How long can the BoE keep rates from rising?

leveller2911

RenovationMan wrote: »

LOL, hardly. I'm probably paying less on this mortgage than you paid back in 1995 on yours. I'm happy to live in my dream house for £500 odd quid a month.

Good for you , make the most of it ,who knows you could be dead in 6 months.....;)

I sleep easy at night knowing I don't owe anyone a single penny.If I want to up sticks tomorrow and travel round the world I can do it whereas chancers/many like yourself are slaves to the banks.....I feel for you ,honestly I do .

Still each to his own I guess, takes alsorts to make a world....

DervProf

leveller2911 wrote: »

Good for you , make the most of it ,who knows you could be dead in 6 months.....;)

Whoa !!!

Steady on there.

It's going to be interesting to see his response to this.

Anyway, it could be worse for him, interest rates could be 0.75% in 6 months time.

Procrastinator333

leveller2911 wrote: »

Good for you , make the most of it ,who knows you could be dead in 6 months.....;)

I sleep easy at night knowing I don't owe anyone a single penny.If I want to up sticks tomorrow and travel round the world I can do it whereas chancers/many like yourself are slaves to the banks.....I feel for you ,honestly I do .

Still each to his own I guess, takes alsorts to make a world....

So because someone has a different goal in life to you they are a "chancer / slave to the banks" who warrants your pity.

Moron.

JonnyBravo

Q. How long can the BoE keep rates from rising?

A. October


Now you can all sleep easier.
Thank me later.

HAMISH_MCTAVISH

leveller2911 wrote: »

I sleep easy at night knowing I don't owe anyone a single penny.If I want to up sticks tomorrow and travel round the world I can do it whereas chancers/many like yourself are slaves to the banks.

!!!!!!????

I bought, I travelled, I've lived and worked in more countries than anyone I know of on these boards.

Having a mortgage has never once stopped me from travelling.

And owning a house has always meant I stayed on the property ladder, never got left behind by HPI, had the security of knowing I'd a place to come back to, and was never beholden to any employer or set of circumstances.

Owning a house gives you far more security and freedom than being some landlord's "Rent Slave".

And most of the actual Expats I know (as opposed to the forum dreamers/chancers trying to portray "being broke" as "being free") own at least one property, usually more.

Graham_Devon

HAMISH_MCTAVISH wrote: »

Having a mortgage has never once stopped me from travelling.

And owning a house has always meant I stayed on the property ladder, never got left behind by HPI, had the security of knowing I'd a place to come back to, and was never beholden to any employer or set of circumstances.

Eh.

You have a mortgage. Therefore you are beholden to your employer for your wages to pay it, and are beholden to your set of circumstances as you have the responsibility of a mortgage to pay to keep your house.

HAMISH_MCTAVISH

Graham_Devon wrote: »

Eh.

You have a mortgage. Therefore you are beholden to your employer for your wages to pay it, and are beholden to your set of circumstances as you have the responsibility of a mortgage to pay to keep your house.

Except for the fact that after the first few years the mortgage is vastly cheaper than the equivalent rent. And banks are far more flexible than landlords with payment holidays, temporary restructuring, etc.

Therefore it becomes much easier to ditch a job, or change your circumstances.

Whereas rent slaves have to keep paying higher and higher rents, with little to no security or protection.

SAHD_Jim

Three reasons the MPC has decided not to increase the base rate imho:

1. Inflation is good for reducing relative debt, and the public and government both have rather a lot of that at the moment. As someone pointed out, whether they admit it, the BoE (and the government) is happy to tolerate inflation if it helps manage debt in the short term.
2. The effects of austerity that are, in particular, hitting public sector employment are yet to be felt to any real extent yet. A general rise in mortgage rates will reduce consumer spending and combined with a further reduction caused by public sector job losses, we could see a double whammy that sends us back into recession which would ultimately cancel out the effects of austerity.
3. Demand-pull inflation (demand out-stripping supply) can be curbed by reducing spending power via interest rates. The cost-push inflation caused by world commodity price increases can only really be managed by the exchange rate and this is the main problem at present. Interest rates will only have a very limited effect on the price of sterling, unless the BoE was willing to increase rates to astronomic levels, which clearly they are not as it would exacerbate the issues described in point 2 even more. And even then, the sterling crisis under John Major showed that interest rates can't always control sterling.

Thus, all in all, the MPC has come to a consensus that, for the time being, they will leave rates as they are. Rates will go up eventually, it is inevitable, just not yet.

Linton

SAHD_Jim wrote: »

Three reasons the MPC has decided not to increase the base rate imho:

1. Inflation is good for reducing relative debt, and the public and government both have rather a lot of that at the moment. As someone pointed out, whether they admit it, the BoE (and the government) is happy to tolerate inflation if it helps manage debt in the short term.
2. The effects of austerity that are, in particular, hitting public sector employment are yet to be felt to any real extent yet. A general rise in mortgage rates will reduce consumer spending and combined with a further reduction caused by public sector job losses, we could see a double whammy that sends us back into recession which would ultimately cancel out the effects of austerity.
3. Demand-pull inflation (demand out-stripping supply) can be curbed by reducing spending power via interest rates. The cost-push inflation caused by world commodity price increases can only really be managed by the exchange rate and this is the main problem at present. Interest rates will only have a very limited effect on the price of sterling, unless the BoE was willing to increase rates to astronomic levels, which clearly they are not as it would exacerbate the issues described in point 2 even more. And even then, the sterling crisis under John Major showed that interest rates can't always control sterling.

Thus, all in all, the MPC has come to a consensus that, for the time being, they will leave rates as they are. Rates will go up eventually, it is inevitable, just not yet.

Agree with most of that BUT..

Surely inflation only helps with debt if we have it causing an increase in wages with the net result that people can buy the same amount of goods and their debt in cash terms is relatively smaller and therefore more managable.

But if we simply have an increase in commodity costs with no corresponding increase in wages people are poorer with less disposable income and so managing debt becomes more of a burden, not less.

leveller2911

DervProf wrote: »

Whoa !!!

Steady on there.

It's going to be interesting to see his response to this.

Anyway, it could be worse for him, interest rates could be 0.75% in 6 months time.

So what was wrong with my post, its a fact isn't it?... Who knows how long any of us have left, the moment we are born we are dying so best to make the most of it..:D