Gigantic Purple Slug Posted October 12, 2017 Share Posted October 12, 2017 Well IMO what happens now is all noise compared to what happens after brexit or as the negotiations go on. They are pretty much at the lower bound anyway. It's not like pushing it up will give them much more capability to lower if Brexit causes the economy to go down the tubes. Inflation should start to drop as well because of the currency changes. My guess is they will continue to big up the chance of a rise but actually not do anything because it would be pointless. If the economy goes tits up it will be because of brexit, not because of any quarter point rate rise they do or don't do now. Quote Link to comment Share on other sites More sharing options...
jiltedjen Posted October 12, 2017 Share Posted October 12, 2017 i think on November they will give a date when they are raising, but will say its certain and we all need to prepare. Perhaps March as mentioned earlier. Carney knows exactly what the BOA have planned and is reacting accordingly. Would seem strange to suddenly have a meeting where everyone once again votes not to raise, (like every other meeting). And then raise, or does Carney make the ultimate decision?  Quote Link to comment Share on other sites More sharing options...
Venger Posted October 12, 2017 Share Posted October 12, 2017 1 minute ago, Gigantic Purple Slug said: Well IMO what happens now is all noise compared to what happens after brexit or as the negotiations go on. They are pretty much at the lower bound anyway. It's not like pushing it up will give them much more capability to lower if Brexit causes the economy to go down the tubes. Inflation should start to drop as well because of the currency changes. My guess is they will continue to big up the chance of a rise but actually not do anything because it would be pointless. If the economy goes tits up it will be because of brexit, not because of any quarter point rate rise they do or don't do now. Sounds about right to me. They could still nudge them up, but they've jawboned about banks and concern about unsecured lending. Banks are saying they plan to tighten up a bit on unsecured lending in future months (or already beginning to happen), although it only stands at £200Bn (not a lot really) vs x8 that in mortgages, and all the £Trillions in Mad Gainz wealth on owner side (at these current valuations). Some articles point out some consequence of tighter lending.  And you only need a few people to tighten their spending, for it to have knock-on in real economy. Although maybe it will just be a drop in some higher end cars bought. Quote  "Credit scoring criteria for granting both credit card and other unsecured loans were reported to have tightened again in Q3, while the proportion of unsecured credit applications being approved fell significantly." While this is a positive move from the point of view of keeping the financial system protected, a reining in of lending could have an adverse impact upon consumer spending. This may therefore weaken the outlook for inflation, dampening the odds of policy tightening from the Bank of England (BoE) in the near-term.  Quote Tuesday 26 September 2017 British GDP growth has been mainly propped up by household spending since the June 2016 Brexit vote, as investment and net exports have made little contribution. While lower consumer borrowing would help ease regulators’ financial stability concerns, it may also slow the wider economy.  Seems to me it's possible to have a HPC in low-rate environment anyway. All depends on borrowers willingness to borrow (to pay these prices). And banks willingnesss to lend. Any falling prices, may mean a tightening in both, even with low rates and banks now sat on loads of cheap money in their reserves.  Quote Link to comment Share on other sites More sharing options...
oatbake Posted October 12, 2017 Share Posted October 12, 2017 I honestly don't think they have anymore choice. If you believe in "the powers that be" they can make far more money in a cyclical market. There's no way prices will stop going down now.... They might as well bang rates up and get the job done quickly, do they can blame it on Brexit turmoil. I reckon Carney has been given the nod ;-) Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 12, 2017 Author Share Posted October 12, 2017 (edited) 1 hour ago, oatbake said: I honestly don't think they have anymore choice. If you believe in "the powers that be" they can make far more money in a cyclical market. There's no way prices will stop going down now.... They might as well bang rates up and get the job done quickly, do they can blame it on Brexit turmoil. I reckon Carney has been given the nod ;-) The media reports over the last 3/4 months would certainly indicate this. When the collapse comes, they can all say, we told you so months ago etc etc etc. Â I'm amazed it's 50/50 to be honest, that it would be 100/0 Â Edited October 12, 2017 by TheCountOfNowhere Quote Link to comment Share on other sites More sharing options...
