Interest rate rises are coming...

[Ah-so]

1 hour ago, Habitationi Bulla said:

To be fair the pound was ridiculously high then, i was in Cambodia getting 2.1USD, good days but theyd never have lasted no matter what.

 

I was think that dollar sterling had a natural rate of about 1.50 to 1.60 and if you are outside of this range, it is either a good long-term buy or sell opportunity. 

[maverick73]

2 hours ago, Ah-so said:

I was think that dollar sterling had a natural rate of about 1.50 to 1.60 and if you are outside of this range, it is either a good long-term buy or sell opportunity. 

It will hit $1.40, as the dollar declines against all major currencies. The impact to inflation will be temporary before rising higher.

[adarmo]

4 hours ago, Ah-so said:

I was think that dollar sterling had a natural rate of about 1.50 to 1.60 and if you are outside of this range, it is either a good long-term buy or sell opportunity. 

The BigMac index has proven adept at predicting the direction of currency movements. 

http://www.economist.com/content/big-mac-index

Would say a £1 should be $1.66 according to this. 

[Ah-so]

8 hours ago, adarmo said:

The BigMac index has proven adept at predicting the direction of currency movements. 

http://www.economist.com/content/big-mac-index

Would say a £1 should be $1.66 according to this. 

Yes, that sounds a reasonable rate. If the rate is down at 1.40 or up at 1.80 then it's only a matter of time until it returns to something more sensible. 

[Gigantic Purple Slug]

Seems to me there is a concerted effort to annouce the possibility of rises going on...

http://www.bbc.co.uk/news/business-40823237

The thing I don't understand is, if they are worried about them going up "higher than people expect" in the future, why not just nudge them up now ? I know the BOE normally uses 0.25% increments, but surely a +0.1% increment would do far more to raise awareness of potential rises on the horizon without making a significant change to the fundamental rate.

[Democorruptcy]

They have to keep pretending rates are going up. If they don't confidence could be completely lost in sterling and the BoE would have to buy ALL the gilts.

[Habitationi Bulla]

22 minutes ago, Democorruptcy said:

They have to keep pretending rates are going up. If they don't confidence could be completely lost in sterling and the BoE would have to buy ALL the gilts.

I think its more a case they need a get out clause should the FED continue to raise rates.

[maverick73]

Decision Factors.

1. Inflation - Above the 2% threshold. (The dependency is import oil prices, if oil prices rise, so does inflation)

2. Unemployment - Below 5%, signs of a stable  economy.

3. Wage Growth - Stubbornly low at 2%. (Higher inflation creates wage growth).

4. Consumer Borrowing - Higher than 2008, but better regulations, and low costs of borrowing have helped.

To crash the market as per 1978, requires

1. Thr price of oil to rise

2. Government instability

4. High unemployment

5. Wage growth stagnation 

[GregBowman]

41 minutes ago, maverick73 said:

Decision Factors.

1. Inflation - Above the 2% threshold. (The dependency is import oil prices, if oil prices rise, so does inflation)

2. Unemployment - Below 5%, signs of a stable  economy.

3. Wage Growth - Stubbornly low at 2%. (Higher inflation creates wage growth).

4. Consumer Borrowing - Higher than 2008, but better regulations, and low costs of borrowing have helped.

To crash the market as per 1978, requires

1. Thr price of oil to rise

2. Government instability

4. High unemployment

5. Wage growth stagnation 

Good anyalsis 

[adarmo]

4 hours ago, maverick73 said:

Decision Factors.

1. Inflation - Above the 2% threshold. (The dependency is import oil prices, if oil prices rise, so does inflation)

2. Unemployment - Below 5%, signs of a stable  economy.

3. Wage Growth - Stubbornly low at 2%. (Higher inflation creates wage growth).

4. Consumer Borrowing - Higher than 2008, but better regulations, and low costs of borrowing have helped.

To crash the market as per 1978, requires

1. Thr price of oil to rise

2. Government instability

4. High unemployment

5. Wage growth stagnation 

In the interests of challenge

1. Forecast inflation is within the target banding  and the GBP is sort of a petrocurrency (appreciates with the price of oil)

2. Lower unemployment should result in wage inflation (according to Phillips Curve theory) but it isn't. In the USA unemployment stands at below % and yet wage inflation is falling. 

3. See above. Higher inflation doesn't necessarily lead to wage growth.

4. Consumer borrowing can only go on for so long......... low costs of borrowing have definitely helped. 

[Si1]

5 hours ago, maverick73 said:

.

