• Welcome to DOSBODS

    Please consider creating a free account to be able to access all the features of the DOSBODS community. It only takes 20 seconds!

Sign in to follow this  
One percent

This is how quickly interest rates could rise

Recommended Posts

http://www.bbc.co.uk/news/business-44001450

Argentina's central bank has raised interest rates for the third time in eight days as the country's currency, the peso, continues to fall sharply. 

On Friday, the bank hiked rates to 40% from 33.25%, a day after they were raised from 30.25%. A week ago, they were raised from 27.25%.

 

I remember black Wednesday. The rise wasn’t as sharpe but iirc, they went to 17 percent 

Share this post


Link to post
Share on other sites
37 minutes ago, Wahoo said:

40% !!!

 

WTF is going on there? I thought Argentina and Chile were stable.

Argentina has been in the shit for a long time, from memory it all went to ratshit in about 2002, they kicked the can down the road for about 12 years until the most recent gov, now struggling to bring it all under control. 

Share this post


Link to post
Share on other sites
5 hours ago, swiss_democracy_for_all said:

Argentina has been in the shit for a long time, from memory it all went to ratshit in about 2002, they kicked the can down the road for about 12 years until the most recent gov, now struggling to bring it all under control. 

Ah, just like the U.K. then. 

Share this post


Link to post
Share on other sites
5 hours ago, swiss_democracy_for_all said:

Argentina has been in the shit for a long time, from memory it all went to ratshit in about 2002, they kicked the can down the road for about 12 years until the most recent gov, now struggling to bring it all under control. 

Twelve years you say?

2008 + 12 = 2020...

Just in time for the next election.

 

Share this post


Link to post
Share on other sites

We're at an intresting time.

Despite what the BoE and whatnot say, there's more to rates than control inflation.

The UK has a number of problems - high current account deficit, high public and private debt, very few people actually working.

Every month the BoE has to roll over old debt and raise new debt.

The world debt market is still driven by the Us - if the US raises rates then they set a higher risk -free rate so other countries have to pay more for their debt.

Theres 3 main currency blocks - US, Euro, China.

UK is a very minor player now. Its not a price maker; its a  price taker.

Share this post


Link to post
Share on other sites

Argentinian central bankers have probably been printing money like crazy and raising interest rates is the way they are fighting the resultant drop in value of the peso.

Imho, we should all have some precious metals stored away.... 

Share this post


Link to post
Share on other sites

There is currently no chance of UK interest rates rising this year. Ditto the EU. Nor Japan.

All 3 are playing the game of buggering their currencies against the US Dollar and hoping to stimulate inflation in all assets as a result. 

Currently, the banksters rate a US interest rate rise in June as being 100% certain. Then 2 more in the Autumn at about 40%. But the odds for one after that just fell considerably.

The Argentina situation is due to the rising USD.

Share this post


Link to post
Share on other sites

Interest rates these days are a bit like following a dud football team eventually the dreariness wins and you can lose interest. 

I think the chart below is from around December 2017.

Britain tends to follow the general US trend or at least used to but Britain is different of course as its economy is in such rotten shape - still, after many decades  of being in rotten shape.

Quote

 

Edited by twocents

Share this post


Link to post
Share on other sites
On 05/05/2018 at 00:29, swiss_democracy_for_all said:

Argentina has been in the shit for a long time, from memory it all went to ratshit in about 2002, they kicked the can down the road for about 12 years until the most recent gov, now struggling to bring it all under control. 

I know an Argentinian girl. She came to the UK about 20 years ago after the argentine economy went down the drain. Her family were middle class, dad was an engineer. They lost all their savings and dad lost his job. 

I don't think these interest rate rises will affect Argentinians in the same way they would Brits. Argies generally aren't drowning in debt and most of them either rent or buy their homes with cash. 

Share this post


Link to post
Share on other sites
On 05/05/2018 at 07:43, spygirl said:

We're at an intresting time.

Despite what the BoE and whatnot say, there's more to rates than control inflation.

The UK has a number of problems - high current account deficit, high public and private debt, very few people actually working.

Every month the BoE has to roll over old debt and raise new debt.

The world debt market is still driven by the Us - if the US raises rates then they set a higher risk -free rate so other countries have to pay more for their debt.

Theres 3 main currency blocks - US, Euro, China.

UK is a very minor player now. Its not a price maker; its a  price taker.

Ever since we were bounced out of the ERM we have been shadowing the US rate, usually 1 - 1.5% above it.  The BoE is generally a waste of time; just take Fed rate + 1%.

It's very unusual for us to below the Fed rate so I'm expecting a steady correction to our usual Fed +1% over the next three years.

Share this post


Link to post
Share on other sites

Although I haven't visited ToS in a while I have found myself by coincidence thinking about the viewpoints on there lately.

