Cable Forum - Rising cost of living

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Re: Rising cost of living

Quote:

Originally Posted by Hugh (Post 36139203)

Bank of England expects UK to fall into longest ever recession

https://www.bbc.co.uk/news/business-63471725

It's amazing that Bojo and even Truss forgot to mention anything about it as recently as last month. :erm:

Re: Rising cost of living

Quote:

Originally Posted by daveeb (Post 36139205)

It's amazing that Bojo and even Truss forgot to mention anything about it as recently as last month. :erm:

It would be much more amzing if they had mentioned it, do you think they can time travel ?

Re: Rising cost of living

Quote:

Originally Posted by Paul (Post 36139212)

It would be much more amzing if they had mentioned it, do you think they can time travel ?

They could have borrowed Rishi Sunaks time machine then, he seemed to have a pretty good idea. Failing that the OBR could have given them a gentle nudge had they bothered to consult them.

Re: Rising cost of living

Quote:

In economics, a recession is a business cycle contraction when there is a general decline in economic activity. Recessions generally occur when there is a widespread drop in spending.

I think energy costs are going to stop, or reduce drastically, public spending for a long while.

Re: Rising cost of living

Quote:

Originally Posted by Taf (Post 36139216)

I think energy costs are going to stop, or reduce drastically, public spending for a long while.

Gas costs for energy retailer are coming down and so far it's a mlld winter. But energy retailers have contracted at expensive rates out of necessity so high prices will continue for six months or so. Fingers crossed for after that!

Re: Rising cost of living

The BoE have completely lost the plot. How on earth does an interest rate hike bring down the energy price? It's objective is to stop people from buying stuff so that internal prices don't rise. But this will lead to unemployment and neither the people in work nor those laid off will be able to pay their mortgages. In time of recession, interest rates should fall.

Re: Rising cost of living

Quote:

Originally Posted by Sephiroth (Post 36139222)

This is the Times explanation

https://www.thetimes.co.uk/money-men...nterest-rates/

Quote:

How does increasing interest rates reduce inflation?

Before December 2021, interest rates had been at a record low so people were encouraged to borrow money because it was cheap. Meanwhile the interest rates on savings accounts were pitiful so there was little incentive to save, meaning people tended to spend instead.

But rising interest rates have increased the cost of borrowing money. In this environment, consumers and businesses are put off from spending or borrowing.

There is now more incentive for people to save their money rather than spend it as they can earn some interest.

But as demand for goods and services fall, this should in theory have a knock-on effect on prices by preventing costs from rising. Shops might even reduce the cost of goods to try to encourage people to buy them.

This is why increasing the Bank rate is like a lever for slowing down inflation.
This is exactly what the Bank of England’s MPC decided to do on 16 December when they voted to raise the cost of borrowing from the record low of 0.1%, and again in February, March, May, June, August and September. The rate is currently 3%.

The rise will be felt by those with mortgages that track the base rate of interest, while those on fixed rate deals may find that rates have increased when it comes to remortgaging. The base rate also impacts other borrowing such as credit cards, personal loans and car loans.

With a weak economy, increasing prices, and static wages, there is a fear that the UK risks falling into “stagflation”.

Re: Rising cost of living

Quote:

Originally Posted by Sephiroth (Post 36139222)

Free market capitalists would rather people get poorer, and unemployment increase, to reduce demand than admit the fake free market for energy doesn’t work.

Re: Rising cost of living

Quote:

Originally Posted by jfman (Post 36139226)

Free market capitalists would rather people get poorer, and unemployment increase, to reduce demand than admit the fake free market for energy doesn’t work.

It works very well for them so they do not really need admit anything. You could say that we, the consumer, should be up in arms about how much we are being ripped off but, to be fair, enough of us voted for the Party that implemented this, so it is sort of what we voted for.

Re: Rising cost of living

Quote:

Originally Posted by Sephiroth (Post 36139222)

On the other side of the argument interest rates for savers should go up

Re: Rising cost of living

Quote:

Originally Posted by papa smurf (Post 36139230)

On the other side of the argument interest rates for savers should go up

:LOL::LOL::LOL::LOL::LOL:

One of my savings accounts was paying 1.75% a week ago. It's now paying 1.5%.

Re: Rising cost of living

Quote:

Originally Posted by Taf (Post 36139232)

:LOL::LOL::LOL::LOL::LOL:

One of my savings accounts was paying 1.75% a week ago. It's now paying 1.5%.

get a better bank;)

Re: Rising cost of living

Quote:

Originally Posted by papa smurf (Post 36139233)

get a better bank;)

My HSBC Online Bonus Saver is paying 3%.

Re: Rising cost of living

Give these folk a go, a reliable source tells me they’re good:

Re: Rising cost of living

Quote:

Originally Posted by Sephiroth (Post 36139234)

My HSBC Online Bonus Saver is paying 3%.

And inflation is 10%.. so losing 7% a year.

I have some national savings index linked bonds they track inflation,they are very beautiful things:)