Are we stupid?

As we sit in the midst of what seems like an historic episode I find myself struck by one question: how can we have let ourselves get into this again?

Didn’t we know this might happen?

For sale signsAt least we should have seen a turn in the housing market coming, surely? It’s not just in the UK that we have had several years of warnings of house price corrections, comparisons to the 1980s, graphs showing scary upward trajectories.

Yet some of the world’s best paid people lent money secured against inflated house prices, and appear to be surprised that the market is not what it was.

There’s a Homer Simpson quality to the analysis that led us here…you can picture Homer attempting to grab a donut well out of his reach, banging his head, and then repeating the mistake time after time. That’s where we appear to be in the housing market.

One colleague suggested to me today – rather acutely - that housing market cycles last eleven years, while our memories last nine. There is always a two year silly frenzy that has to be undone.

The idea is not very different to that expressed by Alan Greenspan in Monday’s Financial Times. He bemoaned the obvious failure of the commonly used risk-management and econometric models to cope with the episode we are now in.

They do not fully capture “the innate human responses that result in swings between euphoria and fear that repeat themselves generation after generation with little evidence of a learning curve” he wrote.

It’s probably the only point on which Alan Greenspan and John Kenneth Galbraith would agree.

Interestingly, human irrationality is a hot topic in economics at the moment. Behavioural economics it’s called, on the cusp of economics and psychology.

While it is dismissed by some old-school economists as a bit flaky, and by others as intellectually lazy, it is a subject that is hard to dismiss entirely, particularly as we look at the repeated cycles of boom and bust.

Put simply, behavioural economics argues that human beings’ decision-taking is guided by the evolutionary baggage which we bring with us to the present day.

Evolution has made us rational to a point, but not perfectly so. It has given us emotions, for example, which programme us to override our rational brain and act more instinctively.

Those emotions probably worked well for us in the savannah, where it wasn’t really very useful to spend time thinking about whether to flee the tiger or not. But the instinct is still with us now, it affects our behaviour, even that of apparently very rational people, and it can’t be ignored.

Emotions are just one example of behavioural effects. The general point is in explaining our behaviour, evolution can trump economic theory.

Two current books make the case for taking behavioural economics seriously rather well.

The first is Dan Ariely’s Predictably Irrational which details the many experiments that have been performed on people to demonstrate systematic behavioural traits.

The second – released soon – is Basic Instincts, by Peter Lunn. It is an excellent book; a feistier defence of behavioural economics and more of an attack on traditional economics.

Personally, I don’t see old economics and behavioural economics as opposed. It is useful to assume people are rational as a good approximation to their long term behaviour, but it would be unwise not to think how in practice their behaviour may deviate from that simplifying assumption.

Both books are well worth reading.

You will read about fascinating lab tests on people, demonstrating the ways in which honest people allow themselves to be dishonest, about how sexual arousal affects judgement and how we tend to work less hard if we are paid by results, than if we are doing something as a favour for someone.

And talking to Dan Ariely in recent days, I find he comes up with at least two ways in which the literature is relevant to where we are now.

First is the insight that emotion (greed, fear) can override rationality when we make decisions (we repeatedly tend to buy too much food if we visit the supermarket when we are hungry).

And secondly is a tendency to see evidence selectively. We give more weight to the facts that support the theory we have in mind.

So in the upswing, it is easy to find facts to support the upswing…other evidence is overlooked. Only when the countervailing evidence becomes unarguable, do we change our mindset and start fearing the uncertain.

The literature does not imply we’re stupid. We’re just not as clever as we like to think.

It is a good point to bow out on, as this column represents the last post for the Evanomics blog for the time being.

I stop being Economics Editor this week, as the excellent Stephanie Flanders takes over. (I’m not sure if it be called Stephanomics, but her blog will be worth reading whatever the name.)

I will strive to do some writing, but my new day job (or night time job to be more accurate) will be presenting the Today programme on Radio 4 (for a year at least).

