Era of Falling U.K. Mortgage Costs May Be at an End - Bloomberg

[Zzzzzzzzzzzzzzzzzzzzzzzzzz]

http://www.bloomberg.com/news/articles/2016-11-14/era-of-falling-u-k-mortgage-costs-may-be-at-an-end

Edited November 14, 2016 by gruffydd

[stormymonday_2011]

4 hours ago, gruffydd said:

http://www.bloomberg.com/news/articles/2016-11-14/era-of-falling-u-k-mortgage-costs-may-be-at-an-end

So Carney may soon be shown to have been p*ssing in the wind with regard to the BOE controlling borrowing costs.

[rantnrave]

1 hour ago, stormymonday_2011 said:

So Carney may soon be shown to have been p*ssing in the wind with regard to the BOE controlling borrowing costs.

Yep. Effects of cut to 0.25% cancelled out...

Unless of course you're a saver...

[btd1981]

Excuse my ignorance, but I thought this might boost savings rates too? If libor increases inter-bank borrowing rates, won't they want to attract deposits?

[TheCountOfNowhere]

No one mentions the savers.

 

[darkmarket]

This trend is worth watching, along with the yields on Gilts it looks like the BoE are losing control of the economy.

[rantnrave]

8 minutes ago, btd1981 said:

Excuse my ignorance, but I thought this might boost savings rates too? If libor increases inter-bank borrowing rates, won't they want to attract deposits?

The Funding for Lending Scheme and other such wheezes introduced recently ensure that banks have access to all the funding they need. The only reason IMO, why banks have savings accounts is to get the personal details to push loans to people. Any savings account paying above 1% has strings attached - another way to raise funds when people fall foul of the conditions.

[TheCountOfNowhere]

10 minutes ago, rantnrave said:

The Funding for Lending Scheme and other such wheezes introduced recently ensure that banks have access to all the funding they need. The only reason IMO, why banks have savings accounts is to get the personal details to push loans to people. Any savings account paying above 1% has strings attached - another way to raise funds when people fall foul of the conditions.

Which in itself should be criminal.  The bankers are basically doing a Zimbabwe on us and no one has realised.

I dont think house prices will collapse now, we'll be a currency collapse and all hell will break loose instead. The thieving bankers will stop at nothing.

After that, who knows.

Someone said in 2007/2008 the government will not let house prices collapse and would do anything to support them.  Sadly, they were right and we will all pay the price.

 

[doomed]

15 minutes ago, TheCountOfNowhere said:

Which in itself should be criminal.  The bankers are basically doing a Zimbabwe on us and no one has realised.

I dont think house prices will collapse now, we'll be a currency collapse and all hell will break loose instead. The thieving bankers will stop at nothing.

After that, who knows.

Someone said in 2007/2008 the government will not let house prices collapse and would do anything to support them.  Sadly, they were right and we will all pay the price.

 

I have been convinced of this for a while, they will not abandon their policies voluntarily.

[rantnrave]

2 minutes ago, doomed said:

I have been convinced of this for a while, they will not abandon their policies voluntarily.

Demographics are key in a democracy though. Brexit and Trump are sending the message that people are restless with the economic hand TPTB have dealt them

[durhamborn]

33 minutes ago, TheCountOfNowhere said:

Which in itself should be criminal.  The bankers are basically doing a Zimbabwe on us and no one has realised.

I dont think house prices will collapse now, we'll be a currency collapse and all hell will break loose instead. The thieving bankers will stop at nothing.

After that, who knows.

Someone said in 2007/2008 the government will not let house prices collapse and would do anything to support them.  Sadly, they were right and we will all pay the price.

 

Its one or the other count i think.Interest rates are pushing up everywhere.The miners have been in a bull market since January,usually a big pointer to coming inflation.They would be going up here now if it wasnt for the criminal communist funding for lending scheme.I topped up my gold mining shares yesterday after a big correction as insurance.If the Trump does increase spending heavily as looks certain,the FED might be able to tighten three or four times over the next two years,that might finally break the back here as well.Lets hope so.Feels like a crossroads now at least.

 

[darkmarket]

23 minutes ago, doomed said:

I have been convinced of this for a while, they will not abandon their policies voluntarily.

They may not abandon their policies at all, but they'll cease to have the impact they've had.

There are increasing signs that things are moving beyond their control. America looks set to export inflation and a strong dollar would add pressure to the weak pound, interbank lending is perilous as we see here and government borrowing costs are spiking. All strong indicators the house of cards is under serious pressure. As the Count says, the only way house prices collapse is if the UK collapses. And to add, the only way the UK actually grows is if property collapses.

Similar to durhamborn's point above, if Trump breaks everything by maxing out US debt to keep coal mines open in the midwest and build walls, it'd be quite the unexpected end to this sad story. But even if congress restricts his plans, there are plenty of smaller dominoes teetering.

[zugzwang]

39 minutes ago, darkmarket said:

This trend is worth watching, along with the yields on Gilts it looks like the BoE are losing control of the economy.

