The world is defenceless against the next financial crisis

shortchanged_2

mayonnaise wrote: »

Old news.

https://forums.moneysavingexpert.com/discussion/5016118

Maybe old news mayo, but the fact is it's still looming. So not much improvement over the past few years.

The Greece situation was never going to go away and it really is coming to a messy finale soon. We'll just have to see how bad the fallout for the rest of us will be.

Thrugelmir

purch wrote: »

I think the idea that Central Banks have no tools left is pretty obvious.

QE/ZIRP were last resorts.

And unwinding QE and moving towards higher interest rates presents a whole new set of problems.

The longer this time is put off, the harder it will be to pull off.

But we are where we are, recovery cannot be forced.

That's why the FED is so keen to raise rates. Time to have the tools available.

Generali

Rinoa wrote: »

Hmmm. The Bank of International Settlements.

On their web page it says:

Established on 17 May 1930, the Bank for International Settlements (BIS) is the world's oldest international financial organisation. The BIS has 60 member central banks, representing countries from around the world that together make up about 95% of world GDP.

So the BIS are effectively saying that the central banks, who make up its membership, have got it all wrong. How curious.

Still, they've made Graham happy.

The BIS has a pretty formidable reputation. If anyone wants to start looking for the mother ship of the shape shifting lizards I reckon the BIS boardroom is a good place to start.

I reckon the Lombards and the Rothschilds might have a thing or two to say about the claim that the BIS is the oldest international financial institution!:)

Conrad

From my own experience the average mortgage in my part of the S/E (typical SE, not Mayfair or anything) is touching £400k now, with even many FTB's looking to borrow such sums.


A 2% rate rise once they hit SVR in 2 to 5 years time would take their rate to something like 7%, so the interest alone would cost £2333 pm. This would tip many people into debt delinquency.


Even FTB Poles I often find myself battling with as I urge them to be more realistic and borrow say £200k, but they wont hear of it.

Thrugelmir

Conrad wrote: »

From my own experience the average mortgage in my part of the S/E (typical SE, not Mayfair or anything) is touching £400k now, with even many FTB's looking to borrow such sums.


A 2% rate rise once they hit SVR in 2 to 5 years time would take their rate to something like 7%, so the interest alone would cost £2333 pm. This would tip many people into debt delinquency.


Even FTB Poles I often find myself battling with as I urge them to be more realistic and borrow say £200k, but they wont hear of it.

Good thing that the vast majority of people in the UK are now taking out repayment mortgages. As it won't be the banks taking the hit next time.

Pobby

Conrad wrote: »

From my own experience the average mortgage in my part of the S/E (typical SE, not Mayfair or anything) is touching £400k now, with even many FTB's looking to borrow such sums.


A 2% rate rise once they hit SVR in 2 to 5 years time would take their rate to something like 7%, so the interest alone would cost £2333 pm. This would tip many people into debt delinquency.


Even FTB Poles I often find myself battling with as I urge them to be more realistic and borrow say £200k, but they wont hear of it.

Interesting. looking at Reading it is pretty frightening as far as housing, buying one, and rents. 3 bed semi. Same as I stared with. About £300k to buy and £12k a year to rent. Not the greatest 2 bed flat is £900 per month. So singleton on good money, taking home £3k a month, less rent and living costs has to go some to get a deposit, at the rate of things it will have all gone up by the time that has been saved. Far cry from when it was possible to buy a resonable place on one wage.

mwpt

wotsthat wrote: »

If the next financial crisis is as good as the last then bring it on!

Out of interest, and I'm trying to not include any judgement in this post (because I care about my own well being as much as the next person), do you ever feel any sense of empathy for the millions who were negatively affected by the crash and the resulting interventions?

wotsthat

mwpt wrote: »

Out of interest, and I'm trying to not include any judgement in this post (because I care about my own well being as much as the next person), do you ever feel any sense of empathy for the millions who were negatively affected by the crash and the resulting interventions?

You're trying to read too much into a tongue in cheek comment but thanks for not being judgemental.

mwpt

wotsthat wrote: »

You're trying to read too much into a tongue in cheek comment but thanks for not being judgemental.

Fair enough, I just saw you make a similar comment on another thread

(Seriously though, people will have their own self interest at heart, so I don't blame anyone from trying to profit from a situation)

wotsthat

mwpt wrote: »

Fair enough, I just saw you make a similar comment on another thread

(Seriously though, people will have their own self interest at heart, so I don't blame anyone from trying to profit from a situation)

I'm rather sceptical of most people's 'empathy' and think they use it as a hypocritical weapon to try and further their own self interest. I rather like HPC in this respect - they want the economy to crash and burn just so they can pick up a cheap house - I like the honesty.

I don't feel the need to deny that I've been a long term beneficiary of good luck and judgement. Engaging in some faux hand wringing isn't going to change that.