Zerohedge blamed for global stock market crash!

Whilst disbelieving a lot of what Zerohedge rants on about he has been correctly calling the solvency problems of French Banks for a while, and we have pointed out their exposure to italian debt and vulnerability to a property downturn, as well as of course that with France’s EDB liabilities that the French banks in trouble are ‘too big to bail’ in terms of debt to GDP.

Earlier today the feeling in the markets was that after a brief rally the fundamentals would put the pressure on France, Italy and Greece over the coming weeks. Greek today reported it falling well short of revenue targets.

But now with the markets seeing an inevitability its time frame can compress from weeks or months to minutes.


Socgen is down 21%

Dow and the FTSE down 3%

Rumours about a France ratings agency downgrade. No agency is immanently downgrading but S&P said they had no ‘shirt term’ plans – the market has picked up on the lack of confidence

Affordable Housing, How an English Idea has driven Chinese Growth

Moderne Housing Tiong Bahru

When a truly global history of 20th housing is ever written the Tiong Bahru Estate in Singapore, a charming mix of moderne housing and straights style shops, will sit there alongside Vienna’a Karl Marx Hoff and our own Hampstead Garden Suburb as one of global significance.  Why is it important?

In the colonial period with concern about slums and poor housing conditions, often over 200 people would live in 1 shophouse.

Captain Edwin Percy Richards was recruited to the Singapore Improvement Trust, which adopted an enlightened model of public housing construction, on the english model of housing reformers with cheap housing built on land at existing use value.

But in typical English style it was slow.  It built only 23,000 housing units in 23 years.

After independent it became the Housing Development Board, and construction boomed, but in the form of concrete ‘matchbox’ style block, but 110,000 units in only 10 years.  Over 60% of all housing was constructed by the HDB.  It is now effectively an arms length company, called Surbuna, and does masterplans and new communities construction all over the world.

What is important is how successful this model was seen, and how it was copied, first by Hong Kong and then 20 years ago by China.

With the state controlling development land it could capture uplifts in land value.  Firstly houses are rented.  Then there are opportunities to buy.  A policy introduced in 1968 and copied by one MP for Finchley.  The owners could then remortage and many used this as capital for small businesses.  Hence an economic miracle largely driven by taking much rentier unearned income out of the picture.

When China was looking for an advisor to drive their market reforms the key consultant engaged by Deng Xiao Ping was Dr. Goh Kheng Swee who was the deputy prime minister of Singapore and one of the two persons who were behind Singapore’s rapid growth into a prosperous country, the other being Mr. Lee Kwan Yew.

Public housing on this model was one of his key suggested market reforms.

Such housing has been essential to driving China’s rapid urbanisation and growth.  Indeed it can be argued that China moving away from this, to too much speculative housing, has driven a housing bubble.  Indeed China has been using in the past year a new programme to build 10 million new public units, in one year, to rebalance the housing market.

There is a lesson here on how to divert rentier income to fuel tiger style growth, but it is not one that western psuedo-free marketeers want to heart.

Form for compensation for #londonriots #ukriots 2 weeks only to claim #riotcleanup

Compensation is payable under the Riot Damages Act 1886 for injury or destruction, by persons ‘riotously and tumultuously assembled together’

Here are the regulations which date back to 1921 including a prescribed form.

Those affected only have 14 days from the day when “such injury, stealing, or destruction” took place.

Police authorities have already called for the act to be abolished, however who pays is a matter for another day.

Clearly small shopkeepers will need help, I hope that people, especially town centre managers and chambers of commerce, will print off copies and get forms out to them.  I also hope that people will give every assistance to them to fill in the forms, which are quite tough, the regulations seem designed to discourage claims through asking for an inventory of every item lost (except for items of same nature and small value) ‘when practical’.

But the 14 day period can be extended

Provided that the police authority, on application to be made before the expiration of the fourteen days, may, for special cause shown, enlarge the period of fourteen days to forty- two days, and in the event of such application be ing refused, the applicant may, within seven days after such refusal, appeal to the Secretary of St a t e , whose decision shall be conclusive as to whether the claim shall be received.

The claim must state separately the sums claimed for:

(A) Destruction of premises,
(B) Injury to premises (including injury to windows, fittings, or fixtures thereof),
(C) Injury to other property in or on the premises,
(D) Theft or destruction of other property in or on the premises

EDIT: Insurers now saying claims to them should be made within 7 days so they have time to claim within 14. This may be a condition of a policy.

