There is palpable renewed confidence in the UK economy since Mark Carney took over as Governor of the Bank of England.  His forward guidance that the record low interest rate of 0.5 percent would hold until such time as unemployment falls to 7 percent implies a very stable environment in which people can borrow and grow their businesses and add to their property portfolios.

 

Some forecasters believe we are in for another three years of this very favourable environment of low interest rates, and this has been registered by the pick up in the housing market.  The FTSE has seen healthy volatility and seems to wear a rosy glow. 

 

Rising house prices are of course not favourable to everybody, as a lot of people become sidelined, unable to buy even their first house while those who are already on the ladder bask in the glory of ownership or further improve their wealth by remortgaging and investing in the Buy-to-Let market. 

This is where the government can bring in some mechanism where priority should be given to First Time Buyers and Growing Families Who Need to Move to a Bigger Property.  That would bring a lot of stability to the market, and ensure a bubble is not created, where some people and corporations may prosper for the meantime but would not be appropriate for the economy long term.

 

The London housing market registered a gain of 0.9 percent last month, one of the healthiest gains for some time.  The availability of mortgages and especially re-mortgages at record low interest rates is the cause for the euphoria. 

 

If a mechanism is introduced through legislation to favour first time buyers and big families as I have suggested above, maybe it will turn into a celebration for more and more people.  The housing supply would help those in need, and curb the unnecessary speculation.  Payment of ever-growing rents from the public purse to buy-to-let owners is merely dishing out national wealth to a small minority of people, whose tenants become dependent on the social security for their lifestyle.

 

The interest rate is at a record low in response to a need for the economy to pick up, as a stimulus, and wealth will only be created when money is employed to create additional enterprise.  In this respect, the banks will be doing their job fine if they pro-actively start to lend money to businesses and entrepreneurs in each local community, thereby enabling people make a living, create jobs in the local economy, and generally give a boost to the whole economy.  When people are purposeful and busy, they have to use transport, buy food outside, dress up well and even buy a few luxuries. 

 

The future looks rosy.

 

Kind regards,

Duru-darshan.

 

There is something about the chemistry, about the language and communication of the mind and soul, which brings people together or drives them apart.  It is this chemistry between people that I would blame for.....or, rather, a change in the chemistry between people that I would blame for separation and divorce. 

 

I am surprised that Napoleon Hill was not given the Noble Prize, but then again there is no category in the Noble Prizes into which his work fits.  Perhaps, on that point, I would suggest there should be another category created by the Trustees of the Noble Foundation.  The Increasing of Human Understanding.

 

Napoleon Hill interviewed 500 of the most successful people in America in the 1920s, and from those interviews he wrote many articles, published in his Hill's Success Magazine.  But a few people made a huge impression on him, viz Andrew Carnegie, Firestone, Henry Ford, Dr.Alexander Graham Bell, and Dr. Thomas Alva Edison.  And yes, Mr Edwin Barnes, who said it could not be done, that is to say, the writing of a blueprint for success based on the interviews with successful people.

 

Napoleon Hill turned that into a questions: Who said it could not be done? and went on to publish his Think and Grow Rich, a book that sells well throughout the world, in many languages, in number just after the sales of the Bible, Koran and Bhagavad-Gita and other religious masterpieces.

 

In his research, Napoleon Hill says that the first three years of a marriage often have petty squabbles and friction, but the love that exists between the two will carry it through.  The next fifteen years are those in which the lucky couple start to look alike in their eye movements and thinking, influencing their value judgements and expressions, meaning the happy couple have achieved understanding of one another, and a state of harmony exists between them that we attribute to the magic of chemistry.

A state of harmony, an instinctive understanding, an automatic understanding of mutual goals. It is like both have the same road-map, or at least complementing road maps.

 

Those for whom a partnership does not work, it seems are rather like a horse-drawn carriage where the horses want to pull in differing directions.  Where it is not possible to bring harmony of direction, abandonment of the journey becomes the alternative.  Such is what happens in business partnerships as well, and in politics as well.

 

A question that may help bring harmony back is : What was the road map that brought the partners together in the first place?  Can it be modified and restored?  If the answer is Yes, then hope still remains for reunion and success.

 

Kind regards,

Duru-darshan.

 

 

 

I went for a long stroll this evening.  Even after a light meal, I felt a bit heavy.  Probably due to eating two boiled eggs yesterday (normally I seldom eat eggs). 

 

Where previously they had restaurants with a bar which seldom had customers, now they have turned them into family restaurants, no alcohol, no smoking, just good food, and they seem to be doing well.

Others, a Turkish kebab house, is on a big scale, but still has a steady stream of customers, it seems to serve fresh well-cooked food and the prices are probably reasonable.  Restaurants which people normally use when they celebrate also seem busy.  When people eat out, they spend to a budget, but don't like going to places which look a bit too homely, cheap food just to fill the stomach; those establishments will have the occassional customer, but that is all.

 

When I read that in England people have been spending less on food over the last few months, that suggests people are becoming health-conscious and buying selectively, and probably also eating out a bit more, as the good restaurants being busy would suggest.

