5 ms·

They're probably avoiding an immediate kneejerk emergency raise, which would look like they're panicking. If they wait a little bit before they raise, it'll loo

They're probably avoiding an immediate kneejerk emergency raise, which would look like they're panicking. If they wait a little bit before they raise, it'll look more calm and considered which should give the market more confidence.

highwaylights 4y ago
Time is a factor here, too. The longer they wait the harder it’ll be to get it back under control - which may not even be possible at this stage, given that they’ve grossly underestimated the scale of the problem at every step. The thing that really worries me is that most people don’t understand how any of this works and are still worried about fuel costs. They have no idea that a further (minimum) 1.5% hike is imminent, and those worst affected (renters/trackers) won’t know that they’re the ones who’ll get wiped out by it. A freeze on rent increases (like the fuel cap) might be needed, but good luck getting this government to agree to that. Edit: as I think about it a rent freeze would be great for shaking the exploitation out of the housing market too.
- Neil44 4y ago
  You seem to be talking about inflation rather than interest rates
  - highwaylights 4y ago
    Both. Raising the base rate is a tool to reduce inflation. They’re two sides of the same coin.
    - Neil44 4y ago
      They are related although the government does not control interest rates, the BofE does. To be honest I'm not super worried as I can see the inflationary pressure is mostly coming from the knock on effects of the Ukraine which will undoubtably end at some point. Also we're coming off the back of Brexit and printing a load of money for Covid.
- highwaylights 4y ago
  I appreciate the downvotes from the landlord who thinks they’re an astute investor and not just exploiting someone further down the wealth pyramid. For anyone not aware of this - housing is not a free market, especially in the UK (your tenants are universally forced against their will to rent from you due to nimbyism).
  - nerdawson 4y ago
    Why are landlords exploitative? Nobody is being forced against their will to rent a property they don’t want. Tenants already get plenty of protections that are only due to be strengthened. Should choice really be limited to owning an expensive asset or accepting whatever the government is capable of providing (council houses aren’t looked upon fondly). What you refer to as exploitation I’d see as freedom of choice.
    - highwaylights 4y ago
      It’s exploitative because your counterparty does not have the luxury of choice. The people who actively work the system to prevent new construction are the same people collecting rents from tenants left without options because of bans on construction.
      - nerdawson 4y ago
        NIMBY attitudes aren't confined to landlords. That's quite a common sentiment among homeowners. People working to secure their best interests shouldn't come as a shock. There are plenty of options for people looking to get on to the housing ladder including government backed schemes that require deposits as low as 5%. If someone is incapable of saving a 5% deposit, are they fiscally responsible enough to own a home?
Neil44 4y ago
GPB to Dollar seems to have levelled out and started coming back slowly so I guess they might get away with it. As the dollar is also up against Euro and many other currencies, possibly due to it being a default 'safe port' in uncertain times, I guess they're trying to take a measured approach.
- SilverBirch 4y ago
  It's really difficult to judge the GBP:USD rate, because it started sliding yesterday, and then it looked like there would be a BoE intervention, which caused it to recover. So it's a sort of catch 22, if it gets really bad the BoE might intervene, if the BoE does intervene, it'll rise because of the intervention. So it sort of levels out at "This is the lowest we can get without pricing in the BoE doing an emergency hike". It's very difficult to tell what is driving what.

highwaylights 4y ago

Time is a factor here, too. The longer they wait the harder it’ll be to get it back under control - which may not even be possible at this stage, given that they’ve grossly underestimated the scale of the problem at every step. The thing that really worries me is that most people don’t understand how any of this works and are still worried about fuel costs. They have no idea that a further (minimum) 1.5% hike is imminent, and those worst affected (renters/trackers) won’t know that they’re the ones who’ll get wiped out by it. A freeze on rent increases (like the fuel cap) might be needed, but good luck getting this government to agree to that. Edit: as I think about it a rent freeze would be great for shaking the exploitation out of the housing market too.

Neil44 4y ago
You seem to be talking about inflation rather than interest rates
- highwaylights 4y ago
  Both. Raising the base rate is a tool to reduce inflation. They’re two sides of the same coin.
  - Neil44 4y ago
    They are related although the government does not control interest rates, the BofE does. To be honest I'm not super worried as I can see the inflationary pressure is mostly coming from the knock on effects of the Ukraine which will undoubtably end at some point. Also we're coming off the back of Brexit and printing a load of money for Covid.
highwaylights 4y ago
I appreciate the downvotes from the landlord who thinks they’re an astute investor and not just exploiting someone further down the wealth pyramid. For anyone not aware of this - housing is not a free market, especially in the UK (your tenants are universally forced against their will to rent from you due to nimbyism).
- nerdawson 4y ago
  Why are landlords exploitative? Nobody is being forced against their will to rent a property they don’t want. Tenants already get plenty of protections that are only due to be strengthened. Should choice really be limited to owning an expensive asset or accepting whatever the government is capable of providing (council houses aren’t looked upon fondly). What you refer to as exploitation I’d see as freedom of choice.
  - highwaylights 4y ago
    It’s exploitative because your counterparty does not have the luxury of choice. The people who actively work the system to prevent new construction are the same people collecting rents from tenants left without options because of bans on construction.
    - nerdawson 4y ago
      NIMBY attitudes aren't confined to landlords. That's quite a common sentiment among homeowners. People working to secure their best interests shouldn't come as a shock. There are plenty of options for people looking to get on to the housing ladder including government backed schemes that require deposits as low as 5%. If someone is incapable of saving a 5% deposit, are they fiscally responsible enough to own a home?

Neil44 4y ago

GPB to Dollar seems to have levelled out and started coming back slowly so I guess they might get away with it. As the dollar is also up against Euro and many other currencies, possibly due to it being a default 'safe port' in uncertain times, I guess they're trying to take a measured approach.

SilverBirch 4y ago
It's really difficult to judge the GBP:USD rate, because it started sliding yesterday, and then it looked like there would be a BoE intervention, which caused it to recover. So it's a sort of catch 22, if it gets really bad the BoE might intervene, if the BoE does intervene, it'll rise because of the intervention. So it sort of levels out at "This is the lowest we can get without pricing in the BoE doing an emergency hike". It's very difficult to tell what is driving what.