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spyguy

Fed To Start Raisng Irs In April 2015

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Interest rises are inevitable.

The question is how soon and how much.

I would be surprised if there is not a US rate rise within 2015 which means the BoE will follow as it has no choice.

The historical pattern is that once interest rate rises start then they rise quicker and steeper then people expect because their purpose, to choke off inflation bubbles, doesn't work when footling around with quarter percent blips.

These will then drop back down to a "normal" level (anywhere from 3% - 6% depending who you believe) but a rapid "spike" is highly likely.

IMO the US will delay their rise as much as they can, so November 2015 is my guess.

If you're looking at buying a house (as I am) the spike will be unmistakable and then you can start assembling your funds or deposit, but the bottom will last for years and there will be some price stickiness at first so give it at least six months post-spike before seriously looking, ignore the "don't miss the boat" rhetoric of the VIs, that boat will be beached for at least a couple of years.

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Interest rises are inevitable.

The question is how soon and how much.

I would be surprised if there is not a US rate rise within 2015 which means the BoE will follow as it has no choice.

The historical pattern is that once interest rate rises start then they rise quicker and steeper then people expect because their purpose, to choke off inflation bubbles, doesn't work when footling around with quarter percent blips.

These will then drop back down to a "normal" level (anywhere from 3% - 6% depending who you believe) but a rapid "spike" is highly likely.

IMO the US will delay their rise as much as they can, so November 2015 is my guess.

If you're looking at buying a house (as I am) the spike will be unmistakable and then you can start assembling your funds or deposit, but the bottom will last for years and there will be some price stickiness at first so give it at least six months post-spike before seriously looking, ignore the "don't miss the boat" rhetoric of the VIs, that boat will be beached for at least a couple of years.

No, I think the Fed board are being clear as they can - IRs rise 6 months after bond buybacks, which are due to stop this autumn.

The Fed is much more transparent, demographic and diverse - ideology, skill and geographically - than the BoE, which is just a small clique of idiot-economists in London.

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Interest rises are inevitable.

The question is how soon and how much.

What is also inevitable is when the fed raise the Boe raises.

There seems to be no independent BoE.

And, do you think the fed gives 2 toots about the British housing market ?

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What is also inevitable is when the fed raise the Boe raises.

There seems to be no independent BoE.

And, do you think the fed gives 2 toots about the British housing market ?

Neither do the Boe, not directly.

They are concerned about not looking like a bunc of cretins.

Too late.

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There's been a 'Fed/BOE/ECB to start raising rates in 6 months to a year' thread started roughly every month..

I'm sure it'll happen, just after public and private debt levels drop sufficiently.

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There's been a 'Fed/BOE/ECB to start raising rates in 6 months to a year' thread started roughly every month..

I'm sure it'll happen, just after public and private debt levels drop sufficiently.

Possibly. Not by me.

You can hold me to this one.

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Sell off of cable has begun now that strong resistance has been broken. Some are now targeting 1.64 then 1.63.

None of this will force BoE hand though/

Edited by aSecureTenant

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It's irrelevant.

So few properties actually have debt now - and so few of the ones that do are on trackers - I can't see it making a lot of difference.

It'll be quite depressing to watch the few poor bstards, who scraped together 5% and had to take the worst possible lending rate available, get mugged again as they are the only ones it'll impact.

Boomers will just buy the assets up with cash and rent them back.

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It's irrelevant.

So few properties actually have debt now - and so few of the ones that do are on trackers - I can't see it making a lot of difference.

It'll be quite depressing to watch the few poor bstards, who scraped together 5% and had to take the worst possible lending rate available, get mugged again as they are the only ones it'll impact.

Boomers will just buy the assets up with cash and rent them back.

:lol::lol:

The boomers have already bought all the houses, now they get to take their hit so the banks can lend again.

Edited by dances with sheeple

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It's irrelevant.

So few properties actually have debt now - and so few of the ones that do are on trackers - I can't see it making a lot of difference.

It'll be quite depressing to watch the few poor bstards, who scraped together 5% and had to take the worst possible lending rate available, get mugged again as they are the only ones it'll impact.

Boomers will just buy the assets up with cash and rent them back.

Do what? There isn't that sort of personal cash laying around, and everybody I know with a house has a mortgage on it. And it's notjust trackers, SVRs will clearly move as well.

The difference certainly is made:

- to buyers no more easily-affordable mortgages on offer, renting is much cheaper, etc.

- to mortgage payers - I only knwo a minority who have been paying down, most have been seeing it as free money. Suddenly the house becomes a major cost, forget any thought of upsizing, consider downsizing

It will make a vast difference.

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Forewarned is forearmed and it is in my opinion that the BoE should grab the bull by the horns and start to raise the base rate NOW or at least before the USofA do so. This should boost confidence in sterling and lessen the interest rate shock coming.

I'd like to see 2-2.5% getting there in 0.5% increments. (Most new trackers are at 2-3% above base now anyway).

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Forewarned is forearmed and it is in my opinion that the BoE should grab the bull by the horns and start to raise the base rate NOW or at least before the USofA do so. This should boost confidence in sterling and lessen the interest rate shock coming.

I'd like to see 2-2.5% getting there in 0.5% increments. (Most new trackers are at 2-3% above base now anyway).

I detect a teensy weensy problem with that plan, no nothing to do with Max Clifford but:

Lurch himself:

OB-VM156_carney_E_20121127080612.jpg

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Forewarned is forearmed and it is in my opinion that the BoE should grab the bull by the horns and start to raise the base rate NOW or at least before the USofA do so. This should boost confidence in sterling and lessen the interest rate shock coming.

I'd like to see 2-2.5% getting there in 0.5% increments. (Most new trackers are at 2-3% above base now anyway).

Mortgage rates at 6% are going to wipe a lot of people off the checkers board?

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Do what? There isn't that sort of personal cash laying around, and everybody I know with a house has a mortgage on it. And it's notjust trackers, SVRs will clearly move as well.

The difference certainly is made:

- to buyers no more easily-affordable mortgages on offer, renting is much cheaper, etc.

- to mortgage payers - I only knwo a minority who have been paying down, most have been seeing it as free money. Suddenly the house becomes a major cost, forget any thought of upsizing, consider downsizing

It will make a vast difference.

Hopefully a big sell off will get rolling soon, that is needed to shake out all the idiots who gambled and lost.

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Hopefully a big sell off will get rolling soon, that is needed to shake out all the idiots who gambled and lost.

Well yes, but I question the "soon". It won't be this year and will only start next IMO. I thought I was buying 2015 but that's now gone back to 2016. I need to call it ahead as I've got lots of three year / five year stuff so I have to start taking some of that as it matures rather than rolling it.

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Mortgage rates at 6% are going to wipe a lot of people off the checkers board?

No questions about that.

Hopefully a big sell off will get rolling soon, that is needed to shake out all the idiots who gambled and lost.

+1

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If you have any spare funds that can be reinvested then if interest rates spike that is the time to lock them in at a high rate :)

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