This year, the UK government must come up with solutions to the main crises that eat away at some ordinary Britons’ well-being. One of these is the housing crisis, which continues unabated despite the billions of pounds thrown at the problem.
As the major central banks are slowly retreating from their policy of asset purchases, we will probably witness some of the side effects of this withdrawal.
Warren Buffett famously said that “Only when the tide goes out do you discover who’s been swimming naked.” The tide is going out only slowly, but we are beginning to see, at least in the UK, the damage the ultra loose monetary policy has done.
The Brexit vote must be manna from heaven for those seeking to hide their illicit gains in London. Busy with all their posturing and negotiations, politicians will have no time to curtail the criminals’ activities.
Many people hope that the UK Prime Minister’s rhetoric calling for a fairer society means she will address what is by far the biggest inequality in today’s Britain: the housing crisis. But a recent speech, in which she outlined her plan for Brexit, seems to indicate that she is unwilling to really tackle the issue.
The announcement by Chancellor Philip Hammond in his Autumn Statement that letting agency fees charged on tenants will be banned has been met with cries of outrage from estate agents.
Their rage is in part justified. Lately, they have been asked to do much more administrative tasks than simply running credit referencing checks. They are also supposed to check immigration papers as well, to ensure that prospective tenants have the right to be in the country in the first place.
The news that Wells Fargo, the US bank that is the world’s biggest lender by market value, targets millennials with its mortgage loans is seen as a sign that we’ve finally gotten over the crisis that nearly brought down the world economy in 2007-2009.
The Financial Times reported that the head of the bank’s home finance business said he was keen to lend more to first-time buyers, who, the paper said, have so far “put off settling down.”
But what is good for America is not necessarily good for the world. While in the US there has been some deleveraging and restructuring that allows the housing market to re-start from a cleaner basis, it is not the case in the rest of the world.