Stevenage Challenges Unsound Core Strategy Report

Good News

Planning Resource is reporting that they are to challenge their recent negative inspector’s report finding that because North Herts was opposed to the Stevenage West and North proposals it was ‘undeliverable’ . A report issued with consumate timing a week before the CALA II decision.  We urged a legal challenge in June.

The council said it has made several attempts to get the inspector’s decision overturned and has asked the Planning Inspectorate to withdraw his report, but they have refused to do so.

It said it has also asked the secretary of state Eric Pickles to overrule the decision but he said he does not have the power to do so.

The council said it had now asked the High Court to overturn the inspector’s decision and grant an interim declaration that it is not required to withdraw its draft Core Strategy.

Interesting issues. The inspectors report is issued on the basis of policy and the law on the date of the decision. It is doubtful that PINS have the power to withdraw a report under the regulations.

However the inspector wrote there letter on the basis of the assumption that the CALA II challenge in the court of appeal would fail, a false assumption. The best outcome may well be for PINS not to contest the matter. The report can then be redrafted. It is doubtful even that the EiP would need to reopen all that is needed possibly is an exchange of position letters.

If the letter is issued in November after Royal Assent of the localism bill then the duty to cooperate will apply. However RSS will not yet have been revoked.

As I shall be reporting on shortly Herts as a whole is massively down on its previous housing targets. Cooperation is not leading to any resolution as to where housing should go, indeed Stevenage’s neighbours are refusing to cooperate.

#londonriot vigilante group to use facebook facial recognition to name and shame rioters

The London Riots Facial Recognition Google Group is developing an API to

identify people in photos posted on Facebook, Flickr and Twitter. There is even talk of using the Facebook Graph API and the Twitter API in conjunction with the one to help better identify the criminals.

Techcrunch Reports

The Prime Minister this morning has slammed ‘false human rights’ concerns over publication of photos.

However this could lead to many false positives of people who are innocent. And as Google+ members cannot be anonymous they could see themselves sued to high heaven.

Do not wear a bandana on your facebook profile, it gives the wrong impression.

Cost of a Big Mac in Zurich – £10.56

From Zero Hedge

One of the things that people pick up on very quickly as they travel are how different price levels are around the world. I’ve been to roughly 100 countries, and I still find it amazing how much variance there is among things like food, property, and entertainment prices.

There are certain places– Cambodia, Ecuador, Tanzania– that are so jaw-droppingly cheap that it almost seems unreal. And you wonder how these people could possibly ever survive if they came to your country.

Well, the United States has just joined this proud cadre banana republics… at least if you’re from Switzerland.

Note the Economist Big Mac index indicates that the Swiss Franc is overvalued by 133%

Bargery -‘The Tottenham rioters were rather less successful in bringing down listed buildings than their local football club would have been if left to its own devices’

Robert Bargery has an interesting piece on his blog at Building Design.

There’s a certain gut-wrenching irony to the fact that Tottenham High Road took centre stage. Huge amounts of communal toil and public money have been put into preserving historic buildings in this very street over the past ten years. English Heritage led the restoration of Nos 808-810, an exemplary project, and very recently vast effort has been put into a successful campaign to stop Tottenham Hotspur Football Club from demolishing fifteen pre-1914 buildings, including a listed Georgian one, to accommodate a new stadium.

The Tottenham rioters were rather less successful in bringing down listed buildings than their local football club would have been if left to its own devices. But the casualty list is still alarming: a Grade II building of early eighteenth century origin caught in the crossfire and gutted, an entire late Georgian terrace wrecked because a jeweller happened to have set up shop on the ground floor; and much else besides. The critical thing now is for local authorities to avoid rushing into demolition on the grounds that these buildings are unsafe. No decisions on their future should be taken without an expert assessment from a conservation-accredited structural engineer.

Adroitly handled, the aftermath of the rioting can be manipulated so that, like a moorland blaze from which life grows back stronger, it becomes part of a regenerative cycle. But historic buildings must be allowed to play their part in that regeneration. As places recover from their traumas, it will make psychological sense to keep familiar markers, but restoration will also be an act of defiance: the rioters’ victims are legion, but we should not allow London’s heritage to be counted among them.

In sure on the duty building surveyor, and conservation officer, at Haringey and Croydon, even Ealing, have not had a lot of rest over the last few days.

Some of the prominent landmarks, such as the former department store /allied carpets, and Reeves Store, seem super-fiscally beyond repair. Indeed I hear that some emergency demolition work has begun.

