2022 mini-budget discussion
- Thread starter Harlequin
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Soldato
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To start with:
Boe can raise rates more - like they should have done already.
Kwarteng can backtrack - scrapping 45% is a blunder.
This all has to happen, pressure will build until it does. Then we see what impact it has.
Britain's cost of borrowing on international markets is now higher than the rates paid by Greece and Italy.
It comes after Chancellor Kwasi Kwarteng's mini-budget last week, which has cause markets to reel.
The former Bank of England deputy governor Charlie Bean said it was significant that bond markets now considered Greece and Italy to be safer bets after several days of panic selling.
According to The Guardian, the five-year bond rose to 4.3%, which compares with Italy’s 3.87% and the 4% rate of interest paid by Greece.
France maintained a rate of 2.3% while German five-year bonds traded with an interest rate, referred to as the yield, at 2.03%.
Sir Charlie, who is also a professor at the London School of Economics, said: "When you have a falling currency and rising sovereign bond yields, this is exactly what we see with a typical emerging market sovereign debt crisis.
"That's not to say we're becoming an emerging market, but the fact is we have gone from looking like the US or Germany in terms of bond rates to now being closer to Italy and Greece."
It comes after Chancellor Kwasi Kwarteng's mini-budget last week, which has cause markets to reel.
The former Bank of England deputy governor Charlie Bean said it was significant that bond markets now considered Greece and Italy to be safer bets after several days of panic selling.
According to The Guardian, the five-year bond rose to 4.3%, which compares with Italy’s 3.87% and the 4% rate of interest paid by Greece.
France maintained a rate of 2.3% while German five-year bonds traded with an interest rate, referred to as the yield, at 2.03%.
Sir Charlie, who is also a professor at the London School of Economics, said: "When you have a falling currency and rising sovereign bond yields, this is exactly what we see with a typical emerging market sovereign debt crisis.
"That's not to say we're becoming an emerging market, but the fact is we have gone from looking like the US or Germany in terms of bond rates to now being closer to Italy and Greece."
Can you imagine having to backtrack on your mini budgets days after it? It would be polictal suicide by choice rather than by force. Look at what it took for BJ to go.
Can't see them doing it. And for some reason I don't understand.. BoE is also not doing anything
This needs to be said a little louder for the people that can't see what a mess we're in.
An incoming fascist government in Italy is considered a better credit risk than the United Kingdom under Truss & Kwarteng.
Things are different now. With the current house prices and mortgage to income levels a 3-4% interest rate mortgage is the same as a 15% mortgage back when you took a mortgage out.
so if they get to base rate of 6% so around 8% mortgage rates, it will be like people trying to cope with 20% mortgage rates back in the 70/80/90s. Thats how bad things are about to get.
Soldato
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Boe is just trying to wait for the next scheduled meeting.
What happened to Boris was media pressure building. Same thing happening now. Truss must concede this or we'll still be talking about it every day for the next 2 years.
Soldato
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At this rate, The Earl of Inverness is our only hope.
Years ago when austerity was still a new catchphrase there was quite a lot of talk about debt and interest rates (mainly in terms of government borrowing), and how although a large debt is sustainable at 1% rates, and 5% it could be extremely expensive to maintain. Interesting that for a while that's not been such a big focus, but now we're about to see what it means in reality for interest rates to rise after the economy has been fed low rates for so long.
Maybe convert the old stables to rental accommodation too to help with the bills - won't have to pay to heat them for one thingBuying a bigger house is the solution.
Then rent out the rooms
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He's alright Jack so doesn't care. Yet.
Soldato
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Nice try. It was the Tory party and his own incompetence that got him in the end. Similar will happen to Truss. And the next one. UKIP has a very shallow talent pool.
And yet, apparently, something like one in three people still support them.
What's the opposite of an emerging market, one that goes backwards from a developed market?
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also should be noted the Rouble did better on the markets than GBP and that's the currency of a country waging an illegal war with a despotic crackpot as their leader......................
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I genuinely think currency devaluation hurts "them" more than "us". I get the wider ramifications but the main reason why folk get uptight is because mega millionares are losing out on sizeable chunks of change. Trickle down economics doesn't work anyways so I have kinda zoned out until it personally hits my pocket.
Whilst funny I think that was debunked as they are not today a fascist party, 80 years ago however…
There's nothing funny about Truss and Kwarteng wrecking our economy to the extent the UK is considered a bigger credit risk than Italy and Greece.
It has already unless you don't buy food.
Italy and Greece, both seen as basket cases.
We've basically got a reverse of the last 10+ years. When interest rates were low the BoE was trying to inject money into the economy and the government were trying to take it out with their austerity BS, now the BoE is trying to take money out of the economy and the government are trying to inject money into it.
Basically our government and central bank have been at war for more than a decade and the only casualties will be us, before this is was public services in the line of fire now it's anyone with debts.
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