HSI Hanshin International - Hanshin International HSI - UK's Economic Recovery.
Hanshin International (HSI) says the United Kingdom's economic recovery is built on more debt and credit designed to please an electorate headed for the polls in 2015.
Online, June 23, 2014 (Newswire.com) - Hanshin International: Britain's economic recovery is based on a prescription of the same medicine that got it into so much trouble in the first place. That's the view of Asia-based investment manager, HSI who cautions investors looking at the country as a safe haven.
"Britain's recovery may look relatively strong going by the numbers but the truth is, it's being driven by reinvigorated consumer spending which, itself, is linked closely to the perceived wealth tied up in real estate," said an Hanshin International HSI analyst.
The UK government has said there is no new property bubble despite mortgage approvals and property transactions levels surging ahead on the back of its Help To Buy program.
"This Help To Buy program has moved the goalposts. It basically says that if you can't afford to save up for a deposit, the taxpayer will cover that for you and enable your mortgage lender to push the boat out and lend you far more money than it otherwise would have done. That is anything but responsible lending and while it may provide the government with the boost it needs to ensure it is returned to office in 2015, in the long run, it is the taxpayers and savers who will pay through the nose," said the Hanshin International analyst.
The firm said it expects the economic data coming from the UK to begin to ease off within the next 6 months although it does see the property market boom continuing for another year.
The UK government has said there is no new property bubble despite mortgage approvals and property transactions levels surging ahead on the back of its Help To Buy program.
"This Help To Buy program has moved the goalposts. It basically says that if you can't afford to save up for a deposit, the taxpayer will cover that for you and enable your mortgage lender to push the boat out and lend you far more money than it otherwise would have done.
That is anything but responsible lending and while it may provide the government with the boost it needs to ensure it is returned to office in 2015, in the long run, it is the taxpayers and savers who will pay through the nose," said the Hanshin International analyst.