whome_yesyou Posted October 12, 2017 Share Posted October 12, 2017 I seriously doubt it, although I naively selected "Maybe, they've taken me in again" because if they do, then it's just correcting the 0.25% cut from Brexit. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 12, 2017 Author Share Posted October 12, 2017 49 minutes ago, whome_yesyou said: I seriously doubt it, although I naively selected "Maybe, they've taken me in again" because if they do, then it's just correcting the 0.25% cut from Brexit. I'm sure the 10s of 1000s of loons who have taken on mortgages at this levels, funded by the magic QE style term funding, to purchase houses at insanely high prices might bit quite see it this way. Â Quote Link to comment Share on other sites More sharing options...
zugzwang Posted October 12, 2017 Share Posted October 12, 2017 3 hours ago, Venger said: Â Seems to me it's possible to have a HPC in low-rate environment anyway. All depends on borrowers willingness to borrow (to pay these prices). And banks willingnesss to lend. Any falling prices, may mean a tightening in both, even with low rates and banks now sat on loads of cheap money in their reserves. Â It's a ZIRP environment for the banks, Venge. Not the mug punters. The mug punters are on the SVR at 4.7%... or worse. Quote Link to comment Share on other sites More sharing options...
Untoward Posted October 12, 2017 Share Posted October 12, 2017 5 hours ago, TheCountOfNowhere said: No one believes them. No one. How is that getting better ? They're openly being mocked. They don't care. They are fleecing us in plain sight. Quote Link to comment Share on other sites More sharing options...
Venger Posted October 12, 2017 Share Posted October 12, 2017 5 minutes ago, zugzwang said: It's a ZIRP environment for the banks, Venge. Not the mug punters. The mug punters are on the SVR at 4.7%... or worse. 12 or so months ago I recall an article setting out there were a high percentage of mortgage borrowers on higher SVRs. I can't go looking for it now to check, - I really should do -  but I get you.  There's many mortgage borrowers on the SVR.  A bit like this but more info http://www.telegraph.co.uk/personal-banking/mortgages/the-great-mortgage-rate-divide-some-pay-099pc-others-are-stuck-o/  It's just I've seen people buy and trade up in recent times, on the teaser rate deals. They look at their rent, their 10 years of savings in the bank earning no interest, and they see it's much cheaper to buy with low-rate fix. My view is earning 0% in the bank isn't good, but it's better than losing 25% of it in value in buying an overvalue home, with significant mortgage, and see value of home fall, and then perhaps not be able to get a new low-rate fix in future.  So if cost of money went up, perhaps it would cool things for such buyers.  Hopefully we're running out of them too. Quote  FT 08 March 2017 Remortgaging sounds like a no-brainer then? It is, but there’s a catch. Some will find it impossible to gain the benefit of today’s low rates if their circumstances prevent them from passing lenders’ stringent affordability tests.   Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 12, 2017 Author Share Posted October 12, 2017 7 minutes ago, Untoward said: They don't care. They are fleecing us in plain sight. I tend to agree. I have no doubt tho they have self preservation as their main goal. Do they want millions of fit healthy young people deciding enough is enough and rising up, quite possibly causing massive civil unrest.  Best way to self preserve is to keep the masses on side. The masses need low house prices.  Life's much more complex that going to work and paying a mortgage. Life's about survival and the British establishment are experts. Quote Link to comment Share on other sites More sharing options...
macca13 Posted October 12, 2017 Share Posted October 12, 2017 Well listening to the Eastern Europeans that I work with a lower £ means they go home.. sending money home is not as beneficial and higher cost of living reduces surplus.. Quote Link to comment Share on other sites More sharing options...
longgone Posted October 12, 2017 Share Posted October 12, 2017 2 hours ago, TheCountOfNowhere said: Do they want millions of fit healthy young people deciding enough is enough and rising up, quite possibly causing massive civil unrest. british and civil unrest do not go together in the same sentence have you not learnt the british are obedient. more chance of a boomer backlash for lost housing wealth unless you call putting an X in a box civil unrest.  Quote Link to comment Share on other sites More sharing options...
