It was a DEPOSITOR bailout. I would quite happily take a few of these dodgey mortgage assets for nothing, the only problem is the corresponding liabilities; this is what is being transferred over to the tax payer.

In effect its another way that my generation – one that has been priced out of homeownership – is going to end footing the bill by guaranteeing the deposits of those that have made vast fortunes via land speculation.

I have no intention of paying this, or indeed the unfunded pension liabilities of public sector workers.

“What passes for diagnosis – explaining the global economic crisis – is no more than navel-gazing. Discussions around “the future of capitalism” carefully avoid challenging the rules that direct people into ethically corrupt behaviour. Just about everyone now has a vested interest in protecting the system – meaning, the rules of the game.”

I half agree with this statement. Perhaps more people than you think would like to see change. I am somewhat skeptical for these reasons:
- Since 2005 very few first time buyers have been able to get into the property market and it is not obvious at what point first time buyers would want to enter the market. What will happen to these people?
- The logic behind the housing market is that it will always go up [at 20% pa] – this is an insane idea, hopefully one that has been laid to rest.
- To perpetuate the fraud >100% LTV and high multiples of LTI will need to see a return to the mortgage market.
- For the previous two points there will need to be a revival of mortgage backed securities – but who will want to buy them?
- The capital wasted on the housing market would be better directed into wealth creation (building sustainable evolving industries) and infrastructure projects. So why isn’t the speculation money being directed into the stock market?
- Unemployment is rising. Buying a house is not currently the top priority whereas keeping your job is.

Unfortunately, I do realize that the salesmen, EAs and politicians are already talking about “affordability”. This is a bad sign and is a reflection of just how poor the politicians believe the state of the education system actually is. Already there are advertisements going around talking about the investment potential of “owning” property over renting. These are simply notions of speculation rather than investment. Nobody seems to understand the word liability or the concept of compound interest (in the banks favor).

What no-one can say for certain is whether the capitulation has been and gone or if it is yet to come.

What is apparent in recent times is that the electorate is no longer interested in political ideology such as collectivism vs objectivism. This is a shame because the ideology would actually guide us to where we want to be……

Nor is the public media machine interested in separating the emotions of owning a home from investment and, worse still, speculation.