Mortgage Rate Rises

I'd say most of the gain was up to the middle of the pandemic, with US throwing all that stimulus money around, then it fell as we came out of Covid but recently it as recovered somewhat.

I put it partly in Life Strategy and partly in VUSA (S&P 500). I just buy it when i have some spare money that month, so don't time to market.
 
Raymond Lin said:
Inflation would fall if people all of a sudden change their mindset and habit. Stop buying things with buy now pay later, stop spreading payment "Pay in 3" because it's "affordable" and simply change the mindset and save more.
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It's not those things driving inflation so would make sod all difference.

TVs bought on finance are not the issue here.
 
Raymond Lin said:
I'd say most of the gain was up to the middle of the pandemic, with US throwing all that stimulus money around, then it fell as we came out of Covid but recently it as recovered somewhat.

I put it partly in Life Strategy and partly in VUSA (S&P 500). I just buy it when i have some spare money that month, so don't time to market.
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VUSA has been pretty stagnant for the last two years too though - https://www.google.com/search?q=VUSA&rlz=1C1GCEA_enGB1035GB1035&sourceid=chrome&ie=UTF-8
 
danlightbulb said:
It's not those things driving inflation so would make sod all difference.

TVs bought on finance are not the issue here.
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Spending money is the issue, TVs bought....regardless how you are paying for it, is spending.

I guarantee you that inflation would be 0% if we make spending money and buying anything illegal for a quarter....riots and economic chaos and civil war aside. There will be no inflation.

If you can't avoid spending money on food, roof over your head and fuel, avoid spending money on other things, like a TV.
 
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I'm gonna carry on spending.
If savings rates hit 7pc for easy access, maybe, maybe, I'll start saving. But right now, there are things I want. And they are only going to be more expensive later. Including holidays
 
Raymond Lin said:
I guarantee you that inflation would be 0% if we make spending money and buying anything illegal for a quarter....riots and economic chaos and civil war aside. There will be no inflation
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Nonsense. The ONS monitors the prices of a goods basket. Even if everyone stopped spending there is nothing preventing asking prices going up still.

We could all stop spending on discretionary goods tomorrow, and food, energy and fuel could still all rise. Not only would you still have inflation, we'd also have recession from all that discretionary spending being lost and millions now claiming welfare.

Spending is not the issue in the UK, it is supply side inflation. This is why the BoE strategy won't work until it destroys the economy in the process.
 
danlightbulb said:
Nonsense. The ONS monitors the prices of a goods basket. Even if everyone stopped spending there is nothing preventing asking prices going up still.

We could all stop spending on discretionary goods tomorrow, and food, energy and fuel could still all rise. Not only would you still have inflation, we'd also have recession from all that discretionary spending being lost and millions now claiming welfare.

Spending is not the issue in the UK, it is supply side inflation. This is why the BoE strategy won't work until it destroys the economy in the process.
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I disagree.

Because if NO ONE is buying anything, then prices has to come down. That's how things work, supply and demand. So your "Goods basket" price has to come down. Why would they drive up the price when there is no demand?
 
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Raymond Lin said:
I disagree.

Because if NO ONE is buying anything, then prices has to come down. That's how things work, supply and demand. So your "Goods basket" price has to come down. Why would they drive up the price when there is no demand?
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That depends on the cost of products. No one will sell at a loss even if not selling.
 
Begbie said:
That depends on the cost of products. No one will sell at a loss even if not selling.
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Separate issues? price at a loss vs supply and demand (prices keep going up), there are connected but the principle of supply and demand is not the same as pricing goods at a loss.

There is a built in profit margin for goods, they just have to reduce that profit margin as demand is fallen.
 
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Begbie said:
That depends on the cost of products. No one will sell at a loss even if not selling.
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Very much depends on the products and areas of economy etc

Its not as simple as you think because the costs are often fixed and contributing at least something towards that is better than doing nothing at all.
This is the manufacturing angle.

If your in for example financial services you cant say if it will be a profit until after its done.
So even though you may be selling at a loss its a predicted loss. (I mean things like insurance here)

Some parts of the economy have to predict prices. They will sell at a loss since its better than just dumping what you have invested.
Eg farming.

Simple things like drop shipping sure wont sell at a loss, but a hell of a lot is more complex than "no one will sell at a loss"
 
It is far too easy to buy stuff today. We needed a new wardrobe as we are still fitting out this house. Cost £315, PayPal offers three easy payments, probably Argos would also have an easy payment scheme or we could use a credit card. No, we pay cash (PayPal in full). If we could not afford it this month we would wait until we could.

Maybe the country needs a good old 1960's credit squeeze as well as adjusting bank rates.
 
Hagar said:
It is far too easy to buy stuff today. We needed a new wardrobe as we are still fitting out this house. Cost £315, PayPal offers three easy payments, probably Argos would also have an easy payment scheme or we could use a credit card. No, we pay cash (PayPal in full). If we could not afford it this month we would wait until we could.

Maybe the country needs a good old 1960's credit squeeze as well as adjusting bank rates.
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If you want to create a short hard recession sure
 
Just received an email from Richer Sounds, not quite the usual mail shot flyer you normally get....! (Yes, I've posted in the right thread!)

Dear XXXXX,

Writing this is, admittedly, a bit of self-indulgent therapy for me after the toughest 12 months I can remember since I started Richer Sounds in 1978.

Last April my colleague-owners felt the business needed my supposed knowledge / expertise and, combined with the serious problems in the economy, gave me a call to lend them a hand. After a sustained period of extremely hard work and long hours from all of us, I am pleased to say that the business is in better shape than ever, with a team that I hope will continue to build and prepare us for years to come… an important consideration seeing as my mortality is a given.