Successive govts and the Bank have had nearly a decade to reform the UK economy and put it on a sustainable debt trajectory. They chose instead to pursue a disastrous high-risk Keynesian strategy of deficit consumption, money printing and hpi.  The markets will put up with that kind of thing only so long before they make you a bystander.

[mh0703]

24 minutes ago, durhamborn said:

Its one or the other count i think.Interest rates are pushing up everywhere.The miners have been in a bull market since January,usually a big pointer to coming inflation.They would be going up here now if it wasnt for the criminal communist funding for lending scheme.I topped up my gold mining shares yesterday after a big correction as insurance.If the Trump does increase spending heavily as looks certain,the FED might be able to tighten three or four times over the next two years,that might finally break the back here as well.Lets hope so.Feels like a crossroads now at least.

 

Sorry, just a quick question, which gold mining shares did you go for? I have my eye on Centamin, looks good value but I'm no expert.

[darkmarket]

4 minutes ago, zugzwang said:

deficit consumption, money printing and hpi

I'd just add private credit and a noose made of financial services, and that's the cross-party consensus UK economic strategy.

The markets do indeed seem to finding better options at last.

[winkie]

The lower the rates went the higher the prices went......as high a price that can be realistically supported by incomes.......when rates rise, prices will fall, to fall in line with money available in the economy to support it...people with savings will no longer feel the need to buy more than they need, when prices falling, with taxes, rents and interest rising.....;)

[durhamborn]

2 minutes ago, zugzwang said:

Successive govts and the Bank have had nearly a decade to reform the UK economy and put it on a sustainable debt trajectory. They chose instead to pursue a disastrous high-risk Keynesian strategy of deficit consumption, money printing and hpi.  The markets will put up with that kind of thing only so long before they make you a bystander.

If you go back over many cycles whats happening now would point to inflation,weakening $ and as darkmarket says the US exporting inflation.That usually sees a huge bull run in emerging markets/commods/PMs because of the inflation expectations.The $ is rising due to interest rate increases the markets sniffs coming,but tightening behind the curve (a huge Trump fiscal curve) usually sees a falling currency.The US has to export inflation,so the $ has to fall.

Like you say our economy should of been put back on track,but they have done zero.The only thing they can do now is follow a Trump example.Frack Lancashire,fiscal spending on infrastructure instead of consumption and let the BOE chase the inflation curve with interest rate increases.The only way to move the BOE is for inflation to overshoot and keep overshooting.That looks like its about to happen.The £ needs to track the $ lower in tandem or we are stuffed.

[durhamborn]

11 minutes ago, mh0703 said:

Sorry, just a quick question, which gold mining shares did you go for? I have my eye on Centamin, looks good value but I'm no expert.

I buy the exchange traded funds,GDX for the big gold miners,GDXJ the junior ones (much more risk but outperform in a bull market) and for silver i buy SIL.

I havent bought any more SIL but i bought GDX yesterday.I prefer the funds because i use it as a hedge on gold itself.Iv used GDX and GDXJ for many years.Deflation cripples them of course,but as an inflation (and currency) hedge there is nothing better.Both GDX and GDXJ have London listings as well. 

Edited November 15, 2016 by durhamborn

[spyguy]

Higher mortgage is the least of he UK problems.

Its higher costs of funding and rolling over government debt.

Its likely, that, going forward, people will really understand how much Bronw fcked up and how useless Gidiot was in putting a stop to it.

[mh0703]

Thank you for the reply DurhamBorn! 

[Wayward]

12 hours ago, stormymonday_2011 said:

So Carney may soon be shown to have been p*ssing in the wind with regard to the BOE controlling borrowing costs.

Anyone old enough to remember the 1980s will know that the BOE can easily lose control of the cost of borrowing.  They have been quite good at nurturing a myth that they are in control...pure make believe.  It is only a matter of time before matters spin out of control...they know this but just hope it doesn't happen on their watch.... 

[Errol]

2 hours ago, mh0703 said:

Sorry, just a quick question, which gold mining shares did you go for? I have my eye on Centamin, looks good value but I'm no expert.

GDX and GDXJ etfs are a good starting point.

[spyguy]

4 hours ago, darkmarket said:

This trend is worth watching, along with the yields on Gilts it looks like the BoE are losing control of the economy.

Did they ever have more than a shortterm, token control anyhow?

[kidgorgeous]

Quick question. If the fed does start hiking rates. Does the uk have to follow suit at some point? And if they do why? Thanks.

 

[Si1]

4 minutes ago, kidgorgeous said:

Quick question. If the fed does start hiking rates. Does the uk have to follow suit at some point? And if they do why? Thanks.

 

As I understand it, yes, because the UK govt won't be able to borrow money to roll over its existing and new debts otherwise. Additionally, if the value of the pound drops (due to currency flows into dollars) compared to the dollar so that petrol and food prices go through the roof then IRs will have to go up to reduce this effect. Please correct me if necessary

Edited November 15, 2016 by Si1