.

although it probably screws those who are halfway through the planning process.

how much power does he have over building regulations in london?

He has a decent amount of power. He can't just decide based on whimsy but he can make life very difficult indeed for developers.

Most significantly, one of his first appointments is a man who is a noted critic of tall buildings and one of the effects of this is that Lord Rogers (who worked for the previous mayor for free) will probably leave. Given that Richard Rogers is one of the most famous architects in the world, it doesn't exactly seem like quality solutions are high on the agenda. There's also a LSE report from a few years ago which said that the number one thing London could do to stay competitive was allow the development of taller buildings. Oh, and "Mr Johnson has announced that he will revise the London Plan,". Experts have been so confident in the London plan that some have been quoted as saying there was no chance any mayor would change it.

Oh, sorry, I went off on a tangent. I know he's ordering reviews and challenges into a couple of skyscrapers that are being planned. He can potentially do a lot of damage.

I dont know about where you are but a lot of people here work for minimum wage. The whole point was that everything is going up in price, but its not just because of fuel!
Quantify "a lot". I'll do the same for "almost no one".

About 1.3 million Americans earn the minimum wage or less. That's 1.1 percent of the working population. Now consider that anyone under 25 is probably not a head of household or primary wage earner and the percentage goes down a little more. In fact 53% of this 1.3 million fall into the 16-24 year old category.

Just because a lot of your college buds earn minimum wage doesn't mean it's a significant factor in anything.

I think we agree that prices are rising, but fuel is driving the costs. The government mandate to put more ethanol in gasoline creates higher prices for corn. It also creates higher prices for wheat because more wheat acres are being planted in corn. See, it's fuel and bad government policy at the root of the problem.

Quantify "a lot". I'll do the same for "almost no one".

About 1.3 million Americans earn the minimum wage or less. That's 1.1 percent of the working population. Now consider that anyone under 25 is probably not a head of household or primary wage earner and the percentage goes down a little more. In fact 53% of this 1.3 million fall into the 16-24 year old category.

Just because a lot of your college buds earn minimum wage doesn't mean it's a significant factor in anything.


I don't understand, why would the costs of a small business not go up if they were paying an increased minimum wage to someone who isn't the head of a household?

I don't understand, why would the costs of a small business not go up if they were paying an increased minimum wage to someone who isn't the head of a household?
Sorry that you got distracted... 1.3 million people earn the minimum wage or less. That's a very small percentage of all wage earners. That means that a very large percentage of all wage earners are making more than the minimum wage. So, we conclude that a small increase in the minimum wage is not going to produce much of an effect on prices because wages are typically above the minimum wage.

However, I believe most union raises are tied to minimum wage increases. If that's true, it will substantially increase costs for the businesses that are employing union labor. So the minimum wage increase can affect prices, but not in the direct manner that was implied some number of posts ago.

Sorry that you got distracted... 1.3 million people earn the minimum wage or less. That's a very small percentage of all wage earners. That means that a very large percentage of all wage earners are making more than the minimum wage. So, we conclude that a small increase in the minimum wage is not going to produce much of an effect on prices because wages are typically above the minimum wage.

However, I believe most union raises are tied to minimum wage increases. If that's true, it will substantially increase costs for the businesses that are employing union labor. So the minimum wage increase can affect prices, but not in the direct manner that was implied some number of posts ago.

You said, "Now consider that anyone under 25 is probably not a head of household or primary wage earner and the percentage goes down a little more. In fact 53% of this 1.3 million fall into the 16-24 year old category."

My question was basically "what relevance does this have?".

You said, "Now consider that anyone under 25 is probably not a head of household or primary wage earner and the percentage goes down a little more. In fact 53% of this 1.3 million fall into the 16-24 year old category."

My question was basically "what relevance does this have?".
None, that's why I apologized for distracting you.

And - this will be a relief to the capitalists - they can relax some of the regulations. For example, the new mayor of London has said he's going to take action to limit the height of new buildings in the capital. Considering land prices, that's simply crazy.
Which is a shame. I like tall buildings. Having said that, Canary Wharf isn't like the City of London and doesn't have any old buildings there. With a bit of luck, the Isle of Dogs might be exempt, or buildings reviewed on a case by case basis, not that I trust Boris to do either of those.

