Trigger Happy Posted June 26, 2010 Share Posted June 26, 2010 It appears that the current consensus is for bank of england base ratesto start rising by the end of the year. Do you think this is still the most likely scenario given the budget? Quote Link to comment Share on other sites More sharing options...
nohpc Posted June 26, 2010 Share Posted June 26, 2010 It appears that the current consensus is for bank of england base ratesto start rising by the end of the year. Do you think this is still the most likely scenario given the budget? No I don't. America is now the only country anti-austerity. The eurozone and the UK are just beginning to embrace the idea. Low rates will be required for some time. Quote Link to comment Share on other sites More sharing options...
blue skies Posted June 26, 2010 Share Posted June 26, 2010 Banks should help on home loans By Niamh Hennessy Saturday, June 26, 2010 IF the Government and banks do nothing to help the 30,000 house owners who are having serious difficulties paying their mortgage it could cost more in the long run. Ads by Google Low Doc Loans Bank says No. We say Yes We Approve When Other Lenders Don't FreedomLoans.com.au/LowDocHomeLoans Bad Credit Personal Loan Struggling with debts? Bad credit loans with 15min approval. DebtRelief.com.au GE Money Personal Loans Stay in Control - Fixed Repayments To Suit Your Budget. Apply Now! www.GEMoney.com.au Bad Credit Personal Loans Over 10k in debt? Repair bad credit reduce debt & lower repayments now Australian-Debt-Reduction.com.au This is according to brokers and support groups who yesterday urged the Government to listen to the advice of the International Monetary Fund (IMF) and put a scheme in place to assist homeowners in arrears. In a review of Ireland, the IMF, which oversees the global financial system, said now that the banks have more capital they could absorb the initial costs of some form of assistance for those who are finding it difficult to pay their mortgage. Director general of the Free Legal Advice Centre (FLAC), Noeline Blackwell, said a lot of people can’t manage their mortgage payments and they are not getting the support they need. She said very little has been done to help the 30,000 people in "serious arrears" with their mortgages. "It is people who are unfortunate enough to be in real trouble because they bought homes at the height of the property boom when they were told it wasn’t the height. "The fact that personal debt is at a very serious level in Ireland has not yet been addressed by the state and it’s not enough to have good intentions about that, real efforts have to be put in place to do that now," she said. Karl Deeter, of Irish Mortgage Brokers, said that every scheme has a cost and doing nothing for homeowners in trouble could end up costing more in the longer term. "There is a problem and we need to deal with it," he said. "What the IMF are doing is pointing out something that we have known for quite a while now," he added. Some of the proposals that Mr Deeter said the Government or banks could consider would be a sale and rent buy-back scheme or negative equity loans. This week the IMF said the transfer of loans to NAMA and the revised capital ratios imposed by the Financial Regulator had moved the banks towards normalcy, adding that a scheme to assist homeowners in difficulty is overdue. It said "narrowly targeted support measures for vulnerable homeowners would limit the economic and social fallout of the crisis". The IMF said that "with their bolstered capital, banks could absorb the initial costs, perhaps basing themselves on the welfare system to identify eligible beneficiaries". Read more: http://www.examiner.ie/business/banks-should-help-on-home-loans-123463.html#ixzz0rxI0hCq9 Quote Link to comment Share on other sites More sharing options...
Bam Posted June 26, 2010 Share Posted June 26, 2010 I think we'll see them rise when the LIBOR rate drops signifcantly more as the banks balance sheets improve Quote Link to comment Share on other sites More sharing options...
Cicero Posted June 26, 2010 Share Posted June 26, 2010 The PTB shall endeavour to keep rates as low as possible. Anything else might bring on a riot or two. Quote Link to comment Share on other sites More sharing options...
ingermany Posted June 26, 2010 Share Posted June 26, 2010 Banks should help on home loans Actually banks should offer a service to depositors and borrowers in such a way that they make an aggregate profit for their shareholders. It was a big mistake to make banks an arm of the welfare and benefits system. Quote Link to comment Share on other sites More sharing options...
InternationalRockSuperstar Posted June 26, 2010 Share Posted June 26, 2010 it may never rise. Quote Link to comment Share on other sites More sharing options...
bear call spread Posted June 26, 2010 Share Posted June 26, 2010 It appears that the current consensus is for bank of england base ratesto start rising by the end of the year. Do you think this is still the most likely scenario given the budget? Personally can not see them changing significantly over the next couple of years (and personally hoping they do not) Quote Link to comment Share on other sites More sharing options...
lets get it right Posted June 26, 2010 Share Posted June 26, 2010 Banks are working on massive margins at the moment - to rebuild their balance sheets. BOE base rate seems completely disconnected. Looks to me like it could rise to 2% without affecting rates pay to savers and charge borrowers. Quote Link to comment Share on other sites More sharing options...
Guest spp Posted June 26, 2010 Share Posted June 26, 2010 A good chance the U.S will print just another few trillion over the next few months. The Ponzi must go on! Quote Link to comment Share on other sites More sharing options...
Wol Posted June 26, 2010 Share Posted June 26, 2010 1% 1Q11 rising to 1.5% end of 2011, as modelled by two of the larger IBs. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted June 26, 2010 Share Posted June 26, 2010 I think we'll see them rise when the LIBOR rate drops signifcantly more as the banks balance sheets improve I would agree base rates won't be going anywhere soon. The banks can't survive with a higher base rate because it would collapse the financial system. The only way base rates can move up now is at 0.05% increases. So we would end up with a base rate of 0.55%. Quote Link to comment Share on other sites More sharing options...
catmandu Posted June 26, 2010 Share Posted June 26, 2010 I think it's still likely to see a rate rise. Given that it is currently at a record low for over a year, a rise need not be considered particularly risky in and as of itself. The only real impact of a small rise will be that people (and banks) start thinking that rates are going to be headed up and start budgeting for it, i.e. the psychological impact is what will make a difference. Having said that, Cameron was clear this week that he wanted low rates and the BoE still voted almost unanimously for that to happen. Quote Link to comment Share on other sites More sharing options...
