What's really happening in the credit market

TomTom

We have Monetary Base Control. The BoE never managed to control the credit base but the commercial banking sector can.

Simply by closing down the off-sheet financing route and making banks back their lending with deposits the control of the monetary base is reflected in LIBOR.

The BoE can do whatever it wants to the discount rate but if we have lived in an era of Gilts famine and banks created what appeared to be pseudo-Gilts using CDOs and CMOs as substitutes it suggests the BoE should discount Bradford & Bingley's mortgage book as if it was Gilt-edged.

Clearly fatuous. The banks have loaded up on toxic debt and treated it as top-grade assets. When Assets turn into Liabilities most businesses have dire problems.

If Brown had issued Gilts instead of insider-deals on PFI most of these CDOs and CMOs would have been much less attractive to long-term portfolio matching

TGF UKIP

Fraser, Brown's Bubble was, as I must continue to point out, also Brown's Bunce.

By turning the money supply taps full on and standing back applauding while the banks lent like lunatics, Brown was filling his spending coffers via equity release and VAT. Every £100k second mortgage saw £17,500 end up with Gordon when it was spent on holidays/cars/conservatories/kitchens/furnishings/extensions etc.

Has any City economist yet calculated the amount of consumer expenditure being removed from the economy by the effective demise of equity release.

The corollary question for your second best mate, Greedy Gideon, then becomes "Given that you are pledged to match Labour's spending plans and given that large amounts of VAT revenue are going to be missing, by how much do you intend to raise either taxes or borrowing to fund your spending shortfall?"

John

Hardly. I have been predicting this for at least 2 years, and the housing crisis for 18 months. It was quite evident to me that the country had gone mad.

Hysteria

I agree with TGIF - DC and gang really must start to articulate a change in direction - and soon -

John - yup - me too - it was always bonkers to spend "Equity" (i.e a theoretical guess of house price) on plasma TVs and holidays.

joanna wippet the slow

John do you have any other financial predictions?

crown

Credit supply has returned to normal after 8 years of crazy lending. see

Crown blogspot for further information

THX1138

I thought I would share a part of a weekly analyst report I receive called Greed & fear from the very highly respected analyst Christopher Wood from CLSA

He is non partisan in my experience & is only interested in telling it how it is to CLSA clients.

This about money not politics.

Meanwhile, GREED & fear continues to believe that the most vulnerable economy globally remains Britain, not America.

In America it is well understood that banks can fail. Hence many
wealthy Americans only keep up to US$100,000 in one bank because of the limit on individual deposits under the system presided over by the Federal Deposit Insurance Corporation.

By contrast, in Britain there is an almost pathetic lack of understanding of the potential downside of boom bust credit cycles. Hence, the shock at the all too predictable demise of the wholesale- funding addicted “Northern Rock”. And hence British Prime Minister’s evident ludicrous self- belief that he had presided as Chancellor of the Exchequer over an economic miracle as opposed to a totally irresponsible debt binge.

The grim nature of America’s housing market is by now well understood. But in Britain the story is only just beginning with massive denial still rampant over the condition of the property
market in the world’s biggest rip off city. But the data is pointing all one way even though the deterioration, as in America, will run from the periphery to the core. Thus, the latest mortgage data from the Bank of England shows that the number of mortgage approvals for house purchase plunged by 28% MoM and 64% YoY to a record low of 42,000 in May

Similarly, UK house prices fell for the eighth consecutive month in June to record their worst annual decline for nearly 16 years, according to the Nationwide Building Society

Share prices of Britain’s banks and home building companies have already fallen dramatically.

But investors should continue to avoid these sorts of areas for now, though
foreign buyers from the emerging markets will eventually emerge for these franchises. Sterling also remains a natural short as “King of England”, a sheep in wolf’s clothing, will inevitably capitulate on interest rates – as he should do. A housing collapse, like the one Britain is about
to experience, will render all talk of “inflation” as an absurdity.

We're all f**ked

Bill Cameron

Only when cheap credit is over do we realise how much we relied on it, and that what Gordon Brown wrongly labelled "prosperity" was a debt-fuelled mirage.