Just remember that your goods don't appear in the shops by magic. Transportation costs go up with fuel prices, and that hits you down at the grocer's etc.

I know. All of the companies that deliver to us have added a fuel surcharge for each delivery they make. I am just saying that the minimun wage going up also has an effect ot the prices raising.

http://www.businessspectator.com.au/bs.nsf/Article/The-new-cost-of-oil-EM3EQ?OpenDocument
No turning back
Martin Wolf, Financial Times

Oil at $US200 a barrel: that was the warning from Goldman Sachs, published last week. The real price is already at an all-time high. At $US200 it would be twice as high as it was in any previous spike. Even so, it would be a mistake to focus in shock only on the short-term jump in prices. The bigger issues are longer term.

Here are three facts about oil: it is a finite resource; it drives the global transport system; and if emerging economies consumed oil as Europeans do, world consumption would jump by 150 per cent. What is happening today is an early warning of this stark reality. It is tempting to blame the prices on speculators and big bad oil companies. The reality is different.

Demand for oil grows steadily, as the vehicle fleets of the world expand. Today, the US has 250 million vehicles and China just 37 million. It takes no imagination to see where the Chinese fleet is headed. Other emerging countries will follow China’s example.

Meanwhile, spare capacity in members of the Organisation of the Petroleum Exporting Countries is currently at exceptionally low levels, while non-Opec production has equally consistently disappointed expectations.

It looks increasingly hard to expand supply by the annual amount of about 1.4 million barrels a day needed to meet demand. This means an extra Saudi Arabia every seven years. According to the International Energy Agency, almost two-thirds of additional capacity needed over the next eight years is required to replace declining output from existing fields. This makes the task even harder than it seems. As the latest World Economic Outlook from the International Monetary Fund adds, the fact that peak production is reached sooner, because of today’s efficient technologies, also means that subsequent declines are steeper.

This is not to argue that speculation has played no role in recent rises in prices. But it is hard to believe it has been a really big one. True, the dollar price has risen sharply, but that is partly the result of the decline in the dollar’s relative value. As I have argued before, if speculation were raising prices above the warranted level, one would expect to see inventories piling up rapidly, as supply exceeds the rate at which oil is burned. Yet there is no evidence of such a spike in inventories, as Goldman Sachs and the IMF point out.

Similarly, it is not even true that the investment needed to boost the constrained production capacity has been lagging. The WEO shows that nominal investment by national and international oil companies more than doubled between 2000 and 2006. But real investment hardly increased, because of a global scarcity of rigs and associated skilled labour services. Against this background, it seems far more likely that such speculation as there is has been stabilising, rather than destabilising: in other words, it is moving prices in the right direction, in order to reduce demand.

Will the high prices succeed in doing this? Certainly. Demand has to match supply for a simple reason: we cannot burn oil that does not exist.

The price spikes of the 1970s were followed by big absolute falls in demand and output. This was partly because of the recessions and partly because of rising efficiency. Both forces should work again this time, but to a much smaller extent. The slowdown in the US economy is indeed likely to be significant. Slowdowns will also occur in western Europe and Japan and even in the emerging world. But the latter will still grow rapidly. Overall, the world economy – and so world oil demand – is likely to continue to grow reasonably briskly. Similarly, the improved efficiency of use of petroleum, as people switch to more efficient vehicles, notably in north America (where the room for doing so is so large), will be offset by the rising tide of demand for motorised transport in the world’s fast-growing emerging countries.

On balance, it is quite unlikely that aggregate demand for oil will collapse, as it did after the two previous price spikes, just as it is unlikely that massive net new oil supplies will come on stream in the near future. This does not mean that prices will remain as high as they are today for the indefinite future: such stability is improbable. But it means we should expect a sustained period of relatively high prices even if “peak oil” theorists are proved wrong. If proved right, this would be true in spades.

So what should be the response to these simple realities? Here are some obvious “do nots” and “dos”.

