Interest rates going up soon...

[Welshbeef]

Got to wonder when they will scrap the 10% savings tax and synchronise it to income tax thresholds especially given now that frankly only the very wealthy will be taxed on savings as you have £30k per year for couples to money away tax free forever.

[Walford]

Sheepshanks said:

0.5% doesn't sound much but that's a two thirds increase in your interest payments.

so how much will payments increase when it goes up to 3%

[Mr Whippy]

PugwasHDJ80 said:

Welshbeef said:

markcoznottz said:

Absolute horsest. I don't know how he can keep a straight face. If interest rates never again best inflation, real inflation not la la land inflation, the boomers will continue to park capital in assets and not spend it in the wider economy. I doubt any party has the patience or timescale to wait fir them all to pass away, so government debt will continue to rise until the roads crumble, and the street lights don't work anymore. As re other posters commenting about globalisation, we just don't have time to duck about with stupid predictions. You might as well sack carney and employ mystic meg. Long term things don't look good at all.

But the fact is wage inflation is barely above inflation as such there is no bandwidth for the UK public to cope with big rate rises as they don't have the money - its line in the sand time they ifs and nuts are irrelevant. Therefore how do you push rates up high without pushing tens if not hundred hundreds of thousands into bankruptcy at that scale it impacts at a macro level. So kills the economy really damages the banks and the non bankrupt will be even more cautious leading to them not spending.

If wage inflation was 5% and inflation 2% clearly there is a really chance to up rates higher but that's just not going to happen for a long time.

Serious question- whats wrong with Bankruptcy?

if you have such a huge mortgage that you can't really afford to pay for it, then you are already Bankrupt- you would probably be better off dropping the huge amount of debt that you have, allowing the market to rebalance, and then in fve or six years buying a much cheaper property (possibly the same one) with much smaller debt.

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

Only people asking for trouble in my view.

If they can't use their brains then they shouldn't be protected.

This perpetual protecting idiots is why we are here in the first place.

My 2p for a change that *should* happen. Protect those from negative equity by letting them carry debt to a new property. Assuming it's their primary residence and their only home they should be able to carry debt around.
Ie, a lender who is £££ down with a borrower is in no worse position if they downgrade their home and are still in some debt, or simply move to a new home with the same debt to follow work or whatever else.

Remove the perceived trap of negative equity so people can still live their lives, albeit still in debt, but a debt they can budget for and pay off given time... and very likely be more than able to afford if they budget accordingly.
OK it might be uncomfortable to see people buying the house next door to them for half the price, but hey, such is life. Life isn't out to be fair.


The government plan is entirely to depreciate the debt with inflation, everything they have done so far points to that I think, but it's gonna take at least another decade until we're really in the clear. Until then expect rates to stay really low so people can afford to keep paying off their excessive debt.

BUT, as SKR mentioned earlier, many people are just using this as an excuse to get into more debt and be screwed now if rates rise, rather than using it as an opportunity to pay down their existing debts.

To sum up, we're screwed. People are generally too greedy. It's all gonna end in tears.

As SKR said, pay off your debt if you have a brain, own everything you own outright. I'd say sit tight with savings because at some point in the next 5-10 years there is a chance you'll be picking up lots of bargains as everyone who owns things with over-leveraged debt sells up and values plunge. Cars, houses, land, everything.

Dave

[Derek Chevalier]

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

[Mr Whippy]

Derek Chevalier said:

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

There are plenty, but should they be protected?

We used QE and bank bailouts in 2009 to protect people which you could argue was acceptable, but to still be protecting people half a decade later seems ridiculous.

Next stop, communism.

Dave

[Walford]

Blair/Brown should be jailed, this mess will take 20 years to sort

[GTIR]

Walford said:

Blair/Brown should be jailed, this mess will take 20 years to sort

What will, the immigrants taking all our jobs, paedo's on every corner or getting cancer by eating too much cheese?

/daily mail

[egor110]

Mr Whippy said:

Derek Chevalier said:

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

There are plenty, but should they be protected?

We used QE and bank bailouts in 2009 to protect people which you could argue was acceptable, but to still be protecting people half a decade later seems ridiculous.

Next stop, communism.

Dave

So if you let them fall , then what who houses them and there family?

Crime levels rise as they steal not fund drug use but to repay there mortgage.

[markcoznottz]

egor110 said:

Mr Whippy said:

Derek Chevalier said:

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

There are plenty, but should they be protected?

We used QE and bank bailouts in 2009 to protect people which you could argue was acceptable, but to still be protecting people half a decade later seems ridiculous.

Next stop, communism.

Dave

So if you let them fall , then what who houses them and there family?

Crime levels rise as they steal not fund drug use but to repay there mortgage.

Who gives a fk, talk about entitlement culture, I'm sure some people think life in this country is a game show. All the while globalisation marches on, and we have no long term plans for education, apprenticeships etc. Instead we protect people who used thier house like an ATM machine to impress thier neighbours.

[Mr Whippy]

markcoznottz said:

egor110 said:

Mr Whippy said:

Derek Chevalier said:

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

There are plenty, but should they be protected?

We used QE and bank bailouts in 2009 to protect people which you could argue was acceptable, but to still be protecting people half a decade later seems ridiculous.

Next stop, communism.

Dave

So if you let them fall , then what who houses them and there family?

Crime levels rise as they steal not fund drug use but to repay there mortgage.