Some of us realised it was unsustainable many years ago, in my own case since at least 2002 when I warned various friends/family who were taking on new mortgages at the time to be very careful not to over-extend themselves based on the then current borrowing rates, historically very low. Some people, for example me, have made sure we have little or no borrowing and what we do have is extremely short-term and insignificant in terms of liquid assets to meet it.I have certainly also been anticipating sharply increasing energy costs for at least 4 or 5 years too with all the consequences that flow from this, including the likely increase in food costs.

People believe what they want to believe, unfortunately, and I never believed that Brown was a prudent manager of the economy almost from his first budget in 1997; it amazes me that some people, including 'experts' who should know better, still assert even today that he was a 'good' Chancellor and ran the economy well.

Rex Burr

When I bought my house in the 60s the interest rate was 6% and my mortgage amounted to 25% of my income. (It was generally accepted that a weeks pay covered the monthly payment)
A three bed detached bungalow cost four times an average income. Why should a house cost twice as much to build now, in real terms, than then?
If land prices are the problem then perhaps land reform is the answer.
The interest rate is not the problem at the moment. The asking price is the problem.

dexey

"Only when cheap credit is over do we realise how much we relied on it, ..."
Speak for yourself. I was told in the mid '80's that interest never sleeps and doesn't take a day off in you are unwell. It is remorseless. It mad quite an impression on me and I worked my way out of debt by the late '90's, put some savings in the bank, and switched to working part time. If I want something bad enouh I pay cash and usually get a discount. If I can't afford it I do without. It has been a much happier life

Craig Strachan

THX1138,

An interesting read. I would observe that the housing collapse we have already experienced in the United States has not rendered talk of inflation an absurdity. In fact we are experiencing surging inflation, fueled by irresponsibly low interest rates that aren't even feeing through to lower coupons.

Tom Burroughes

Milton Friedman had it right. In the end, if you push up the money supply quicker than the likely growth rate of an established economy such as the UK's - about 3 per cent a year or thereabouts - inflation will take hold eventually. The various measures of money supply have been off the charts for years, and yet it has been fashionable for even some supposedly clever economics writers to ignore this old fuddy-duddy monetarist worry and focus on something else.

I fear we are going to have a painful re-acquaintance with the ideas of the late, great, Professor from Chicago.

James

Has any City economist yet calculated the amount of consumer expenditure being removed from the economy by the effective demise of equity release.

Yes. The amount of Mortgage Equity Withdraw equalled the increase in consumer spending in 2006. I have not checked teh 2007 figures yet. The BoE disputes there is a strong link between Mortgage Equity Withdraw and consumer spending, although many others (including myself) think there is a strong link.

Rex Burr

I’m with you dexey. Except for mortgages, credit is not good. Waiting is good.
Credit does not increase purchasing power it just affects the phasing.

Aidan

In the '70s we learned that "industrial policy" didn't work - it was hopeless for civil servants to try and second guess the market. Now we are learning the hard way that "monetary policy" doesn't work either. As the Baroness said: you can't buck the markets. The best the Bank of England can ever hope to do is to smooth away some of the volatility in interest rates and, as regulator, ensure that banks are adequately capitalised and properly valuing their assets and liabilities. The Bank of England cannot control interest rates.

THX1138

Craig It is interesting read Isn't it, if very bearish about are two economies. I take your point about US inflation & have read the same.

Asia seems to cope better with high inflation & managing growth I think the world economy is moving eastwards & once the Asian economies get over the "oil price shock" we sill see internal untapped Asian consumer demand spring into life & Asian markets rise (anyway that's what I'm betting) & slowly decouple from growing on the back of servicing the western & particularly US consumer (anyway that's what I'm betting).

Gold a classic hedge & Asians love it & Asian equities (but don't check them everyday which could be scary) are my bet for growth over the next few years. Forget the West we're over.

Elizabeth

I posed a question on another thread and didn't get an answer.
Somebody kindly explained on what basis interests rates went up but that was not the answer only the result.
Why does putting up interest rates stop inflation?
Putting them up transfers even more money from the 'poor' or capital deficient people to the 'rich' who have excess to lend.
From the 'poor' to the banks.
How does screwing the 'poor' stop inflation?.
It doesn't remove the money from the system. It just makes the rich richer and the poor poorer.
As, on the thread it was generally agreed inflation is the fault of governments issuing too much money and thereby destroying the value of the currency - how does hurting those without capital help the situation?.
Answers anyone?

