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interest rates will lag inflation more than normal
we have a government who wants to pay debt down any way they can. short to medium term interest rates will stay fairly low it's after this we should be worried. Turning the taps on is easy. turning them off, not so easy!! **your mortgages now imo |
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No , I am agraid not. Rates are to stay low for forseeable future, despite CPI increasing. Most prices are falling , and the habits that the majority are displaying are deflationary.
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rates will go up when the tories come into power. their backers will demand it. then the fun will start
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Any rate rise will have nothing to do with the Tories being elected. Rates will rise once inflation takes off which it will in a year or so.
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coincidental or not, an interesting trend
http://moneyworld.com/bank-base-rates.htm |
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QE will have to be withdrawn beofre rate rise. QE is a substitute and desighned to have the same affect as a rate cut.. This is teh new tool for hitting the inflation target
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Chisel,
You seem to have a lot to say about these things. Would you be kind enough to define what inflation actually is for me please? Thanks in advance |
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if those predicting the end of the world and CIVIL UNREST saw it going their way, they would have a LOT more to say than chisel imo
funny, when it began going against them they could still be found once every couple of days posting some rubbish, now they are completely gone :( |
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Put your handbags away ladies. I am inclined to agree with the those who think that a government change is likely to have an impact on interest rate changes but I think that will still take 2 years or so to take real effect. Until then enjoy the rate for those with trackers and commiserations those savers out there.
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There so no reason at all why rates wont rise long before QE is withdrawn.
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Harry
Sorry , I simply do not agree! We have a few years of rates sub 2%, maybe even longer CPI increased last month but the price of most things is actually falling. The QE money is still not getting through to the peopel that need it, and we are all displaying deflationary behaviour(not necessarily through choice) |
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You may not agree chisel but thats not relevant to the situation. Mervyn King has already indicated this is the case.
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Chisel,
can you define inflation/deflation for me? I'm a little confused. thanks |
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got myself unbanned eventually. needed to respond to this..
if those predicting the end of the world and CIVIL UNREST saw it going their way, they would have a LOT more to say than chisel imo there's plenty to say. said it on many threads but theyve all dropped off. all that remains is chisel on one side trying to ramp everything, and mikaad on the other over reacting re the markets etc. people arent bothering to entertain the debate anymore it seems to me. i wasnt, because i was banned lol. so, like i said before, the fiat currencies are all being devalued. this is why gold for example is going up and up. it is a raw material yes, but a currency also. the dollar and the pound particularly are being run into the ground. dollar/pound holders are using their holdings to buy up assets - stocks and shares, and gold etc. this is because they are losing faith in the ability for us ever to pay back our debts. they want to use their holdings for something ebfore they become worthless. they hold so many that they have to drip feed them in for fear of crashing the currencies prematurely and destroying their holdings. why you think obama has been in china/asia.... creditor meeting. i suspect he was asking if by passing another stimulus bill they would pull their credit and sell their dollars thus crashing it... wonder what the answer was? in china you can buy gold in a bank. everyone is buying. the government is telling its people to buy gold. yet over here all the adverts tell you to sell it at peak prices lol, and the man in the street who may talk about buying some from time to time quickly forgets to. he is too busy with xfactor etc. yet the price of gold is reaching new highs almost daily. re the currencies, of course our governments know what they are doing. they are crashing the pound/dollar intentionally, for us to get in the euro and the yanks in something similar. now that they have us under eu control, they want to centralise the currency too. as a result of all this, the stock markets are in general going up - those dollars and pounds have to go somewhere, and it wont just be gold. as ive said previously they will likely keep doing so. their maybe some steep drops on the way in the next year or so, but in the next 3/4 years it will surpass the old highs imo. of course just looking at the dow or ftse it is not quite as cut and dried because certain sectors are in dire straits and others are set to make a killing. the miners for example, which ive been in since july, are rockin and rollin :) :) the type of calamity mikaad mentions tho will likely also happen at some point - it is a certainly given how the system works, but is still 4/5 years away imo. house prices and interest rates - well regardless of what the gov tells you, this will be out of their control in due course. the pain many predicted will occur. the world will not end of course, but it will be a very different place. we will not be able to avoid massive inflation because of the policies adopted over the last year or so. im sure you know the implications of that... think iceland/zimbabwee. deflation is only occuring in luxury/nonessential goods and house prices. the house price issue is about affordablity, in that many are in bad shape, newbies find it hard to get on, and a lot will be in trouble when their rates do go up effectively out of the control of both their mortgage provider and the state - because we will import the inflation from abroad due to our crushed currency and also continue to support ourselves with quantitative easing and general spending adding further pressure to the pound. so it's not all sunshine and roses yet im afraid , and far from it. while im here, i saw another thread re gold/silver, and this is how you can save yourself imo. i hold a fair bit of physical silver, as i think the ratio between gold and silver will eventually shorten again quite dramatically, and so with the currency situation silver is a real power play likely to make even bigger gains than gold, silver miners included. (why you think buffet owns so much silver, and then rents it out... the man is shrewd). platinum pretty good too imho- well undervalued. |