Reccession ..... Calm Down & Carry On

[Herr Tubthumper]

So what happened to teh £95 billion that the B of E printed last time?

Oh dear, didn't you get any?

 

[sten_super]

It's a necessity, but awful for savers and people looking to retire.

Most emphatically THIS.

What I don't fully comprehend is this Quantative Easing.

I always thought that we operated a Gold Standard which basically said you can't print money unless you have the gold to back it up.

Isn't QE the same as what teh Wiemar Republic did before the war, where they just printed money left right and centre and money became worthless?

So what happened to teh £95 billion that the B of E printed last time? Did it just go into the bank vaults to make their balance sheets look good...want it supposed to be all loaned out to business?

Nope, we've not had the gold standard since the 50s(?). Money is constantly 'printed'. The QE was the creation of money which was used to buy dodgy assets from banks, the idea being that removing this risk from their accounts (and replacing it with stable assets) would allow the banks to increase their lending. What actually happened was that banks held onto it as insurance against other risky assets losing value, and very little of it made it out into the economy.

 

[SK1NT]

The Bank of England base rate looks like being kept at 0.5% for another 2 years. This will be 5 years at its historic low. Do people think this is good or bad for the economy ?

This can only be good. As im sure people of Standard variable rates and trackers will only hvae less money which will further stop consumer spending...

US i just can't believe banks can get away with offering min 4% mortgages when the f ing base rate is .5%. If banks were offering better mortgages im sure this would boost consumer spending. The banks just arent reflecting where the base rate currently is with their mortgages.

 

[Uncle Spielberg]

This can only be good. As im sure people of Standard variable rates and trackers will only hvae less money which will further stop consumer spending...

US i just can't believe banks can get away with offering min 4% mortgages when the f ing base rate is .5%. If banks were offering better mortgages im sure this would boost consumer spending. The banks just arent reflecting where the base rate currently is with their mortgages.

The base rate is irrelevant to lenders as they borrow the money from the markets and not the Bank of England. Interest rates in the markets has gone up due to ongoing uncertainity over the Euro which continues to attach itself to the side of the UK like a huge tumour, general cautiousness and reluctance to lend and lenders having to hold far more back in reserves for another 2008.

Lenders held svr's at historic lows for 3 years when they did even need to do that. Now as it is expected the economy is going to flatline for this decade they have said " enough is enough " and increased rates and their profit margins. The real winners are those on life time trackers, I have clients paying 0.99% still and those on the C&G and Nationwide svr of 2.50%.

The real problem will be when people try to re mortgage or indeed move and get a new mortgage as 8 out of 10 will never be able to do so due to huge changes in mortgage criteria, the most devastating being it is almost impossible to get over 50% ltv on interest only which will lock people into being mortgage prisoners. Its not pretty out there.

 

[Dave the OAP]

Oh dear, didn't you get any?

OH I got loads thanks. What about you?

 

[SK1NT]

The base rate is irrelevant to lenders as they borrow the money from the markets and not the Bank of England. Interest rates in the markets has gone up due to ongoing uncertainity over the Euro which continues to attach itself to the side of the UK like a huge tumour, general cautiousness and reluctance to lend and lenders having to hold far more back in reserves for another 2008.

Lenders held svr's at historic lows for 3 years when they did even need to do that. Now as it is expected the economy is going to flatline for this decade they have said " enough is enough " and increased rates and their profit margins. The real winners are those on life time trackers, I have clients paying 0.99% still and those on the C&G and Nationwide svr of 2.50%.

The real problem will be when people try to re mortgage or indeed move and get a new mortgage as 8 out of 10 will never be able to do so due to huge changes in mortgage criteria, the most devastating being it is almost impossible to get over 50% ltv on interest only which will lock people into being mortgage prisoners. Its not pretty out there.

So f***ing depressing. I was on a 1.99 tracker but the guy who set it up didnt mention the lifetime tracker... He just wanted me to go back to him 3 years later. Now im on a 4.95% svr and pissed off that i cant at least get a 3.50% mortgage....

