Saturday, 27 May 2017

House prices - an example of higher order thinking

Here in the UK, we have a cultural obsession with house prices. Occasionally, the public start discussing the same topic. In this example it is affordable housing. A few 'think tanks' notice this concern. Very highly specialised lobbyists will present this to the Prime Minister with a 'solution'.

This is just how our society works. It just does.

The Prime Minister issues a public statement. They 'promise' affordable housing. They detail the plans. A first order analysis / the man in the pub / a low level banker at a dinner party, all decide the government are making it far easier for first time buyers. Then they reminisce about double digit interest rates and that nobody helped them.

Now let us give this some further, deeper thought: a second order analysis.

Were the government advised to create new social housing? Remembering that 2/3 the price of most new houses is for the land. These new homes could be sold or rented at less than half the price of similar properties. No, this idea was never born. The special interest lobbyists clearly did not want to initiate a plan that would provide affordable housing.

What the UK did get was various 'help to buy' schemes. This plan merely benefits the sellers, as house prices actually go up. Or at least, do not correct downwards.

To summarise, the chattering classes and man in the pub can agree that housing is now more affordable despite the fact that prices have increased.

A third order analysis reveals that this was the intended consequence from the lobbyists point of view. An unintended consequence, from the governments point of view. The publics view is that housing is now more affordable, regardless of reality.

Note how easily the publics will is seen to be organising and how easily it is misdirected?

Thus the rules for this particular game are set. As soon as public will starts to firm up about affordable housing, then a new plan will be rolled out based upon lowering mortgage payments for first time buyers to sustain or increase actual house prices.

The specialist lobbyists will keep this game going for as long as their clients continue to profit from it. In theory, standard mortgages could become 100 years with 0.5% interest only payments. Affordability is maintained but house prices could easily quadruple.

At some point, first time buyers will no longer be suitably incentivised to take on such huge mortgages.

Currently, the public believe that house prices always increase. There may be periods where they fall a little but in time prices bounce back. There may also be periods of stagnation. This is not considered to be significant, over the long term prices are always going to increase. Well, that is exactly what the specialist lobbyists clients want us to believe.

Should the publics confidence in ever increasing house prices ever fail, what would happen? Lots of very credible people will write and say that house prices are set to increase because of blah blah blah. Most of the time this is enough. If the public believes house prices will rise, then few people will enjoy selling under 'market' value. People will buy sooner, rather than later and house prices will rise.

What happens when our belief in ever increasing house prices falters? Simple, prices will drop. Slowly at first, then nose bleedingly fast. Then, after a small delay, we get the first wave of defaults. Then much bigger waves. Have no fear, the specialist lobbyists will have a raft of solutions all involving tax payer money. The clients of the lobbyists will retain their control of our wealth. Ultimately, interest rates will go double digit due to massive numbers of defaults on existing mortgages making the issuance of mortgages incredibly risky. All first order truths.

Higher level analysis reveals a truly unbelievable truth. The lobbyists clients already understand all this. Vast amounts of public wealth is spent on controlling public opinion. The BBC is not an unbiased news source. It is a purveyor of the world's finest propaganda. The government is seen as powerful but must always dissipate the publics will or risk being seen as irrelevant. Bankers employ the best lobbyists that money can buy otherwise their harnessing of mankind's productive output could be lost.

Can I prove any of this?
Imagine that the great british public decide that mortgages are no longer acceptable. All houses are to be paid for without borrowing. Would we expect house prices to go up or to crash down to earth? Obviously, they crash but what would make us all decide never to borrow money for a home?

The few already know what would cause such a widespread belief to arise. Acknowledgement of one simple truth would stop 98% of people ever borrowing money again. This truth is so simple that the human brain struggles to accept it.

High order evaluation of the following truth will be required before enlightenment.

Banks lend bank credit which they create at (close to) zero cost.

For example, I go into a bank to borrow 150,000 bank credits against a house priced at 180,000 pounds. Paperwork is filled and I give my signature. Over the next 25 years I pay back the 150,000 bank credits that the bank created at zero cost. The bank gets to spend or invest the interest payments however it likes. Some goes to specialist lobbyists to ensure the wealth skimming continues.

Banks do provide a public service. The public should own the banks. Creating bank credits is virtually costless. Banks should be public owned and the wealth they skim be spent locally. Not controlled by the few.

Banks should not be allowed to own businesses, or property or shares. Private banks should not exist. Banks should create bank credit to serve humanity. Not enslave it.

Public will and public money is manipulated by the few at the expense of the many. The basic tool of the few is the control of the issuance of bank credit and the subsequent control of the vast wealth that this takes from us.

Anyway, how many of us are capable of higher order thought?
Far more if we stopped ingesting fluoride, aspartame and other 'safe' chemical monstrosities.

Please discuss this nonsense amongst yourselves. 98% of you are capable of higher level thought. Help yourself by eating high quality foods, perhaps grow your own and drink high quality water. Perhaps by distilling tap water. Give it two years because we deserve better, much better because we are better. We simply are.

P.S. You might assume that I consider banks and / or the government to be the 'bad guys'. Or perhaps the lobbyists?

No, no and no. To get a clear view of the 'bad guy' simply stand in front of a mirror. There you will see your own worst enemy. Or, you might glimpse an enlightened mindful being.

There are those who will use your own ignorance of reality against you. The natural remedy for this is a Mindful Enlightenment.

I write three blogs and have written three books, all to help me to walk the path towards becoming Enlightened. Hopefully, you will at least find some part of them, interesting, as I have no desire to waste your time.