That does raise an issue. For example when the Totnes gatehouse burnt down they did consider a competition to replace it, but instead decided to rebuild it brick by brick. None of the cases here are of that importance as heritage assets. But clearly a standard replacement 8 storey resi block, even designed by a good architect, is not going to be enough. These sites were landmark. Yet a self serving ‘landmark’ replacement I feel would not go down well locally. I hope this provides the opportunity for local young practices to show their ideas and to involve the local community in generating them.

Summer Heat on the #NPPF

With the summer slowdown of planning issues worth reporting its time to get my teeth into writing a formal NPPF response. So the posting on here will slow down for a while, though that work will of course find its way onto here.

The first priority is to write a Commons Select Committee response, which will be posted on here.

Im also going to do a more campaigning piece setting out the key flawed policy changes in the NPPF.

That will then feed into a formal NPPF response here, which I will post in sections.

Finally with the help of some other its time to have a go at redrafting it. There is no point moaning, and this is in theory an open source process.

I hope to enliven these with real life examples of how it will effect actual cases and proposals. Any contributions would be welcomed.

There will be a lot of tooing and frowing of draft responses with various bodies so this will mean some restrictions on what can be made public and when.

I hope some resources on here will help various groups and LPAs in drafting their responses. If people could email some draft responses ill create an online library and do some analysis on common themes and any points where there are disagreements.

Happy Holidays!

French Solvency the Critical Weakness of the Eurozone

While all eyes have been on events in UK cities the equity markets have calmed following a week that saw the most dramatic collapse since 2008.

The Markets are still digesting the US downgrade and it remains to be seen whether the ECB interventions on secondary bond markets for Spanish and French debt will bring rates down to prevent default. This seems unlikely as their pockets are not deep and their commitment, and political backing from Germany, seems shallow.

So as is inevitable the focus of contagion has shifted towards France.

Matt Lynn at the WSJ

French debt is escalating rapidly. It might not be as big as that of some other countries yet, but it’s getting there fast. Last year it ran a deficit of 7% of GDP. French debt will total 90% of GDP this year and 95% in 2012, according to estimates by Capital Economics. That isn’t exactly running out of control — but it is getting very close. Indeed, it’s around the same levels of debt-to-GDP that earned the U.S. a downgrade. And France is racking up fresh debt at a faster rate than countries such as Italy or Spain. It is hard to see how you can feel comfortable about that.

Next, France is steadily losing competitiveness against Germany — in exactly the same way that countries such as Italy and Spain have, except not quite so quickly. France, a major manufacturing center, used to run healthy trade surpluses; now it runs big deficits. The balance of trade for the six months to June showed a deficit of 37.5 billion euros compared with a deficit of 27.6 billion euros in the last six months of 2010, figures released last week showed. The deficit with Germany, its major trading partner, is running at a billion euros a month. Back in 2004, it was regularly running surpluses of a billion euros a month. Countries with big, persistent trade deficits — as any American can testify — have to borrow to fund themselves. The bigger the debts they run up, the greater the risk of a downgrade….

The cost of insuring against a French default is starting to rise. The markets have started to notice the country’s dire position. It can’t be that long before the rating agencies catch up. If France does get downgraded, then it is going to be a very serious blow to the markets. Just about every bank and every bond portfolio in the world is going to take a hit.

This leads them to query if it can maintain AAA. For example S&P have only been able to give such a rating a ‘stable short term future’

But he doesn’t mention at all the problems of its banks, and the fact that its housing market appears close to a bubble peak. If the rumuors that one bank is close to insolvency and several more are close behind, unable to cope with, for example, an Italian default, then the ability of the French Government to be able to cope with the cost of a bailout, of a shrinking number of creditor nations in an effective transfer union to a increasing number of debtors, must be questioned.

France 24

Paul Donovan, London-based deputy head of global economics at UBS AG told Bloomberg, “France is not, in my view, a AAA country… France can’t print its own money, a critical distinction from the US. It is not treated as AAA by the markets.”

In a note to its clients Monday afternoon, financial services firm BBH said, “France has slipped into borderline AA+/Aa1/AA+ (one notch below AAA) territory, so risks to its AAA are rising as stresses spread.”

So what is the French plan B. Well Sarzozy has threatened before to leave the euozone if Germany did not agree to Bale out Greece. He may he tried that tactic again over the ECB interventions. But as the costs of this become more apparent to German politicians I suspect that Merkel might reply, if he made the threat to withdraw from the Eurozone again, ‘make my day’. Sooner or later domestic economic and political survival will be more important for both of them than persuing an unsustainable project.