It’ll be a fascinating test, to see whether the mind-set of an economist can contribute to discussions on subjects as diverse as Pakistan and frog spawn.

Thank you for reading Evanomics, and to the News blogs team for ensuring that some of the most egregious errors are dealt with.

Comments   Post your comment

  • 1.
  • At 12:30 PM on 19 Mar 2008,
  • Paul Brogan wrote:

Good luck in your new job Evan.

I will miss your posts.

  • 2.
  • At 12:35 PM on 19 Mar 2008,
  • D Graham wrote:

As always from Evan a clear insight into the wierd and wonderful ways of the market and economics. Thanks to Evan for making some sense of economics over the last few years and making the subject interesting. I shall be listening to Radio 4 with excitement

  • 3.
  • At 12:37 PM on 19 Mar 2008,
  • Chris wrote:

Thank Evans! Great blogs although I wish you wrote more. Good luck on waking up at 4am.

  • 4.
  • At 12:38 PM on 19 Mar 2008,
  • Liam Godfrey wrote:

Have we really let the same happen again or are we in danger of creating a self-fulfilling prophecy? This is not necessarily the late 80s, employment is still high and interest rates are still low. House price rises are slowing certainly and may even have a period of nil growth similar to the mid 90s but a crash? perhaps we are being a little premature. And no I am not an estate agent.

  • 5.
  • At 12:43 PM on 19 Mar 2008,
  • Phil wrote:

Dear Mr (should be Dr. even if you don't have a PhD) Davis
I was desolate when I heard the news the other night and your colleague was introduced as the new Economics editor.
You have the priceless ability that I have found to be extremely rare of being able to explain complex ideas in a manner that others are able to understand. You may regard this as easy or even, perhaps, not understand why such ideas should be so difficult (I suspect neither from the tone and content of your articles and presentations) to understand but I assure you it is not. Should it ever be necessary, I am sure a post as a lecturer would be well within your capabilities.
Congratulations on your new post but, I fear, commiserations for us no longer able to look forward to hearing the economics news presented with such clarity and with such insight (with apologies to your replacement).
I sincerely hope you may be persuaded to return at some time to elucidate and educate us who find the economics world both interesting and challenging to understand.

  • 6.
  • At 12:45 PM on 19 Mar 2008,
  • martin ellis wrote:

The eleven year cycle and nine year memory theory hits the nail on the head. Property will always attract this type of behaviour as people like the idea of making money from something they have to do anyway, such as finding somewhere to live.

Also congratulations on your stint as Economics editor. I studied economics and then became an accountant (so clearly I didn't learn my lesson), and I've admired how you make what can be complex issues very clear with succinct answers to the core questions. Good luck with getting up at 4am!

  • 7.
  • At 12:46 PM on 19 Mar 2008,
  • Michael Orton wrote:

I look forward to listening to you in the mornings, but I will miss your articles here.

Stephanie has a hard act to follow!

  • 8.
  • At 12:51 PM on 19 Mar 2008,
  • Kevin Riley wrote:

Thanks for some wonderful insights;the world of Economics has been made a much more accessible place!

  • 9.
  • At 12:56 PM on 19 Mar 2008,
  • stephen scott wrote:

Great writing over the years and easy to understand for non economists like myself.
When are people going to stop wanting more more more though? To be fair though the shops are not as busy as they were and reality is hitting home.
Those old enough to remember back to the late 1970's and the bowing and scraping we had to do to building societies to get mortgages and the same societies limiting the amount of money they allocated each month. Once the limit was reached no more mortgages were issued that month.
I paid £125 a month for my first mortgage in 1979 and I earned £125 per week including shift pay. By 1980 I was paying £168 per month when interest rates went to 15% and we lost our shift work due to the downturn in orders.
Those were difficult times indeed.

  • 10.
  • At 12:59 PM on 19 Mar 2008,
  • paddles wrote:


Looking forward to hearing you on the Today programme. Good Luck!

In response to the question in this blog; is full of posts from people who spotted the results of this recent gorging on credit.

