Interest rate rise?

Filo25

Ozymandias73 wrote: »

yes, and I am finishing the conversation, with the obvious answer that only time will tell who is right.

Well as I haven't said anywhere that some companies won't face issues if rates rise, then I assumed you either hadn't read my post or just hadn't understood it, I will put it down as hadn't understood it.

I fully agree that as rates rise a number of companies who are on the border will struggle and fail, that is common sense, some of those companies will fail anyway even without rate rises.

My point was pretty straightforward, if that happens in significant enough numbers to start impacting the broader economy then interest rate rises will stop or even possibly reverse, if we just get a few failures which don't particularly impact the broader numbers (as has happened recently) well that is undoubtedly sad for those negatively impact but unfortunately nothing much new in a mixed capitalist economy, compnaies go under and people lose their jobs all the time.

System

buglawton wrote: »

Which resulted in low inflation (that still outstripped wage growth), massive house price bubble, no pay rises for approx 8 years and pay up overall by about 6% in 10 years.

That worked well.

Plus a collapse in productivity. QE, the wonder medicine that makes you very ill. No wonder they cannot repeat QE, knowing what they now know about how toxic it is.

Filo25

buglawton wrote: »

Which resulted in low inflation (that still outstripped wage growth), massive house price bubble, no pay rises for 10 years and pay up overall by about 6% in 10 years.

That worked well.

And what was the alternative, people seem to forget just how awful the global economy looked during the GFC, the 2008 crash could have looked a lot more like the great depression without aggressive policy responses.

I can't blame policy makers for being aggressive in using whatever tools they had to stave off an economic crisis, do I think they got everything right, clearly not, but it was a lot better than sitting on their hands and doing very little.

michaels

buglawton wrote: »

Which resulted in low inflation (that still outstripped wage growth), massive house price bubble, no pay rises in many sectors for approx 8 years and pay up overall by about 6% in 10 years.

That worked well.

So the post crash dip has been very uncomfortable in terms of real wages...but in terms of unemployment, repossessions, bankruptcies etc it has been much more mild than previous boom and bust cycles.

I guess it is a value call as to which s worse - some pain for most or major pain for a large minority....

buglawton

The use of QE and it's debatable outcome underlines just how few tools the BoE has. It has interest rates, QE and...

And it lets the government off the hook for not tackling UK productivity and continuing to charge the taxpayer for exorbitant blunders
https://www.telegraph.co.uk/news/2018/08/01/smart-meters-millennium-dome-britain-uniquely-awful-big-projects/
- £100BN of waste not including HS2.

lisyloo

Ozymandias73 wrote: »

It may be a storm in a teacup for you, because your income is high and guaranteed, and you have no exposure to debt yourself or debt ridden companies, but I am sure for Gaucho, Prezzo, Carillion etc ex-employees, and other current workers who are 'just about managing', it is rather more than a storm in a teacup

My income is not high nor is it guaranteed. My job was formally at risk as recently as February in fact although you are correct to conclude I'm not over-extended and have contingency i.e. have executed sensible financial planning.


I am sorry for those who lost their jobs through no fault of their own, but no sympathy for over-extending or lack of sensible financial planning.


Those companies you mention went out of business BEFORE the rate rise so are completely unrelated the recent BOE rate rise.

MobileSaver

Ozymandias73 wrote: »

I am sure for Gaucho, Prezzo, Carillion etc ex-employees, ... it is rather more than a storm in a teacup

Gaucho, Prezzo and Carillion all got into trouble before this interest rate rise so, yes, it is a storm in a teacup; you are exaggerating out of all proportion the effect that this rate rise had on those companies and their ex-employees.

This is one of the fundamental problems of people like you and your HPC friends; you are so blinded by your desire for a house price crash that you always extrapolate the most extreme worst case scenario in a bid to convince yourself and others that a crash is just around the corner.

You and the HPC gang have been wrong for over a decade and you are wrong now.

lisyloo

You and the HPC gang have been wrong for over a decade and you are wrong now.

Ah that explains a lot, including the jealousy and lies (my income is not high I merely did the sensible thing and bought a house over the course of 22 years).

System

MobileSaver wrote: »

Gaucho, Prezzo and Carillion all got into trouble before this interest rate rise so, yes, it is a storm in a teacup; you are exaggerating out of all proportion the effect that this rate rise had on those companies and their ex-employees.

This is one of the fundamental problems of people like you and your HPC friends; you are so blinded by your desire for a house price crash that you always extrapolate the most extreme worst case scenario in a bid to convince yourself and others that a crash is just around the corner.

You and the HPC gang have been wrong for over a decade and you are wrong now.

Indeed. I sincerely hope the rate hikes that have started have no effect on anything or anybody, and are truly a storm in a teacup. That way, the BoE will need to keep on raising higher and higher for them to have an effect That would be the best outcome for me. PS I have no idea what HPC is. Hire purchase contract?!

System

lisyloo wrote: »

Ah that explains a lot, including the jealousy and lies (my income is not high I merely did the sensible thing and bought a house over the course of 22 years).

I am not jealous. I have around £5 million in the bank, and would like some decent interest. Why would I be jealous of a wage slave?