Even lower base rates.
Discussion
The subject of negative base rates being considered is last weeks news perhaps. People such as me are sick to the back teeth of subsidising those idiots who have taken on large mortgages that they will not be able to service if the base rate rises. Something the Government cannot afford to let happen perhaps, are they in collusion with the 'independent' B.O.E. The point is savers and non mortgage borrowers have been subsidising those mortgages for far too long, perhaps its time the Government cut us some slack and we actually received some interest on our money tied into cash savings.
If people cannot afford a large house they should down size, that is reasonable.
If people cannot afford a large house they should down size, that is reasonable.
Rollin said:
I thought you lot blamed the banks for forcing people to take out loans?
I just want decent rate returns and a stop to subsidising people who cannot afford to service their mortgages at a sensible borrowing rate. Five years losing cash to this policy is long enough perhaps.crankedup said:
Rollin said:
I thought you lot blamed the banks for forcing people to take out loans?
I just want decent rate returns and a stop to subsidising people who cannot afford to service their mortgages at a sensible borrowing rate. Five years losing cash to this policy is long enough perhaps.OH i don't
It does annoy me somewhat. We cannot possibly have people loosing money on their speculation on the property market. It's fine for people to loose money on any other financial gamble, but not their house. They must make money on their house, it's written in law, somewhere.
But it's fine, savers don't mind being paid half of f
k all so people can buy a "property" (what a stupid word, it's "a house" not "a property") they can only afford if they get subsidy in the form of low interest rates.
All low interest rates do is keep individuals in houses they can't really afford and it keeps businesses going that should have gone to the wall. Interest rates might as well increase ten fold when lenders aren't lending at any rates, at least it would be worth saving.
If the UK economy is so dependant on people making a paper profit on a house then we really should have a rethink on how the country is run. Here you are treated like a second class citizen if you don't own (the mortgage lender actually owns it) your own house.
It's all bks.
But it's fine, savers don't mind being paid half of f
k all so people can buy a "property" (what a stupid word, it's "a house" not "a property") they can only afford if they get subsidy in the form of low interest rates. All low interest rates do is keep individuals in houses they can't really afford and it keeps businesses going that should have gone to the wall. Interest rates might as well increase ten fold when lenders aren't lending at any rates, at least it would be worth saving.
If the UK economy is so dependant on people making a paper profit on a house then we really should have a rethink on how the country is run. Here you are treated like a second class citizen if you don't own (the mortgage lender actually owns it) your own house.
It's all b
ks. Does the base rate being low really affect that many ordinary people with mortgages and savings?
With the base rate at 0.5%, it's still relatively easy to earn 2% on savings, and personal loan/mortgage rates are higher than that - some of them are substantially higher.
If people aren't borrowing, banks don't need your savings, so they won't pay much interest.
If savings rates went up, people would be even less inclined to spend their spare cash, and the economy would shrink even further.
I have no loans, and cash in the bank. I don't like it that I'm actually losing money on my savings (inflation higher than savings interest), but I can see why it might be best for the country as a whole.
With the base rate at 0.5%, it's still relatively easy to earn 2% on savings, and personal loan/mortgage rates are higher than that - some of them are substantially higher.
If people aren't borrowing, banks don't need your savings, so they won't pay much interest.
If savings rates went up, people would be even less inclined to spend their spare cash, and the economy would shrink even further.
I have no loans, and cash in the bank. I don't like it that I'm actually losing money on my savings (inflation higher than savings interest), but I can see why it might be best for the country as a whole.
crankedup said:
The subject of negative base rates being considered is last weeks news perhaps. People such as me are sick to the back teeth of subsidising those idiots who have taken on large mortgages that they will not be able to service if the base rate rises. Something the Government cannot afford to let happen perhaps, are they in collusion with the 'independent' B.O.E. The point is savers and non mortgage borrowers have been subsidising those mortgages for far too long, perhaps its time the Government cut us some slack and we actually received some interest on our money tied into cash savings.
If people cannot afford a large house they should down size, that is reasonable.
Perhaps you could take some of the value out of your house price inflation from the last few years (money from borrowers to savers/asset holders)If people cannot afford a large house they should down size, that is reasonable.