In the last week I've had conversations with 2 middle aged boomer women who I don't know particularly well -- but know enough about their situation. Both of them professed the idea that young people are lazy and aren't willing to forego the usual predictable trove of gadgets like iPads instead of saving for a deposit on a house. When I remarked that there was no point in saving for something that is so utterly out of reach, and would they consider saving for a new Lamborghini Aventador (£250k), they both had the same reaction - whatever. They just don't care is the crux of it. For that reason I hope interest rates do go up to 17% again, just so they and everyone like them can be turfed out and have to go back to square one.

Share this post


Link to post
Share on other sites
9 minutes ago, spunko2010 said:

Although I haven't visited ToS in a while I have found myself by coincidence thinking about the viewpoints on there lately.

In the last week I've had conversations with 2 middle aged boomer women who I don't know particularly well -- but know enough about their situation. Both of them professed the idea that young people are lazy and aren't willing to forego the usual predictable trove of gadgets like iPads instead of saving for a deposit on a house. When I remarked that there was no point in saving for something that is so utterly out of reach, and would they consider saving for a new Lamborghini Aventador (£250k), they both had the same reaction - whatever. They just don't care is the crux of it. For that reason I hope interest rates do go up to 17% again, just so they and everyone like them can be turfed out and have to go back to square one.

Until the treachery of 2008/9/10/11/12/13/14 and indeed right up to now every generation had it's chance with a reset of the property market. The the politicos decided the young were stupid and didn't follow finance/politics or vote so didn't matter, up to now they've got away with it.

Share this post


Link to post
Share on other sites
18 minutes ago, spunko2010 said:

Although I haven't visited ToS in a while I have found myself by coincidence thinking about the viewpoints on there lately.

In the last week I've had conversations with 2 middle aged boomer women who I don't know particularly well -- but know enough about their situation. Both of them professed the idea that young people are lazy and aren't willing to forego the usual predictable trove of gadgets like iPads instead of saving for a deposit on a house. When I remarked that there was no point in saving for something that is so utterly out of reach, and would they consider saving for a new Lamborghini Aventador (£250k), they both had the same reaction - whatever. They just don't care is the crux of it. For that reason I hope interest rates do go up to 17% again, just so they and everyone like them can be turfed out and have to go back to square one.

Well, lets take their argument as it is.

Who the fuck are they going sell their house too?

You make money from houses by selling them not buying them.

Share this post


Link to post
Share on other sites

I wish you hadn't started this. I am pissed off today already.

On a Facebook thread for where I want to move to, you have a woman crowing that she has just sold her Woking three bed for £700k. 

She is going to rent for six months, and although the place she wants is on for £1,200 per month, she is going to offer £1,500 per month, paid upfront, to make sure she gets it.

Fuck. I am moving away from here because I am priced out, only to be priced out of where I am going by people from here.

Fecked up economy. I am really looking forward to being a tenant at 80, with the possibility of needing to move every six months.

I feel that I am at the vanguard for what our current youth face as a future.

 

 

Share this post


Link to post
Share on other sites
1 hour ago, twocents said:

Interest rates these days are a bit like following a dud football team eventually the dreariness wins and you can lose interest. 

I think the chart below is from around December 2017.

Britain tends to follow the general US trend or at least used to but Britain is different of course as its economy is in such rotten shape - still, after many decades  of being in rotten shape.

Having got bored woth interest rates as our have done fuck-all since 2008 I had a delve.

'So far, the US Fed has delivered one rate hike of 25bps this year, and it's own median projection is for a total of three 25bps rate hikes in 2018. In a rising interest rate environment'.

'Talking Points: - FOMC holds benchmark interest rate in range of 1.50-1.75%, as was expected by markets. - Fed funds price in a 100% chance of a 25-bps rate hike in June, but odds for September and December stay in same territory post-release as they did pre-release. '

Looks like ours will have to follow suit at some point, then it will get interesting again.

https://www.thepeninsulaqatar.com/article/06/05/2018/EM-capital-flows-prove-more-volatile-in-2018-QNB

https://www.dailyfx.com/forex/market_alert/2018/05/02/US-Dollar-Drops-as-FOMC-Turns-Hawkish-on-Inflation-Dovish-on-Growth.html

Share this post


Link to post
Share on other sites
4 hours ago, Cunning Plan said:

I wish you hadn't started this. I am pissed off today already.

On a Facebook thread for where I want to move to, you have a woman crowing that she has just sold her Woking three bed for £700k. 

She is going to rent for six months, and although the place she wants is on for £1,200 per month, she is going to offer £1,500 per month, paid upfront, to make sure she gets it.

Fuck. I am moving away from here because I am priced out, only to be priced out of where I am going by people from here.

Fecked up economy. I am really looking forward to being a tenant at 80, with the possibility of needing to move every six months.

I feel that I am at the vanguard for what our current youth face as a future.

 

 

Oh, youll look back and laugh. Telling your grandkids that people paid 30x average salary for a house in Woking.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.