THX1138

Elizabeth- Because if interest rates go up people have to spend more money servicing debt & therefore have less to spend on other things so demand drops & so does the pressure on the price of things.

mart

Rex Burr:

"Why should a house cost twice as much to build now, in real terms, than then?"

My humble attempt at an answer: Because the purchase price is agreed between buyer and seller. And if more "money" is available generally to sellers (because of lax lending criteria) then the overall market in which buyer and seller meet suggests the purchase price be higher. I am no economist, so my terminology may be all wrong - but I think I got the principle right.

Elizabeth

'Elizabeth- Because if interest rates go up people have to spend more money servicing debt & therefore have less to spend on other things so demand drops & so does the pressure on the price of things.'
No that doesn't work.
Some people have to spend to service the debt but others have more money and income as a result of it.
So the money is still there but the poorer are poorer and consequently more hit by the inflation.
If 'A' borrows £5000 he has that money at that point.
If 5% inflation kicks in, that sum becomes worth £250 less.
Yet if the interest rates go up he has to pay £250 in interest on a sum worth actually less plus! the extra interest as it has gone up since he borrowed the money. He loses actually all ways.
'B' lends the £5000. He gets his £5000 back in full because of the extra interest put on to cover the inflation plus the £250 in original interest.
He then has his original £5000, inflation proofed and pockets £250. 'B' then has that money to spend. And because they are on the richer side of the ledger possibly on imported goods which are detrimental to our balance of payments as I understand it.
So the poor get a double whammy.
Pay more interest on a reducing sum.
How does that stop inflation?

Jonathan

Elizabeth:

Because most of the money that people borrow is not from what savers have deposited but is 'new' money created by the bank. Higher interest rates therfor result in increased repayments but with no concurrent payout to savers, ie. there is no B.

Craig Strachan

THX1138:

"Gold a classic hedge & Asians love it & Asian equities (but don't check them everyday which could be scary) are my bet for growth over the next few years."

One word: commodities!

Elizabeth

Jonathan

Thank you for your reply which I find very shocking.
No wonder our economic system is busted.
So what you are saying is that although some money comes from investors - who the media remark will be better off - that is the capital rich getting richer at the expense of the capital 'poor'
some of the money is 'created' by banks.
You cannot be serious? And I mean that with shock.
By what right, law, statute or whatever, have the banks the right to print money presumably based on 'air' which of course has to be inflationary (how appropriate) as it devalues the existing currency.
How can banks just create money?
You leave me more confused than ever.
Please someone explain what seems to me crazy economics.
How can banks create money to lend out at interest - which is real money of course?

Rex Burr

Elizabeth
I made the same point a few weeks ago. I am not a wealthy person nor do I have wealthy friends but raising interest rates has no moderating effect on me or on most of those people I know, as we owe nothing and do not pay interest.
If prices are driven down by lack of demand we will be out there spending.
If house price growth of 150% is the result of availability of cash then why are builders not making 150% profit?

Ian C

Elizabeth - Supply and Demand is the simple answer.

If you increase the price of something you reduce demand for it. So the price (interest rate) eventually reverts as demand falls away as fewer want to borrow and more want to save to earn the higher interest. So there is less money chasing goods and services so their prices cannot rise as fast.

The effects of inflation thus hit the poor the hardest. The effects of all negative economic activity affects the most vulnerable hardest - a fact of life that noone can do anything about.

Elizabeth

'If you increase the price of something you reduce demand for it. So the price (interest rate) eventually reverts as demand falls away as fewer want to borrow and more want to save to earn the higher interest. So there is less money chasing goods and services so their prices cannot rise as fast.

