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https://mises.org/wire/fearful-fed-keeps-pouring-money-repo-market

This is looking like 2008 again. 

Bank lending is freezing up again and the fed just keeps making the eventual reckoning worse. 

Edited by Mikhail Liebenstein
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Does this make it more likely we will have a collapse in confidence and a subsequent jump in interest rates?   I have been hoping for this for a decade but it never seems to happen.  Credit in the UK still seems absurdly easy to get and the interest rates are astonishingly low unless you have an agreed overdraft but that is another story.

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25 minutes ago, dougless said:

Does this make it more likely we will have a collapse in confidence and a subsequent jump in interest rates?   I have been hoping for this for a decade but it never seems to happen.  Credit in the UK still seems absurdly easy to get and the interest rates are astonishingly low unless you have an agreed overdraft but that is another story.

I find it hard to understand the cognitive dissonance from central banks that says (1) the economy is at risk and under pressure from crushing debt levels so (2) we need to drop interest rates and print more money to keep the wolf from the door. 

It strikes me that low interest rates are the problem and not the solution. But then again I don't get paid £1 million per year to say the opposite.

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4 hours ago, dougless said:

Does this make it more likely we will have a collapse in confidence and a subsequent jump in interest rates?   I have been hoping for this for a decade but it never seems to happen.  Credit in the UK still seems absurdly easy to get and the interest rates are astonishingly low unless you have an agreed overdraft but that is another story.

 

My bank just sent me a letter telling me that interest rates on my savings are going to be cut even further from their already paltry level....

 

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20 minutes ago, Sour Mash said:

My bank just sent me a letter telling me that interest rates on my savings are going to be cut even further from their already paltry level....

We will see further cheaper mortgage deals ?

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1 hour ago, Sour Mash said:

 

My bank just sent me a letter telling me that interest rates on my savings are going to be cut even further from their already paltry level....

 

Mine did too. From 0.2% to 0.1%. 

My imaginary £100k will earn me a cool £100 next year!

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3 hours ago, Simhadri said:

We will see further cheaper mortgage deals ?

My fixed rate ended in Dec... I've held off refixing as I believe the BoE & then high st banks will cut their rates too....

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19 hours ago, headmelter said:

My fixed rate ended in Dec... I've held off refixing as I believe the BoE & then high st banks will cut their rates too....

There seems to be a  pivot between long term and short term debt. 

Things like mortgages down, but short term things like credit cards up. 

 

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On 11/01/2020 at 14:19, Orb said:

Mine did too. From 0.2% to 0.1%. 

My imaginary £100k will earn me a cool £100 next year!

With my bank, ISAs now seem to have the best rates.  Must move some cash there and see what I want to do with the rest.

I've already loaded up to the max on premium bonds which have been consistently paying from 25-150 quid per month, with the occasional payout-less month here or there.  Unlike a bank there's no counter-party risk (other than the state collapsing) and you can withdraw at effectively one-day's notice ... so IMO they are a much better bet than most savings accounts at the moment.  50k limit though.

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2 hours ago, Mikhail Liebenstein said:

There seems to be a  pivot between long term and short term debt. 

Things like mortgages down, but short term things like credit cards up. 

 

That makes sense. Credit cards and overdrafts are probably the things that people are obviously getting into trouble over. Doesn't mean that they're the cause of the problem though. It's just playing wackamole with economic instabilities though.

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1 hour ago, Sour Mash said:

With my bank, ISAs now seem to have the best rates.  Must move some cash there and see what I want to do with the rest.

I've already loaded up to the max on premium bonds which have been consistently paying from 25-150 quid per month, with the occasional payout-less month here or there.  Unlike a bank there's no counter-party risk (other than the state collapsing) and you can withdraw at effectively one-day's notice ... so IMO they are a much better bet than most savings accounts at the moment.  50k limit though.

I've had £12k of premium bonds for 14 months, and won £125 since then. I've had 12 payout-less months. I'm keeping them for another 10 months, and if I see no improvement, I'm selling them. I'm going to look at ISAs this year too. 

Edited by Orb
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On 12/01/2020 at 21:26, Orb said:

I've had £12k of premium bonds for 14 months, and won £125 since then. I've had 12 payout-less months. I'm keeping them for another 10 months, and if I see no improvement, I'm selling them. I'm going to look at ISAs this year too. 

http://rebuildingsociety.com risk is there but if you manage with 'A' grade companies, risk is less.