So that’s good news for us and, hopefully, for you, our dear customers, to know that Richer Sounds will keep going strong, but the economy is another thing… Adam Smith rightly said all those years ago that you cannot have a happy society if the greater part is poor and miserable… so where did it all go wrong?! The very rich are getting richer, some deservedly but many less so, with everything from Porsche cars, Hermes ties and private jets ‘flying off the shelves’… with a huge gap until we see only Greggs, Primark and charity shops booming on the high street, along with record sales of baked beans (I am simplifying a bit here). But, as citizens, we are experiencing the greatest inequality in our lifetime, which makes me very concerned. Surely we all care about the many, many people struggling?

In my opinion, for what it’s worth, and many of you may well suggest I should stick to selling stereos, we must first urgently plug the tax gap to stop the enormous amount of unpaid tax leaking out of the system to ensure that everyone pays their fair share and which HM Treasury could definitely do with.

I really am non-party-political (even though Nick Ferrari loves publicly teasing me about my long-distant-past donations to the Tory party). I am just hoping that whoever runs the country has integrity, is good at balancing the books and has a genuine social conscience - someone who acknowledges the unfairness of growing inequality as well as the danger this poses to social cohesion and happiness.

I would also love our leader/s to please sort the disgraceful state of housing for far too many non-homeowners, as well as the NHS’s and the criminal justice system’s problems while they are at it… And when I say ’sort’ I obviously mean ‘invest as necessary’, including paying the real living wage as a minimum to allow working people to live decently, and banning evil zero-hour contracts when imposed on workers against their will. And don’t get me started on the water monopolies…

Anyway… sorry to rant, apologies, I get carried away… I can hear our marketing team shouting in my ear to ‘get on with it!’ I wanted to mention just a few things, whilst writing, about our VIP Club benefits (which, as you all know, are available free of charge to all who are willing to let us send them these emails). We had this great idea recently that if we wanted customers to visit our stores, we should try to entice them down (who knew?). So we now have many prices cheaper in-store (and some very expensive free soundbars with tellies) than we do online, for our club members. And our range of ‘inflation-busting megadeals’, that we sell at close to cost price or even at a loss, to help those having a tough time, goes from strength to strength.

In the meantime, we will keep our chin up attempting to deal with rampant rising costs and doing our best to advise and help our long-suffering customers afford the very best electronics they can with their hard-earned cash. And as for customers who are less financially constrained and are considering a home install, we absolutely love you too... and have an amazing custom installation team on hand who can help with all manner of projects, from the design and build of custom home cinemas to kitting out anything from boardrooms to submarines (we really have done several).

To our great relief we are managing to keep our heads above water, but it has taken every tool in the toolbox to keep us there, not least the efforts of the wonderful team I am lucky to work with. And thank God we own our freeholds and have no debt.

Finally, I would like to thank the consumer organisation Which?, who voted us the UK’s best retailer, for the fifth year running last month, and, most importantly, I’d like to thank you for your much appreciated loyalty and support which we will never take for granted.

Yours,

:D
 
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Of course some of the issues are from silly spending. For years now we have been having issues with people living beyond their means or at the very edge and thats when there wasn't a cost of living crisis. If you can't budget when times are good you are really going to struggle when times are bad. Habits are hard to break as well. You don't go from being rubbish with money to great with it overnight.

The bigger issues is that certain staples are flying up in cost and most people don't have a choice in many of these. So many of these things are being taken advantage of as well. Fuel duty cut wasn't properly passed on. Cost of production hasn't gone up nearly as much as many products. Our insurance premium is going up 50% this year for god knows what reason. Looking forward to that phone call and their justification.

Its all a complete mess but raising the base rate much more is going to absolutely kill the economy. They must know this. They must. They must know that locking people into 6%+ mortgages for 2-5 years on average will absolutely kill the economy and any attempt to revive it will fall flat on its arse when people don't have any spare money to spend for years no matter what you bring the base rate down to. My bet is they will end up doing stupid **** like stamp duty holidays, eat out to help out etc.
 
fez said:
Of course some of the issues are from silly spending. For years now we have been having issues with people living beyond their means or at the very edge and thats when there wasn't a cost of living crisis. If you can't budget when times are good you are really going to struggle when times are bad. Habits are hard to break as well. You don't go from being rubbish with money to great with it overnight.

The bigger issues is that certain staples are flying up in cost and most people don't have a choice in many of these. So many of these things are being taken advantage of as well. Fuel duty cut wasn't properly passed on. Cost of production hasn't gone up nearly as much as many products. Our insurance premium is going up 50% this year for god knows what reason. Looking forward to that phone call and their justification.

It’s all a complete mess but raising the base rate much more is going to absolutely kill the economy. They must know this. They must. They must know that locking people into 6%+ mortgages for 2-5 years on average will absolutely kill the economy and any attempt to revive it will fall flat on its arse when people don't have any spare money to spend for years no matter what you bring the base rate down to. My bet is they will end up doing stupid **** like stamp duty holidays, eat out to help out etc.
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Maybe the Tories know they are on the way out and want to simultaneously screw the Labour Party and reward their mates to buy up some cheap properties? :p
 
Hagar said:
It is far too easy to buy stuff today. We needed a new wardrobe as we are still fitting out this house. Cost £315, PayPal offers three easy payments, probably Argos would also have an easy payment scheme or we could use a credit card. No, we pay cash (PayPal in full). If we could not afford it this month we would wait until we could.

Maybe the country needs a good old 1960's credit squeeze as well as adjusting bank rates.
Click to expand...


I think it all evens out though. If you buy stuff on credit today, yes you've spent it now instead of saved for it, but then as you pay it back it lowers your future spending by whatever the monthly repayments are. So over the long term your spending is the same. Credit isn't infinite, once you've over extended that's it, you then have to pay it back, reducing your outgoings.
 
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