Lord King WTAF

midlandslad · May 21, 2022

how high does everyone think they will move the base rate to control inflation?

The BofE think neutral is 1.5% to 2%

oil barron · May 21, 2022

hoff135 said:
Some are saying that due to high demand we won't see a crash but just because someone wants a house if they can't get a mortgage due to high interest rates then their demand is worth nothing.

Reverse course and start again, will we see digital currency and negative rates?

Demand is always high in a rising market. Once you get that inflection point suddenly no one wants 3 houses.

I’m not smart enough to know what happens long term after the cycle starts again. Just now crypto basically tracks technology stocks, when if the theory played out it should be performing well as a safety hedge.

I bought gold before Covid kicked off and thought that would be a great investment when Covid really got going but it has been a damp squib.

Then there’s the war, and if Putin can pull everyone into it like he is desperately trying to do and have a big old reset.

hoff135 · May 21, 2022

midlandslad said:
how high does everyone think they will move the base rate to control inflation?

The BofE think neutral is 1.5% to 2%

No idea but with everyones so leveraged up compared to 40 years ago when inflation was this high I doubt they will need to push them nearly as high to soak up the excess money in the system.

glasshouse · May 21, 2022

SilliamWhale said:
I dunno.

Macroeconomics is different. The cost of not keeping bad banks afloat could have been more if a lot of people lost life savings etc.

No

glasshouse · May 21, 2022

oil barron said:
While the money printing after 08 was bad, it is really lost in the noise compared with the last couple of years. The last couple of years were driven by Rishis policy of furlough payments. The BoE had no option but to buy back government bonds as there was no one else ti buy them at the rate Rishi has been selling them. He is Gordon Brown incompetent x 10. And while Gordon Browns motives were solid, I think Rishi was playing the markets for his own wealth.

No, Gordon Browns motives were not solid.
He saved his own ass in 2004, so he was clear for three big job as tony had promised.
He deregulated the banks and b of E so set the scene for the 2008 crash.
He then again saved his own ass by bailing banks and starting printing money..
Everything since has followed from that.

ollie989898 · May 21, 2022

midlandslad said:
how high does everyone think they will move the base rate to control inflation?

The BofE think neutral is 1.5% to 2%

I don't see how interest rates at those levels will make any difference to inflation.

ollie989898 · May 21, 2022

glasshouse said:
No, Gordon Browns motives were not solid.
He saved his own ass in 2004, so he was clear for three big job as tony had promised.
He deregulated the banks and b of E so set the scene for the 2008 crash.
He then again saved his own ass by bailing banks and starting printing money..
Everything since has followed from that.

To be fair, the Thatcher government began de-regulating the banks, but Brown and co accelerated that. Now they are obliged to carry much larger reserves. The way the banking sector was sorted out in 2008 was basically by handing the rotten banks over to the banks who were able to continue trading. It was a huge mistake to ever sell the shares the government had in them. Cost the tax payer hugely. We should still own those shares.

glasshouse · May 21, 2022

ollie989898 said:
To be fair, the Thatcher government began de-regulating the banks, but Brown and co accelerated that. Now they are obliged to carry much larger reserves. The way the banking sector was sorted out in 2008 was basically by handing the rotten banks over to the banks who were able to continue trading. It was a huge mistake to ever sell the shares the government had in them. Cost the tax payer hugely. We should still own those shares.

And where have they obtained those reserves from?
Out of their customers hides

ollie989898 · May 21, 2022

glasshouse said:
And where have they obtained those reserves from?
Out of their customers hides

Yes, they have to retain more of their profits I presume.

holwellcourtfarm · May 21, 2022

ollie989898 said:
Yes, they have to retain more of their profits I presume.

That hasn't stopped them paying near record bonuses.... :scratchhead:

oil barron · May 21, 2022

glasshouse said:
No, Gordon Browns motives were not solid.
He saved his own ass in 2004, so he was clear for three big job as tony had promised.
He deregulated the banks and b of E so set the scene for the 2008 crash.
He then again saved his own ass by bailing banks and starting printing money..
Everything since has followed from that.

Fair point. I think he has some level of integrity though, and don’t think he has got rich post the office. This guy Sunak is very dangerous, and has had a free ride from the press and opposition until the none dom thing with his wife.

ollie989898 · May 21, 2022

holwellcourtfarm said:
That hasn't stopped them paying near record bonuses....

I have no issue with huge bonuses being paid in the private sector. I do have an issue with the private sector, including individuals appearing able to pay fudge all tax.

hoff135 · May 21, 2022

The problem with the whole thing is the mainstream media are not holding govt and central banks to account, I'm yet to see a single reporter talk about all the qe and covid stimulus. Its all due to supply problem and now russia. Majority of the population are clueless and will go along with this

glasshouse · May 21, 2022

ollie989898 said:
I have no issue with huge bonuses being paid in the private sector. I do have an issue with the private sector, including individuals appearing able to pay fudge all tax.

Bailed out banks are not private

robs1 · May 21, 2022

ollie989898 said:
I have no issue with huge bonuses being paid in the private sector. I do have an issue with the private sector, including individuals appearing able to pay fudge all tax.

I think bonuses should be a maximum of times the lowest wage in the business, I'm no socialist but when the boss gets a bonus many time the average wage to me that's very wrong

oil barron · May 21, 2022

hoff135 said:
The problem with the whole thing is the mainstream media are not holding govt and central banks to account, I'm yet to see a single reporter talk about all the qe and covid stimulus. Its all due to supply problem and now russia. Majority of the population are clueless and will go along with this

It doesn’t appear like anyone in the media has economic training anymore. It’s just an echo chamber for public short term moaning. The media were generally against removing furlough in September last year.

ollie989898 · May 21, 2022

glasshouse said:
Bailed out banks are not private

No, but those employees and their companies signed a contract when they were taken on. My friend works for a high street bank and is paid a (far more modest) bonus every year. No reason they should not receive that if they have met their contract terms.

ollie989898 · May 21, 2022

oil barron said:
It doesn’t appear like anyone in the media has economic training anymore. It’s just an echo chamber for public short term moaning. The media were generally against removing furlough in September last year.

But what does the average media bod know? They are all copy writers trying to attract your attention in 140 characters or less. It's all bilge these days.

oil barron · May 21, 2022

ollie989898 said:
But what does the average media bod know? They are all copy writers trying to attract your attention in 140 characters or less. It's all bilge these days.

I would say there is a lot better news in the 140 characters or less space than there is on the TV.
This guy is really good.

https://mobile.twitter.com/texan40?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor

glasshouse · May 21, 2022

ollie989898 said:
No, but those employees and their companies signed a contract when they were taken on. My friend works for a high street bank and is paid a (far more modest) bonus every year. No reason they should not receive that if they have met their contract terms.

Thats why the banks should been let go bust and then bailed out, to wipe out all these contracts

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