Jump to content
House Price Crash Forum
Sign in to follow this  
Fairyland

Interest Rate Sentiment Change ?

Recommended Posts

What is going on ?

This (Express) : Interest rate hike more likely as inflation hits 15 month high

Inflation increased by more than expected to 0.5 per cent in the year to March, as measured by the Consumer Prices Index (CPI), according to the Office for National Statistics (ONS).


It means that a typical basket of goods and services that cost £100 a year ago would be priced at £100.50 today.

The expectation of a rate hike caused the pound to strengthen against other currencies today.

This(Bloomberg): Blaming Draghi Finally Unites Merkel's Fractious Coalition

German Chancellor Angela Merkel’s fractious coalition partners can at last agree on one thing: it’s all Mario Draghi’s fault.

After months of bickering over refugees, the three coalition parties are taking advantage of a lull in the crisis to address widening alarm over dwindling pensions and savings. That’s translated into a slew of criticism of the record-low interest rates set by the European Central Bank under Draghi.

And this(Reuters): ECB policy causing 'extraordinary problems', says Germany's Schaeuble

The European Central Bank's record low interest rates are causing "extraordinary problems" for German banks and pensioners and risk undermining voters' support for European integration, Finance Minister Wolfgang Schaeuble told Reuters.

But the veteran minister said it would be wrong to blame the ECB entirely for this situation, stressing that central banks alone should not be relied on to restore economic growth and calling instead for Europe to press on with structural reforms.

Politicians from Chancellor Angela Merkel conservative camp, to which the finance minister belongs, have complained the ECB's ultra-low rates are creating a "gaping hole" in savers' finances and pensioners' retirement plans as returns have dropped.

Schaeuble suggested they risked fuelling the rise of euroscepticism in Germany, where voters flocked to the right-wing Alternative for Germany in state elections last month.

"It is undisputable that the policy of low interest rates is causing extraordinary problems for the banks and the whole financial sector in Germany," said the 73-year-old. "That also applies for retirement provisions."

Edited by Fairyland

Share this post


Link to post
Share on other sites

What is going on ?

The next phase of "We're gonna raise, we're gonna raise, I'm telling you we're gonna raise.....OK someone farted in Tibet......we may not raise, but we might........OK we're not raising rates. We're not sure what that Tibetan fart means for the global economy".

Or something similar.

Share this post


Link to post
Share on other sites

Wild guess. German pensioners have been thrifty for 30 years or more. Don't have benefit of massive gains via HPI like our pensioners. They depend more on their savings generating income. Given ecb policy, they are starting to feel the pain.

Hence their leaders now making noises re. Rate hikes.

German leaders tend to get their way in the end in the EU.

Interesting times.....pardon the pun.

Share this post


Link to post
Share on other sites

Talking about it they hope gives the right effect as doing it, when they won't do it....strengthening the pound that is...been doing this for ages now, crying wolf.

Share this post


Link to post
Share on other sites

I don't trade UK or European rates, but I've a Long Sept'16 / Short Sept'17 Eurodollar futures spread on. In English, this is a bet that sometime in the next 6 months there will be a strengthening of the expectation that a US rate hike will happen sometime in the next 18 months. ( or that a surprise rate hike does actually happen in the next 6 months )

It's barely moved in the last few weeks - just a smidge stronger right now, but within the bounds of "noise", so no real sign of a hike yet, at least in the US.

I'll be holding the position until August, or until it jumps on interest rate expectations, in which case I'll post here that things may be happening.

Edited by ManVsRecession

Share this post


Link to post
Share on other sites

Are we STILL wondering about rate rises? Really???

Too funny.

I can see what the OP is getting at, there's been a few things in the MSM in the last week about the problems low IRs are causing.

It's probably more a case of the MSM editors have now realise the problems/implications/outright fraud and are starting to make waves rather than any change in government policy.

Share this post


Link to post
Share on other sites

Rates have been low for so long that the mindset is set. Any change will cause a recession.

Probably talk is all that is left. The only way any tightening will occur is if their is a cataclysmic event.

Share this post


Link to post
Share on other sites

Rates have been low for so long that the mindset is set. Any change will cause a recession.

Probably talk is all that is left. The only way any tightening will occur is if when their is a cataclysmic event.

It is inevitable now

Share this post


Link to post
Share on other sites

I guess it will be all OK .... unless the debt problem has been caused by ultra-low interest rates and can not be solved by raising interest rates.

Carney and his mates could just talk about raising rates, collect their cash and hopefully string it out until they retire while hoping something else will come and fix it all for them ... a war or recession in USA and China would let them off the hook. Until then the addict needs the fix of more and more free money/debt.

