UK Property Market

On the subject of the British property market, one of the little discussed results of the frankly crazy rise in property prices (well it is just.my2p.com) is that it drains investment funds from the economy.

Anyone who has some spare cash nowadays wants to invest it in property because they all think that you can double your money in a year or so, and/or is the best pension fund you can have. The result of this is that the small investor doesn't invest in businesses that actually do something to create wealth, thus starving the business world of finance. Oh, no they invest in things that don't create wealth, but rise in price through supply and demand - which will always end up in an investment bubble.

So we end up with less investment in businesses and lots of money into a bubble economy. A recipe for disaster. And we wonder why much of British industry is foreign owned.