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Oh learned ones.....

My theory is as the lastest debarcle was caused by ease of credit we may not see rates go that much higher over the next 5-10 years. not because they cant but because the ease of credit just wont be there to drive inflation.....

Does anyone have an opinion on this? :rolleyes:

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Oh learned ones.....

My theory is as the lastest debarcle was caused by ease of credit we may not see rates go that much higher over the next 5-10 years. not because they cant but because the ease of credit just wont be there to drive inflation.....

Does anyone have an opinion on this? :rolleyes:

My theory is:

Credit will become more accessible through a low BoE base rate; - accessible to banks, at least.

Over the next 1 to 3 years this accessibility will flow though to consumers; but the rates will remain around the same as today c.5%, possibly creeping upwards.

The BoE base rate will not increase by much if at all. That way the banks re-fill their coffers at their consumers (and tax payers) expense.

All of this keeps house prices artificially high.

Edited by Green-Inca-Roots

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Or, to put it another way, we are all being f**king robbed to bail out the banks and everyone is celebrating a house price rise.

People are just stupid.

Edited by TheCountOfNowhere

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My theory is:

Credit will become more accessible through a low BoE base rate; - accessible to banks, at least.

Over the next 1 to 3 years this accessibility will flow though to consumers; but the rates will remain around the same as today c.5%, possibly creeping upwards.

The BoE base rate will not increase by much if at all. That way the banks re-fill their coffers at their consumers (and tax payers) expense.

All of this keeps house prices artificially high.

no, one of my customers been to the bank today. he has a business loan and top credit.... base +2.5%, plus fees.

normal business loans now base+5-7% and if you are not whiter than white its base+10%plus.

banker also said loans to private customers for house purchase are being reduuced and criteria still being tightened with the plan to be at 3*income the norm by 2010.

the banker said it was a return to normality and that rates would be rising as well as their margins soon enough.

the logic was that an immediate pull to 3* income would cause houses to crash very quickly, they would rather see the decline controlled....by them of course....

You have been warned.

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when the tories are in they will sort it out i think.

as if any government could....government dug the hole, and through away the soil that should have been piled up.

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as if any government could....government dug the hole, and through away the soil that should have been piled up.

of course but tories like Redwood are already calling for higher rates, they will jack them up to help rebalance the economy, they have to really.

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I reckon the tories will try and slash the public service bill as far as they can, and try and ease their fiscal position that way ( although its going to be a long hard road).... if they have some success I think they'd prefer to a situation where wastage is flushed out of the system, and some sensible tax cuts put in place to stimulate growth a little (one cancelling out the other).... once the economy starts growing strongly its only then that I think rates will rise.... I reckon we have another at least 12 months of this recession to go... or looked at another way perhaps two to three years of weak growth/recession... ie we could stop shrinking in 2010... but won't grow significantly until quite a little while after that..... Cameron will be looking to show falling unemployment for a year, improving government finances and some tax cuts before he faces the voters... and ideally (which he just may get) he'd also like the beginings of some house price growth and still have relatively low mortgage rates (sub-5%).... all possible within five years

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no, one of my customers been to the bank today. he has a business loan and top credit.... base +2.5%, plus fees.

normal business loans now base+5-7% and if you are not whiter than white its base+10%plus.

banker also said loans to private customers for house purchase are being reduuced and criteria still being tightened with the plan to be at 3*income the norm by 2010.

the banker said it was a return to normality and that rates would be rising as well as their margins soon enough.

the logic was that an immediate pull to 3* income would cause houses to crash very quickly, they would rather see the decline controlled....by them of course....

You have been warned.

Lovely chunk of bear food that.

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Oh learned ones.....

My theory is as the lastest debarcle was caused by ease of credit we may not see rates go that much higher over the next 5-10 years. not because they cant but because the ease of credit just wont be there to drive inflation.....

Does anyone have an opinion on this? :rolleyes:

John Redwood did this morning:

Published by John Redwood at 5:50 am under Blog

The Monetary Policy Committee will probably keep interest rates at 0.5% and chug on with their programme of quantitative easing. This policy will keep house prices higher than they need to be, will keep many savers starved of a proper return, will extend the government bond bubble,encourage too much debt and do nothing to sort out the huge imbalances in our distorted economy.

Sometime the authorities have to

1. End quantitative easing

2. Curb the public deficit

3. Bring the recommended interest rate into line with the reality of what banks are offering and charging

4.Offer help in the form of lower taxes and less regulation to the exporting private sector, to slash the trade deficit further

They may not want to start to do this even now, but they could at least tell us they want to do it, and sketch a timetable for returning their management of money markets to something more normal. Otherwise it will look as if they are just going in for a political fix for this year, delaying the essential adjustments the economy needs to make.

Share and Enjoy:

Edited by Sybil13

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no, one of my customers been to the bank today. he has a business loan and top credit.... base +2.5%, plus fees.

normal business loans now base+5-7% and if you are not whiter than white its base+10%plus.

banker also said loans to private customers for house purchase are being reduuced and criteria still being tightened with the plan to be at 3*income the norm by 2010.

the banker said it was a return to normality and that rates would be rising as well as their margins soon enough.

the logic was that an immediate pull to 3* income would cause houses to crash very quickly, they would rather see the decline controlled....by them of course....

You have been warned.

That was my thinking Bloo, but the way Labour is going down the pan, with the conservatives & Libdems looking like shadow puppets, I'm afraid there is a possibility it could all go very pete tong and some complete loonies could come out on top.

What then? All bets off?

Scary stuff eh :blink:

Edited by help?

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I reckon the tories will try and slash the public service bill as far as they can, and try and ease their fiscal position that way ( although its going to be a long hard road).... if they have some success I think they'd prefer to a situation where wastage is flushed out of the system, and some sensible tax cuts put in place to stimulate growth a little (one cancelling out the other).... once the economy starts growing strongly its only then that I think rates will rise.... I reckon we have another at least 12 months of this recession to go... or looked at another way perhaps two to three years of weak growth/recession... ie we could stop shrinking in 2010... but won't grow significantly until quite a little while after that..... Cameron will be looking to show falling unemployment for a year, improving government finances and some tax cuts before he faces the voters... and ideally (which he just may get) he'd also like the beginings of some house price growth and still have relatively low mortgage rates (sub-5%).... all possible within five years

+1

Pretty much the scenario I see playing out. Watch the movement of money into growth not income.

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no, one of my customers been to the bank today. he has a business loan and top credit.... base +2.5%, plus fees.

normal business loans now base+5-7% and if you are not whiter than white its base+10%plus.

banker also said loans to private customers for house purchase are being reduuced and criteria still being tightened with the plan to be at 3*income the norm by 2010.

the banker said it was a return to normality and that rates would be rising as well as their margins soon enough.

the logic was that an immediate pull to 3* income would cause houses to crash very quickly, they would rather see the decline controlled....by them of course....

You have been warned.

Good job the banking mafia isn't running the country...

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Good job the banking mafia isn't running the country...

are you tocking to me?

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