First, do not blame conspiracies by speculators, oil companies or even Opec. These are the messengers. The message is one of fundamental shifts in demand and supply. If speculators push prices up in response, they are helping the adjustment. Even if Opec keeps cutting output back, it is preserving a valuable resource for the future.

Second, do not blame the emerging countries for their growing demand. Citizens of rich countries must adjust to the higher prices of resources that the rise of the emerging countries entails. The only alternative is to attempt to destroy those hopes. That would be a blunder and a crime.

Third, understand that prices at these levels are now playing a big macro-economic role. At $100 a barrel the annual value of world oil output would be close to $US3,000 billion. That is 5 per cent of world gross product. The only previous years in which it was higher than that were 1979 to 1982.

Fourth, adjust to high prices, which will play a big part in encouraging more efficient use of this finite resource and ameliorating climate change. The current shock offers a golden opportunity to set a floor on prices, by imposing taxes on oil, fossil fuels or carbon emissions.

Fifth, do try to reach global agreement on a pact on trade in oil based on the fundamental principle that producers will be allowed to sell their oil to the highest bidder. In other words, the global oil market needs to remain integrated. Nobody should use military muscle to secure a privileged position within it.

Finally, do become serious about investing in basic research into alternative technologies. Energy self-sufficiency is an implausible goal. Investing for a post-oil future is not.

We are no longer living in an age of abundant resources. It is possible that huge shifts in supply and demand will reverse this situation, as happened in the 1980s and 1990s. We can certainly hope for that happy outcome. But hope is not a policy.

The great event of our era is the spread of industrialisation to billions of people. The high prices of resources are the market’s response to this transforming event. The market is saying that we must use more wisely resources that have now become more valuable. The market is right.

Just thought that one was appropriate. And of course the news that the US CPI figures didn't shoot up all that much, which is nice.

I know. All of the companies that deliver to us have added a fuel surcharge for each delivery they make. I am just saying that the minimun wage going up also has an effect ot the prices raising.

minimum wage has an effect but not a large one.

and since the price of oil has exploded, its a damned good thing that a raise in the minimum wage is already in effect. people need that money.

Just thought that one was appropriate. And of course the news that the US CPI figures didn't shoot up all that much, which is nice.

It's hopefully a sign that inflation is under control, although even if general price inflation remains tame we're still going to see a pretty big knock-on effect on consumer spending from food and energy costs. I know energy has around a 12% weight in the CPI, which is the average spent in the US, although I don't know how much weight food has.

It's hopefully a sign that inflation is under control, although even if general price inflation remains tame we're still going to see a pretty big knock-on effect on consumer spending from food and energy costs. I know energy has around a 12% weight in the CPI, which is the average spent in the US, although I don't know how much weight food has.
Right now I'm more worried about inflation than the recession in the States. I think the recession is there either way, regardless of what oil- and food prices do, and given that the cause of it is a pretty strong and persistent one, it's going to take its time to work out as well.

I'm much more worried that you end up getting inflationary pressures at the same time, which puts Bernanke in a bad position. But it seems now that unless you get lots of wage demands, the rising prices for some of these items in themselves aren't enough. And given the downturn, the only cause for something akin to such demands I can see is the election...

And for more analysis regarding oil prices:
http://www.economist.com/business/displaystory.cfm?story_id=11332313
Trouble in the pipeline

WHEN the price of oil reached another record on May 6th, of over $122 a barrel, analysts pointed to attacks on pipelines in Nigeria and turmoil in Iraq as the immediate causes. Even small disruptions to supplies from such places can cause the price to jump, since only Saudi Arabia has the capacity to replace the lost production, and it does not seem inclined to do so. But to understand how supplies became so scarce in the first place, one must look at the state of the oil industry in Russia, the world's second-biggest producer.

Today, my toilet paper went up from $7.45 to over $9.
One day, my (very basic) icecream went up $1.25.
Also, over the last year, my the cost of my pasta has increased nearly $1.

Now, these aren't exactly luxury items, they're staples (well, perhaps not the icecream). It's just not fair.

I would agree in principle, though with the subprime thing, the turbulence in share markets and the fall in the dollar you'd have to say that a lot of money flowed from shares and dollar-denominated bonds into commodities. Remove them and commodity prices would still trend upwards, but not nearly as quickly as they are at the moment.

