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Realistbear

Bo J Vote Unanimously On No I R Hike

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http://www.iht.com/articles/2006/06/15/business/yen.php

Bank of Japan keeps interest rates near zero

Bloomberg News, Reuters

Published: June 15, 2006

TOKYO The Bank of Japan kept its key interest rate near zero percent Thursday, and the bank's governor, Toshihiko Fukui, said it would monitor the effect of falling Japanese stock prices on the economy.
The decision by the nine-member board, which signaled in March it was preparing to raise rates, was unanimous, the bank said.
A 19 percent drop in the Nikkei 225- stock average in the past seven weeks has weakened the central bank's case that the economy is ready for higher borrowing costs
. The controversy over Fukui's investments also fueled speculation that he would hold off raising rates, sustaining a rally in government bonds.
If the stock market stabilizes and all indicators remain "in good shape," it is "likely they'll raise rates in July," said Masaaki Kanno, chief economist at J.P. Morgan Securities in Tokyo. "If not, then they don't have to rush."
The European Central Bank, the Bank of Korea, the Reserve Bank of India and the Reserve Bank of South Africa all raised interest rates last week. At least seven officials from the U.S. Federal Reserve, which next meets June 28 and 29, have said in the past two weeks that they are concerned about inflation in the United States.

:(

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I can't see that as being bad news for a HPC?

If the Economy slows down too quick Merv won't need to put rates up over here.

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I can't see that as being bad news for a HPC?

If the Economy slows down too quick Merv won't need to put rates up over here.

The economies around the world do appear to be slowing without much in the way of IR hikes. IMO its due to the high debt levels many find themselves saddled with. There comes a point when the spending has to stop and apart from the recent frenzied buying of those awful LCD TVs for the World Cup the spending is slowing.

The housing market is now dead in the water as it is not only FTBs who are priced out but those who would like to move up can no longer afford the cost involved.

I think we will slip into recession within the next 6 months as unemployment accelerates. A protracted bear market in the City will lead to a lot of layoffs in the brokerage houses which will have a knock on effect into other city jobs such as accountants, lawyers etc. Right now the City is making a ton of money on the sell off and commodity crash as commissions are generated on sell orders. Once the selling stops and the buyers go home the firings will begin. If it happens quickly then we may not need IR hikes.

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But I thought rates were going up no matter what?

"Inflation" is a disease whether it is in oil prices or house prices. IR are the cure.

If we go into a full blown recession the market will have doen the work that IR should have done long ago. By doing nothing to curb inflation Gordon has dug his own economic grave: inflation.

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"Inflation" is a disease whether it is in oil prices or house prices. IR are the cure.

If we go into a full blown recession the market will have doen the work that IR should have done long ago. By doing nothing to curb inflation Gordon has dug his own economic grave: inflation.

He has done something and will keep doing it - fiddling the CPI

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Looks like the BoJ boss may be Fukui'd:

http://uk.biz.yahoo.com//16062006/323/japa...inted-fund.html

Friday June 16, 02:37 PM

Japan's central banker earned millions of yen in scandal-tainted fund

TOKYO (AFP) - Japan's embattled central bank chief Toshihiko Fukui has said he made millions of yen in profit out of an investment in a scandal-tainted fund that has triggered calls for his resignation.
"I don't remember exactly ... but (annual) profit came to some hundreds of thousands of yen at a minimum and amounted to some million yen at a maximum," Fukui said in the second day of his testimony in a parliament committee.

Hopefully his replacment will end the shall we shan't we approach and get on with the IR hikes. The market needs certainty not confusion.

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This is the problem with bears hoping that when the stock market crashes it will help their argument. It won't, central banks would normally reduce rates in a bear market, that is one of the things that sparked off HPI in the first place.

Isn't 20% the official crash point? I was checking out a Jap fund the other day, the graph just showed a classic double top, so I'll stand aside for now.

:)

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I don't think this correction is done yet. Nothing has changed with IR still headed up in the US and Eurozone and just about every other market you can name except the UK. These corrections we are seeing in commodoties, house prices and stocks are all IR related and the unwinding of the carry trade whether the BoJ goes official with it or not. There has been too much cheap money around for too long and the world banks are reigning it in. Those commodities that went up the most as a result of low rates will come down the most as a result of the same rates rising.

I would go to cash and stand well clear of anything that is overly IR sensitive.

http://news.ft.com/cms/s/57ffd5ac-fd0b-11d...20abe49a01.html

No recovery for commodities

By Kevin Morrison

Published: June 16 2006 09:15 | Last updated: June 16 2006 18:46

Commodity markets spent the last part of the week trying to make up the ground they lost on Monday and Tuesday when the sector was caught up in a broad-based sell-off in financial markets on concerns over higher inflation and interest rates.
However, none of the commodities managed to recover fully from the losses incurred at the start of the week, when metal and oil prices fell to their lowest levels in about two months.
The sell-off almost prompted some analysts to forecast that the five-year commodity price boom was finished.
Edited by Realistbear

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  • 301 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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