And as you said US the criteria has changed and now i am even finding it hard to get a mortgage false stop so am currently ( as you know) sticking with my 4.95 interest only mortgage.

 

[aftershavedave]

The real winners are those on life time trackers

wasn't there a very long thread about this subject back in 2007?

 

[Uncle Spielberg]

So f***ing depressing. I was on a 1.99 tracker but the guy who set it up didnt mention the lifetime tracker... He just wanted me to go back to him 3 years later. Now im on a 4.95% svr and pissed off that i cant at least get a 3.50% mortgage....

And as you said US the criteria has changed and now i am even finding it hard to get a mortgage false stop so am currently ( as you know) sticking with my 4.95 interest only mortgage.

To be fair to the other bloke he probably did not think for a second, as no economic expert in the country predicted at that time, that interest rates would fall to 0.5% which has never happened in the 400 years history of the bank of england and that they would stay there for 3 years now, 5 years in total at least, most likely. In late 2007 base rate was 5.5% and expectactions of a RISE next, Northern Rock went down the shitter in 8/07 and the rest followed like a deck of cards. Us people living through this tsunami must realise something one of this scale has NEVER happen before and probably will not do so again for at least 100 years if ever.

Also svr has averaged over 7% before 2008 so 4.95% is still historically pretty good.

 

[SK1NT]

To be fair to the other bloke he probably did not think for a second, as no economic expert in the country predicted at that time, that interest rates would fall to 0.5% which has never happened in the 400 years history of the bank of england and that they would stay there for 3 years now, 5 years in total at least, most likely. In late 2007 base rate was 5.5% and expectactions of a RISE next, Northern Rock went down the shitter in 8/07 and the rest followed like a deck of cards. Us people living through this tsunami must realise something one of this scale has NEVER happen before and probably will not do so again for at least 100 years if ever.

Also svr has averaged over 7% before 2008 so 4.95% is still historically pretty good.

Jesus don't i know it... Bought my flat in August 2007.... worst time ever... Northern rock even callapsed a few weeks before the exchange.. i really should have pulled out then.

When i got my 1.99 tracker the base rates were almost dropping every month. I took the mortgage out at 1.99 with the base rate at something like 3%... A lifetime tacker made total sense. The base rate was dropping and i was on a tracker for 3 years... When that expired i could either keep the 1.99% rate (as it would have been a lifetime) or transfer onto a new mortgage had the base rate gone up... I would have had a better choice... to stick with the lifetime tracker or move... Now im jus in sh1t... stick with a 5% SVR or move to a slightly better fixed mortgage at 4.5% at best....

i hate mortgages... Being wrongly advised has cost me £400 a month... and the wanker cant help me now... They want to be there for you when they can make a quick quid and things are going well and now they cant offer me f*** all...

 

[Lokki 7]

Please get back to an interesting debate people.

Indeed please do. You have as usual hijacked the thread and turned it to your own agenda. Any chance of you getting back on the original topic (which wasn't the mortgage deals that you have arranged) and answering the question I posed you?

"What policies did you expect from them that they have not delivered? And what policies did you not agree with? "

 

[Uncle Spielberg]

Indeed please do. You have as usual hijacked the thread and turned it to your own agenda. Any chance of you getting back on the original topic (which wasn't the mortgage deals that you have arranged) and answering the question I posed you?

"What policies did you expect from them that they have not delivered? And what policies did you not agree with? "

Here we go AGAIN. I posted that as BB refered to the subject of mortgages. FFS ! I am no economic expert unlike yourself but even I can see the slash and burn austerity measures are not working. Obama and the French socalist guy think there may be another way.

 

[Uncle Spielberg]

Jesus don't i know it... Bought my flat in August 2007.... worst time ever... Northern rock even callapsed a few weeks before the exchange.. i really should have pulled out then.