Well maybe I would have to look at the numbers myself.

There's not gonna be a war in China. Even in the worst case scenario, if somehow the Chinese economy went through some sort of super-collapse, the Chinese would simply blame the communist party and remove it from power. They wouldn't divide the country or find any other reason to use guns.

As for BHP, they don't want a controlling stake. They just want to make sure they don't end up with a Rio-BHP super-company dictating prices to them. They quite like the setup with Vale, and it's only the competition between Rio and BHP that makes it work. That's why they have such a problem with the merger, and why they'll undoubtedly do whatever they can to interfere with it.

Why is it that we have China increasing their defence capabilities at strong rate. They have a secret underground submarine base, they recently shot a US satellite out of space, with a new weapon they were testing, they have a scale model of the crossing between China and India (the passage they used when they attempted to invade India in the 1960's) not to mention a new mural was commissioned by the Chinese government to celebrate the military and their accomplishments this mural included Chinese forces conducting a beach landing something that the PRC has never done. I am sure that they would like to invade the Republic of China shall we let them just take it? I am sure that at some point in the future we will have a war with China.

Not to mention China is attempting to increase their power on a non-military stage, the Olympics, a sudden increase in aid for some African countries (and no they aren't doing it out of the kindness of their heart), large funding towards Chinese history which has come out with some doosies lately such as they were the first to circumnavigate the globe and they discovered Australia first. They also want to intervene and ensure that two Australian companies do not merge and they keep some control in it as so when China does decide to take on the world, they will still have access to important resources

I don't have a car and my entire tuition and most of my room and board is covered by scholarships. Basically, anything I do buy is either textbooks or completely discretionary.

Well you are very lucky then, not all students have all of this.

Well you are very lucky then, not all students have all of this.

On a related note:

This is, of course, a good example of why the CPI and other inflation measures are not meant to be a measure of inflation for everybody; rather, it's meant to be a macro measure of inflation in the entire economy.

Yeah...Well much as i like to bitch and moan about it...and as much as i like to think of solutions to these sorts of problems....

I, unfortunately, have no way of putting that into action...So...I guess ill continue to bitch and moan, and keep trying to keep gas in my tank off my measly Theater Pay...

Why is it that we have China increasing their defence capabilities at strong rate.
Because they're a new superpower and they're far, far behind the US in military terms. And since they can afford it, it's not exactly surprising.

The important thing is that they have made no moves towards actually using any of the stuff, which is more than can be said for the States, for example.

...they recently shot a US satellite out of space, with a new weapon they were testing...
No, they didn't. It was one of their own weather satellites, old and no longer useful.

You seem to be speaking in half-truths a lot. That's dangerous.

I am sure that they would like to invade the Republic of China shall we let them just take it? I am sure that at some point in the future we will have a war with China.
I can see that you're sure, it's just that your evidence is not all that convincing. The actual leadership of the PRC knows that it can't gain anything from a fight over Taiwan. So does Taiwan, as well as the Pentagon and State Department.

Much more likely is a continuation of the status quo until such a time as China is developed and democratic enough to make permanent peace.

Not to mention China is attempting to increase their power on a non-military stage, the Olympics, a sudden increase in aid for some African countries (and no they aren't doing it out of the kindness of their heart)...
Those are all things big countries do.

...large funding towards Chinese history which has come out with some doosies lately such as they were the first to circumnavigate the globe and they discovered Australia first.
Actually, that story didn't come from China, but from a British historian (http://en.wikipedia.org/wiki/Gavin_Menzies). There was no Chinese involvement in this story - the official Chinese position remains that Zheng He's expeditions didn't go beyond South Africa.

They also want to intervene and ensure that two Australian companies do not merge and they keep some control in it as so when China does decide to take on the world, they will still have access to important resources
That's silly. Owning a few shares doesn't mean you have access to the resources in times of war.

This is how the resource trade with China works, particularly in iron ore and coal: The three largest supplying companies are Rio Tinto, BHP Billiton and Vale from Brazil. China agrees with these to contracts for prices that are then binding for all three companies.

