The madness of current interest rates

[Bruce Wayne]

Just seen on the news that the current low interest rates have cost savers £45 billion since the economy blew up, whilst borrowers have gained £52 billion from the low rates.

Am I going mad or did the economy blow up because people borrowed too much and saved too little? Yet we want 'growth' to happen off the back of people borrowing even more??? :blink:

Nevermind, the government will just print more money, setting inflation loose and further dwindling the cash of any poor fecker that has bothered to save money to look after themselves.

 

[ToffeeMark]

Just seen on the news that the current low interest rates have cost savers £45 billion since the economy blew up, whilst borrowers have gained £52 billion from the low rates.

Am I going mad or did the economy blow up because people borrowed too much and saved too little? Yet we want 'growth' to happen off the back of people borrowing even more??? :blink:

Nevermind, the government will just print more money, setting inflation loose and further dwindling the cash of any poor fecker that has bothered to save money to look after themselves.

You are quite clearly mad.

The economy blew up as part of an illuminati/new world order plot....

 

[Muggins]

Bruce, I'm yet I see a 'System' that is politically, economically and socially flawless.

Yet they try over and over.

 

[Bruce Wayne]

Sure I don't expect perfection, but surely we should be trying to encourage people to not do the same things that they did before? Right now we're making it easy for consumers to borrow money, and the government are bending over backwards to get banks to lend more, even though those were the exact problems that caused the crash. It's madness.

 

[Muggins]

Sure I don't expect perfection, but surely we should be trying to encourage people to not do the same things that they did before? Right now we're making it easy for consumers to borrow money, and the government are bending over backwards to get banks to lend more, even though those were the exact problems that caused the crash. It's madness.

Systematic madness I'd say. New systems are worked on and implemented but little changes. We rely too much on computer models.

Put a system in place, and people will find a loop hole or a work around. Whether it's benefits, banking or financial fair play in football.

 

[Reidy's Bottle Of Grecian]

So has everyone paid off what they borrowed ?

or do the lower rates enable them to begin to pay it back ? as opposed to defaulting/ repo's/ bankruptcy ?

the rates are low but that doesn't mean the banks will lend, e.g. (i haven't asked btw) my house is worth £135,000 ish, with £95k ish mine (equity) but i'd be doing well to borrow any more (say 50 - 60 k) to extend/move as even with so much equity in it the banks would be reluctant.

Hands up how many have enough savings that Interest actually makes any difference.

 

[somuchfun]

.A
/o\ <- the all seing eye. or a crappy xmas tree. or a cyclop with a hat and a beard,
""""

 

[Bruce Wayne]

So has everyone paid off what they borrowed ?

or do the lower rates enable them to begin to pay it back ? as opposed to defaulting/ repo's/ bankruptcy ?

the rates are low but that doesn't mean the banks will lend, e.g. (i haven't asked btw) my house is worth £135,000 ish, with £95k ish mine (equity) but i'd be doing well to borrow any more (say 50 - 60 k) to extend/move as even with so much equity in it the banks would be reluctant.

Hands up how many have enough savings that Interest actually makes any difference.

*raises hand*

 

[Reidy's Bottle Of Grecian]

*raises hand*

Spot Bruce

We are all pawns btw, in the general scheme.

 

[linglong]

Sure I don't expect perfection, but surely we should be trying to encourage people to not do the same things that they did before? Right now we're making it easy for consumers to borrow money, and the government are bending over backwards to get banks to lend more, even though those were the exact problems that caused the crash. It's madness.

It shows to me how morally bankrupt BOTH parties really are they have really no clue other then to hope we fuel a spending spree to get us out of the recession we're undoubtablly in maybe,just maybe people would be a little less scared of spending if our glorious leader,deputy and chancellor hadnt for the first few weeks of this governments life gone around shouting britian is bankrupt,now that maywell be true but no one in power,if they hads an ounce of sense they where born with should have done that,in one foul swoop they stalled what little recovery there was.

What is needed now is a new way of thinking but alas we'll just do more of the same staying safe in a system that frankly doesnt work,but i suppose for something new to arrive we'd have to have agreement across the world and lets be fair thats not going to happen and interest rates will stay as low as a snakes belly as a result.

Its a bad time to be a saver

 

[Bruce Wayne]

I guess the 4/5 year political term does little to encourage longer term thinking, each incumbent merely wants to do ok for that period of time, not fussed if it piles up problems in the medium/long term.

 

[linglong]

I guess the 4/5 year political term does little to encourage longer term thinking, each incumbent merely wants to do ok for that period of time, not fussed if it piles up problems in the medium/long term.

Sadly true mate,but it seemed to me that given the gravity of the situation surely it would have been in the "national interest" for ALL parties to put aside differences and work together if only say for this term.

It just shows how insular the bubble is at westminster is becuase surely given we missed a depression by a gnats hair this would,no should have been the time for party politics to have been put aside

 

[Bruce Wayne]

The thing is, lets say a party said "we're going to experience negative growth/minimal growth in the short-term but in the long-term our society will be on a much more sustainable footing (ie not one fueled by debt)".

You just know as soon as the first quarter of small/negative growth was reported the other party, or other interest groups, would be kicking the boot in making political capital out of it.

 

[linglong]

The thing is, lets say a party said "we're going to experience negative growth/minimal growth in the short-term but in the long-term our society will be on a much more sustainable footing (ie not one fueled by debt)".

You just know as soon as the first quarter of small/negative growth was reported the other party, or other interest groups, would be kicking the boot in making political capital out of it.

Once again mate you're right,but that shows how broken our political system is in my eyes,you would have thought given the fact nearly all MP's had their noses in the expenses trough they could have moved aside such differences but alas no,like little children the lot of them.

 

[Bruce Wayne]

I think the problem goes deeper than that. The system basically provides whoever wins the election with a monopoly for 4/5 years, so those in opposition to whatever's happening either have to persuade the incumbent to change during their term or snipe at the edges to encourage change come election time. There's very little they can actually do themselves. They're not in a position to offer those that wish to an alternative there and then.

This doesn't encourage long-term thinking imo.