Sorry but OP you really sound a selfish tt on this one. Screw keeping the cost of borrowing down for individuals and the whole of industry just so someone like you can make a few more quid on your 'investment'. Grow a set of balls, do some actual thinking and look for ways to invest your money in something that has better returns? Oh I guess you want win-win easy money sit back and let the money come flooding in..........
t on this one. Screw keeping the cost of borrowing down for individuals and the whole of industry just so someone like you can make a few more quid on your 'investment'. Grow a set of balls, do some actual thinking and look for ways to invest your money in something that has better returns? Oh I guess you want win-win easy money sit back and let the money come flooding in..........I have a modest income, I have a small house, I cannot afford to buy bigger. I have no savings anymore because we spent them on plugging the gaps betwen income and bills and repairs to the house.
If the interest rates go up my Mortgage will go up, I will struggle to find the extra money especially since everthing else is going up all the time. the Gas/Electricity/fuel for the car and all the other costs rise year on year and my wages don't, worst case we lose the house after a period with no food/electric/gas or what ever I feel we can do without.
We manage, we never go out, never eat out, the car is 11 years old but well maintained and we are not wasteful of food or electricity or anything. I am at my limit but we claim no benefits.
So, I would like the interest rates to stay put, those lucky enough to have savings must be doing ok if they are not in the position I am in, I had to spend mine to stay afloat, If you have surplus money at the end of each month then good for you but don't complain that you are not getting free money given to you for simply putting it away, please realise that some of us are in quite a precarious and worrying position. You are lucky you don't spend every penny you get in each month.
If the interest rates go up my Mortgage will go up, I will struggle to find the extra money especially since everthing else is going up all the time. the Gas/Electricity/fuel for the car and all the other costs rise year on year and my wages don't, worst case we lose the house after a period with no food/electric/gas or what ever I feel we can do without.
We manage, we never go out, never eat out, the car is 11 years old but well maintained and we are not wasteful of food or electricity or anything. I am at my limit but we claim no benefits.
So, I would like the interest rates to stay put, those lucky enough to have savings must be doing ok if they are not in the position I am in, I had to spend mine to stay afloat, If you have surplus money at the end of each month then good for you but don't complain that you are not getting free money given to you for simply putting it away, please realise that some of us are in quite a precarious and worrying position. You are lucky you don't spend every penny you get in each month.
Getragdogleg said:
I have a modest income, I have a small house, I cannot afford to buy bigger. I have no savings anymore because we spent them on plugging the gaps betwen income and bills and repairs to the house.
If the interest rates go up my Mortgage will go up, I will struggle to find the extra money especially since everthing else is going up all the time. the Gas/Electricity/fuel for the car and all the other costs rise year on year and my wages don't, worst case we lose the house after a period with no food/electric/gas or what ever I feel we can do without.
We manage, we never go out, never eat out, the car is 11 years old but well maintained and we are not wasteful of food or electricity or anything. I am at my limit but we claim no benefits.
So, I would like the interest rates to stay put, those lucky enough to have savings must be doing ok if they are not in the position I am in, I had to spend mine to stay afloat, If you have surplus money at the end of each month then good for you but don't complain that you are not getting free money given to you for simply putting it away, please realise that some of us are in quite a precarious and worrying position. You are lucky you don't spend every penny you get in each month.
The problem is the artificial interest rates are not sustainable, no matter what the Keynesians will tell you. And the longer we try to keep them down, the more damage that will be done when they adjust according to the market. The BoE is just delaying the inevitable and plugging its ears instead of warning people about what will happen in the future.If the interest rates go up my Mortgage will go up, I will struggle to find the extra money especially since everthing else is going up all the time. the Gas/Electricity/fuel for the car and all the other costs rise year on year and my wages don't, worst case we lose the house after a period with no food/electric/gas or what ever I feel we can do without.
We manage, we never go out, never eat out, the car is 11 years old but well maintained and we are not wasteful of food or electricity or anything. I am at my limit but we claim no benefits.
