Blame use of CPI for low interest rates
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MatthewAinsworth wrote: »Zanderman - they've said many times how rates were high then and low now, that's something the public understands and it's why house prices have risen - but the public don't understand rpi/cpI, however suddenly using a different calibration to measure it will lead to different behaviour
I wasn't talking about the public. I was referring to financial journalists. They will understand this (much better than you or I) - and if CPI/RPI index switching was the root cause of the current low rates they would be shouting it from the rooftops. It would be the major theme of every story about interest rates. A huge story. But they aren't.0 -
MatthewAinsworth wrote: »Masonic - rates can need to rise for cpi for non housing reasons but it lacks the same force that RPI would've had (as mortgage costs would rise with rates)
Comparing cpi to cpih will be interesting0 -
That could be lack of evidence so far, as it's still early days and there have been other, easier to explain factors, but I think something can exist before it gains traction - ie it's only fairly recently that people started wanting house prices to slow down, I remember when ruses were always seen as good, or as another example why did rpi persist so long if it was wrong? Why do people still doubt global warming? - the world is slow to change, especially when it doesn't want to0
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MatthewAinsworth wrote: »That could be lack of evidence so far, as it's still early days and there have been other, easier to explain factors, but I think something can exist before it gains traction - ie it's only fairly recently that people started wanting house prices to slow down, I remember when ruses were always seen as good, or as another example why did rpi persist so long if it was wrong? Why do people still doubt global warming? - the world is slow to change, especially when it doesn't want to
Well, as you've not presented any evidence to speak of then perhaps there is a lack of it. That doesn't make your hypothesis more credible - it makes it less so.
As for house prices, I've never supported them rising and don't understand why the average single home 'man in the street' does (if they do). If you already own a property it's all relative, if you don't it makes life difficult.
I'm not sure the comparison to global warming is relevant - there is an overwhelming majority of expert opinion that supports that concept. The doubters are, in that case, clearly wrong and have been clearly wrong for decades. Your concept, on what you've said so far, doesn't seem to be supported at all. So the doubters (i.e. the respondents in this thread) seem perfectly reasonable. Possibly because you may well be wrong.0 -
This thread is beginning to remind me of the saying: "Everyone is entitled to his own opinion, but not to his own facts."0
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MatthewAinsworth wrote: »the world is slow to change,
The world has changed more than people realise in a short space of time. Even Trump for all his faults. Sees the dangers that are being posed.0 -
Zanderman - could be wrong, can conclude yet
People wanted house prices to rise so that they would release equity through remortgaging to spend in the economy
I do believe in global warming but I don't think it really matters if half the species on the planet and a few archipelagos dissapear0 -
MatthewAinsworth wrote: »That could be lack of evidence so far, as it's still early days and there have been other, easier to explain factors, but I think something can exist before it gains traction -
It only exists in your own mind. If you want it to gain 'traction', you are going to need a paper published.MatthewAinsworth wrote: »ie it's only fairly recently that people started wanting house prices to slow down,
What's your evidence for that claim?MatthewAinsworth wrote: »I remember when ruses were always seen as good, or as another example why did rpi persist so long if it was wrong? Why do people still doubt global warming? - the world is slow to change, especially when it doesn't want to
The world has changed remarkably quickly over my lifetime, The USSR has gone, China has abandoned communism, we have the internet, people walk around with telephones in their pockets, and England has won a World Cup penalty shoot out.0 -
Antrobus - Its merely speculative, I gain nothing from it gaining traction, I merely predict that with time it might gain traction from other people's discovery, and testing the idea in my own mind
I don't have evidence other than what I remember reading in papers at the time, the cheer when prices rose, the view that the economy relied in people using their houses like ATMS
Those things still took a whole lifetime to happen, and before the industrial revolution mankind did not very much for quite a while. I think in the past social immobility slowed progress and, although that's better now, especially with Internet, there is room for improvement0 -
Mankind still can't find peace, still commits horrible crimes at home sometimes, even though we know better deep down, we are flawed- ideas like gravity and evolution and round earth or free market struggled due to biases, so once again where mankind doesn't want to believe something it won't. Today we still struggle with left wingers and active investors0
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