To crash the market as per 1978, requires

1. Thr price of oil to rise

2. Government instability

4. High unemployment

5. Wage growth stagnation 

Was the missing #3 a typo?

We could be not far off having all but the third one, which might happen if brexit is badly negotiated or Corbyn takes power and wrecks the economy.

[Habitationi Bulla]

3 minutes ago, Si1 said:

Was the missing #3 a typo?

We could be not far off having all but the third one, which might happen if brexit is badly negotiated or Corbyn takes power and wrecks the economy.

I believe that has already been done for Corbyn. But maybe Corbyn will wreck the economy of those who've made vast sums in the last 2 decades for doing sweet FA i.e the 10%ers..so it will be perceived that he ruined the economy if he were to get in power.

[Noginthenog]

On 04/08/2017 at 0:34 PM, Mr Banks said:

No way are rates going anywhere immediately we can have 5% inflation the bank only cares about wage inflation. That is well under control if someone can convince me that wage inflation is going north of 4% then maybe untill that time i expect no change in interest rates this year and maybe if the ecomomy does slow down a futher cut to 0 next year. Look at the way the bank was trying to talk up interest rates through the farcical forward guidance. They were expecting wage inflation below 7% unemployment it didn't. Really nothing to see here.

I totally agree. Expect stagflation for the foreseeable future.....

And actually I don't think the BOE will care about wage inflation either. What matters is eroding debt.

[TheCountOfNowhere]

On 15/06/2017 at 12:12 PM, TheCountOfNowhere said:

I predict we will see the first rate rise before Christmas ( 2017)

 

Bank of England leaves interest rates on hold in shock 5-3 split - business live

https://www.theguardian.com/business/live/2017/jun/15/markets-bank-of-england-retail-sales-greek-debt-talks-business-live

 

The shock is that 5 evil ****s refuse to do what is right for 99 % of the country

 

Unashamed bump.

If we see this coming to fruition tomorrow then I'll give my mate a big pat on the back and I'll start to believe the rest of what he's told me.

Sufice to say, you'd not want to be a BTLers right now.

 

PS I still wont believe it till we see it.

Edited November 1, 2017 by TheCountOfNowhere

[TheCountOfNowhere]

Looks like my mate was spot on.

If he is right then if the trolls/BTLers/Boomers think this is a one off shock, they are in for a surprise.

The game has changed.

Shoulda sold last year when they had the chance.

 

Now, they'd be better off investing in these.....

 

 

 

[LC1]

1 hour ago, TheCountOfNowhere said:

Looks like my mate was spot on.

If he is right then if the trolls/BTLers/Boomers think this is a one off shock, they are in for a surprise.

The game has changed.

Shoulda sold last year when they had the chance.

 

Now, they'd be better off investing in these.....

 

 

 

So what's this other bit of insider info you've been promising to reveal?! 

[TheCountOfNowhere]

One word for the trolls today.

 

[rantnrave]

TSB has revealed it will follow the BoE rate rise.

It says: "Interest rates on TSB's variable rate mortgage and base rate linked credit card accounts will increase by 0.25%.

"Interest rates on variable rate savings accounts will increase by 0.15%."

[Bruce Banner]

And the £ dropped a percent against the €..... .

Time to stop playing around and raise rates to 5%, not 0.5%.

[Mr Banks]

This rise i welcome but we are still at 0.5% future rate rises are what interests me. TBH 0.25 or 0.5% doesn't matter we had well over 9.5% hpi in 2012 with interest rates at 0.5 so claiming this will mass slaughter BTL'ers and "Trolls" whatever they are (i believe they are people who the count doesn't like) isn't really going to cut it. It is just reversing a mistake of last year to cut rates prematurely.

[TheCountOfNowhere]

11 minutes ago, LC1 said:

So what's this other bit of insider info you've been promising to reveal?! 

Do you ever watch one of those TV shoes, or listen to the radio where the hook the viewer/listener in just before the adverts ?

The adverts are on.

If the BTLers/Trolls want the bad news they'll have to wait a while  

[Social Justice League]

And it's begun.

 

How will the public cope when rates are at 5%??

[LC1]

5 minutes ago, TheCountOfNowhere said:

The adverts are on.

If the BTLers/Trolls want the bad news they'll have to wait a while  

You tease!

[BoredByTorque]

6 minutes ago, Social Justice League said:

And it's begun.

 

How will the public cope when rates are at 5%??

They are a very long way off being 5%. 

And an increase of  0.25% and a clear 'slow and steady' outlook isn't really that much to celebrate. They are literally giving themselves some wiggle room to drop again if they need to. 

[TheCountOfNowhere]