Who gives a fk, talk about entitlement culture, I'm sure some people think life in this country is a game show. All the while globalisation marches on, and we have no long term plans for education, apprenticeships etc. Instead we protect people who used thier house like an ATM machine to impress thier neighbours.

They were given a break, we all were, with low interest rates. We've been given a 5yr grace period to settle up our bad debts.

The result is idiots borrow even more money because it's cheap.

No hope. Idiots need to be punished.

Giving them financial safety blankets from cradle to grave is communism. We should have some safety systems in there, but not ones to protect complete stupidity.

Dave

Edited by Mr Whippy on Friday 4th July 01:01

[Walford]

GTIR said:

Walford said:

Blair/Brown should be jailed, this mess will take 20 years to sort

What will, the immigrants taking all our jobs, paedo's on every corner or getting cancer by eating too much cheese?

/daily mail

[GTIR]

Yes very good. All that's proved is you can use google.

My point being how have you come to the conclusion it'll take "20 years to sort out" and practically they're not likely to be imprisoned so it's a bit of a silly statement to make, which led me to the conclusion you've read it somewhere (Daily Mail) and just regurgitated it without forming any opinion of your own.

Everyone is culpable for this financial crisis if you want to blame someone direct it to idiots taking out 120% mortgages and over stretching themselves by "buying" cars, flat screen TV's and holidays they can't afford.

[Walford]

GTIR said:

Everyone is culpable for this financial crisis if you want to blame someone direct it to idiots taking out 120% mortgages and over stretching themselves by "buying" cars, flat screen TV's and holidays they can't afford.

Are you suggesting that the man in the street, had something to do with the moving of powers from 11 Downing street to the Bank of England, the setting up of the FSA the following lack of banking regulation, allowing the us of complicated credit bundling, buying and selling, and the spending of the governments share of this spent on a huge increase in public sector

[GTIR]

No.

I'm disappointed you didn't post another graph up. Not even a pie chart.

[egor110]

markcoznottz said:

egor110 said:

Mr Whippy said:

Derek Chevalier said:

Mr Whippy said:

And what idiots took so much debt in the last 4 years or so while rates have been so low, for rates rising to be a significant issue?

One would assume a large minority

There are plenty, but should they be protected?

We used QE and bank bailouts in 2009 to protect people which you could argue was acceptable, but to still be protecting people half a decade later seems ridiculous.

Next stop, communism.

Dave

So if you let them fall , then what who houses them and there family?

Crime levels rise as they steal not fund drug use but to repay there mortgage.

Who gives a fk, talk about entitlement culture, I'm sure some people think life in this country is a game show. All the while globalisation marches on, and we have no long term plans for education, apprenticeships etc. Instead we protect people who used thier house like an ATM machine to impress thier neighbours.

You will when it's you being burgled, because the police are at record low numbers and there not going to be coming to your rescue.

It's all very well saying if they borrowed too much fk them , but the reality is you'll have a huge number homeless something no government is going to do when they can just put it off and leave the difficult stuff to which ever party comes in next.

Just to clarify if rates do rocket i'll be alright so i'm not fighting this for personal reasons.

[markcoznottz]

Not much of a future then is it? Managed decline anyone? Better to be burgled twice in ten years than pay other people's mortgage for them as infinitum and to actively help the government inflate its debt away. Nice .....

[Derek Chevalier]

Mr Whippy said:

There are plenty, but should they be protected?

No

[egor110]

markcoznottz said:

Not much of a future then is it? Managed decline anyone? Better to be burgled twice in ten years than pay other people's mortgage for them as infinitum and to actively help the government inflate its debt away. Nice .....

You think it's better to be burgled rather than pay others mortgages?

I take it you've never actually been burgled, your wife/kids won't feel safe in there own house anymore, if your at home reality will hit that your not bruce lee and didn't fight the burgler's off like you thought you would.

The reality is it will either happen when the house is empty or they'll do it early hours of the morning when your asleep , if there good they'll have someone waiting for you at the bottom of the stairs so you don't try and be a hero.

Like i said it is a stter that those of us who took out affordable mortgages are being punished by low savings interest rates but the reality is if loads of people can't afford to pay there mortgages if rates rise and there is no council/social housing for them what do you thinks there going to do?

Desperate times make normal people do desperate things.

[toppstuff]

I think there is some overreaction going on here to the prospect of higher rates.

Lets look at the facts;

> Mortgages are being controlled by regulation, capping of income multiples etc..

> House price inflation is a largely South East UK issue. Other parts of the UK are not seeing any major growth. There are plenty of areas of the country where the housing market is flat and even falling.

> Manufacturing is improving, but it is not uniform.

> Both businesses and households are heavily indebted.

The BoE have used the media to introduce some fear as well; talking of 2.5%/3% as the "new normal", alluding to rates of 5% in the longer term: all these things are designed to make people more cautious and put the brakes on.

I would not expect rates to go up by more than 50bps over the next 18 months or so. Not unless UK levels of debt make some miraculous reversal.

[oyster]

Walford said:

GTIR said:

Walford said:

Blair/Brown should be jailed, this mess will take 20 years to sort

What will, the immigrants taking all our jobs, paedo's on every corner or getting cancer by eating too much cheese?

/daily mail

That graph says debt when it actually means deficit. That's not exactly a good way to convince people is it?