I've been getting bored of saying this recently, but "TOLD YOU SO".

  • 11.
  • At 01:03 PM on 19 Mar 2008,
  • Andy wrote:

Its been a pleasure reading your blog Evan. I'll miss your down to earth, honest and open viewpoint on house prices, the economy etc.

You're spot on with your analysis here. Intelligent, rational people, behave totally irrationally and without thought when purchasing the most expensive thing they will ever buy.

Boom and bust, long may it continue!

  • 12.
  • At 01:04 PM on 19 Mar 2008,
  • Mr Wood wrote:

You leave us when we most need common sense and economic insight. Surely that can’t be right!

Hope it turns out to be a plum job.

  • 13.
  • At 01:05 PM on 19 Mar 2008,
  • Rhys Parsons wrote:

Fascinating, as ever.

Will look forward to hearing you in your new role as a presenter on Today.

Good luck!

  • 14.
  • At 01:05 PM on 19 Mar 2008,
  • Lesley-Anne Ives wrote:

Will miss your blogs & the articulate insight into the financial world of today. Will tune in to radio 4 and wish you every success for the future.

  • 15.
  • At 01:06 PM on 19 Mar 2008,
  • Fiona Watson wrote:

Was the eighties crash not precipitated by the fact that the MIDAS relief was cut to one set per property rather than all the non married people being able to claim tax relief on one mortgage in their own right.

I was always under the impression that that had started the problem as groups of friends who bought a house together could not get the same 'discounts' that had been previously available.

i don't disagree with your comments at all. Only to add this wee one:

Yes the house prices are in the short term inflated in the UK. BUT much of this 'crunch' has been caused by house pricing being massively inflated elsewhere, where there might not the same market dynamics as here. Additionally its been caused not so much as inflated prices, but by daft and greedy lending to people who just cannot afford homes, at any price.

In the south east of england, there will be a price adjustment, but overall prices will still creep upwards as the demand is bigger than the supply. That will not change. So in that respect things are different from the 80s (where the housing shortage, even though still there was not so apparent).

Perhaps in future, apart from being less greedy, British Banks should be compelled to somehow segregate their international risk from their domestic. This in turn might then reduce the impact on their internal interest rates and ability service their UK (and what should be their primary) customers.

  • 17.
  • At 01:11 PM on 19 Mar 2008,
  • Stuart Bell wrote:

Are we stupid? Probably. Are people greedy? Absolutely. Look at all the day-time TV programmes predicated on ever-rising house prices. Look at all the people caught in the buy-to-let trap. The whole thing was like pyramid selling, and bound to come unstuck one day, since house prices could not continue to rise relative to incomes indefinitely.

It's all down to greed.

Stuart Bell

(PS Enjoy the new job!)

  • 18.
  • At 01:11 PM on 19 Mar 2008,
  • alex wrote:

Its a big shame your leaving especially at this acute time in the Histoy of world economics..
hope the follow up is a s thorough as you
i have really appreciated your analysis

  • 19.
  • At 01:11 PM on 19 Mar 2008,
  • Sally wrote:

Thanks for your blogs Evan. I had no interest in economics prior to reading them and have found them fascinating, especially todays, the last.

Good luck and I will tune in to the Today programme.

Sorry to see you go from here Evan, but welcome to R4!

Final blast from me..... I think the Bank of England should think less about the price of fish and take whatever action is needed to save the economy!

all this ''should we have known'' or the usual snipers ''I told you so'' can wait.

The fact is the 'told you so' clever cloggs had no idea this was on the horizon at all - even if they have convinced themselves they did. IF they did (and I wont accept it without evidence) - the they are clearly in the wrong job! Plus I assume THEY are now making a fortune from ''where we are now''

All the best Evan; I look forward to waking up to you next week.


Only some of us are stupid. Myself and fellow posters at have been way ahead of the curve.