Indeed, looks like Carney might serve his time and have done absolutely nothing, we may as well get chimps to sit on the committee and pay them peanuts to do nothing.

Interest rate rises look very unlikely in the near term, CPI is likely to trend down during the summer, housing activity is falling off a cliff and probably GDP with it following the manic boost Osbo gave to the Market by announcing tax changes but not implementing them immediately, what a tosser.

Edited by crashmonitor

Share this post


Link to post
Share on other sites

Rates have been low for so long that the mindset is set. Any change will cause a recession.

Probably talk is all that is left. The only way any tightening will occur is if their is a cataclysmic event.

Would London HPI count as cataclysmic effect? Oh, but can we raise IR before the US???

Share this post


Link to post
Share on other sites
Guest BillyNI

Carney and his mates could just talk about raising rates, collect their cash and hopefully string it out until they retire while hoping something else will come and fix it all for them ... a war or recession in USA and China would let them off the hook. Until then the addict needs the fix of more and more free money/debt.

This I feel it the approach of all our leaders. Take what we can get, make sure we are sorted, fûck the rest of them.

Share this post


Link to post
Share on other sites

Rates have been low for so long that the mindset is set. Any change will cause a recession.

Probably talk is all that is left. The only way any tightening will occur is if their is a cataclysmic event.

I agree. The next couple of generations are going to pay severely for this period of quantitative pleasing... the tightening will come, many things are already at breaking point. Countries even. But it won't happen casually.

More importantly for TPTB, socially... there is a growing discontentment. I know I sense it, I know other people sense it. It is an inequality problem that was always there, but is now in the spotlight more than ever. This could lead to bigger changes, land taxes, the decline of the global debt serfdom. There are only so many times you can poke the little guy before he lunges at you, and you won't be expecting it. Nobody will see it coming.

Share this post


Link to post
Share on other sites

I thought there were mkts people on here.

Mkt says late 2019 before 1st rise. 2020 in Japan and Eurozone.

Late this year for US but being pushed back and back.

Share this post


Link to post
Share on other sites

I thought there were mkts people on here.

Mkt says late 2019 before 1st rise. 2020 in Japan and Eurozone.

Late this year for US but being pushed back and back.

AKA....NEVER !!!!

Share this post


Link to post
Share on other sites

I agree. The next couple of generations are going to pay severely for this period of quantitative pleasing... the tightening will come, many things are already at breaking point. Countries even. But it won't happen casually.

More importantly for TPTB, socially... there is a growing discontentment. I know I sense it, I know other people sense it. It is an inequality problem that was always there, but is now in the spotlight more than ever. This could lead to bigger changes, land taxes, the decline of the global debt serfdom. There are only so many times you can poke the little guy before he lunges at you, and you won't be expecting it. Nobody will see it coming.

Whilst you might be right there is a growing sense of discontentment, most people will always direct their discontent in the exact direction they are told to by their beloved televisions and newspapers. At the moment it appears to be the in thing to casually abuse immigrants and people on reciept of benefits (chavs I believe they are calling them - charming) as well as travellers (gypos). Basically anyone who isn't taking on a shedload of DEBT.

I don't believe the average Joe is able to join the dots which is why this website will always be an echo chamber. The amount of knowledge on here is staggering but it is all kept nicely contained within a fringe website. We should create some simple MEMEs and start posting them up on any random forums we all frequent, get people joining the dots!!

Share this post


Link to post
Share on other sites

I can see what the OP is getting at, there's been a few things in the MSM in the last week about the problems low IRs are causing.

It's probably more a case of the MSM editors have now realise the problems/implications/outright fraud and are starting to make waves rather than any change in government policy.

And the compound growth problem of interest rates higher than growth is ignored.

Share this post


Link to post
Share on other sites

I thought there were mkts people on here.

Mkt says late 2019 before 1st rise. 2020 in Japan and Eurozone.

Late this year for US but being pushed back and back.

Rates have no reason to rise as long as prices/growth/income/assets are falling...... ;)

Share this post


Link to post
Share on other sites
We should create some simple MEMEs and start posting them up on any random forums we all frequent, get people joining the dots!!

My immediate reaction was that this is a great idea, but I'm struggling to come up with any concepts that are easy to get across to the masses. The reason why we are a fringe website is because of the level of knowledge on here; if everyone could understand why things are wrong I suspect HPC as a website might not exist.

This is not a criticism, more a request for suggestions of what could be easy to put into meme form. Perhaps an idea for a new thread?

I suspect with a little prompting collectively we could come up with a few to start the ball rolling.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • Next General Election   93 members have voted

    1. 1. When do you predict the next general election will be held?


      • 2019
      • 2020
      • 2021
      • 2022

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.