NS&I to cut premium bond rate and other accounts

longhill

Hi the security came up when logging back in after not completing withdrawal after he forgot the answer to one of the questions will just log in tomorrow and hope he's a wake enough thanks for the quick reply

polymaff

Are we [rhetorical question] all too obsessed?  On BBC Radio 4 Moneybox, the only reference to this event was a brief comment right at the end of the broadcast.

The BBC Sounds version doesn't appear even to include that brief comment.

eskbanker

polymaff said:

Are we [rhetorical question] all too obsessed?  On BBC Radio 4 Moneybox, the only reference to this event was a brief comment right at the end of the broadcast.

The BBC Sounds version doesn't appear even to include that brief comment.

There's definitely a tendency for threads like this to descend into echo chamber territory, with an (admittedly severe) interest rate reduction extrapolated to the collapse of government financing and no doubt eventually the end of civilisation as we know it - in a similar vein I've seen other threads where some participants are utterly astonished that their (relatively) insignificant and irrelevant issues aren't front page news (the SVS collapse being one such example).

ffacoffipawb

eskbanker said:

polymaff said:

Are we [rhetorical question] all too obsessed?  On BBC Radio 4 Moneybox, the only reference to this event was a brief comment right at the end of the broadcast.

The BBC Sounds version doesn't appear even to include that brief comment.

There's definitely a tendency for threads like this to descend into echo chamber territory, with an (admittedly severe) interest rate reduction extrapolated to the collapse of government financing and no doubt eventually the end of civilisation as we know it - in a similar vein I've seen other threads where some participants are utterly astonished that their (relatively) insignificant and irrelevant issues aren't front page news (the SVS collapse being one such example).

I am waiting for Godwin's Law to kick in.

RG2015

polymaff said:

Are we [rhetorical question] all too obsessed?  On BBC Radio 4 Moneybox, the only reference to this event was a brief comment right at the end of the broadcast.

The BBC Sounds version doesn't appear even to include that brief comment.

What about The Thunderer?

Millions of savers will see their returns plummet after National Savings and Investments slashed its interest rates.

The move, which affects 25 million people, has been described by analysts as “devastating” for the market.

https://www.thetimes.co.uk/article/ns-amp-i-rates-big-squeeze-hits-25m-savers-and-premium-bond-holders-r56jb0bfq

polymaff

Just surprised - well, not really - that the destruction of NS&I Income Bonds wasn't covered by Moneybox.

That programme is not what it was.

whitesmith

You wouldn't have had much fun in Stalingrad, would you... 

Copperbark

I found this article really helpful to give some background context to the NS&I rate drop:
https://medium.abundanceinvestment.com/community-municipal-investments-a-new-way-to-earn-a-lower-risk-return-9ba867676a1d

The shock isn't that they dropped their rates, but that they continued to be so high for so long given what was happening with rates across the broader market.

As a saver of course the rate drops are not what I'd want.
But as a taxpayer it's a bit shocking to learn that there's been:

over £1 billion of effective taxpayer subsidy to ensure NS&I’s market leading position since the start of 2019

Which is a helpful reminder that there's always a bigger picture to consider.  A bit like people who say the NHS is free.  There's no magic billionaire funding it.  We're still paying for it, just not at the point of use.

d63

effective taxpayer subsidy? huh? surely any money that is paid out in interest is like the premium bond prizes just being paid for from the money people have on deposit with them? 

eskbanker

d63 said:

effective taxpayer subsidy? huh? surely any money that is paid out in interest is like the premium bond prizes just being paid for from the money people have on deposit with them? 

But the point is that government can access equivalent funds without returning that much in interest or PB prizes, therefore paying out even at 1% isn't cost-effective if they can borrow from elsewhere at lower rates.