The EU debate - Part II

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Jurgen said:
Dropping interest rates can only be a good thing right?
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Unfortunately doesn't work like that, as interest rates will be linked to a whole raft of other economic measures, which I'm sure others on here are better qualified to explain. Some of it is not all bad though and if used correctly can help boost the economy. For example, the government could borrow money at a lower rate, to push ahead with large capital projects, which could help with potential slowdowns in the private sector.
Most of us think only of the reduction in mortgage rates, but I'm not sure even if this saving will be passed on.
 
pieguts said:
Unfortunately doesn't work like that, as interest rates will be linked to a whole raft of other economic measures, which I'm sure others on here are better qualified to explain. Some of it is not all bad though and if used correctly can help boost the economy. For example, the government could borrow money at a lower rate, to push ahead with large capital projects, which could help with potential slowdowns in the private sector.
Most of us think only of the reduction in mortgage rates, but I'm not sure even if this saving will be passed on.
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Looks like it won't be from what I saw this morning.

Having said that, the U.K. Mtg market is very competitive. It only needs one to break ranks and cut, the others will have to follow.
 
Jurgen said:
Dropping interest rates can only be a good thing right?
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Unfortunately not. It's the reason behind the rate cut that's the issue, and that is a drop in consumer and business confidence, which is already leading to a slow down in the economy. The rate cut makes holding on to cash even less lucrative, so the hope is that it'll stimulate spending.
 
NowsufferinginSpain said:
Looks like it won't be from what I saw this morning.

Having said that, the U.K. Mtg market is very competitive. It only needs one to break ranks and cut, the others will have to follow.
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I think there'll be massive pressure on the banks to ensure that it is in fairness.
 
Tobes said:
I think there'll be massive pressure on the banks to ensure that it is in fairness.
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As NowSpain says the indications and early reports are that the banks won't be passing on the savings, or will be very slow in doing so. On another, related issue The BoE is reported to be setting up a fund to encourage banks to lend to businesses - despite the fact that when the BoE lowers interest rates, it should mean banks lower their interest rates, making loans lower anyway. But it didn't happen very quickly in the recession and the BoE doesn't think it'll happen quickly now.

I heard that the Express is reporting that Carney has said there's no risk of a recession, which is the opposite of what he said. They also put a poll on an article about the UK not falling into a UK - the poll was on 'will Britain fall into a recession post-Brexit' and 81% of voters think that Britain need the EU and will fall into a recession post Brexit!

This coming from the readers of a right wing paper that funds UKIP and their Brexit campaign!

http://www.express.co.uk/news/uk/69...-fall-recession-European-Union-EU-Theresa-May

The article is shockingly inaccurate as well - but what can you expect? <laugh>
 
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Tobes said:
Unfortunately not. It's the reason behind the rate cut that's the issue, and that is a drop in consumer and business confidence, which is already leading to a slow down in the economy. The rate cut makes holding on to cash even less lucrative, so the hope is that it'll stimulate spending.
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People that save obviously don't like spending. What makes people think they'll spend now the interest rates are down rather than just wait for the rates to go up again?


God's Cock said:
Not for me, but good for some.
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I was wumming tbh but for my perspective, it's perhaps a good thing. I don't have savings and in looking to move house. Lower interest rates will see a increase in new mortgages being taken. Perhaps that'll will push house prices up too (not got a lot of equity in current house so higher prices is better for me atm)
 
Jurgen said:
People that save obviously don't like spending. What makes people think they'll spend now the interest rates are down rather than just wait for the rates to go up again?




I was wumming tbh but for my perspective, it's perhaps a good thing. I don't have savings and in looking to move house. Lower interest rates will see a increase in new mortgages being taken. Perhaps that'll will push house prices up too (not got a lot of equity in current house so higher prices is better for me atm)
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It puts more money in the system as banks will look for other avenues rather than putting their money on deposit. When the BOE cuts rates, it's not just to help home owners. In some cases negative interest rates are used to dissuade banks from placing their cash on deposit with the central bank. The BOE wants that money in the system.

Theoretically, it should make more funds available for mortgages. However, with a lot of negative sentiment out there, and a possible fall in property prices due to the slowdown, I would guess that the lenders will be somewhat more cautious about what they lend and to who.
 
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HRH Custard VC said:
But we all knew that this may happen, you seem shocke and the rest of us are not.

Also currency values drop when you get a rate reduction, it always happens, so nothing new here.
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I'm shocked at your monumental idiocy.

Can anyone, anywhere, be thicker than you? You are the thickest **** in Thicksville, even people from Hull are not (quite) as thick as you, and they've had centuries of inbreeding to get that thick.
 
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