When i got my 1.99 tracker the base rates were almost dropping every month. I took the mortgage out at 1.99 with the base rate at something like 3%... A lifetime tacker made total sense. The base rate was dropping and i was on a tracker for 3 years... When that expired i could either keep the 1.99% rate (as it would have been a lifetime) or transfer onto a new mortgage had the base rate gone up... I would have had a better choice... to stick with the lifetime tracker or move... Now im jus in sh1t... stick with a 5% SVR or move to a slightly better fixed mortgage at 4.5% at best....

i hate mortgages... Being wrongly advised has cost me £400 a month... and the wanker cant help me now... They want to be there for you when they can make a quick quid and things are going well and now they cant offer me f*** all...

As I said 8 out of 10 mortgage borrowers will be mortgage prisoners now. Anyone with a mortgage on interest only over 50% phone a few lenders about re mortgaging and see what they say.

 

[Tim Over Whelmed]

The Bank of England base rate looks like being kept at 0.5% for another 2 years. This will be 5 years at its historic low. Do people think this is good or bad for the economy ?

More importantly is what products are out there now as far as 10 year projections etc? The guy buying our previous Buy To Let is getting a product which would appear to be a 10 year product, wouldn't fancy costing that baby at the moment!

 

[Herr Tubthumper]

As I said 8 out of 10 mortgage borrowers will be mortgage prisoners now. Anyone with a mortgage on interest only over 50% phone a few lenders about re mortgaging and see what they say.

But there are plenty of repayment mortgages up to 80% and some even more. Maybe now is the time to switch to a repayment deal?

 

[Herr Tubthumper]

More importantly is what products are out there now as far as 10 year projections etc? The guy buying our previous Buy To Let is getting a product which would appear to be a 10 year product, wouldn't fancy costing that baby at the moment!

A 10 year fix? That's just stupid.

 

[Lokki 7]

even I can see the slash and burn austerity measures are not working. Obama and the French socalist guy think there may be another way.

What I am interested in knowing is what exactly were you expecting, and what have they not delivered for you to say this..

I had high hopes for Cameron and Osborne but they have been a crushing dissapointment.

 

[Monsieur Le Plonk]

Anyone with a mortgage on interest only over 50% phone a few lenders about re mortgaging and see what they say.

Was reading something related the other day. Those people that were sold interest-only mortgages in the early 80s are all going to have to pay back the lump sums in the next 5 or 10 years. Aspirations of high stock market returns or juicy bonuses to pay these back must have gone out the window for many leaving a ticking time bomb.
Question for financial advisers - Were those housebuyers that signed up correctly advised or were they unlucky/foolhardy/mugs? Is there an element of guilt felt by those of you who sold the interest-only mortgages in the first place?

 

[beorhthelm]

Here we go AGAIN. I posted that as BB refered to the subject of mortgages. FFS ! I am no economic expert unlike yourself but even I can see the slash and burn austerity measures are not working. Obama and the French socalist guy think there may be another way.

but there hasnt been any slash and burn austerity. you've highlighted yourself how little austerity has been actually applied. Obama has relied on the Fed to do some massive QE and carried on spending, banking that US backed debt will be held as good debt. we are not the US, we dont have their gravitas in international trading. Hollande (the french socialist) is sticking a finger in the air and betting his way will work. bet it doesnt.

 

[dingodan]

The reasons for the artificially low interest rates, and their consequences, were known well in advance by many. This crisis was predicted 10+ years ago.

 

[Simster]

but there hasnt been any slash and burn austerity. you've highlighted yourself how little austerity has been actually applied. Obama has relied on the Fed to do some massive QE and carried on spending, banking that US backed debt will be held as good debt. we are not the US, we dont have their gravitas in international trading. Hollande (the french socialist) is sticking a finger in the air and betting his way will work. bet it doesnt.

But if the austerity measures are all implemented here, you can bet your arse that won't work either.