Labelled as doom mongers it now looks like we were correct all along. Dr Bub one of the most prolific posters started the thread

"credit tightening lets keep track in 2005"

  • 22.
  • At 01:14 PM on 19 Mar 2008,
  • Russell wrote:


Thank you for your blog over last while.

It has always been a pleasure to read your blogs, and its refreshing to know there is someone else out there (by that i mean a fellow economist) who shares a similar sense of the world with me!

Where things havent been clear, or my own economic analysis has come up with nothing, i always found clarity in your blog.

Thanks again and i will certainly be listening for an economists view on frog spawn and Pakistani Politics!

  • 23.
  • At 01:37 PM on 19 Mar 2008,
  • Gaye wrote:

Thanks for posting such an interesting article as your final blog entry. It expands on what many have always suspected when it comes to how people make "rational" economic or financial decisions - to paraphrase a good old Yorkshire saying :"there's nowt so queer as folk"! Good luck with the new job.

  • 24.
  • At 01:38 PM on 19 Mar 2008,
  • Ian in London wrote:

With regards to your question, "How did we let this happen again?" Only one phrase comes to mind..

"History, will teach us nothing."

Good luck in the new role

  • 25.
  • At 01:41 PM on 19 Mar 2008,
  • Alex wrote:

Of course, there will be a crash, Liam. Anything else is wishful thinking.

When a two-bed end of terrace with no garage or garden in an old mill village in the North, miles away from a decent CBD, is priced at over 10 times the average salary of £26K pa (which hardly anyone in the area earns anyway), then the bubble has to pop.

Sorry but you all lost your minds over the last eight years, and trying to pretend you didn't is daft.

To Liam Godfrey,

I think we will be *worse* off this time around. The monumental mountain of personal debt that has built up during the boom is what will drive the next crash as liquidity, sorry, solvency dries up. The credit crisis is the tip of the iceberg. Expect to see many more banks go insolvent first.

I agree with Evan, and have been saying this will happen for years. It's inevitable. History has a tendency to repeat itself, and this time is no different from any other. It is never different this time.

Buckle your seatbelts, because this is going to be a very bumpy ride.

  • 27.
  • At 01:44 PM on 19 Mar 2008,
  • Ben wrote:

Well done on a great job as an entertaining, illuminating and insightful Economics Editor. And good luck in the new job!

  • 28.
  • At 01:45 PM on 19 Mar 2008,
  • Jim Kerrigan wrote:

Good coment from Evan but missed one crucial point. There have always been people who want to borrow more than they can cope with. In the past the Banks assessed the borrowers ability to repay and rejected many applicants on this basis.

Ironically many Banks were criticised for this and journalists said they should be more like the American Banks!

The Banks then went after profit, got rid of their experienced lenders (I was one of them) and replaced them with sales people whose only instruction was to sell, sell, sell.

While the economy was on the up the economic balloon just kept inflating, but the minute there was any decline the end result was inevitable. people with debt they can't cope with.

The sad thing is the senior management won't suffer, it will be the junior bank staff who lose their jobs (like 1/3rd of Northern Rock staff) and those whose homes are repossessed.

  • 29.
  • At 01:46 PM on 19 Mar 2008,
  • John wrote:

Will look forward to hearing you on Today Evan. Good luck and best wishes. A well deserved promotion.

  • 30.
  • At 01:46 PM on 19 Mar 2008,
  • Mark Jones wrote:

In the long term house cannot rise at 10-20% per annum while average wages rise by 3-4% per annum.

Over the past few years the only reason that this has been able to happen is that banks have vastly increased the salary multiples they are willing to lend to wannabe home owners.

As any economist will tell you, an increasing money supply will cause inflation, when the supply of money is increasing but can only be spent on one type of asset then the price of that asset will rise. (I couldn't borrow £200k to spend on holidays or champagne but I could for spending on houses.) As soon as the banks decided that enough was enough and the risks of non-payment were too great it is inevitable that the whole thing comes crashing down.

