[Hampshire] vsftpd confusion

Hi Folks.

I am messing with the above on my home Ubuntu Hardy Server. When I first
set up the ftp server I could login anonymously but could not upload.
Makes sense as the permissions on the default /home/ftp directory have
to be changed. So per the advice chmodded them to 777. But then when I
logout I cannot log back in. Changing permissions to 755 allows the
login again but then I cannot upload!

Any ideas whats going on?

TIA
Mike