Pent Up Posted June 26, 2010 Share Posted June 26, 2010 in the next few months. IMO. Quote Link to comment Share on other sites More sharing options...
dpg50000 Posted June 26, 2010 Share Posted June 26, 2010 <snip> This is according to brokers and support groups who yesterday urged the Government to listen to the advice of the International Monetary Fund (IMF) and put a scheme in place to assist homeowners in arrears. In a review of Ireland, the IMF, which oversees the global financial system, said now that the banks have more capital they could absorb the initial costs of some form of assistance for those who are finding it difficult to pay their mortgage. <snip> FFS - when will the MSM realise? People who have a mortgage are not homeowners. Those who have paid the mortgage off are. Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted June 26, 2010 Share Posted June 26, 2010 When the wind turns... when hobbits are no more... Quote Link to comment Share on other sites More sharing options...
Liquid Goldfish Posted June 26, 2010 Share Posted June 26, 2010 2030 Quote Link to comment Share on other sites More sharing options...
RufflesTheGuineaPig Posted June 26, 2010 Share Posted June 26, 2010 I fear not for a long time, however it doesn't matter. The BoE doesn't set rates anymore... the banks do. Quote Link to comment Share on other sites More sharing options...
plummet expert Posted June 26, 2010 Share Posted June 26, 2010 (edited) Banks are working on massive margins at the moment - to rebuild their balance sheets. BOE base rate seems completely disconnected. Looks to me like it could rise to 2% without affecting rates pay to savers and charge borrowers. Correct! It's the biggest fraud against savers in history. The banks make more money from mortgages than at any time since their inception. Many mortgages simply have not benefited in any proportionate way from the current base rate. It is not actually assisting anyone except tracker mortgage holders and banks themselves. It is the wrong policy! The base rate function to control inflation etc will not have much effect, if indeed it is needed in the nearterm, until it rises above 4%. The banks variable rates are creeping up anyway. Greedy banks! The Boe say that current inflation is a passing problem. Deflation and then inflation I suspect. Edited June 26, 2010 by plummet expert Quote Link to comment Share on other sites More sharing options...
non frog Posted June 26, 2010 Share Posted June 26, 2010 Correct! It's the biggest fraud against savers in history. The banks make more money from mortgages than at any time since their inception. ..... Banks don't need (or want) savers any more. They want savers to buy a house and borrow to do it. If you have a nice big deposit that you are stupid enough to turn into an even bigger loan the banks will love you. Your debt is their (taxpayer guaranteed) wealth. Quote Link to comment Share on other sites More sharing options...
quinnbear Posted June 26, 2010 Share Posted June 26, 2010 Correct! It's the biggest fraud against savers in history. The banks make more money from mortgages than at any time since their inception. Many mortgages simply have not benefited in any proportionate way from the current base rate. It is not actually assisting anyone except tracker mortgage holders and banks themselves. It is the wrong policy! Yes, and I am sure that if the BoE rate did go up the banks would waste no time in raising their rates, because obviously they would need to as a result of the base rate rise! I'm sure I saw in a documentary that at the height of the boom the differential between BR and lending rate was 0.5-0.75% in some cases, and it was the volume of transactions that was making the money for the banks (credit - pile it high, sell it cheap!). Now of course the sales volume has fallen away, the banks are in the sh*t and we have a difference of 4% between base rate and lending rate. Of course, the difference between base rate and savings rate is another matter entirely. :angry: It feels like everything depends on the low rates staying. Of course, Japan had low rates for quite a long time (!) and their property prices still fell... QB Quote Link to comment Share on other sites More sharing options...
Liquid Goldfish Posted June 26, 2010 Share Posted June 26, 2010 Of course, the difference between base rate and savings rate is another matter entirely. :angry: many savings rates are actually pretty high compared to the BR, historically speaking they're just low compared to inflation Quote Link to comment Share on other sites More sharing options...
Once in a lifetime Posted June 26, 2010 Share Posted June 26, 2010 ... Quote Link to comment Share on other sites More sharing options...
LetsGetReadyToTumble Posted June 26, 2010 Share Posted June 26, 2010 Any economists around here? Why in normal times do rates have to be in the region of 5%? What are the driving forces that require these higher rates? When are those forces likely to activate? Quote Link to comment Share on other sites More sharing options...
Bam Posted June 27, 2010 Share Posted June 27, 2010 Yes, and I am sure that if the BoE rate did go up the banks would waste no time in raising their rates, because obviously they would need to as a result of the base rate rise! I'm sure I saw in a documentary that at the height of the boom the differential between BR and lending rate was 0.5-0.75% in some cases, and it was the volume of transactions that was making the money for the banks (credit - pile it high, sell it cheap!). Now of course the sales volume has fallen away, the banks are in the sh*t and we have a difference of 4% between base rate and lending rate. Of course, the difference between base rate and savings rate is another matter entirely. :angry: It feels like everything depends on the low rates staying. Of course, Japan had low rates for quite a long time (!) and their property prices still fell... QB I personally think that when the base rate goes up, the LIBOR rate and rate at which banks are lending will have come down. The base rate willl go up when transaction numbers go up but at the same time competition between the banks will have increased cause a net change of nil Quote Link to comment Share on other sites More sharing options...
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