GreenDevil Posted October 12, 2017 Share Posted October 12, 2017 3 hours ago, Untoward said: They don't care. They are fleecing us in plain sight. I hate your avatar. Can you change it for something less utterly despicable? Quote Link to comment Share on other sites More sharing options...
dgul Posted October 13, 2017 Share Posted October 13, 2017 I think they'll raise. The BoE (and others) have made a big deal about their new superpower -- 'forward guidance'. But trust is wearing a bit thin, in that they never actually follow through. This is a great opportunity for them to say 'see, we told you' even though they're really only correcting their mistake from last year. Quote Link to comment Share on other sites More sharing options...
Blod Posted October 13, 2017 Share Posted October 13, 2017 Two things, he’s indicated he’ll raise but not when nor by how much. I don’t see sufficient inflationary pressures swaying the few members of the MPC needed to get the vote for twenty five basis point currently. A lower amount would be easier to get as well as offsetting their perceived risks. They get to kill two birds by doing so whilst negating some of the risks. That rise could then be scheduled to come in at a later point so avoiding affecting the Christmas sales figures. Quote Link to comment Share on other sites More sharing options...
btd1981 Posted October 13, 2017 Share Posted October 13, 2017 14 hours ago, Sperm Donor said: Call me deluded but I actually think they will this time Come again? Quote Link to comment Share on other sites More sharing options...
nome Posted October 13, 2017 Share Posted October 13, 2017 9 hours ago, TheCountOfNowhere said: I tend to agree. I have no doubt tho they have self preservation as their main goal. Do they want millions of fit healthy young people deciding enough is enough and rising up, quite possibly causing massive civil unrest.  Best way to self preserve is to keep the masses on side. The masses need low house prices.  Life's much more complex that going to work and paying a mortgage. Life's about survival and the British establishment are experts. But the masses don't realise that they need low house prices, what they (think) they need is the ability to afford current house prices... and that's what they're being given thanks to HTB and 35 year+ mortgages. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted October 13, 2017 Share Posted October 13, 2017 Given rates are at record lows in a weak recovery they really do need to raise them so they can cut them again in the next inevitable crisis. Raising to 0.5% hardly suggests a booming economy. Plus there's the pension issue with that black hole getting bigger and bigger. Quote Link to comment Share on other sites More sharing options...
billybong Posted October 13, 2017 Share Posted October 13, 2017 10 hours ago, Untoward said: They don't care. They are fleecing us in plain sight. Exactly - no increase. Quote Link to comment Share on other sites More sharing options...
LondonBooming Posted October 13, 2017 Share Posted October 13, 2017 Yep he will say we are not there yet, inflation is still low 3%+. I don't know how they calculate inflation but the numbers surely cannot be right. Items in shops has gone up massively. Â Quote Link to comment Share on other sites More sharing options...
winkie Posted October 13, 2017 Share Posted October 13, 2017 They want inflation and bubble assets prices.....growth, init. Quote Link to comment Share on other sites More sharing options...
Wurzel Of Highbridge Posted October 13, 2017 Share Posted October 13, 2017 I stopped paying any attention to the news and just look at the recent past. I can predict with a large degree of accuracy that rates will not rise in any meaningful way. For a start the government can't afford the interest payments, Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 13, 2017 Author Share Posted October 13, 2017 The best thing about these polls are the trolls  Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 13, 2017 Author Share Posted October 13, 2017 1 minute ago, Wurzel Of Highbridge said: I stopped paying any attention to the news and just look at the recent past. I can predict with a large degree of accuracy that rates will not rise in any meaningful way. For a start the government can't afford the interest payments, Most people here were saying the US would raise rates.....just saying Quote Link to comment Share on other sites More sharing options...
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