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henry the king

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  1. Yeh, fast crash. I have re-christened it as flash crash though because it sounds cooler. Everywhere will see a flash crash now imo. The question will be after that. It could rebound a little after it depends.
  2. The more I have looked into this data today, the more it indicates 0.5% is the only logical solution. They could even consider a bigger rise. IF the data doesn't flip just before the meeting (the next employment data is before their meeting) then I just cannot see a justification for anything but 0.5% at least. But I will still only believe it when I see it, such is how I view the BoE. But if Bailey has any competence whatsoever the case for 0.5% is way stronger in September than it was in August. And the thing that matters is we get the 0.5% rises NOW whilst the "going is good", because soon the employment and growth situation will deteriorate and we will be seeing no more rate rises. I hope to see us get to 3% by year end.
  3. Some building societies are doing ok passing it on somewhat. Banks though, yes I agree. Still a lot of term funding money out there for the next 3 years and QE money out there too, that is probably why. Be interesting to see if banks are begging for savers money after QT has been going for a while globally.
  4. And then they claim to care about the environment whilst they are advocating subsiding gas prices haha The labour party should be a sitcom
  5. The thing that will do the most damage isn't rate rises anyway. Its a recession. Inflation and covid largess just stops the BoE/government from intervening as aggressively. So that is when a true crash happens. We are 2 out of 3 currently. BoE hands tied and raising rates. Governments hands tied as need to provide COL help not specific housing help. Now all that is needed is a recession and job losses and you will have a window where a crash happens because they will be waiting for inflation to come down before cutting rates aggressively.
  6. Energy bills and food bills and petrol will be going up £3k a year or something. If you are getting a 10% pay rise and are on £80k a year already then you just made £4.5k or something in extra take home pay. If your partner is getting the same, maybe £2k take home increase or something, then that is £6.5k extra for £3k a year extra costs. So they absolutely will be better off and there will be more money to be plunged into housing. This is why a while ago I said that I thought cost of living would do more damage in places like the North East where pay and pay rises are lower. Whereas in the South East or North West, pay rises are often huge as they are in sectors (business services) where the pay rises are huge. As a result cost of living will do nothing there. £3k extra on bills and petrol and food means nothing to people on large salaries in the South East. For prices to go down meaningfully in the South East there needs to be continued IR rises. 1.75% will cause some downward pressure, but they need to go higher. If they go to 2.25% in September I think the fireworks start.
  7. BoE have tied themselves to getting inflation down now. Like the Fed did too. They probably have to just keep putting rates up right now. But yeh, wage inflation is a problem that the BoE should respond to with another 0.5% rise. It is what they are focussed on so I am torn about them doing it. Logically, if they follow their rules, they will do 0.5%. But this is the BoE. A bunch of doves. So I am never convinced till it happens. The employment market might be topping out now though. So wage rises could be gone by 2023. Job losses might replace them.
  8. Labour's energy policy is probably the worst ever policy they have proposed. It would cripple the entire country for years, as is what they usually achieve but usually with more than one policy. 1, Who uses the most energy? People with huge houses. Who has huge houses? Rich people. So they are basically subsidising rich people. So it is not progressive in the slightest. 2, High prices will limit demand and stop spiralling prices. If you remove the high prices then the dude on £250k a year in his 5 bed house will still have no incentive to do full-wash loads and things. So more energy usage. So gas demand stays high. So gas prices get higher and higher. Potentially spiralling out of control. 3, You create a huge cliff edge in April when you remove the cap. Gas will be even more than it would have been as demand will stay high because you didn't incentivise energy saving. So you remove the cap and get the shock again. The only way the cap works is if you know that gas will come down by April, which is won't because Putin isn't leaving Ukraine next month. 4, If you keep the cap in April, the issue just grows and grows. The IFS said this will cost furlough levels of money potentially. So it will spiral out of control and the UK will be broke and will not have fixed the issue (which is lack of supply of gas due to a war). 5, Governments often make things worse in the long term when they intervene. The cap is exactly like help to buy for housing. Sure it helps people buy a house in the next months, but it just stores up issues for the future. The truth...wait for it...is that bad stuff happens and governments can't fix every problem. There is a war. So there is no gas. So prices go up. Nothing the UK government or any government in europe can do will ever change that. Stuff happens in life. 6, It is inflationary. Beer Starmer has said it reduces inflation. NO Starmer you simpleton. It reduces the statistical reading of CPI but it works to increase inflation (underlying real inflation) because it is a massive support to rich people. And so in 1-2 years inflation will be HIGHER (by a lot) than it would have been. And who does inflation hurt? The poor and pensioners on fixed incomes. So the vulnerable. So his policy is actually terrible for poorer people. The IMF know all this. Which is why they said don't do a cap. Classic populism politics from a party long devoid of any credibility.
  9. Well I am expecting the serious falls nationwide to be seen in the HF/NW data released in October/November. I think September's release will probably still be flat. I think NW and HF will both be -1% MoM by the end of the year at an absolute minimum.
  10. Flash crash. As I think happens here. But we didnt have some of the crazy rises so here it will be more like 10% over 6-8 months coming. Which will be 20% in real terms in 6 months After that? Who knows.
  11. 175k old folk (over 65) went back into work. The pandemic let them retire early. Cost of living put them back into work. This will ease the labour shortage. Should drive down wages eventually
  12. The BoE should try to regain credibility. Even now, people don't think these rate rises are going to last. That is why things like savings are so low. The banks all think rate falls will come because they have no faith in the BoE to fight inflation
  13. Today's data means they absolutely should do 0.5% again. The wage data was really inflationary. Much higher than expected and previous readings revised up. This is the thing they are targeting too. I still don't believe they will do it. Saunders left the MPC. And they still look for any excuse not to do it. Inflation data will be lower next month than expected due to fuel price falls. And that will be their excuse. Even though it shouldn't be based on their own rules.
  14. He is talking about a credit crisis probably. Seems plausible
  15. Wages still rising too quickly which will also add pressure to the BoE to jack up rates more quickly.
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