Because they have been able to play off the various suppliers against each other, these contract prices are signficantly lower than the spot prices if they were to buy the stuff on the open market. The fact that Vale had some issues last time around and agreed to a very low price certainly helped.

BHP and Rio aren't happy with the setup in which Vale in effect serves to depress the price they can get. The merger is to a big part about trying to gain more power in these negotiations. And obviously China has no interest in seeing the current setup change. That's the reason they're interfering, and there is nothing wrong with it. Companies interfere in merger plans by others all the time - I invite you to have a look at who'll end up owning big chunks of St. George in a few weeks.

On a related note:

This is, of course, a good example of why the CPI and other inflation measures are not meant to be a measure of inflation for everybody; rather, it's meant to be a macro measure of inflation in the entire economy.

Well to go back to your scholarship is it linked with CPI. Because if it isn't and you are receiving the money to pay for it then rising cost of living will eventually affect you as your scholarship dollars will buy less

*snip* I invite you to have a look at who'll end up owning big chunks of St. George in a few weeks.

Points accepted, but China is putting a lot of money into institutions around the world to promote how good hey are and all their achievements throughout history regardless of how close to the truth it is.

And I think to dismiss China as not a threat to the World entirely is also dangerous.

As for St George, it is going to be interesting to see, the first major bank merger since the 90's (I don't really count Adelaide and Bendigo Bank merger) I look forward to seeing how it pans out, and how the banking industry will change in Australia.

Points accepted, but China is putting a lot of money into institutions around the world to promote how good hey are and all their achievements throughout history regardless of how close to the truth it is.

And I think to dismiss China as not a threat to the World entirely is also dangerous.


Of course. But then, in terms of threats actually fulfilled, there's really no one in recent history that comes close to the US.

If you can do it, I highly recommend getting a place, but keep in mind that the upward trend does go down. Real Estate is a very cyclical market. Get in at the wrong time and you might not be able to sell for a decade. But if you're talking about a primary residence it's a little better since you do live there.
Yes, that's what I do want it for. Here in HK it's really warped. Rents and property prices are skyrocketing (20+% this year already) yet mortgages are at their lowest rate ever (I said 2.8% but some banks are even offering as low as 2.4% for 70% mortgages!).
A place I looked at would cost me less in mortgage repayments than renting it. So even if I do end up selling it on a downward cycle technically it's still not going to lose me money. By that I mean any loss would need to be compared to the money I would have spent on renting over that time.

Points accepted, but China is putting a lot of money into institutions around the world to promote how good hey are and all their achievements throughout history regardless of how close to the truth it is.
That'd be no different to what Hollywood is doing. The real question is: does that actually change anything? Does it change your mind about China?

And besides, there is no way around the fact that Chinese achievements throughout history are pretty damn impressive. Comes with being such an old continuous civilisation. If anything current efforts to remember this and share the knowledge are due to the end of Maoism and a return to a more continuous, almost dynastic, view the Chinese government has of the country.

And I think to dismiss China as not a threat to the World entirely is also dangerous.
It'll be a great cause of change, certainly. Some people will be better off, some people won't be. We're seeing that already.

But I'm not the type who is threatened by change. I tend to look at the opportunities rather than the threats. Plus, I really see no fair, justifiable way one can want to deny the Chinese the same living standards and global influence that the West has.

As for St George, it is going to be interesting to see, the first major bank merger since the 90's (I don't really count Adelaide and Bendigo Bank merger) I look forward to seeing how it pans out, and how the banking industry will change in Australia.
The business and finance student in me thinks its an awesome deal and it should go ahead, but the economist in me is not so sure. I don't think the ACCC will shut it down, and Swan probably won't want to be seen as "anti-business", so he won't veto it either...but as far as the Australian consumer is concerned, it sets a pretty big precedent.

