Today's expected interest rate rise will cause considerable pain among the mortgage holders of middle England, reports The Guardian.
But with growing numbers being seduced into unsustainable levels of borrowing, repossessions - now at levels last seen in 1992 - have for some time been swelling the ranks of those unable to buy their own home.
This increasingly detached underclass are the real victims of our dysfunctional housing market.
Today, a million children live in overcrowded, rundown, damp or dangerous housing. The number of homeless people in Britain has risen to 391,000; and across the UK 93,000 families are living in temporary accommodation, twice the number when Labour came to power.
The average price paid by first-time buyers has doubled in five years. House prices are now beyond the reach of first-time buyers in 93% of towns, up from 37% in 2001. A decent and secure home is crucial to having a reasonable chance in life. The chronic shortage of affordable housing is a moral issue: if the market can't address it then the state must.
BRITAIN IS LOSING ground in the global race for competitiveness as the West’s developed economies and their businesses face a growing challenge from rising economic powers such as China, India and Russia, one of the world’s leading business schools reports today, reports The Times.
The competitiveness of the British economy when gauged on a wide range of key factors against 54 international rivals has slipped back over the past 12 months, the Lausanne-based International Institute for Management Development (IMD) finds.
For a second year in a row Britain has clung to its twentieth place in the IMD’s annual league table of the competitiveness of the 55 important economies around the world. However, the institute’s detailed analysis shows that the UK managed to hold its place in the rankings only narrowly and lost some ground against rival nations.
THE FEDERAL RESERVE held its key short-term rate steady yesterday and warned that, despite flagging growth in the first quarter, inflation remained the main worry of the central bank, reports The Independent.
In its statement after a one-day meeting, the policy-setting Federal Open Market Committee announced its target rate for overnight federal funds was staying at 5.25 per cent, where it has been for almost a year.
In the statement accompanying the decision, the FoMC noted growth had weakened in the first three months of 2007.
It said the slowdown in the housing market, the main drag on the US economy, was "ongoing" - implying that such problems could continue for a while yet.
Nevertheless, it said, "the economy is likely to expand at a moderate pace in the future", while core inflation remained "somewhat elevated". For the Fed, "the predominating policy concern is that inflation will fail to moderate" in the months ahead. The Dow oscillated between positive and negative territory shortly after the news, before climbing 53.8 to 13,362.87, a new closing high.
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