Emergency Interest Rate Cut Announced (from All Major Central Banks)

[uncle rogi]

My point was,For me this points to deflation as the end result of the intermediary stage of biflation.

yeah, many a slip twix cup and lip though eh

steady biflation i agree but then an endgame of crushing deflation in all things bought on/with credit with massive geopolitically influenced inflation in all things imported, until we rebuild a productive economy...

[George Ldn]

EMERGENCY INTEREST RATE CUT - EMERGENCY EMERGENCY EMERGENCY

BoE are "independant" remember.

So independant that after Mervyn King has meeting with the PM... the next morning he cuts rates.

[FortuneFTB]

BoE are "independant" remember.

So independant that after Mervyn King has meeting with the PM... the next morning he cuts rates.

I reckon he should put them up by 1% when he makes the scheduled announcement tomorrow, that would put the shits up Gordy

[hunky007]

So are we totally fcuked then?

Peoples savings become ever more worthless

But peoples mortgages hopefully slightly little more affordable. little bit of thought to homeowners with mortgages will be much appreciated thank you. We have to live and survive as well you know.

[Ash4781]

Did Japan take part?

They are at 0.5% aren't they.

[Guest anorthosite]

Just a little thing that landed in my email today:

[council dweller]

Did Japan take part?

They are at 0.5% aren't they.

They took part by "supporting" the rate cuts of other countries. Maybe, having done it before they realise that it's meaningless for them to cut to 0.25 or 0%.

[lufc]

Just remember the Fed is @ 1.5% now, they surely can't go below 1% so maybe they have .5% left in the tank.

Without stating the obvious this was a concerted Feb,Ecb,Boe effort probably for the sake of the currency markets and oil.

Question is now, with the Fed having very little left to play with, what will happen to sterling when the Boe has to keep cutting ... or will they even ????

[FreeTrader]

Scariest quote of the day, from the end of this article in the FT:

Indeed, some bankers believe the scheme might be sufficient to restore confidence to the system, encouraging private investors and lenders to jump back into the market. “We’re not trying to spend taxpayers’ money,” one official said.

At the same time, however, officials also stress that the £400bn in new funding and capital the government committed to put in place on Wednesday should by no means be seen as a finite pot of money. “The message is: we’ll do whatever it takes,” one said.

(Please don't let Injin see this )

[evictee]

On 08/10/2008 at 12:07, Buy Toilet said:

"In the light of that outlook, the Committee judged at its October meeting that an immediate reduction in Bank Rate of 0.5 percentage points to 4.5% was necessary to meet the 2% target for CPI inflation in the medium term."

....aaaand - we're back.

Phew, that was quite an emergency.

[LetsBuild]

Just think, only a few more hikes and they will be able to say rates are the highest they have been since ‘before’ 2008. We have been butting up against that cliff for a while.

[Huggy]

Should've been allowed to crash then. Maybe, many of the people who cheer HPI4eva today wouldn't have 'had' to buy at Mega-HPI*2 prices thus causing them shitting it today

BTW, once you've stopped crying at today's news, and if you're reading, HPI is a bad thing always.

[Glental]

My whole working life has been under zirp and those were supposedly some sort of boom years. What a mess 

[msi]

57 minutes ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

hahahaha

[bomberbrown]

58 minutes ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

🤣

[Square Mile]

1 hour ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

😍

[nero120]

1 hour ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

BRILLIANT! 

[Englaender]

1 hour ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

Kudos to you, sir (or madam or other)! 😆

[Orb]

So, where were we before we were rudely interrupted?

[Si1]

I'm so glad they were so vigilant. Where would we be otherwise.

[Flat Bear]

On 08/10/2008 at 13:49, Flat Bear said:

Think it through.

Why is it a good move?

How does it affect the banks?

The banks can borrow at slightly lower rates from the central banks which is OK but really doesnt solve their massive and increasing lending requirement, end result is central banks will be bank of last only resort.

How will banks respond?

They will lend even less to each other as they try and get fed as much as possible by the limited amount of cash available at low rates from the central banks, many will become totally dependant and puppets for their new master. Losses will grow and compound daily and using the new borrowing rate of the relavent central banks as a base mortgages and loans will rise to accomodate whilst saving rates will fall in line.

How will it affect money?

It will de-incentivise lending. Why lend money if there are little rewards especially when liquidity is at a premium and risk is so much higher.

Who will gain?

The banks could see a very short term gain in margin and thus profits.

Will it make it easier to get a business loan or overdraft?

No

It is not a problem with rate of interest but available reserves and risk.

Expect business overdrafts to go up again. Was around 3 points over recently risen to around 5 to 6 points over now expect a rise to 10 points plus.

Overall low interest rates at a time of high inflation will be more detrimental to the well being of the economy. The short term gains will disappear quickly.

I had not considered the possibility, or the concept of, QE.

QE and ZIRP distorted everything.

[w11 1rh]

I panicked when I first saw this thread. Then I laughed. Then I laughed a lot.

[danlee74]

3 hours ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

Genius! Well played!!

[rollover]

2 hours ago, Orb said:

So, where were we before we were rudely interrupted?

[Fishfinger]

5 hours ago, evictee said:

....aaaand - we're back.

Phew, that was quite an emergency.

😁