Suncorp is next (if you want a gamble, buy a bunch of them now while they're still cheap and hope the St George merger gets the ok - then wait for NAB, ANZ and CBA to swoop...30% premium at least), followed by a bunch more as the Big 4 try to swallow as many little ones who are down because of the credit crunch as they can. And we all end up with less competition. So I say either block this merger, or end the 4 pillars policy and let foreign banks come in properly.

i've been trying to cut back on my expenditure in the last few months anyway. particularly visiting restaurants less.

i still bought Mario Kart Wii and GTAiv, and am probably going to get tickets to a music festival this summer, but in other areas i'm cutting back, as well as trying to drive more economically (which makes it less fun and more boring...)


so in that i've been cutting back anyway, i haven't felt the effects too badly. however, where i work, clients have become quite hesitant to pay, which makes getting the money in for work done quite a bit more difficult.

Yes, that's what I do want it for. Here in HK it's really warped. Rents and property prices are skyrocketing (20+% this year already) yet mortgages are at their lowest rate ever (I said 2.8% but some banks are even offering as low as 2.4% for 70% mortgages!).
A place I looked at would cost me less in mortgage repayments than renting it. So even if I do end up selling it on a downward cycle technically it's still not going to lose me money. By that I mean any loss would need to be compared to the money I would have spent on renting over that time.

That sounds about how it was here 2 years ago: it was cheaper to buy than to rent. Just make sure it's a flat rate mortgage, not an adjustable rate, and be sure to calculate the taxes in when you compare the value vs. renting. :)

That'd be no different to what Hollywood is doing. The real question is: does that actually change anything? Does it change your mind about China?

And besides, there is no way around the fact that Chinese achievements throughout history are pretty damn impressive. Comes with being such an old continuous civilisation. If anything current efforts to remember this and share the knowledge are due to the end of Maoism and a return to a more continuous, almost dynastic, view the Chinese government has of the country.

I am not saying that they haven't but when a country starts spending a lot of money into overseas and domestic universities in towards special subjects which may exaggerate the truth of Chinese history, that is something to be concerned about, especially as people do believe new post-modern thought that pops in the papers every now and then. A bit like that 'hobbit' that was discovered in Indonesia everybody thinking that this is some huge discovery and the media having a field day on it. And now we are seeing that this discovery wasn't as true as the original team claimed, of course the public don't get to here about this unless they read that small article on page 23.


It'll be a great cause of change, certainly. Some people will be better off, some people won't be. We're seeing that already.

But I'm not the type who is threatened by change. I tend to look at the opportunities rather than the threats. Plus, I really see no fair, justifiable way one can want to deny the Chinese the same living standards and global influence that the West has.

So you won't mind if you are one of those people worse off because of it?

And I am not saying that the Chinese people should be denied this I am saying we should watch the Chinese Government carefully. Another thing I forgot to mention, German government networks, Pentagon networks, New Zealand networks and I believe the UK also had a hit, they were all hacked from a source originating in China, of course that's all these people could say as they have to watch their diplomatic tongue, but I am sure that they know elements of the Chinese government were behind the attacks.


The business and finance student in me thinks its an awesome deal and it should go ahead, but the economist in me is not so sure. I don't think the ACCC will shut it down, and Swan probably won't want to be seen as "anti-business", so he won't veto it either...but as far as the Australian consumer is concerned, it sets a pretty big precedent.

Suncorp is next (if you want a gamble, buy a bunch of them now while they're still cheap and hope the St George merger gets the ok - then wait for NAB, ANZ and CBA to swoop...30% premium at least), followed by a bunch more as the Big 4 try to swallow as many little ones who are down because of the credit crunch as they can. And we all end up with less competition. So I say either block this merger, or end the 4 pillars policy and let foreign banks come in properly.

Yes I hardy doubt Swan would veto it, only if the papers make a big song and dance about how bad it will be.

Suncorp you reckon, interesting something to look into. I have a feeling that there will be a increase of mergers by the Big 4 too, hence why Adelaide and Bendgio Bank merged in order to warn off any sort of takeover by one of the big 4.

Correct me if I am wrong, but isn't the 4 pillar policy in place to stop the Big 4 from merging with each other? As an attempt to keep the industry competitive and as a preventative on any liquidity and/or systemic problems that might come up.

