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Post by Vinny on Oct 12, 2022 9:15:59 GMT
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Post by Bentley on Oct 12, 2022 9:22:17 GMT
The government seems to have painted itself into a corner .
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Post by Steve on Oct 12, 2022 15:31:28 GMT
No we need to realise you can't live off ever deepening debt and printing money forever. It didn't work for Zimbabwe, it didn't work for Greece and it won't work for us. Tell the public the truth, everyone is going to have to accept cuts to the wealth they thought they might have been expecting. And prove that that really mean everyone by having a wealth tax. |
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Deleted
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Post by Deleted on Oct 12, 2022 15:57:06 GMT
I think it's called 'bubble up' economics but I agree with the principle. |
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Post by Vinny on Oct 12, 2022 18:27:17 GMT
Mostly agree Steve, we have to live within our means, BUT, charging heavy tax levied on the poorest, already having to deal with higher fuel prices due to that cunt Putin and his stupid war, cut taxes for the poorest as an emergency measure and raise them on the richest, whilst giving out the odd knighthood as a thank you to those billionaires who pay their way through the crisis.
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Post by Red Rackham on Oct 12, 2022 18:54:08 GMT
No we need to realise you can't live off ever deepening debt and printing money forever. It didn't work for Zimbabwe, it didn't work for Greece and it won't work for us. Tell the public the truth, everyone is going to have to accept cuts to the wealth they thought they might have been expecting. And prove that that really mean everyone by having a wealth tax. Absolutely right, we have had years of record low interest rates and people now think it's the norm. Interest rates should be around 7% not 0.25%. The problem today is people are used to low interest rates, living beyond their means and living on credit. There has to be a reset, and for many people it's going to be difficult. |
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Post by colbops on Oct 12, 2022 22:29:55 GMT
Interest rates should be around 7% not 0.25% Why? |
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Post by Vinny on Oct 12, 2022 22:32:29 GMT
Better savings rates for starters.
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Post by Red Rackham on Oct 12, 2022 22:46:20 GMT
Interest rates should be around 7% not 0.25% Why? Most young people today think 7% is high, but it isn't. Over the past 50 years it's the average. In 1979 interest rates were 17%, down to 9% in 1982 and back up to 15% in 1989. Recent interest rates of 1% and lower were never going to last, and besides an interest rate of c7% would encourage people to save rather than spend. |
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Post by colbops on Oct 12, 2022 23:00:10 GMT
That doesn't clear it up for me. why should it be any arbitrary figure, whether it be 1%,7%,14% etc etc?
historical average doesn't seem like a good reason, why does that matter?
I don't see why it would encourage people to save either? Surely that depends on what savings rates are available when compared to BOE base rate? On top of that doesn't it limit rather a large chunk of the population's ability to save? Pushing mortgage payments up / Debt payments up etc on top of the massive cost of living rises in play is eating into what a lot of people might have otherwise been able to save.
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Post by Steve on Oct 12, 2022 23:07:35 GMT
Historically it was high because banks were much less efficient than now and needed the high margin over savers rates. Then they became somewhat geared to the higher saving rates needed to get people to save when inflation was high. Now that's high again the issue is more driven by the rates needed to pay people to loan money to the government.
So they need to be high right now.
I can remember paying for what went up to a 16% mortgage, that stung
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Post by Pacifico on Oct 13, 2022 6:52:21 GMT
The 'ideal' interest rate for the economy is 4%. The BoE target rate for inflation is 2% so add another 2% to get a real rate of return.
Of course that all depends on whether the BoE can keep inflation to 2%...........
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baff
Junior Member
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Post by baff on Oct 13, 2022 7:06:10 GMT
They should aim to keep it to zero %.
If not considerably less.
The cost of living should be going down, not up.
Technology advances. Infrastructure increases. Systems become refined.
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Post by Bentley on Oct 13, 2022 9:16:46 GMT
In the 70s wages we’re going up by ( iirc) about 10% every year and house prices were booming .
It was feasible ( for a few years ) to buy a house with a mortgage you could hardly afford and within a year or two be in a much better position when your wages went up. It was expected .
Then the negative equity and job losses came in , in the 80s and people who got on the carousel too late ended up losing houses that were worth less than they paid for them .
I sincerely hope we do not get a repeat of that because we are starting from a far worse platform now than we were in the 1970s.
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Post by Orac on Oct 13, 2022 9:53:31 GMT
My view is that the people who might have lost with housing in the 2010 crash were 'let off' at the expense of the future viability of rest of the economy - interest rates at near zero for decades. In a sense, we never paid that debt.
Our starting point now is consequently far worse than it was then
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