Average yields going beyond 6%.

I invested £600 and got around £110 in 12 months with B and C grade companies.

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9 minutes ago, hurlerontheditch said:

just invest in a US tracker fund... free money since trump got in

Marmalade Face is running a primary deficit of 5.6% after the longest period of uninterrupted growth in American history.

Makes Gordon Brown look like a ranker.

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On 11/01/2020 at 13:09, Sour Mash said:

 

My bank just sent me a letter telling me that interest rates on my savings are going to be cut even further from their already paltry level....

 

We will have to tighten our belts then...

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20 hours ago, hurlerontheditch said:

just invest in a US tracker fund... free money since trump got in

Passive investing based on nothing other than "the powers that be will make sure nothing happens to my money..."?

Sounds dangerous to me - taking the attitude of 'you just can't lose' has ended up with ruined people chucking themselves off high buildings on more than a few occasions.

Just make sure that when the panic starts, you panic first!

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1 hour ago, zilly said:

Passive investing based on nothing other than "the powers that be will make sure nothing happens to my money..."?

Sounds dangerous to me - taking the attitude of 'you just can't lose' has ended up with ruined people chucking themselves off high buildings on more than a few occasions.

Just make sure that when the panic starts, you panic first!

obviously for those investing you would have permissives in place. e.g. i trade a composite Nasdaq system which moves to cash and bonds at various times so as to avoid the huge drawdowns with buy and hold systems 

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1 hour ago, zilly said:

Passive investing based on nothing other than "the powers that be will make sure nothing happens to my money..."?

Sounds dangerous to me - taking the attitude of 'you just can't lose' has ended up with ruined people chucking themselves off high buildings on more than a few occasions.

Just make sure that when the panic starts, you panic first!

.....a price worth paying to protect a few bankers from risk.....?

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3 hours ago, zilly said:

Passive investing based on nothing other than "the powers that be will make sure nothing happens to my money..."?

Sounds dangerous to me - taking the attitude of 'you just can't lose' has ended up with ruined people chucking themselves off high buildings on more than a few occasions.

Just make sure that when the panic starts, you panic first!

Two straw men in one post!

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On 15/01/2020 at 09:41, zilly said:

Just make sure that when the panic starts, you panic first!

Indeed... 

I did in Oct 2018. Missed the losses that followed the minicrash and took some gains on bonds. But now I am just waiting for this meltup on the Dow to meltdown and the Dollar to collapse. 

It feels close now. I've been through 2 such manias with Dotcom and the Great Recession 2008.  The shoeshine boys of the internet are in full flow!. 

 

 

 

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2 hours ago, Mikhail Liebenstein said:

Indeed... 

I did in Oct 2018. Missed the losses that followed the minicrash and took some gains on bonds. But now I am just waiting for this meltup on the Dow to meltdown and the Dollar to collapse. 

It feels close now. I've been through 2 such manias with Dotcom and the Great Recession 2008.  The shoeshine boys of the internet are in full flow!. 

 

 

 

i would say we have seen nothing yet, blow off top 2029, and a massive blow off top. double in a day kind of jobby. then the music suddenly stops.

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On 12/01/2020 at 14:56, Sour Mash said:

With my bank, ISAs now seem to have the best rates.  Must move some cash there and see what I want to do with the rest.

I've already loaded up to the max on premium bonds which have been consistently paying from 25-150 quid per month, with the occasional payout-less month here or there.  Unlike a bank there's no counter-party risk (other than the state collapsing) and you can withdraw at effectively one-day's notice ... so IMO they are a much better bet than most savings accounts at the moment.  50k limit though.

I have 50k in PB and they have been returning 1.75% the first year and 2.25% last year I got £650 in one month.

Average is around 50 to 100 a month.

I think it's worth the risk for the possibility of 1 million quid.

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On 11/01/2020 at 13:30, Simhadri said:

We will see further cheaper mortgage deals ?

I took out a 10 year fixed rate mortgage 2 years at 2.7% thinking I was onto something as rates would only be going up. Fast forward to today, you can now get a 10 year fixed rate for 2.2%. If we get further rates cuts, or a recession, where do we go? 

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  • 415 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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