You can see why the banks have done this, it is in their interest see house prices increase, much better to receive interest of %5 on £200k than on £100k. As long as people can pay the money back, they want to take up as big a slice of our incomes as possible.

The individuals making these policies at the banks are probably not bothered about the long term consequences for the country, their bonuses are based on performance over a year or two, they won't neccesarily lose anything when the crash comes, they will have made enough money to retire on.

A long period of no growth would be preferable but markets always overshoot due to people's 'herd mentality' and so a shorter crash is more likely in my opinion.

This will probably happen again and again as long as people in the UK have an obsession with home ownership, a penchant for speculation and as long as housing s treated preferentially by the tax system (no CGT for example).

There will be no housing crash in Germany because there has been no bubble, people see houses and apartments as homes rather than get-rich-quick schemes and housing is therefore much more affordable relative to incomes.

Not being on 'the housing ladder' is not seen as a disaster there either, indeed many people prefer to rent and let the landlord have the hassle and expense of home ownership, finance, maintenance, etc

  • 31.
  • At 01:52 PM on 19 Mar 2008,
  • Philip wrote:

I'll look forward to hearing you on the Today show periodically.

Though I must say I will miss your clear, understandable, balanced and interesting pieces on economics.

  • 32.
  • At 01:56 PM on 19 Mar 2008,
  • Justin Leahy wrote:

I'm saddened to read that the polite man of economics commentry is to stand down, but I'll look forward to my wake up calls and the less aggressive questioning...

Best of luck Evan.

  • 33.
  • At 02:01 PM on 19 Mar 2008,
  • JohnP wrote:

Many thanks Evan. Yours is one of the few blogs I read every post of, and has been consistently excellent the whole time you've been writing it.

Happily, I'm also a Today programme listener. I'll look forward to hearing you.


  • 34.
  • At 02:02 PM on 19 Mar 2008,
  • John E wrote:

I think your background will stand you in good stead for your new job, as I expect many of the major news stories for the next year or two will be about the fallout from the ongoing crisis in the financial markets! Good Luck.

  • 35.
  • At 02:03 PM on 19 Mar 2008,
  • Andrew wrote:

Dear Mr. Davis,

You are an excellent communicator and the balance and restraint you bring to your editorials exemplifies the best traditions of the BBC. I look forward to you accompanying my journey to work!

On your final piece, do you think I can repeat the claim that scrapping all credit controls in the 1980's was not wise, without being denounced as a rabid socialist?

  • 36.
  • At 02:04 PM on 19 Mar 2008,
  • Numaan wrote:

I have been telling all my friends that the year of the great depression will be 2010, this fits very nicely with your 11 year cycle statement, the trends are all pointing to a gloomy 2010 for everyone!

ps. good luck with the new job, hope to see your blog back in 2009!

  • 37.
  • At 02:06 PM on 19 Mar 2008,
  • Dr Alok Bhattacharyya wrote:

What a wonderful way to try hide the true reasons behind this current credit fiasco?

It is now some amount of irrational human behaviour that is responsible as expounded by behavioural economists. Great!!

Not the excessive greed by the greedy bankers who have been allowed to creat credit out of thin air by our politicians in their pockets! It is now our fault. We human beings are irrational.

We are only negligent to the extent that we confuse credit with money. And this confusion is created and maintained deliberately by banks and most economic commentators.

Bankers exactly know how to creat extra credit and how to withdraw the same causing boom and bust to transfer peoples' real wealth to them. There is nothing accidental in all these. This happened many times before when a countries government allows a central bank to creat credit instead of its treasury creating real money commensurate to the economic activity in that country.

  • 38.
  • At 02:08 PM on 19 Mar 2008,
  • Jonathan Ray-Smith wrote:

For my money, as BBC Economics Editor, you have been the best broadcast journalist around. Your ability to translate complex economic issues and data into simple and entertaining television news reports (and blogs) and to explain their relevance to the general public will be sorely missed by your many fans. Your loss to BBC News is the Today programme's huge gain.

