Ok, so what's the interest rate floor ?

[anonymous-user]

[redacted]

[scotal]

anonymous said:

[redacted]

Probably nothing of much interest but most mortgages are collared at 3%, so lower than that makes little or no difference from that point of view.

[Andy Zarse]

3.5% for the record. Any lower and it buggers up all sorts of other things.

[rude-boy]

Andy Zarse said:

3.5% for the record. Any lower and it buggers up all sorts of other things.

I was going to say 3.5%.

any lower and we have the reverse of what we are having now, but with savers.

[215cu]

I think the deflation genie is well and truly out of the bottle and insolvency is going to be a big problem.

I'd say 2% base by Q1 '10, retail, probably about 4%

[V8mate]

Am loving all these numbers guys.

With a 0.6% over base, tracker mortgage these are very welcome predictions :-)

[anonymous-user]

anonymous said:

[redacted]

Do you mean wave goodbye to decent interest on your savings or the fact that inflation will erode them?

[briSk]

most importantly do you reckon such a thing as a 10 yr fixed rate offset mortgage with a rate of 4% will exist any time next year?

purely theoretical you understand...!

[Shnozz]

anonymous said:

[redacted]

that is the problem isn't it.

Currently biding time on a no ties BoE tracker which has great flexibility but I would be keen to find a 10 - 15 yr fix at the soon to be low rates, assuming it was transferable. However, by the time the bigger fees are balanced out over the life of the mortgage, the fixed rate suddenly looks far less attractive (on a mortgage the size of mine) that taking chances of a tracker rates or discounted rates etc may be a more tempting gamble.

The interest for me is more will there be a combination of low rates, together with reasonable fees, rather than 1 or the other.

[cod man]

anonymous said:

[redacted]

Indeed, I have noticed that to get a good rate you have to pay a high up front fee. (which they very kindly allow you to add to your loan and charge you even more interest on!) So it seems really pointless renewing a fixed rate deal every 3 years. As such I have been on a flexible base +.39 tracker for years now (and very smug now too until the base goes up again of course!)

[Ozzie Osmond]

Take a look at the Japanese.....

"Japan has kept its key interest rate at 0.5% for the 20th consecutive month - amid continued worries about the global financial crisis. But analysts said that Japan was unlikely to lower its main rate anytime soon, given it was already so low."


Meanwhile, elsewhere in the Pacific,

"Australia's central bank cut its official interest rate by a bigger-than-expected 1 percentage point to 6%."

[Yes, the Japanese rate really is one half of one percent. It's not a typo.]

[Chilli]

Ozzie Osmond said:

Take a look at the Japanese.....

"Japan has kept its key interest rate at 0.5% for the 20th consecutive month - amid continued worries about the global financial crisis. But analysts said that Japan was unlikely to lower its main rate anytime soon, given it was already so low."

[Yes, the Japanese rate really is one half of one percent. It's not a typo.]

That's not bad....it used to be negative!

[oyster]

coyft said:

The way this shower of st are operating, I wouldn't be surprised if interest rates went into negative territory.
They seem to be set on a path of self destruction, they are not prepared to suffer the pain now.

Have you been away?

Isn't there pain now?

[cod man]

Chilli said:

Ozzie Osmond said:

Take a look at the Japanese.....

"Japan has kept its key interest rate at 0.5% for the 20th consecutive month - amid continued worries about the global financial crisis. But analysts said that Japan was unlikely to lower its main rate anytime soon, given it was already so low."

[Yes, the Japanese rate really is one half of one percent. It's not a typo.]

That's not bad....it used to be negative!

Really? How the **** does that work. You borrow money and the amount you owe gets less without you paying any off? It sounds great!

[rsv gone!]

V8mate said:

Am loving all these numbers guys.

With a 0.6% over base, tracker mortgage these are very welcome predictions :-)

Well make sure you don't have any savings and overpay as much as you can

[Dirty Boy]

What do you do if you have no mortgage and say a couple of hundred thousand on deposit at Nationwide?

Where do you put your cash?

[rsv gone!]

Ozzie Osmond said:

Take a look at the Japanese.....

"Japan has kept its key interest rate at 0.5% for the 20th consecutive month - amid continued worries about the global financial crisis. But analysts said that Japan was unlikely to lower its main rate anytime soon, given it was already so low."

I read somewhere(?) that Japan's solution to their own financial disaster in the 90s was to lower interest rates right down and print money. Looks like that's happening here. Sounds like an erosion of debts by inflation.

[215cu]

rsv gone! said:

Ozzie Osmond said:

Take a look at the Japanese.....

"Japan has kept its key interest rate at 0.5% for the 20th consecutive month - amid continued worries about the global financial crisis. But analysts said that Japan was unlikely to lower its main rate anytime soon, given it was already so low."

I read somewhere(?) that Japan's solution to their own financial disaster in the 90s was to lower interest rates right down and print money. Looks like that's happening here. Sounds like an erosion of debts by inflation.

Actually, what prolonged the Japanese 'experience' is they refused to let their banks either go under or be taken over.

So basically, they've been protected by government whilst they repair their balance sheets.

And it's taken nearly 20 years.

So it's not quite the same.

What's happened in the UK and US is a more selective interventionist approach, let some go to the wall, support some mergers (including overseas takeovers) and protect others.

Edited by 215cu on Wednesday 8th October 13:08

[Shnozz]

coyft said:

The way this shower of st are operating, I wouldn't be surprised if interest rates went into negative territory.
They seem to be set on a path of self destruction, they are not prepared to suffer the pain now.

Never have those in charge been selfless in attemping to make decisions in the country's best interests, rather than carrying their own political agenda.

Any attempt at stemming the flow immediately is going to look attractive to a Labour government watching the electorate become more impoverished on a weekly basis and more likely to vote for a change in their circumstances (no matter what that change may be).

Unfortunately, this taints a whole number of decisions that are made on the basis of public support more than with any real consideration as to what might be better for the country as a whole. There is also a temporal relationship as to when a election may take place and the speed at which any such solutions may fix a problem. In this case, they have to show a flicker of hope that they are working quickly, not properly.

I guess its an associated problem with democracy.

[rsv gone!]

215cu said:

rsv gone! said:

I read somewhere(?) that Japan's solution to their own financial disaster in the 90s was to lower interest rates right down and print money. Looks like that's happening here. Sounds like an erosion of debts by inflation.

Actually, what prolonged the Japanese 'experience' is they refused to let their banks either go under or be taken over.

So basically, they've been protected by government whilst they repair their balance sheets.

How does that work then? Were deposits protected? Surely that is a blank cheque for them?

215cu said:

And it's taken nearly 20 years.

So it's not quite the same.

Although this mess will take years to settle down.

215cu said:

What's happened in the UK and US is a more selective interventionist approach, let some go to the wall, protect others.