kzb Posted April 15 Share Posted April 15 1 hour ago, Si1 said: No I'm talking about the real long term natural interest rate which is not the same as the short term interest rate set by central banks. There is a natural cost of money relative to inflation which is set by the economy. I don't think you are talking about inflation and interest rates in the way we understand them. 1 hour ago, Si1 said: Japan had a lot of saved capital keeping real interest rates so damned low. They have very conservative savings habits. Japan has a massive national debt, bigger than ours relative to GDP. Quote Link to comment Share on other sites More sharing options...
kzb Posted April 15 Share Posted April 15 1 hour ago, winkie said: Creating easy cheap money does cause inflation, splash it about a bit.......you could say energy shortages helps cause deflation.......everything needs energy, nothing gets done without it, nothing made without it.... Western central banks have basically printed loads of money. That gives a select few more money to splash around. The article we are discussing is some kind of attempt to cover up the incompetence of these banks and deflect the blame onto demographics. Not our fault gov, it's because you've allowed too many pensioners. Quote Link to comment Share on other sites More sharing options...
Si1 Posted April 15 Share Posted April 15 (edited) 22 minutes ago, kzb said: I don't think you are talking about inflation and interest rates in the way we understand them. Fair comment. 22 minutes ago, kzb said: Japan has a massive national debt, bigger than ours relative to GDP. Owed to itself thru massive domestic savings Edited April 15 by Si1 Quote Link to comment Share on other sites More sharing options...
winkie Posted April 15 Share Posted April 15 8 minutes ago, kzb said: Western central banks have basically printed loads of money. That gives a select few more money to splash around. The article we are discussing is some kind of attempt to cover up the incompetence of these banks and deflect the blame onto demographics. Not our fault gov, it's because you've allowed too many pensioners. Don't care how many pensioners there are, too many and pensioners will only get poorer.....new more recent pensioners and those due to shortly retire but later already are, no index linked final salary pensions for them..... Quote Link to comment Share on other sites More sharing options...
kzb Posted April 15 Share Posted April 15 1 minute ago, winkie said: Don't care how many pensioners there are, too many and pensioners will only get poorer.....new more recent pensioners and those due to shortly retire but later already are, no index linked final salary pensions for them..... Public sector, which has grown, still have DB pensions. When you read the scheme details of those pensions they could easily turn out more generous than previous schemes overall. My modest final salary pension (which I am not getting yet before anyone starts) had an accrual rate of 1/80ths, and that was the usual rate in the public sector. Whereas the new civil service scheme is in 1/43rds, the new local authority scheme is something like 1/45ths. If you are a plodder who never gets promoted but you put the years in, you could end up with a take home pay which is more than you took home from your salary. Under the old schemes you wouldn't get much more than half salary. The NHS scheme is CPI + a certain per cent every year. They are not bad really. Quote Link to comment Share on other sites More sharing options...
Up the spout Posted April 15 Share Posted April 15 If inflation falls interest rates will too, but we've seen very clearly that if a country has a bad crop for a year it can affect global inflation - poor yields in farming are literally baked in for now. Quote Link to comment Share on other sites More sharing options...
The Angry Capitalist Posted April 15 Share Posted April 15 4 hours ago, kzb said: I don't think that logically follows. Especially in a country that does not actually produce anything much, and anyway imports its workers. Go look at the national debt. It follows. Also see the pension deficits. And loss of purchasing power. Quote Link to comment Share on other sites More sharing options...
kzb Posted April 15 Share Posted April 15 36 minutes ago, The Angry Capitalist said: Go look at the national debt. It follows. Also see the pension deficits. And loss of purchasing power. Inflation is caused by too much money being available. It does not follow that the first two are inflationary. The third one is what inflation is, not its cause. Quote Link to comment Share on other sites More sharing options...
The Angry Capitalist Posted April 16 Share Posted April 16 43 minutes ago, kzb said: Inflation is caused by too much money being available. It does not follow that the first two are inflationary. The third one is what inflation is, not its cause. It is but price rises are not unique to inflation. The terms get mixed and the headline of this thread will be due to prices going higher meaning rates will have to stay higher. Quote Link to comment Share on other sites More sharing options...
winkie Posted April 16 Share Posted April 16 (edited) 9 hours ago, Up the spout said: If inflation falls interest rates will too, but we've seen very clearly that if a country has a bad crop for a year it can affect global inflation - poor yields in farming are literally baked in for now. The wet weather has not been kind to our farmers, other farmers suffering from dry weather conditions......what is grown will keep for themselves or sell for a very high price to others plus trade tarrifs.......not good for lowering inflation. Supply and demand. https://www.fwi.co.uk/news/extreme-weather-forces-uk-to-import-significantly-more-veg Edited April 16 by winkie Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted April 22 Share Posted April 22 Looks like interest rates are rising again: https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934 Quote Link to comment Share on other sites More sharing options...
dpg50000 Posted April 22 Share Posted April 22 7 hours ago, Mikhail Liebenstein said: Looks like interest rates are rising again: https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934 Link to the post (instead of the blog feed): https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934?postid=7569459#liveblog-body  Surely this is fake news. Class clown @Stewy assured us mortgage rates had crumbled. Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted April 22 Share Posted April 22 26 minutes ago, dpg50000 said: Link to the post (instead of the blog feed): https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934?postid=7569459#liveblog-body  Surely this is fake news. Class clown @Stewy assured us mortgage rates had crumbled. Good to have the link. I think the blog popped up first. Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted April 22 Share Posted April 22 28 minutes ago, dpg50000 said: Link to the post (instead of the blog feed): https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934?postid=7569459#liveblog-body  Surely this is fake news. Class clown @Stewy assured us mortgage rates had crumbled.  We need to watch the US. If US inflation stays high and so do their interest rates, then cutting rates here, just makes things priced in Dollars more expensive as GBP will fall due to our lower interest rates. Quote Link to comment Share on other sites More sharing options...
kzb Posted April 22 Share Posted April 22 8 hours ago, Mikhail Liebenstein said: Looks like interest rates are rising again: https://news.sky.com/story/money-latest-consumer-personal-finance-mortgages-13040934 The article says interest rates will be falling.  The London Stock Exchange Group is still pricing in a June cut and two further cuts before the end of the year. Analysts at Morgan Stanley, Goldman Sachs Group, Capital Economics and Bloomberg Economics all concur.   Quote Link to comment Share on other sites More sharing options...
Dreamcasting Posted April 22 Share Posted April 22 22 minutes ago, kzb said: The article says interest rates will be falling.  The London Stock Exchange Group is still pricing in a June cut and two further cuts before the end of the year. Analysts at Morgan Stanley, Goldman Sachs Group, Capital Economics and Bloomberg Economics all concur.   This whole saga about when rates go down, if they do, is really more to do with central banks facilitating pump and dump operations. I suspect when Powell came out at the end of 2023 with his dot plots stating several cuts in 2024, it was nothing more than a pump for stocks - nothing else. There is the possibility that the BOE is playing a similar game now. Quote Link to comment Share on other sites More sharing options...
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