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Debate House Prices
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Interest rate held at 0.5%
Comments
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Graham_Devon wrote: »Spending on the high street has gone up, as mortgage payments have gone down. Is this coincidence?
Do you think this might have been considered as a consequence to help the economy?
Could this have been a goal from lowering the rates?
If so, does this not imply that rates are unlikely to rise until the economy is on a firmer footing?:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
IveSeenTheLight wrote: »Do you think this might have been considered as a consequence to help the economy?
Could this have been a goal from lowering the rates?
If so, does this not imply that rates are unlikely to rise until the economy is on a firmer footing?
I just think people saw less money going out, so went out and spent.
I don't buy the theory that it was one of the goals personally. They probably would have extended the VAT reduction if there was a big goal there.0 -
I do think people are motivated by simple reasons. Most arent great with money just do whatever seems best at the time. If I have 50 in my pocket instead of just a tenner I will probably buy something to cheer myself up , why not - Carpe diem, quam minimum credula postero
Life is boring if you think too much about it and anything could happen anyway so why worry. people will spend more if possible thats the british nature mostlyIf so, does this not imply that rates are unlikely to rise until the economy is on a firmer footing?
I dont agree here. We are assuming rates are set by choice.
Theres good reason rates have never been this low and we will be reminded why its not a good idea
Same argument as firstly, people will do what they can get away with. Right now it looks like 0.5% has no downside, thats our reality today but its not the case long term.
The economy has been this bad before, clearly this is not a reason why rates have fallen so low or for them to stay thereI don't buy the theory that it was one of the goals personally.
It was a deliberate goal to encourage spending. USA has done the same many times. A few years back the fed had taxes paid back to citizens for those reasons0 -
sabretoothtigger wrote: »I
The economy has been this bad before, clearly this is not a reason why rates have fallen so low or for them to stay there
A very different situation to before. With free movement of capital globally and people around Europe. Technology has taken the skill out of many jobs in the past 25 years. We've exported the metal bashing jobs but these are the ones that are required to employ people en masse.
An economy based on people trading houses and financial services isn't a good starting point.0 -
Graham_Devon wrote: »I just think people saw less money going out, so went out and spent.
I don't buy the theory that it was one of the goals personally. They probably would have extended the VAT reduction if there was a big goal there.
Well I've certainly saved more from interest rate reductions than from VAT decreases.
VAT reduction only helps people after they have worked out their disposable income.
If people didn't have the disposable income in the first place, there's less likely they'd be able to take advantage of VAT reductions.
Interest rates lowering has helped millions of people (including thousands of businesses) by having more money available to them.:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0
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