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Blame the Banks or The Government?

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  • 100saving
    100saving Posts: 314 Forumite
    edited 23 July 2013 at 12:16PM
    you can get an avg. interest rate on savings of just above 3% but you have to be willing to do the work by setting up accounts reg savers, current account, etc.

    it used to be cash is king but sadly them days are long gone. If the gov. stopped lending banks money for free then interest rates would be higher as banks would need our savings to then lend out, but then the interest rates on loans etc as well and food etc would start to go up even more.

    The biggest issue we have is wages not going up with inflation so everything is getting harder to buy as the money we earn to live on is not going to cover the cost that means we will end up back in 2009/10 again with banks going tits up.
    Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
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  • Glen_Clark
    Glen_Clark Posts: 4,397 Forumite
    talexuser wrote: »
    "let the free market run" party.
    You make some good points, except there is no free market party.
    If there was a free market the Government wouldn't use planning permission to restrict house building and inflate house prices. Then inflate them some more with taxpayer funded interest free loans on £600k sub prime mortgages. In a truly free market London house prices would probably be about a quarter of what they are now.
    We only have a free market where it suits the Government.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
  • grizzly1911
    grizzly1911 Posts: 9,965 Forumite
    Glen_Clark wrote: »
    You make some good points, except there is no free market party.
    If there was a free market the Government wouldn't use planning permission to restrict house building and inflate house prices. Then inflate them some more with taxpayer funded interest free loans on £600k sub prime mortgages. In a truly free market London house prices would probably be about a quarter of what they are now.
    We only have a free market where it suits the Government.


    I took the comment as referring to the free-er market pre GCF.
    "If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....

    "big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham
  • grizzly1911
    grizzly1911 Posts: 9,965 Forumite
    dunstonh wrote: »
    No point being frustrated. In most periods in history, cash has not kept up with inflation.
    opinions4u wrote: »
    If you want to keep up with inflation there has been no extended period in the last half century where a bank / building society deposit account has succeeded in delivering that requirement.

    Why would you expect that to change now?

    Not even in fixed/term deposits deposits?

    Appreciate the average or instant pass book type savings haven't.
    "If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....

    "big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham
  • grizzly1911
    grizzly1911 Posts: 9,965 Forumite
    theGrinch wrote: »
    Anyone else utterly frustrated of where to save without inflation (aka negative real interest rates) murdering your capital or without betting on the stock market?

    Its not like you can get 3% here without locking your money away. Typically you are looking 2.3% (fixed) and 1.5% (instant) and thats gross.

    Cyprus is silently happening here every day.

    Im pointing at the Government with its tricky cheap money for lending.

    Ive spent several hours over the last 2-weeks looking and its getting worse.

    Any chance of a reprieve with a market topper or are we stuck in a rut?

    Rant over, search ongoing.

    I guess they are both to blame but in different ways.

    On other boards, affordability isn't cited as a problem, for residential mortgages (deposits yes - they say) and many larger businesses are sitting on cash piles so perhaps it is time to start increasing rates to test that theory.
    "If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....

    "big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham
  • IronWolf
    IronWolf Posts: 6,445 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    It's the government and BoE's fault, not the banks. They will charge as little interest as they can get away with but the BoE sets interest rates and the government is loaning banks money at competitive rates. Throw QE into that and you have a greatly reduced need for banks to raise money through traditional deposit taking hence low interest rates.
    Faith, hope, charity, these three; but the greatest of these is charity.
  • coastline
    coastline Posts: 1,662 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    Not even in fixed/term deposits deposits?

    Appreciate the average or instant pass book type savings haven't.

    rpi..

    http://swanlowpark.co.uk/rpiannual.jsp

    average savings....fixed term should have been a bit better.

    http://swanlowpark.co.uk/savingsinterestannual.jsp
  • Archi_Bald
    Archi_Bald Posts: 9,681 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    IronWolf wrote: »
    Throw QE into that and you have a greatly reduced need for banks to raise money through traditional deposit taking hence low interest rates.

    What do you want the government/BoE do as an alternative? Let the country go bankrupt in the short term?
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Stop blaming and take responsibility.

    For over borrowing in the good days, for underspending in the bad.

    For not being a borrower with the lowest rates ever, my mtg savings have outdone my lower interest income.

    for saving in cash, instead of other assets like equties which have done well.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    IronWolf wrote: »
    Throw QE into that and you have a greatly reduced need for banks to raise money through traditional deposit taking hence low interest rates.

    Outstanding personal debt exceeds retail deposits. So the banks need far more than Joe Public can provide. Therein lies the problem.
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