Hyndburn MP Graham Jones invites minister to see ‘struggle’ (From Lancashire Telegraph)

Graham Jones is correct. A lot of forces are forging a new circumstance. We’re now living in the era that I call ‘The Pincer’.

On the household income side the employment situation is exceedingly difficult for many people as a consequence of technological advances, globalisation, the weakened power of organised labour and the banking crisis. One consequence of this is that a great many people are on low wages, and these are collapsing in real terms.

On the household expenditure side the prices of essential goods and services has increased markedly, and while recent data points to them rising less quickly they are still increasing at a fair clip.

All of this is taking place after a credit boom when the prices of the asset of choice – houses – lost all contact with the fundamentals of supply and demand. One consequence of this was that the housing market moved into a speculative and euphoria state based on the erroneous assumption that house prices would increase continually without limit, and without interruption.

Prospective homeowners and many of those moving to a bigger home took on mortgages that were not only at a high LTV – Loan-to-Value – but in many cases were interest only. A theory had taken root that rising wages and house prices would quickly erode the true carrying value of the debt. This had worked for the last three decades, but it is very clear that this no longer holds true. The results are now becoming plain for all to see.

The people that I have real sympathy for are those first-time buyers that felt impelled to buy during the latter stages of the house price bubble, notably 2004-2007, by the misguided and at times foolish statements from VIs – vested interests. The list includes: mortgage brokers, estate agents, house builders, politicians with their idiotic schemes to help first-time buyers and journalists in the mainstream media. These first-time buyers are in the unfortunate position of having been duped into paying the highest price possible for the most expensive item they’ll ever buy in their lives.

I think it would be useful for the entire Cabinet to visit North East Lancashire so that they can appreciate that the policies pursued by the political class over the last three decades have, to borrow a phrase from James Quinn, not floated all boats – just the yachts.

Kevin, Colne wrote:
Graham Jones is correct. A lot of forces are forging a new circumstance. We’re now living in the era that I call ‘The Pincer’.

On the household income side the employment situation is exceedingly difficult for many people as a consequence of technological advances, globalisation, the weakened power of organised labour and the banking crisis. One consequence of this is that a great many people are on low wages, and these are collapsing in real terms.

On the household expenditure side the prices of essential goods and services has increased markedly, and while recent data points to them rising less quickly they are still increasing at a fair clip.

All of this is taking place after a credit boom when the prices of the asset of choice – houses – lost all contact with the fundamentals of supply and demand. One consequence of this was that the housing market moved into a speculative and euphoria state based on the erroneous assumption that house prices would increase continually without limit, and without interruption.

Prospective homeowners and many of those moving to a bigger home took on mortgages that were not only at a high LTV – Loan-to-Value – but in many cases were interest only. A theory had taken root that rising wages and house prices would quickly erode the true carrying value of the debt. This had worked for the last three decades, but it is very clear that this no longer holds true. The results are now becoming plain for all to see.

The people that I have real sympathy for are those first-time buyers that felt impelled to buy during the latter stages of the house price bubble, notably 2004-2007, by the misguided and at times foolish statements from VIs – vested interests. The list includes: mortgage brokers, estate agents, house builders, politicians with their idiotic schemes to help first-time buyers and journalists in the mainstream media. These first-time buyers are in the unfortunate position of having been duped into paying the highest price possible for the most expensive item they’ll ever buy in their lives.

I think it would be useful for the entire Cabinet to visit North East Lancashire so that they can appreciate that the policies pursued by the political class over the last three decades have, to borrow a phrase from James Quinn, not floated all boats – just the yachts.

Absolutely true Kevin. I don't believe for a moment that inviting a Minister like Andrew Stunnell will make a blind bit of difference, The Tories simply don't care. You just have to read Andrew's deluded comments to see what a fool he is. I appreciate Graham has to go through the motions but is it worth it. We still have a great deal of self respect left in this area. Maybe the case for a regional government has some Merritt.

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