That sounds about how it was here 2 years ago: it was cheaper to buy than to rent. Just make sure it's a flat rate mortgage, not an adjustable rate, and be sure to calculate the taxes in when you compare the value vs. renting. :)
Tax here is zero for the first $13000US you make, $850 for the next $15000 and capped at 15% thereafter. And that's not counting the $5000US in tax rebates we've had over the past two years!
And owner-occupiers can deduct annual mortgage interest rates from their total income before calculating tax owed which would save me another couple of hundred dollars US.
Finally, last two years, the govt has charged nothing on rates due to the tax surplus.

All good reasons to buy I think you'd agree.

Yes, that's what I do want it for. Here in HK it's really warped. Rents and property prices are skyrocketing (20+% this year already) yet mortgages are at their lowest rate ever (I said 2.8% but some banks are even offering as low as 2.4% for 70% mortgages!).
Have you thought about the reason for skyrocketing prices perhaps being the very low interest rates? They're at those levels because the HK dollar is pegged to the US dollar and whatever the Fed does HK has to follow suit. You can be 90% sure Bernanke is not going to cut rates any more, so they only have one way to go from here. Granted, that might not be in the next few months, but buying houses is a long-term thing. So yeah, definitely lock in those rates for as long as possible.

A place I looked at would cost me less in mortgage repayments than renting it. So even if I do end up selling it on a downward cycle technically it's still not going to lose me money. By that I mean any loss would need to be compared to the money I would have spent on renting over that time.
That depends on the size of the loss you make. It seems to me like HK property markets don't do things by halves, and when they go down, they do it properly. Make sure your banks don't get any chance to start asking for extra if the price of your collateral tanks or get any other chance to raise your payments on you.

If you can do that, and you're comfortable enough never to have to sell the place quickly, you'll probably be okay.

All good reasons to buy I think you'd agree.
Yeah, but don't get suckered into a frothy market and bite off more than you can chew. If property prices do tank, be sure that you can wait it out, even if it takes a year or two for them to come back.

The big investment banks don't reckon it's a bubble yet, but make sure you're always up-to-date with what they say. Also look at how far rent/price ratios fall to get some idea of whether people are buying with reasonable expectations of making good returns, or whether they're buying on pure speculation that prices keep going up.

Tax here is zero for the first $13000US you make, $850 for the next $15000 and capped at 15% thereafter. And that's not counting the $5000US in tax rebates we've had over the past two years!
And owner-occupiers can deduct annual mortgage interest rates from their total income before calculating tax owed which would save me another couple of hundred dollars US.
Finally, last two years, the govt has charged nothing on rates due to the tax surplus.

All good reasons to buy I think you'd agree.

Absolutely!

Here I pay $6,000/year in taxes to the town for the house. It's not bad, really, considering that in most of the rest of the county it'd be higher, even double or triple the closer one gets to NYC.

So you won't mind if you are one of those people worse off because of it?
There are ways of avoiding it.

Suncorp you reckon, interesting something to look into.
Just because they've been hard fairly hard by the credit crunch and look very cheap at the moment. Or did, anyways. It seems like I wasn't the only one with the idea, and you can see quite a jump around the time the St George thing came to light. :p

http://www.asx.com.au/asxcharting/CisServGif?RequestType=ByName&UseSession=False&GifResponse=image&fresh=false&extgif=true&caller=sharenet&volval=VOL&periods=D6&spread=LAST&siafsec1=S&sec1=SUN&divn1=0&siafsec2=I&sec2=XJO&divn2=0&siafsec3=I&sec3=MA&divn3=0&extcsv=false&reducefact=80&fromdate=18/11/2007&todate=18/05/2008

Correct me if I am wrong, but isn't the 4 pillar policy in place to stop the Big 4 from merging with each other? As an attempt to keep the industry competitive and as a preventative on any liquidity and/or systemic problems that might come up.
That's one part of it. But it's also the institutionalisation of an oligopoly based on history and protectionism. All currency going in and out of Australia is required by law to go through one of the Big 4, for example, and they're making money out of it. That even includes JPMorgan wanting to repatriate profits back to the US.

I mean, the costs of entering the commercial banking market in Australia are huge anyways, so even without legal barriers foreign banks might have a hard time setting up, but you'd have to say that we don't need a 4 pillar policy with all the other stuff to stop the Big 4 from merging. The ACCC could do that if parliament were to write the relevant guidelines.