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I Think Rates May Not Stay Down Despite The Headlines


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Has anyone else noticed that alot of the rate cuts are being implemented on December the 1st.

3 weeks is along time and I cannot help but wonder if this promised drop will get eroded by "market forces"

At this meeting at Downing Street I can imagine that that the bankers have agreed to give the politicians their headlines today and we could see further sockes that could prevent the total reduction being eventually passed through.

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This is standard procedure for most banks and building societies.

They charge you interest from the 1st of every month and it takes a while to send out the millions of letters to existing borrowers (and savers I presume) to tell them of the change in rates and if their payments are affected.

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I agree with what you say but my main point is this.

These are not fixed rates so the banks can do what they want with them over time. Saying they will be passing the rates on in full helps Brown and Co short term and is a PR exercise.

We all know Banks have to rebuild their margins and price in risk which is increasing with recession. The banks are under no obligation to maintain the rates as promised and believe we will see them creeping up.

If they haven't been able to to tie rates in the US how will Brown be ble to do it here?

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These are not fixed rates so the banks can do what they want with them over time. Saying they will be passing the rates on in full helps Brown and Co short term and is a PR exercise.

From a point of total economic ignorance and increasing despair I tend to agree with you. It feels everything at the moment is PR spin (so what's new).

Interest rates are cut, I (Brown) demand banks pass it on, Banks give out a statement capitulating (wink wink amongst each other)..Look how masterful I (Brown) am.

It has worked short term, did anyone hear Hilary Benn on Any Questions on R4 tonight, and the audience's appreciation.

Do you remember those plate spinning variety acts that are now out of fashion. Well you could only run around and keep so many spinning before one fell, and then another and another... I agree that's not as good as Paddles' Tsunami analogy on another thread but at least I can picture Brown doing that, I can't picture him in a swimming costume, or rather don't want to.

I live in an area where houseprices are 10-15 times a single average income and 40% of properties are vacant most of the year. Impossible to buy if you do not subscribe to idiocy. A semi-detached 2-up 2 down here can be well over 300K. I can almost understand what went on in N. Wales in the 70s.

Common sense without economics says the last decade has to be totally unsustainable. The banks have to be bust since the majority of the money just doesn't exist. So I think the banks will catch Brown out with arrangement fees, LTVs etc., look how they raised rates or withdrew deals prior the anticipated IR cut.

I just hope that low interest and inflation does not erode everyone's STR or 'my save to buy', or the BS go bust - after all there is a limit to the number of 50K accounts you can open.

Sorry about all of that, just convincing myself that the HPC is still full-on :)

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Has anyone else noticed that alot of the rate cuts are being implemented on December the 1st.

3 weeks is along time and I cannot help but wonder if this promised drop will get eroded by "market forces"

At this meeting at Downing Street I can imagine that that the bankers have agreed to give the politicians their headlines today and we could see further sockes that could prevent the total reduction being eventually passed through.

£100m's+ in mortgage loans per bank equates to an enormous amount of compounded interest in 3 weeks

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Something gives me the impression that although the banks are indeed going to pass these lower interest rates on as so wildly advertised by the beeb, it will be only with regard to a very limited number of products. They have to take something back for what they have been forced to give. They may have been coerced into offering SOME lower rates but nobody is forcing them to keep lending. I think that along with the "passing on of rate cuts" will come much, much tighter lending restrictions, e.g no new mortgages without a minimum 25% deposit, no more lent that can be proven to be easily repayable when future risks are taken into account, major increases in interest rates on other types of borrowing. And no bad thing, either.

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I've read that there is serious international consideration being given to cutting interest rates to 0% (zero).

Please no ! I am a disgusted saver ! 0% interest rates and we should just take everything out of the banks ! Cheers Gordon !

2702.jpg

YOU FAT BAST*RD T*AT YOU !

post-16847-1226102110_thumb.jpg

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Please no ! I am a disgusted saver ! 0% interest rates and we should just take everything out of the banks ! Cheers Gordon !

2702.jpg

i agree no matter how much or little you have withdraw it if rates go any lower bankrupt the banks send brown a message

YOU FAT BAST*RD T*AT YOU !

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Something gives me the impression that although the banks are indeed going to pass these lower interest rates on as so wildly advertised by the beeb, it will be only with regard to a very limited number of products. They have to take something back for what they have been forced to give. They may have been coerced into offering SOME lower rates but nobody is forcing them to keep lending. I think that along with the "passing on of rate cuts" will come much, much tighter lending restrictions, e.g no new mortgages without a minimum 25% deposit, no more lent that can be proven to be easily repayable when future risks are taken into account, major increases in interest rates on other types of borrowing. And no bad thing, either.

This fits in with an early election scenario

may just help keep the reposessions down for a while

then all hell will break loose after the election

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