The effects of inflation thus hit the poor the hardest. The effects of all negative economic activity affects the most vulnerable hardest - a fact of life that noone can do anything about.'
Ian
Sorry to be a nuisance but this makes no sense either.
You make money too expensive to borrow. In fact like Rex it would not worry me - i dare not get into debt - however when you do this you immediately cause a slowdown in purchasing power, stuff up sales and put people out of work.
Worse as our industry and production has higher labour costs and find it very hard to compete with 20p a day slave wages, being hard up we will go for the cheapest product because we can't afford a better one that may have made in England stamped on it. Companies closed as well.
As for your last paragraph - I trust that view is not very widespread.
Why is it acceptable that the poor get hardest hit. They have taken the least in the good times and become the fall guys in the bad.
You know, the present picture of rabid internationalist capitalism is a very very ugly one as was international communism. Both extremes that turn me off completely.
Of course we all know the coming slump with its mass repossessions and broken lives will present an 'economic opportunity' - don't I hate that expression it means someone or something can be economically screwed.
What is already happening is that people with capital will move in on folk who are unable to meet their mortgage repayments and pick up homes for peanuts - and already a scheme is going to let them back for rent to the unfortunate previous owners.
Anyone who feels little sympathy for those who will fail to meet their mortgages should consider that many bought before the enormous rises in council tax and energy. Who could predict - as brown had promised 'no more boom or bust' - that inflation would race away making meeting a mortgage more and more difficult for the average family.
Add to that the enormous social pressures to 'get on the housing ladder' and you have a nearly perfect storm.
I feel very very sorry for anyone caught up.
Of course only those with traditional repayment type mortgages will lose their homes.
Islamic mortgage holders will have the government on hand to pick up the 'rent' as I have understood it.
Injustice all round.

THX1138

Craig - I have been riding the commodity story for awhile & have made good money through ETF's in Industrial Metals & baskets of soft commodities but it's really starting to feel like a bubble.

Obviously their is more pressure on the price of hard commodities due to the rise of Asian economies & soft commodities thanks to growing populations, biofuels & the oil price making fertilisers & transportation more expensive.

However A larger part of the rise I believe is fuelled by the commodity funds the price rises suck in global capital looking for a home (particularly petro dollars) which the funds then have to spend on commodities, mostly futures forcing the price up & sucking in more capital & so we go on until, well until is stops & some poor sap is in at the top.

The prices as we know always faller much faster than they went but I still think we have awhile to go but any fall in commodity prices Inc & especially oil will fuel my Asian equity story

Happy Investing & get yourself a Gold ETF pronto, it's got $1500 per oz written all over it.

Ian C

Elizabeth - I am afraid that is the explanantion as you have summarised after quoting me. Inflation kills jobs because the response to it is to raise interet rates to choke off demand to kill the inflation. That's why controlling inflation is a top priority as it is so painful to cure - and the most vulnerable are in the front line. Sense or not, it is the reality. I don't know that holding a v'iew' like this is particularly relevant, becuase my or any one else's views on facts are menaingless.

Views about what to dod about it (inflation, hurting the poor hardest as the cure etc) are where the debate is. In the 1970's the Labour Party got thrown out that their 'view' was to tax the rich to give governemnt enough money to give to the poor. All that did was send the productive people abroad and left a sinking economy with a reducing tax take because they stifled enterprise, boosted inflation and dragged thec ountry to its knees. They have done it again this decade.

There is a balance to get right between having a productive economy and and ensuring the vulnerable are provided for that noone has perfected yet although the USA has done a far better job than the rest of the world, as witnessed by the millions who want to go and live there.

Craig Strachan

THX1138:

I guess whether you see a bubble in commodities depends on how you view the outlook for global inflation in the next couple of years. Personally, I think we're off to the races on that front.

