Ernst And Young Recommend Lower Interest Rates

Pimperne1

http://www.bbc.co.uk/news/business-15326778

"It thinks further action should include cutting interest rates to 0.25% from their current record low of 0.5%, and a cut in stamp duty for first-time buyers".

HAMISH_MCTAVISH

And their economist was on the TV news this morning calling for further action to get the housing market moving again.

Obvious really... There will be no sustainable wider economic recovery until house prices are back in steady growth.

geneer

With the further deterioration in the economy that such a desperate move would no doubt indicate, the bulls will no doubt sit back and consider it a job well done.

doire_2

The economy is f**ked would have been a better title for your thread

EchoLocation

Yes, what better way to tackle Inflation than another round of QE followed by a cut in historic low interest rates. The word 'desperation' somehow doesn't seem to do this idea justice.

ultrawomble

Pimperne1 wrote: »

http://www.bbc.co.uk/news/business-15326778

"It thinks further action should include cutting interest rates to 0.25% from their current record low of 0.5%, and a cut in stamp duty for first-time buyers".

Are there many first time buyers going straight in at +£250K?

Really2

ultrawomble wrote: »

Are there many first time buyers going straight in at +£250K?

In the south east I would say yes, a fair few.

Pimperne1

ultrawomble wrote: »

Are there many first time buyers going straight in at +£250K?

Unless it has been changed without me seeing it then the £250k threshold drops back to £150k in March next year. I assume they are suggesting continuing the exemption.

Graham_Devon

A move to lowering interest rates to 0.25% would of course prompt mass celebration by a few. Would also prompt threads to be dragged up, lots of glee, and an impact on our forests what with the amount of man size tissues used.

However, it would also indicate that our economy is absolutely up the creek without the inevitable paddle.

What will it actually do?

If cutting base rates 5.25% didn't work. What will 0.25% achieve? Seriously. There would be more people suffering than there would saving a measly few quid a month.

Might aswell just cut them to 0% and be done with it...will do as much good.

IMO its time to try something else instead of the tried and tested which didn't work and just made anyone without mortgages poorer through living costs.

sheffield_lad

Graham, cutting interest rates down to there current .5% did work imagine how people would be coping if the mortgage rate was still around 6-7%?

Not good.

The problem is normally doing something means borrowing or it has in normal recessions but this recession is built on debt so not a good option borrowing more, everybody knows that bar Mr Balls up it seems.

If I was George O I would be looking at Ireland and going for lower corporation tax but Mr Union man would not want to hear that in a time of cut backs.

Graham_Devon

howee wrote: »

Graham, cutting interest rates down to there current .5% did work imagine how people would be coping if the mortgage rate was still around 6-7%?

I was talking more on the economy lines