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frugalista

Interest Rate Policy Cannot Stop The Crash

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A few weeks back, before the 0.25% cut, I started a thread called "Why Interest Rates Cannot Now Stop the Crash":

http://www.housepricecrash.co.uk/forum/ind...topic=11924&hl=

My central point was that Bank of England interest rate cuts would not be followed by cuts from the mortgage lenders, since they are probably going into damage limitation mode. It seems that this may be true:

http://news.bbc.co.uk/1/hi/business/4155604.stm

frugalista

edit: grammar

Edited by frugalista

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"Why Interest Rates Cannot Now Stop the Crash":

Indeed.

The cut in rates has done nothing for mortgagees,

and inflation has increased to 2.3 %.

Household costs have risen sharply. (The CPI hides most of them).

Debt is biting and the building societies have stolen the rate drop.

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Bankers looking after their mates in the banks - notice how all the banks dropped their savings rates well before the MPC had their little meeting to deicde rates - how does that work then?

The banks will no doubt try and go on another lending binge.

Screw the economy and look after your friends - a pattern quite evident over the last few years.

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A great example of media spin. I have seen a few headlines a long the lines of "housing market revived by rate cut", yet half the banks havnt cut their rates...hmmm...

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Guest Charlie The Tramp

Now come on be fair.

Someone has got to pay for the defaulters and that won`t come from their profits, after all they are in business. :rolleyes:

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A few weeks back, before the 0.25% cut, I started a thread called "Why Interest Rates Cannot Now Stop the Crash":

http://www.housepricecrash.co.uk/forum/ind...topic=11924&hl=

My central point was that Bank of England interest rate cuts would not be followed by cuts from the mortgage lenders, since they are probably going into damage limitation mode. It seems that this may be true:

http://news.bbc.co.uk/1/hi/business/4155604.stm

frugalista

edit: grammar

And not too many people are going to be borrowing for a declining asset. And not too many people will be in a position to borrow if house prices decline. Seems like a right mess is on the way.

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  • 302 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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