 

The current Recovery in the U.S. is being fueled by the quantitative easing and the record low interest rate.  The housing market has started to pick up at last, although fewer houses are being built recently. 

 

The Japanese quantitative easing has helped Japan turn around, with the Yen and Japanese goods becoming a bit more affordable.  Coupled with the trend of Japanese investments overseas, this is certainly doing good to a lot of people.  As China buys more Japanese bonds and currency, the whole region is promising good growth.  Chinese newcasters and public figures seem to be sporting high-end European and American brands in attire, which creates balance in trade and fulfills peoples' taste.

 

Here in Ilford, shops which were too large are being converted into smaller shops, and people are putting good fitments and creating neat, attractive parades.  It probably remains for the Bank of England Guvnor to pump some additional credit and quantitative easing into the system to create a boom, which would be a great blessing and bring the normally happy atmosphere of peace and plenty.

On Thursday I pray the MPC members will give Sir Mervyn King a supportive vote to do the necessary

 

That's about it, except to mention that the Oil price is still quite high.  A lowering of $10 per barrel in the context of 30m b/d would be okay for most of the OPEC members, and as the rest of the world motors ahead, so can the OPEC economies continue to develop their infrastructure projects.

 

Kind regards,

Duru-darshan.

 

 

The I.M.F. has a good suggestion for Britain : to inject some capital into infrastructure projects.  That would of course create or maintain lots of jobs, as well as upgrading the infrastructure.

 

There may be a good argument to bring forward the house-building at the racecourses, refurbishing houses in the deserted towns in the regions, and perhaps assisting people to move away from the main areas and into these new areas, which could create a lot of economic activity as well as giving people better housing, jobs (in a new town you would need doctors, nurses, cinema ushers, porters, teachers, traffic wardens, salespeople, double-glazing companies, solar panel engineers, builders, drivers, electricians).

 

The shale cracking or fracking industry could be a viable alternative, once safety concerns have been ascertained, creating jobs, lowering energy bills, making Britain an affordable place to live in, and attracting more people to consider making Britain their home if they are suitably qualified to add to the economic life here.

 

The lending requirements in the housing sector are of the order of a £100 billion, and yet Bank of England Guvnor Sir Merwyn King is only backed by 2 of the 9 MPC members for an additional stimulus of £25 billion.  The other seven would probably like to keep Austerity measures, the snake that is squeezing life out of the European economies.  As the IMF has suggested, growth would be the alternative, and a stimulus is the required cash flow mechanism that must be utilized.  The U.S. quantitative easing policy has shown that it is a practical way to come out of recession, and both the U.S. and Britain are blessed in this regard in that they can issue their own legal tender.  The MPC board members can hopefully see the sense of it, and give Sir Merwyn the vote to issue a further stimulus before he retires.  It will be a blessing to the nation, and in time for the royal birth in June. 

 

What should we have instead of Austerity?  Well, of course, a jamboree and a celebration would be good, which will help people satisfy their reasonable demands of a growing prosperity.  The quicker it is put in place, the earlier the cycle of wealth creation can continue, which in turn will bring money to address the deficit, and the only really practical way of growth.  Can you imagine a shop-keeper without cash flow?  Nor should the MPC board members see Britain in such a light.

 

Kind regards,

Duru-darshan.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I don't see what the real fuss is about regarding the Interest-only mortgages.  

 

At one time, people used to buy interest-only mortgages side by side with an Endowment policy, that would hopefully build up and mature into the principal sum owed on the mortgage.

 

Then, people did a smartness.  They cancelled the endowment policies.  That meant their monthly outgoing was lower than on a Repayment mortgage, and they had relative security of a roof over their head which was cheaper than renting.  And that is the light an Interest-only mortgage should be looked at.

 

Often, it is cheaper than renting, and if there is a surplus over the price paid to buying price of the house, that's the icing on the cake.  If not, at least it is a secure roof for as long as you continue to work hard and pay for it, meaning it is cheaper than renting and you are your own landlord.

 

So if it is cheaper than renting and you have pride of ownership, then at the end of the mortgage term if the house doesn't belong to you should not be such an awkward question.  That's the reality of it.

 

However, if property prices improve (and they probably will in England over the next four year I believe, going by previous house-price cycles) then there may to nothing to worry about.

 

The U.K. economy will recover and strengthen in the coming months and years, as growth continues in the U.S. and China, not to mention huge growth in Africa (where they regularly discover some hidden Oil resources, potential for building towns and railways, etc, etc) and an improved outlook for India, in my opinion, where the current UPA Congress government has published figures which show a steady improvement in standards of living, declining mortality rates, better nourishment for people, it is such a promising picture....If the Oil price is cheaper, all economies will grow and prosper, including the oil exporters, who will have sufficient income to sustain their infrastructure growth and prosperity of their people. 

 

Look forward to the future with optimism;  the ECB rate cut today to half percent should give added impetus to growth in the Euroland, to complete the global picture.

