0% interest rate - possible?

eeja

purch wrote: »

The Exchange Control Act was removed from the Statute Book (ie.repealed not suspended) on 24th October 1979.

In 1978 the UK still had a Labour Government and "Fatty" Lawson was just an opposition MP, rather than Financial Secretary to the Treasury as he was in Thatchers first Government.

My point about negative Swiss interest rates was not disagreeing with you, rather pointing out that this is not a unique nor undesirable situation.

OK it was 1979 not 1978 . I apologise but you are DEFINITELY wrong about it not being a suspension. I actually heard with my own ears Nigel Lawson's speech announcing the removal of Exchange Controls being broadcast on the BBC 6 o'oclock news that day. Even called a friend to listen as had undergone the tyranny of that demonic law ever since I was a child. ( the £50 allowance )_
Not only that, he said the legislation would remain on the Statute Book in case it ever had to be brought back in an emergency . Neil Kinnock for Labour expressed his total disagreement with the removal of the controls saying that money should stay in the UK where it was needed and not exported overseas. He pledged to bring back the controls once in office ! I understand the legislation was used again, this time directed against Argentina during and after the Falklands War. If you have evidence to the contrary ( MOST unlikely,) chapter and verse / or Hansard please as it is only logical such a law would remain in the government's armory in case of sudden dire urgent need to protect the economy . !

1echidna

If, as seems likely, the economy rapidly deteriorates with rising unemployment and falling inflation, the monetary levers will be pulled very hard (never mind savers' interests) and I feel a bank rate of 0% is entirely possible.

purch

All exchange controls under the Exchange Control Act 1947 (10 & 11 Geo. 6 c14) were abolished on December 13th 1979 by the Exchange Control (General Exemption) Order 1979, S.I. 1979/1660 made under section 1 of the 1949 Act.

The Exchange Control Act 1947 remained on the Statute Book until it's repeal by section 68 (1) (Part VI Schedule 16) of the Finance Act 1987

http://www.opsi.gov.uk/acts/acts1987a

scroll down the page to the Finance Act, and you can download the PDF and read at your leisure. (P.S. It's on page 115 of the Act)

eeja

purch wrote: »

All exchange controls under the Exchange Control Act 1947 (10 & 11 Geo. 6 c14) were abolished on December 13th 1979 by the Exchange Control (General Exemption) Order 1979, S.I. 1979/1660 made under section 1 of the 1949 Act.

The Exchange Control Act 1947 remained on the Statute Book until it's repeal by section 68 (1) (Part VI Schedule 16) of the Finance Act 1987

http://www.opsi.gov.uk/acts/acts1987a

scroll down the page to the Finance Act, and you can download the PDF and read at your leisure. (P.S. It's on page 115 of the Act)

Many thanks indeed for that. So I was completely right. The controls were only suspended by Nigel Lawson and the legislation remained in force.
Thank you for informing us that the Act was in fact abolished completely
8 full years later. I did not know that. Repeal of an unused defunct law in a budget eight years later is not likely to be made known to the general public or even published in the budget reports of newspapers of the time.. [So clearly different legislation was used to impose financial controls on Argentina and my assumption in that regard must have been incorrect.] Most grateful for your research on the matter and making all the facts clear. Lets hope Google's search engine gets hold of your well researched reply so that the wider public will know the facts you uncovered for us all.

drc

What's the point of saving your money if you don't get rewarded for doing so? Savers are effectively now having to subsidise all those who were reckless with their money. We lose interest on our savings so that those who were reckless with their finances can be cushioned from having to question or change the way they behave when it comes to personal finance. From the way this government acts, you'd think that buying everything on credit, being up to your eyeballs in debt, never taking responsiblity for anything and living off benefits is a way of life to be rewarded and its depressing the hell out of me.

What do the responsible people of the UK who don't rely on other people bailing them out have to do to get rewarded by this shoddy government :mad:

earlgrey_3

drc wrote: »

What's the point of saving your money if you don't get rewarded for doing so?

The important bit is the return you get relative to inflation. Far better to get 2% interest with inflation at 1%, as being predicted, than 15% with inflation even higher (especially as you would be taxed on the 15% interest even though the return was negative). That was when savers massively lost out.

phil_b_2

http://www.bloomberg.com/apps/news?pid=20601087&sid=axScg04s0X38&refer=home

Big Merv has more or less said 0% rates are perfectly possible, as the BOE will cut to whatever level is necessary. I certainly wouldn't bet against it.
I may suggest to him that -10% rates are necessary and the BOE should be paying us to borrow. Worth a shot!

eeja

drc wrote: »

What's the point of saving your money if you don't get rewarded for doing so? Savers are effectively now having to subsidise all those who were reckless with their money. We lose interest on our savings so that those who were reckless with their finances can be cushioned from having to question or change the way they behave when it comes to personal finance. From the way this government acts, you'd think that buying everything on credit, being up to your eyeballs in debt, never taking responsiblity for anything and living off benefits is a way of life to be rewarded and its depressing the hell out of me.

What do the responsible people of the UK who don't rely on other people bailing them out have to do to get rewarded by this shoddy government :mad:

Agree 100% with the sentiments expressed above and so would most others on this forum. You make a very valid and important point
Can you not post this important point on a new thread devoted to the point as am sure dozens if not hundreds of people would be interested to contribute their views ..but not on this rather 'specialist' type thread they would not even read ! If you do, expect at least 10000 people to read it. .

Andrew64

Maybe we'll end up having to pay the banks to keep our money!!

halight

Hi
I dont think that the rates will go down as far as 0% but i do think thay will hit 1%.