Interest rates so low - don't bother saving!

sabretoothtigger

brokenarrow wrote: »

When interest rates go back up to normal it will slow down gold and silvers yearly gains, but that could be years away yet.

Here is the ironic thing, when interest rates are raised up high it will also be when gold is rising fastest.

The reason being is that its not the headline rate but the effective rate difference between cash returns and asset inflation.

The way to view this clearly is to examine in a currency from every continent. IF we just view the world in sterling prices, its going to give a goldfish bowl perspective.

They can have interest rates at 20% but we can also have inflation rates at 20% so why is this any more influential on gold then our low rates now

The way I see it is gold is about stability, its boring and as said above it does nothing and gives no interest.
So when its highest value will be when we are most unsure of everything, no doubt they will be raising rates and changing all sorts of rules and laws to calm things down

sabretoothtigger

Im in the camp that all humans are ultimately equal in their possible success and failures and any manipulation is the reason for its own failure

I know gold is more freely traded then bonds or currency is. They are a natural, useful global resource. We got to assume because of that superior balance in supply to demand, that is why they will be worth more in the end to people

They are not used as often as bonds now, so thats the biggest manipulation I would call out. They act inversely to government debt and politics. I dont follow 'secret stuff' as big drivers of anything, the best place to hide is in plain sight.

Transaction frauds may occur but its not significant
The reason you should agree is that gold or anything of limited supply but unlimited use is less easy to manipulate then what is written on paper.

Naturally one will transcend the other, hence prices will certainly rise. If fraud is equally likely with both, we might as well stick with paper promises and save the effort of storing 'value'

System

I get 4.25% in my 3 year fixed ISA

ScarletBea

I've got a 3-year bond ending now.
It's a sad state of affairs that putting that in my instant access account is the option that gives me the highest interest, if I don't want to fix for 5 years (which I don't)...

atush

Yeah, it is sad.

But I am happy I am paying less than 1% on my mtg. Swings and roundabouts really.

gadgetmind

This is one of the few times that I wish we had a mortgage!

Thrugelmir

berbastrike wrote: »

I get 4.25% in my 3 year fixed ISA

and after the Fixed Term ends?

GeorgeHowell

Thrugelmir wrote: »

and after the Fixed Term ends?

About 2.25% if you're lucky I would think. But at least you won't lose nominal capital like you might on the stock market.

planemad

Glad I opened up a Tesco bond in October @ 3.2% - rates seem to have dropped like a stone since then!

innovate

GeorgeHowell wrote: »

About 2.25% if you're lucky I would think. But at least you won't lose nominal capital like you might on the stock market.

There are currently 2-year fixed deals at 3.1% about. Obviously way lower than 4.25%, but also way higher than 2.25%.