  • 39.
  • At 02:11 PM on 19 Mar 2008,
  • thalia wrote:

Best wishes in the new job Evan.

I've always valued your opinions, and you've been a saner voice than most on topics such as the housing market, sub-prime etc.

  • 40.
  • At 02:11 PM on 19 Mar 2008,
  • Mark Hamblin wrote:

Best of luck in the new role. If my A level economics had been as interesting and informative as your blogs i may have stuck with it.

  • 41.
  • At 02:12 PM on 19 Mar 2008,
  • HW wrote:

Measured, balanced, well-argused, clear without being patronising and genuinely enlightening - you'll be missed Evan, but good luck on Today. John who?

  • 42.
  • At 02:22 PM on 19 Mar 2008,
  • Mongo (Howard Davies) wrote:

As we are all looking at economic catastrophe.... The world has finite resources. Population growth is exponential and the curve will probably get steeper as health care improves - assuming access remains as it is. What happens when/if it becomes clear that the world has hit capacity. I am thinking in terms of free markets and "growth"; "confidence" when it becomes clear that all things may not remain equal in the free market model; simple demographics where population must be controlled by birth rate - so the aleady serious issue of a less young people supporting many old will become critical.

  • 43.
  • At 02:22 PM on 19 Mar 2008,
  • thalia wrote:

Best wishes in the new job Evan.

I've always valued your opinions, and you've been a saner voice than most on topics such as the housing market, sub-prime etc.

  • 44.
  • At 02:24 PM on 19 Mar 2008,
  • HW wrote:

Measured, balanced, well-argused, clear without being patronising and genuinely enlightening - you'll be missed Evan, but good luck on Today. John who?

Congratulations on the new role Evan! I'm sure I'm not alone in saying I have mixed feelings: We'll miss your insightful analysis and excellent presentation of complex economics issues (especially in the current climate), but as a regular Today listener, I'm very much looking forward to hearing you on Today where I'm sure you'll take our politicians to task.

  • 46.
  • At 02:26 PM on 19 Mar 2008,
  • Tirumal Rao N wrote:

It has been few years in Briton for me, and watching Evan with Evanomics on BBC TV and reading articles on website was very interesting. Thanks for making it so simple and interesting to lay man. We wish you publish more blogs like this. Good Luck with new assignment at BBC4

  • 47.
  • At 02:26 PM on 19 Mar 2008,
  • Rahul, London wrote:

Evan, all the best for your new job. Your blogs have been interesting, informative reading - I will miss Evanomics.

  • 48.
  • At 02:28 PM on 19 Mar 2008,
  • Colin Smith wrote:

Yes. In general, we're stupid.

We repeatedly believe what we're told by banks, leaders and politicians, despite 90 years of evidence to the contrary.

  • 49.
  • At 02:29 PM on 19 Mar 2008,
  • Ketan Varia wrote:

Good luck Evan...have really enjoyed your analaysis and the passion in which you present it.


  • 50.
  • At 02:30 PM on 19 Mar 2008,
  • Ben wrote:

What a shame, you will be sorely missed. Evanomics has been a great part of the BBC blog network hopefully you can still find the time to contribute once in a while.

  • 51.
  • At 02:32 PM on 19 Mar 2008,
  • Peter wrote:

The reason we are in this mess again is due to the asymmetric risk in banks and hedge funds. If they bet big (with someone else's money) and the bet comes right, they win 20% of the return. If the bet goes wrong, then the client loses their money. At the worst the trader loses his job. For the first time this week, traders at Bear Sterns have had to bear some of the loses of the bank by losing their accumulated stock options. Many will have been pretty seriously hurt by this. It needs to happen more often so that risks and rewards are more evenly spread.

I will miss your writing Evan. keep up the good work elsewhere.

  • 52.
  • At 02:36 PM on 19 Mar 2008,
  • Dom wrote:

Really enjoyed the blogs, Evan. Thanks and good luck.

