Interest rate rise

[essex man]

Negative real interest rates of the order of 8% have never historically brought inflation down.
Not sure why the bank thinks it will now, think they are relying on quantitative tightening also but haven't announced the schedule for that

 

[kiwi pom]

What would the rate be for a standard mortgage now?
Seems to be about 5% here. Not really sure as I don't owe anyone anything.

 

[essex man]

What would the rate be for a standard mortgage now?
Seems to be about 5% here. Not really sure as I don't owe anyone anything.

Up until recently you could get for 2-3 % I think.
Someone I know was offered 3.6 fixed for 25 years fairly recently.
I like to stay clear of debt also, remember paying mid teens percentage on large overdrafts being very painful in the past

 

[midlandslad]

Up until recently you could get for 2-3 % I think.
Someone I know was offered 3.6 fixed for 25 years fairly recently.
I like to stay clear of debt also, remember paying mid teens percentage on large overdrafts being very painful in the past

Current funding for a 25 yr fixed loan of a decent size will be over 5% and that is with no review.

 

[renewablejohn]

How would you have coped in the days when interest rates were in the mid to high teens cos that was hard.

Easily. I would never have bought the farm.

 

[essex man]

Current funding for a 25 yr fixed loan of a decent size will be over 5% and that is with no review.

May look cheap soon!
You are talking about business loans here, rather than mortgages for house purchase?

 

[Still Farming]

The difference these days are because of high house prices people have borrowed to their limit at very low rates which means their mortgage payments can very quickly double or even treble causing mayhem.

Negative equity and foreclosures again is it?

 

[hoff135]

Property prices have soared world wide on the back of low rates from covid. America, Canada and Australia are even worse than the UK. Question is did they even need to cut rates considering there were mortgage holidays and furlough?

 

[BrianV]

Negative equity and foreclosures again is it?

Will be if they scare off buy to let investors, good for new young future buyers not so for others !

 

[midlandslad]

It takes a lot more to finance land at 5% interest at current values than it ever did at 15%.

 

[Still Farming]

https://www.facebook.com/100064620046507/posts/408021621361836

 

[DaveGrohl]

Inflation forecast to reach 11% now by boe

Anyone that actually believes these figures hasn't been paying attention. 10/11% my aarse.

 

[DaveGrohl]

Bank of England now run by a complete bunch of idiots. Seems like they only have one tool in the box to raise interest rates. Fine if the economy is overheated and excess cash needs taking out but hopeless if the economy is already in a downward spiral with consumers already strapped for cash thats how we ended up with the Great Depression. If they carry on with this nonsense that is certainly were we are heading.

Interest rates aren’t the only tool in the box, they also have QE. They’ve used both in shocking fashion for many years. They are always behind the curve with tightening and also with loosening. These people only know how to do their job by looking in the rearview mirror to see what was happening a few months ago. Which of us only brakes once we’re actually on the bend? It’s been like this all of my lifetime but it’s been getting worse lately.

They have realised that they have to raise rates and cut QE far too late. They may even know they’re creating recessions around the world but they also know they have to raise rates so that they can then cut them again. Oh, look, a recession’s arrived, we’d better cut rates to help people. If they’d left them at 0.1 where would they have to go to "appear to be doing something"? They’d have nothing left in the bag.

 

[hoff135]

Interest rates aren’t the only tool in the box, they also have QE. They’ve used both in shocking fashion for many years. They are always behind the curve with tightening and also with loosening. These people only know how to do their job by looking in the rearview mirror to see what was happening a few months ago. Which of us only brakes once we’re actually on the bend? It’s been like this all of my lifetime but it’s been getting worse lately.

They have realised that they have to raise rates and cut QE far too late. They may even know they’re creating recessions around the world but they also know they have to raise rates so that they can then cut them again. Oh, look, a recession’s arrived, we’d better cut rates to help people. If they’d left them at 0.1 where would they have to go to "appear to be doing something"? They’d have nothing left in the bag.

The forthcoming economic crisis will be used by central banks to introduce cbdc (central bank digital currency). I believe the fed has plans to roll this out next year along side the dollar. Normally people would push back but if more are struggling they will go along with anything if they think it's the solution.

 

[DaveGrohl]

The forthcoming economic crisis will be used by central banks to introduce cbdc (central bank digital currency). I believe the fed has plans to roll this out next year along side the dollar. Normally people would push back but if more are struggling they will go along with anything if they think it's the solution.

A solution in search of a problem. Sounds a great idea. How’s Bitcoin doing lately? But then central banks doing it is all about control. The more control you have the faster you can fekk things up cos they can’t do it fast enough already…..

 

[hoff135]

A solution in search of a problem. Sounds a great idea. How’s Bitcoin doing lately? But then central banks doing it is all about control. The more control you have the faster you can fekk things up cos they can’t do it fast enough already…..

It's above my pay grade but bits I've seen suggest they can put money in your account to buy thing or if there's too much in circulation they can simply delete it. They can also take rates negative.

It actually feels like we have arrived at the point where the economy works by central banks creating money and giving it to the lemmings, 99% of which will spend it as fast as possible. After a few transactions all the money ends up with people like Jeff bezos. Sounds like a conspiracy theory but it think there's some truth in it

 

[DaveGrohl]

It's above my pay grade but bits I've seen suggest they can put money in your account to buy thing or if there's too much in circulation they can simply delete it. They can also take rates negative.

It actually feels like we have arrived at the point where the economy works by central banks creating money and giving it to the lemmings, 99% of which will spend it as fast as possible. After a few transactions all the money ends up with people like Jeff bezos. Sounds like a conspiracy theory but it think there's some truth in it

It’s about control. Cash is a thing the central banks want rid of for all sorts of reasons. The ability to make interest rates negative is just one of these reasons. Covid has been a gift for them. But you’re right, the more they can take financial power away from the little people the more they can control everything. Which would be fine if what they did with that control was positive……

 

[hoff135]

It’s about control. Cash is a thing the central banks want rid of for all sorts of reasons. The ability to make interest rates negative is just one of these reasons. Covid has been a gift for them. But you’re right, the more they can take financial power away from the little people the more they can control everything. Which would be fine if what they did with that control was positive……

Definitely about control.

Interesting take the situation -

 

[oil barron]

It will be interesting to see how we end this vicious cycle. The government have the most to lose from higher interest rates as they are more heavily geared than joe public. They are therefore going to have to dramatically reduce government spending at the same time as everyone who gets paid by the government is striking demanding more wages and we are funding a proxy war in the east. What are they going to cut? Probably the NHS.

 

[robs1]

It will be interesting to see how we end this vicious cycle. The government have the most to lose from higher interest rates as they are more heavily geared than joe public. They are therefore going to have to dramatically reduce government spending at the same time as everyone who gets paid by the government is striking demanding more wages and we are funding a proxy war in the east. What are they going to cut? Probably the NHS.

No government has cut the nhs yet, inflation will make everything it buys dearer though so extra will be needed to stay the same.
Inflation means higher prices and higher wages so tax take increases at both ends and reduces debt in real terms I'm sure most governments will be happy with inflation at a reasonable level for a couple of years as long as it doesnt cause a recession reducing tax take too much, two years of 10% inflation will reduce the "real" national debt by roughly 12% lots of government borrowing will be fixed rates so higher levels wont have a big impact.
Those living on fixed pensions will be impacted the most