 

Kind regards,

Duru-darshan.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I think so.  For the first time, there is sign of growth in Greece, with unemployment falling, the Greek Bonds at just over 10 percent (compared to the unsustainable and unbankable 40 percent not so long ago, before Greece received the massive bailouts and the haircuts). 

 

There is huge potential for the Greek economy to bounce back and be on track to sustainable growth.  Of course, the most blatant pointer would be some of their legislation, which is keeping shopping areas like ghost towns.  Red tape with establishing shops should be cut down, so that people do not need to make so many applications to the council and muncipal authorities just to open a shop.  There should be just one certificate, saying the council agrees that a shop of a specific type can be opened in a certain patch of town.  That is all, and once that happens, it will create self-employment for people as shop-keepers, for people as shop assistants and so on.  And the economy will start to pick up, with goods being despatched from warehouses, delivery vans delivering the goods, people walking around in the shopping centres, and so on.  Someone, that will breathe life into the economy.  And when people see busy places, they feel safe, it feels good, it gives people confidence to spend.  Tourists would go to such places, and everything will improve.  Think of retsina and ouzo people will be drinking with the delicious Greek cuisine.

 

A similar pattern will develop with Spain, and I guess the property markets there will pick up.  After the 39.5 Billion Euro injection they received recently, I understand Blackrock the American investment group have started to take up investments in Spain.  That is a good indication of improvements to come.

 

Poland and the Zloty were doing very well, but on a very conservative mind-set and interpretation of the headwinds, the Polish economy seems a bit neutral at the moment, but given renewed confidence in the other markets, could very well pick up.  I believe they will, as the positive signs from U.S. and China feed confidence worldwide.  At least, I pray so.

 

Kind regards,

Duru-darshan.

 

 

Today the markets, and indeed the world, waits to hear Federal Chief Ben Bernanke's testimony at the FOMC, on the issue of QE.

 

At the moment, the quantitative easing and mortgage-backed securities buy-back is running at around $85 billion per month, and it seems to be working as job creation seems to have stabilised, the housing market seems to be trending slightly upwards, the stockmarket is rising nicely (to levels which it should have achieved last year, perhaps) and there is a growing optimism throughout the world.

 

The Bank of Japan has loosened up its monetary policy, and allowed the Yen to fall vis a vis the major currencies.  This is likely to help Japanese exports of their excellent products and help production pick up at home and earn them from overseas markets and provide for their economy, which seems to have started a turn-around.

 

The appointment of Party Chairman Xi Jinping who will assume full powers of leadership in China in March must auger well for China.  Paying heed to his ideas in the past have created a boom in China. 

 

Perhaps another $15 billion per month in the U.S. for a period of six months may bring America back to a full Recovery, with creation of many more jobs, doing up and sale of many more houses to hard-working citizens who are earning their living, as well as housing for social projects (perhaps funded by generous philanthropists who can turn their paper fortunes into real wealth with their hallowed names attached to the building and stocking of community centres, libraries, study centres, playgrounds, etc).

 

Do you think the day is far away when the generosity of the wealthy will give them soul-satisfaction, and create happiness for the people in Ghana and Nigeria who need laptops, appreciate reading real books, would be happy wearning clothes which they know are known as apparel in America?  Do you think that day is far away?

 

There is a subtle law of prosperity, as you add more to the stream, the richer it becomes, and riches flow into the world, and the richer everyone too becomes.

 

Listen to your hearts, and look at the world. 

 

Kind regards,

Duru-darshan.

 

 

Tongue in cheek, the idea of a Trillion Dollar Coin, with President Obama's sketch on the obverse, is being tossed around on the television channels.

 

As a souvenier, it would be good, but as a practical idea, it would be unworkable.  If such a coin were minted, it would be uncashable, therefore I think the idea can rest just there.  Can you imagine, it would need the protection of Fort Knox....

 

No, the Trillion Dollar that they need to have in place by the time the debt clock hits 16.15 Trillion Dollars, whenever that is, will have to be in denominations that are easily convertible into legal tender so that people can be handling the greenback in the size and shape they know.  And with which they can buy houses, cars, buildings, company shares, debit cards, holidays, education, cinema tickets, pay for their meals, whatever and however people like to spend and enjoy themselves, and allow the U.S. to carry on trading with the world.

 

Can you imagine bi-partisan co-operation not being reached on this matter?  I cannot imagine many Senators or Representatives being happy to miss their paycheck, or to see the whole financial system dry up. 

 

Regardless of whatever happens, I believe President Obama holds the President's Prerogative on this, and he will exercise that, just to ensure the nation keeps ticking as normal and there is no hickup or delay on the path to economic Recovery, which the American nation has worked hard for and put on a sustainable basis.    By my figures, I would say the U.S. economy could possibly create 300,000 to 500,000 jobs a month, on-going for a period of 14 months, with the raising of the debt ceiling and pumping in of $62.5 Billion each month.  That would create heatmaps of happiness, everywhere, as trade is assured everywhere and continues to sustain jobs worldwide. 

Who would want a recession when cordial agreements with trading partners will ensure continued worldwide economic Recovery?

 

For a happy jamboree scenario worldwide, I pray.

 

Kind regards,

Duru-darshan.