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Bank of England has upgraded its growth forecast ....
Comments
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Thrugelmir wrote: »Savers benefited from the credit boom years as well...........
Really ?
The model of financial institutions paying retail savers and charging borrowers effectively broke down during the credit boom, and in extremis Northern Rock demonstrated this
I thinks its difficult to argue the fact that interest rates were too low during all the boom years - and this in fact made the boom worse, extended the normal business cycle and delayed recession.
The only break that savers have had in the last 12 years is the taxpayer guarantee on savings in institutions that are insolvent.US housing: it's not a bubble - Moneyweek Dec 12, 20050 -
Kennyboy66 wrote: »The only break that savers have had in the last 12 years is the taxpayer guarantee on savings in institutions that are insolvent.
It's a pretty big break for rich people that the guarantee went from a few £10,000s to absolutely every penny.
That's a massive transfer of risk from the rich to the rest.0 -
TheFactory wrote: »Don't get too far ahead of yourself, there will not be any rate rises for now
I know that! I was stating that it is looking to rise earlier than we thought.:beer:0 -
It's not every penny. Around £80k. Does that only apply to rich people?It's a pretty big break for rich people that the guarantee went from a few £10,000s to absolutely every penny.
That's a massive transfer of risk from the rich to the rest.
£80k saved over a lifetime is not that much.0 -
It is for controlling inflation. The target is 2%. It is almost on track. It has come down a lot. This suggests an increase is unlikely. If the current trend keeps up it will fall below 2%, what happens then, interest rates drop?I know that! I was stating that it is looking to rise earlier than we thought.:beer:0 -
It is for controlling inflation. The target is 2%. It is almost on track. It has come down a lot. This suggests an increase is unlikely. If the current trend keeps up it will fall below 2%, what happens then, interest rates drop?
Inflation has been above target for so long that many have just assumed it'll stay like that.
The big drop has highlighted that whether employment reaches 7% is irrelevant if inflation is on target and the BoE don't predict any inflationary pressure. Interest rates won't be changing.
I'm almost starting to feel sorry for those who are too scared to take their savings out of cash. I suppose if they've not learnt that cash rarely yields a return by now they never will.0 -
The 7% unemployment is not a trigger as you identify. Inflation is. It was seen before that keeping rates low despite high inflation was acceptable to maintain a recovery. As we are recovering and inflation is at an acceptable level it is reasonable at this time to say that the interest rates won't change at the moment. If inflation was to rise then this could change.Inflation has been above target for so long that many have just assumed it'll stay like that.
The big drop has highlighted that whether employment reaches 7% is irrelevant if inflation is on target and the BoE don't predict any inflationary pressure. Interest rates won't be changing.
I'm almost starting to feel sorry for those who are too scared to take their savings out of cash. I suppose if they've not learnt that cash rarely yields a return by now they never will.0 -
It's a pretty big break for rich people that the guarantee went from a few £10,000s to absolutely every penny.....
Blame the Irish, it was their unlimited guarantee that obliged everyone else to up the ante....That's a massive transfer of risk from the rich to the rest.
The FSCS is funded by levies on authorised firms. So effectively the cost of providing the guarantee is born by banks in proportion to the deposits they hold, and ultimately by the owners of said deposits. Hence the risk is borne in proportion to the deposits.
P.S. I am of the opinion that having a deposit guarantee scheme is a good thing as it saves the government from having to 'save' every bank that attracts any negative media coverage. Otherwise there would be little pieces of the Co-Op Bank strewn all over the place.0 -
I'm almost starting to feel sorry for those who are too scared to take their savings out of cash. I suppose if they've not learnt that cash rarely yields a return by now they never will.
Like pensioners you mean. Investment strategy to switch out of more risky investments to cashlike safer alternatives. Unfortunately that usually means lower returns.
Not everyone can or is capable of chasing investments or BTLs."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 Muruganantham0 -
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