So, I would like the interest rates to stay put, those lucky enough to have savings must be doing ok if they are not in the position I am in, I had to spend mine to stay afloat, If you have surplus money at the end of each month then good for you but don't complain that you are not getting free money given to you for simply putting it away, please realise that some of us are in quite a precarious and worrying position. You are lucky you don't spend every penny you get in each month.
anonymous said:
[redacted]
It is a small house in Cornwall, I could sell and get more money than what I paid but then could not move to somewhere smaller because the prices have gone up since I bought and my mortgage is managable now but if i swopped it would go up. Best to stay put and hope for the best.I bought because I am not prepared to pay rent and line someone elses pockets, I would rather pull myself up by my boot straps and own my house and be beholden to no-one.
It won't always be this way, I work hard.
Art0ir said:
The problem is the artificial interest rates are not sustainable, no matter what the Keynesians will tell you. And the longer we try to keep them down, the more damage that will be done when they adjust according to the market. The BoE is just delaying the inevitable and plugging its ears instead of warning people about what will happen in the future.
Yup, completely untenable but then the situation has been made by poor decisions over the years and then those in charge having to keep it the way it is to stop thousands of people hitting the wall at the same time.One day the Government will realise we need to be making stuff again, Industry produces wealth, we need to be competitive and be making stuff the world wants to buy.
Interest rates will be kept low for as long as possible. To do anything otherwise would be disaster.
Asset prices are artificially high.
But the alternative is unthinkable. If the cost of debt servicing rises, then property values will get squeezed as leveraged owners dispose, forcing values down.
In turn, this will destroy even further bank balance sheets holding this stuff as collateral. So we will have to bail them out again.
The world is going to have to kick this problem down the road for as long as it takes.
The issue of marking to market, the true value of real estate assets around the world, is the elephant in the room. Everyone is going to ignore it for as long as possible.
And if the OP is upset about the return on cash, then use some imagination. Forego liquidity in favour of uncorrelated real assets. Get exposure to food, farmland, forests and certain commodities. They're gonna outperform cash comfortably provided you accept you can't go to the ATM to get access.
Asset prices are artificially high.
But the alternative is unthinkable. If the cost of debt servicing rises, then property values will get squeezed as leveraged owners dispose, forcing values down.
In turn, this will destroy even further bank balance sheets holding this stuff as collateral. So we will have to bail them out again.
The world is going to have to kick this problem down the road for as long as it takes.
The issue of marking to market, the true value of real estate assets around the world, is the elephant in the room. Everyone is going to ignore it for as long as possible.
And if the OP is upset about the return on cash, then use some imagination. Forego liquidity in favour of uncorrelated real assets. Get exposure to food, farmland, forests and certain commodities. They're gonna outperform cash comfortably provided you accept you can't go to the ATM to get access.
Getragdogleg said:
Art0ir said:
The problem is the artificial interest rates are not sustainable, no matter what the Keynesians will tell you. And the longer we try to keep them down, the more damage that will be done when they adjust according to the market. The BoE is just delaying the inevitable and plugging its ears instead of warning people about what will happen in the future.
Yup, completely untenable but then the situation has been made by poor decisions over the years and then those in charge having to keep it the way it is to stop thousands of people hitting the wall at the same time.One day the Government will realise we need to be making stuff again, Industry produces wealth, we need to be competitive and be making stuff the world wants to buy.
t. Things are going to get much worse, interest rates will rise and a recovery is far over the horizon.Willy Nilly said:
If the UK economy is so dependant on people making a paper profit on a house then we really should have a rethink on how the country is run.
Many of us have often thought the same.I'm not saying BOE should seek to have a large step in rates, just gently apply pressure to keep house prices falling towards normal historic measures over the space of the next few years.
Getragdogleg said:
anonymous said:
[redacted]
It is a small house in Cornwall, I could sell and get more money than what I paid but then could not move to somewhere smaller because the prices have gone up since I bought and my mortgage is managable now but if i swopped it would go up. Best to stay put and hope for the best.I bought because I am not prepared to pay rent and line someone elses pockets, I would rather pull myself up by my boot straps and own my house and be beholden to no-one.
It won't always be this way, I work hard.
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