Separate names with a comma.
Discussion in 'Current Events' started by edesignuk, Nov 6, 2008.
Let's see how long it takes for Building Societies to pass on the cut...
yeah right they will hang on till the last minute to pass over the cut's
1.5% is like £120 i think on my mortgage - well guessing there!
I'm on a fixed rate for another 8 months anyway, so it probably won't affect me. Until they realise they've made a mistake and whack it up to 7%
The problem now is recession. inflation was, and remains a problem that is still been felt by many. And inflation was a contributory factor in tipping us into recession.
It'll be interesting to see whether the banks & co willingly pass on the whole cut, it's still unbelievable that the taxpayer c/o Darling lent banks money interest-free so that the banks can lend it back and charge interest!
are the bank's lending anything at the moment? i bet people are getting turned down for any credit left right and center.
for me if it is over £100 saving per month on my mortgage, then it's going on overpayments for my mortgage- this will save me loads in the end
just need to keep my job
I'm confused. I thought that the BOE remit was to keep inflation below 2%?
As an aside, I feel for the savers who are being kicked in the teeth at the moment. First they didn't know if their money was safe in the bank, and now they'll be wondering if their savings will be accruing any interest.
They are supposed to ensure inflation is at 2%, not below 2%.
Most economists expect inflation to fall way below 2% in the future due to recession, so this explains the BOE's drop in interest rates now. The actions they take now are supposed to have effects up to 2 years down the road.
(I'm not an expert, but this is how I understand it!)
So not only am I worse off because of out of control inflation, but I get next to no interest on savings. Help for those foolish enough to get in debt and nothing for those who live within their means.
Well to an extent I agree, but what was the alternative? After HBOS went, letting it continue would have left us with HSBC and not much else. They weren't lending money, they were lending confidence.
I have a mortgage, am I a fool? If, instead, I had £25,000 on credit cards this wouldn't help me one iota, my rate stays the same. Similarly, most loans agree a fixed rate (else pay arrangement and closing fees). If you want to earn more interest on your savings, might I suggest this account...
...or, first direct are giving you £100 to transfer to them (although I believe there's a minimum monthly deposit)
If the banks don't pass this on to their mortgage customers it'll actually take money out of the economy by penalising savers.
Personally I'm quite fed up that the whole living beyond your means thing seems to be how to get government* on side these days. There's absolutely no incentive in this country to be financially responsible any more.
I think I'll go get a mortgage at 25 times my income. It's obviously the way to live
* And yeah, I know this is the BoE today, but going on other events it's a fair statement...
Why do you think you get interest on your savings? It's because there are people out there borrowing money - whether it be people or businesses they are borrowing money for whatever reason and paying it back with interest. Some of that interest goes to the bank and some to you...
There is nothing wrong with borrowing as long as you can afford to pay back what you have borrowed. The problem is with those who have borrowed (and been allowed to borrow...) more than they can actually afford to pay back that are the problem.
Lending is simply a way for people with money to make it grow at more than the rate of inflation. Borrowing is simply the other side of that coin. No right or wrong with either as long as they are done responsibly.
point 1 - The UK IS NOT officially in a recession, negative growth has only occurred over one financial quarter, to actually be a recession, this needs to occur over two consecutive quarters. The governor of the BofE only said that he "fears Britain is heading towards a recession"
POINT 2 - and this is a good one - Northern Rock DID NOT FAIL DUE TO THEIR LENDING PRACTICES, or due to the fact that they recieved a loan from the bank of england directly. they failed because the media reported less than 1/2 of the story of this, without explaining that it is part of the "normal" bank process, joe public then panicked due to the reports in the media and withdrew all their money. Northern Rock only failed because almost every customer removed all thier savings / current account balance from their accounts and closed them.
Point 3 - still cant afford a ruddy mortgage. Darned property developers, skum of the earth, artificially inflating the market values, and creating scarcity due to their buy-to-let buisness models. How I HATE thee.
The alternative was to loan money to the banks, with more robust and substantial conditions attached, and to charge interest on that money.
Of course, with a capitalist society, what really should happen is that failing banks, like any failing businesses, should be allowed to fail.
I've never had a Credit Card before. I have a dodgy credit history for long and complex reasons during my time as a student. It may be dropping off the bottom of my credit record ( it was about 7 years ago ) but I'm not sure. I do have a good salary, and have done, every month, for > 5 years. Anyway, I wanted a Mastercard so that I can rent a car when I travel to the US (they wont rent to someone without one)
Guess what? Bad credit history, economic melt-down. I just got a card with a £1k limit without any questions at all. I was more than a little suprised. A shocking %'age rate on it, but it's there simply as an enabling tool to do a specific thing when travelling.
One thing I like about the credit crunch. When was the last time you heard the words 'Ocean Finance' in an advert break
Lenders heed calls for rate cuts
Finally some movement.
Of course only from 1st November
I think the Central Banks are more worried about deflation, since the current monetary system is inherently inflationary if we get deflation then we most likely get something like what happened in Japan for the past 20 years...except the Japanese have/had significant savings to fall back on...so probably it ends up much worse in the west.
As for passing rate cuts on, the "official" rate is actually only a target rate, the banks are more interested in LIBOR rates, the central banks can set the rate where ever they want, if Mr Market has other ideas then sorry but it does not matter.
The spike in LIBOR is what started this whole mess and when LIBOR returns to normal values then all will be well. Lowering rates will probably be good short term and a disaster long term, after all they did the same thing in 2003 and it got us in to a nasty housing bubble.........
I beg to differ. Northern Rock went to the wall very much due to its business model, buying short and selling long to a much greater extent than any other bank and much more than was prudent after it started to become clear a year ago what was happening in the US with sub-prime lending.
The media were very clear in reporting this and did take pains to point out that NR had a decent mortgage portfolio and that its problems stemmed from not reacting quickly enough to the contraction in the capital market. The rush to withdraw funds really only happened in earnest after the government had to bail it out.