Thoughts from the Managing Director May 2018

“An economist” – an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.  In all recorded history there has not been one economist who has had to worry about where the next meal is coming from.

This writer is not an economist and the following views of the world economy and how it relates to the UK property market are based upon having been a financier for 40 years and not with other people’s money. As our website makes clear we are a self-funded principal lender and nothing sharpens the senses more than putting your own money at risk.

It is time to sound a few words of caution and concern. The present time is feeling more and more like the feelings engendered and became manifest in the Spring of 2008 when output was going strongly to completely overshadow common sense fundamentals. There is a real prospect of a return to higher interest rates and increasing geopolitical tensions.

Reality is being disregarded in this era of manufactured interest rates and a property market injected with an unprecedented level of artificiality. For Help to Buy read help to sell!  History will show that the only one sector (major building corporates and their executive) really benefited from this ill-thought concept. Buyers will reap the whirlwind in due course.

Global Debt levels are now officially at £115Trillion or 225% of total world output.. The explosion of financial speculation has seen leveraged loans rise to £554Billion. Interestingly the comparable figure on 2007 was £535Billion. Bubbles do not burst-they are pricked.

You can draw your conclusions so far as the impact on the property market is concerned.

This is not negativity – this is reality.