Elizabeth

Ian

Surely the issue driving all our production abroad is globilization and the billions the capitalist world makes from cheap labour.
Surely the best cure for the vulnerable - is a job! where they can work.
Unemployment in this country is many times the stated amount but is all being hidden in collusion by government with the rest of the establishment.
It is cheaper to keep young girls breeding an underclass of unemployable kids on sink estates providing sink schools (we have seen the danger of educating the working classes), offering houses and a pension (better than hard working old people who have paid into the kitty all their lives) with the first pregnancy and tipping them a bit more for every feral child they produce.
There is no work for them, Factory and sewing work gone, secretarial skills and the typing pool gone.
Its cheaper to leave these unfortunate woman wallowing in their own often wretched lives than pay them a wage in British factories and sewing rooms.
They are surplus, not required for labour, an embarrassment for the figures, so they become a bottom tier of society, often immoral, irresponsible and pitiful without real hope.
The decent amomg them dragged down, their kids perverted or subverted and ill educated fighting drug dealing and god knows what iniquities all around them. Their culture and history devalued as immigrants are moved in all around who promptly often join the benefit queue.
Yet their grandparents were the people who fought through the war, survived the blitz, worked the munitions, manned the guns.
They as a class have been deliberately degraded and demoralized because bigger profit can be made by girls working in China.
Look at the layabout hoodies and knife wielding youth.
Ditto. Unwanted and unemployable because we have made them so by the system.
No family and no chance as any future family. What woman wants them to win her bread when the state pays so handsomely. They are shiftless, feel worthless have no prospects and no hope.
Unless we need them as cannon fodder in a future war!
It makes bigger profits to keep this lot on a pittance from the state, fighting over drugs and killing and maiming each other.
A few of the brightest and the best get out but in general the picture gets bleaker each year.
These are the human beings society no longer wants because their labour is too expensive so we let them rear each other to an existence coming out of hell.
It must be two, three hundred years we have regressed to pre industrial Britain to see such urban inhumanity and now its millions not thousands.
Globilization and rampant unregulated capitalism.
No one is talking about 98p tax in the pound.
What we desperately need is the willingness of government to start levelling a playing field and finding worthwhile employment.
The underclass is a blot on 21st century Britain.
We don't really have a productive economy any longer. We offer degrees from McDonalds and as you say the USA has perfected it and done a better job.
Their underclass is as bad if not worse than ours, we are just catching up. The USA has shed jobs overseas at a greater rate than us.
The American people and politicians are waking up to what globilization has done to the working classes as are other western nations.
We have lost our ability to make - we import, import import, our balance of payments a disaster.
We need to get back some values and some pride in our nation and most of all we have to start becoming self sufficient in food, ween all the big land owners off EU subsidies to keep their land unproductive, and get back our jobs and self respect.
That way we stop benefit culture, start people working instead of allowing them to be 'disabled' screwing other working people to keep the figures right.
At the moment it is not just inflation and the prospect of higher interest rates hurting those at the bottom of the heap -its greed, selfishness and pig troughing of huge proportions often by those who are already so obscenely rich it makes no sense to still want more.

Rex Burr

Elizabeth
You deliver a better analysis than any Select Committee. Get into politics, you have my vote.

Ian C

Elizabeth

You are right on so many points but you are in danger of setting out a stall that says government can sort it for society. It cannot. Society can sort it, if left to get on with it with the right incentives and the tools to do it with.

The main tool needed is a good education. And for investment in that to pay means that strong familial parenting is a pre-requisite for success. The economic and the social cannot be separated. Socialists will have everyone having the same edcuation whatever its quality. That solves nothing other than the consciences of those whose lives are based on preventing you getting a better education than me because its unfair on me, so noone gets a good enough education and the nation slips down the relative league tables - as this country is now. Just look how much bigger this genration of underclass is today compared to 20 years ago, all because it was deemed unfair, which it is, but we have to accept that until we are rich enough as a nation for it to no longer be the case. Life is not fair, but that does not mean that all should be dragged down to the lowest achievabe level for all at any one stage in our development. It is about being progressive in constantly raising the standards all can achieve while not penalising those ahead of the rest. Not an easy balance to get right and one that marxism/socialism refused to recognise as the objective. It is today so abvious thanks to a century of failure of their thinking that it is becoming second nature to us all and will become entirely mainstream over the next decade.

We should perhaps be doing this on The Wall if you want to continue.

Kram Ekosum

Elizabeth, your comedy rant was very entertaining and very educational. You are possibly a budding socialist or at least proto-socialist politician. You worry me with the 98p tax talk, though! Of course you may just be a partly de-constructed Labour MP having fun or contemplating coming over to the Dark Side. The main problem with politics is that IT is the real problem. Most politicians obfuscate and stifle debate. They shirk the major issues and are not ready to challenge the status quo for fear of being ridiculed. The general populous are aware of this and have therefore become apolitical. This is an extremely dangerous step and has sown the seed for untrammelled dictatorships. Modern politicians can achieve alot using smoke and mirrors while the general public are kept ignorant.
Mass rigorous education is needed and a substantial re-assessment of the meaning of life and work is required. Life should not really exist without work. It is that seismic a change in attitude! There are catalogues of statistics that show that work itself(paid or unpaid) is beneficial to human beings. My uneducated view on minimum wages and welfarism is that the system gives us a licence not to work. A revolutionary concept would be to genuinely remove most benefits but top up income where there is real evidence of poverty. You do not need to be a marxist to realise that it is perfectly honourable to sweep the streets, sell burgers, pour drinks, wipe dirty bottoms, drive trucks, or even answer telephone calls. It is probably more honourable to do some of these things than reading the news or dealing in equities. Unfortunately the former are a lot less well paid. We are a service economy society but apart from the higher echelons we place little emphasis on the quality of service that we provide. This will be to the detriment of us all. The question still remains about the USA. If it is so bad, rotting away and the healthcare system stinks so much, do people still want to go and settle there?! Anyway these worries are for people with time and/or money and not those of us who are busy working.

