BoE urges savers to spend spend spend to save the economy!

StevieJ

Old_Slaphead wrote: »

Better keep your fingers crossed that they don't have a dodgy oilwell somewhere off the coast of America that you know nothing about.

Many people, me included, could claim to have some of their rainy-day money stashed away with BP

I sold BP in March (£6.30) to crystallise a capital gain and didn't buy back

StevieJ

Paul_Herring wrote: »

That is not what I would consider an emergency fund. An emergency fund is money I can access within hours or at a push days.

Hoping the stock market didn't drop 25% yesterday so I could call on the funds today isn't really my idea of a safe place for such funds.

Not too much damage as I am already up 20% BTW I can access those funds fairly quickly. Depends what you mean emergency, I do have some small funds on hand for everyday emergencies, the investments are more for holidays and the like.

sKiTz-0

Erm, I can't spend spend spend as I'm trying to save up for the 25% deposit on a house that I need to get an affordable mortgage.

Primrose

To be honest, I wouldn't mind spending a bit of my savings if I thought I was buying goods made in Britain which would help the economy but virtually everything you buy these days comes from abroad. So that is only helping another country's economy.

Maybe if we had another Buy British campaign and people could see that their money, being spent here, would help their own economy,, they might be more tempted to spend a little. But I fail to see how helping China, Japan and Korea will do the UK any good. Until the UK is able to vastly increase its own manufacturing base, especially with consumer goods which people want to buy, I can't see that happening.

Rob_192

From my point of view, low interest rates are a barrier to spending. When I was earning 6% a few years ago, I felt very confident and didn't mind splashing out on something from time to time. Now I'm struggling to average 3% and even then loosing out to inflation, I'm going to hold on to my savings thank you. There must be millions out there who think like this.

I'm really not convinced low interest rates encourage spending. OK if you're in steady employment on the right mortgage deal, then you probably feel quite flush at the moment, but most people I know in that situation are paying down their mortgages whilst they can.

R

margaretclare

Primrose wrote: »

To be honest, I wouldn't mind spending a bit of my savings if I thought I was buying goods made in Britain which would help the economy but virtually everything you buy these days comes from abroad. So that is only helping another country's economy.

Maybe if we had another Buy British campaign and people could see that their money, being spent here, would help their own economy,, they might be more tempted to spend a little. But I fail to see how helping China, Japan and Korea will do the UK any good. Until the UK is able to vastly increase its own manufacturing base, especially with consumer goods which people want to buy, I can't see that happening.

I agree - the only alteration I would make in your argument is England rather than UK.

All other countries give tax concessions and tax breaks to their industries. That's why Germany still has Dornier, Krupp, Messer!!!!!!t, Zeppelin and the rest of names familiar from the 70th anniversary of the Battle of Britain, whereas we famously have Rolls-Royce for aero-engines but none of the rest of our aircraft industry. The most recent 'Queen' liner was built in Germany.

bigheadxx

You can either spend all of your savings, fuelling the economy and inflation and then look forward to an impoverished retirement or you can keep hold of your savings, forcing the BOE to continue QE, fuelling inflation and then look forward to an impoverished old age.

Paul_Herring

bigheadxx wrote: »

You can either spend all of your savings, fuelling the economy and inflation and then look forward to an impoverished retirement or you can keep hold of your savings, forcing the BOE to continue QE, fuelling inflation and then look forward to an impoverished old age.

http://en.wikipedia.org/wiki/Fallacy_of_the_excluded_middle

JamesU

margaretclare wrote: »

I agree - the only alteration I would make in your argument is England rather than UK.

Why only England?

JamesU

Joe_Bloggs

Part of the reason that I am not going to splurge my savings is because I am on a Bank of England tracker mortgage. If the BoE starts to up its rates then then I am going to need to have reserves of cash either while I refinance or if I hold out and wait for rates to fall. I would probably throw my saved money at the mortgage once this happens. I am unlikely to get a better return given my knowledge of investments.

Is the Bank of England (and other unmentioned places ) following the same track as the Japanese central bank ? They have low interest rates but what else can they do apart from giving money away ?
J_B.