  • 53.
  • At 02:37 PM on 19 Mar 2008,
  • Henry Giles wrote:

Not to include house price inflation in the overall inflation statistics has been partly to blame for the current economic woes. If house price inflation had been included, interest rates would have risen years earlier in order to cool the housing market. The Bank of England is just as culpable as the Government in not dealing with house price inflation. Corporate greed is to be expected and could have been controlled by increasing interest rates.

  • 54.
  • At 02:38 PM on 19 Mar 2008,
  • Ted Yeoman wrote:

Evan good luck in your new role .... One question before you go ... with the banks in crisis, inflation twitching in the background do I use my hard earned money to:-
a) pay down my huge borrowings?
b) buy while the market is low?
c) put it under a matress until needed?
d) use it to secure even more borrowings on the hope that the lender will go bust and I'll get another loan to sort out the creditors later on?
Oh and would you give the same advice to the man at no 11 Downing Street?

Your might want to point your readers at Cordelia Fine's book "A Mind of its Own" - which provides an excellent background to our irrationalities, and explains how we so happily justify them.

Thank you for all the excellent postings; here's hoping you'll now be blogging for Radio 4.

The Homer analogy works well in this case - particularly as it seems US banks have been lending to people with fewer job prospects than the great donut-muncher himself.

I shall look forward to hearing you in your new role - Stephanie has made a good start.

That also means we'll have to change our blogroll...

  • 57.
  • At 04:04 PM on 19 Mar 2008,
  • David wrote:

Evan, You're always such a welcome sight on the TV, always a dream to listen to and to read, as everything you say is clear and comprehensive. Cannot wait to listen to you on the Today programme. Every good wish.

  • 58.
  • At 04:08 PM on 19 Mar 2008,
  • Ian wrote:

In reply to post 15, double MIRAS was removed and the crash happened just after that, but while it was the final hoorah, it is absolutely wrong to say that was the cause. The cause was, just as it is this time, the abandoning of any reason by sellers and buyers, and the belief of the banks that lending on any property was sound whatever the price and whatever the borrower's prospects were in paying back the loan.

Unfortunately views like the poster's were probably common in the banks and maybe they thought that because we no longer had MIRAS, the housing market wouldn't crash!

1989 is but a droplet compared to today's tidal wave.

Good luck Evan, you will be missed, but I hear that Stephanie is a very able replacement.

  • 59.
  • At 04:15 PM on 19 Mar 2008,
  • James Holden wrote:


As a novie with little understanding of economic theory but a keen interest in what is happening in the world your blogs have been a guiding light for me - well written with a good insight into the functioning of the economic world delivered in a way that is accessible to all; a perfect example of true journalism.

I do wish to raise one point in relation to this article - why is it do you think that traders panic so much at the first signs of danger when everyone knows that panic just breads further problems? Surely some calmness among the markets would breed more stability; have market traders really not evolved this far?

Finally I would like to wish you luck with the new job. I look forward to hearing you soon.

P.S. will you still be presenting Dragon's Den?

  • 60.
  • At 04:19 PM on 19 Mar 2008,
  • Neil Oliver wrote:

Good luck, at least the sun's up early now it's spring.

On interest rates; do UK interest rates follw the US rates, ie. if they lower thheir base rate by 1.75% will the Bank of England do similar within a few days or weeks?

Does it adversely affect our economy if our rates are very different to the US?


Neil Oliver

  • 61.
  • At 04:21 PM on 19 Mar 2008,
  • Matt wrote:

Good luck with the new job. Gutted your leaving your blog was always a great read.

  • 62.
  • At 04:23 PM on 19 Mar 2008,
  • Lakshmi Narayanan wrote:

Evan you will be missed, will we still see you in Dragon's Den?

Good Luck.

  • 63.
  • At 04:23 PM on 19 Mar 2008,
  • Peter Tompkins wrote:

What a shame you're going. We'll miss your brand of common sense in everything from whether to buy the second-cheapest bottle of wine in the off licence to resisting the urge to today's suggestion that we buy too much in the supermarket when we're hungry!

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