Elizabeth

Ian
Thanks for your thoughtful answer. And thank you Rex. Me a politician? My snout isn't big enough and I have too much conscience to be lobby fodder. The two main qualities for politics today.
Ian you are very right about education.
Education, education, education!!! Now who said that?
Eleven years ago we still had decent working class schools before they were overwhelmed by the immigrant invasion.
When I went to school, longer ago than I would like to admit, we had much bigger classes and not a single kid who could not read. Not one!!
Take a look at the schools today. It is reliably reported that many schools have 100 different languges.
Dozens!! of kids who cannot even speak English. Many schools where English is a minority language.
Now controversial as I may sound, I still believe that we should give equal opportunity to the needs of indigenous English kids as we do to the needs of the immigrants.
But this doesn't happen, does it? If it did we wouldn't be putting our own into these sink multicultural hell holes where they are increasingly a minority and being overlooked.
Immigration, as with so much else has impacted our working classes horribly, many schools unfit for the purpose and any good or decent child pulled down to the degraded level of the rest. Drugs, violence and bullying rampant.
As with so much else immigration whilst providing cheap nannies and plumbers for the upper classes has devastated our poorer people.
Working class kids should be, if not given equal education, at least an education that can give them an opportunity in life. One only has to quote DD. I wonder how he would have thrived in a climate of mass nationalities, widespread corruption or ignorance of the English language and the a downgrading by the neo/liberal anti/white/christian progressives of English culture and history.
Education I agree. But the government must do it and there is absolutely no will by the establishment - all three main lib/lab parties, you cannot put tissue paper between them.
As I pointed out - educating the working classes has been proved dangerous. My God you get a DD. Worse you get them wanting jobs.
THERE IS NONE FOR THEM.
Because globilization has made them too expensive to employ.
We must start creating our own industries and job opportunities or else sterilize the poor. The growing underclass is both brutal and unfair.
The other thing that could be done tomorrow - but won't be but should - is to end the career option of single motherhood.
It is monstrous and decaying and immoralizing and degrading our society.
If a single woman wants a child - fine. But she earns the bread, or her family takes it in.
She does not! jump the housing queue and she does not get unending benefits increased for each child - often by different fathers and all shades of the rainbow.
If unable to provide for herself lets start handing the babies for adoption to the childless couples costing the NHS a fortune on IVF or she gets put in a hostel with shared child care and she works even if just in the community.
It must not be an easy option.
Was I the only person shocked, the Labour MP when questioned sniggered with amusement, when the story broke of a group of some 15 or so young girls also all about 15 or so making a pact to all get pregnant.
Where are we?. That is disgusting. This must not be. Why should these feckless women be allowed to burden the taxpayer in this way?
The answer, because there is no work - the chinese do it for bigger profits and it keeps them off the unemployment figures.
They are unemployed! and costing an absolute mint.
When we go buy our chinese 'tat' start thinking of the true cost of the washing machine.
The Underclass. The benefits, the cost of crime and related problems getting out of control in this country.
The social cost to the working class.
Next time we get the excuse of getting in immigrants to do the work our own won't do. Reach for a bucket.
They don't do it because sink schools don't even barely educate most of them. They don't do it because the social structures within the working class have been allowed to decay. The work ethic gone.
Deliberately. Its cheaper to import your labour already educated.
The Government could do an awful lot in the short term but won't and nor will the Tories because Corporate and big business rules supreme and the British poor don't feature in their gross new world.
We must stop immigration and start controlling our population. We must stop paying families to produce endless children. Family benefit for two. The third neutral but you cover the cost for more. No more upgrading of council housing if you outbreed the one you have.
Ian there is plenty that could be done and would save the taxpayer billions - but it won't.

Rex Burr

Elizabeth
I'll say it again.
You deliver a better analysis than any Select Committee. Get into politics, you have my vote.