[PeteMorris]

I'm slightly puzzled that the IMF Chief (Christine Lagarde) suggests Britain should (amongst other helpful suggestions) cut our interest rates.

I might be wrong, but it currently stands at half of one percent. How much lower can you go? Can it go negative? I presume that means a bank would charge you interest to deposit your money with them?

[truman]

Who is actually only paying half a percent?

[PeteMorris]

Originally Posted by truman

Who is actually only paying half a percent?

Well that's a good question. Havn't the building Society's just increased their rates for mortgages? It seems the BOE set the rates and everyone else ignores it and sets theirs at whatever they like.

It's certainly not Joe Bloggs in the street paying half a percent!

[splodgeyAl]

Originally Posted by truman

Who is actually only paying half a percent?

Banks mostly.

[truman]

Originally Posted by splodgeyAl

Banks mostly.

I'm not sure they do...do you know for definate?

[splodgeyAl]

Originally Posted by truman

I'm not sure they do...do you know for definate?

No, I don't to be honest. But the IMF / BoE usually talk about the "Bank Rate" *not* the retail interest rates. I'd imagine they couldn't dictate the retail rate due to competition laws, anyway?

[truman]

Originally Posted by splodgeyAl

No, I don't to be honest. But the IMF / BoE usually talk about the "Bank Rate" *not* the retail interest rates. I'd imagine they couldn't dictate the retail rate due to competition laws, anyway?

I think the 1/2 % relates to the ineterest the BoE charge..the interbank rate is likely to be higher..although I could be talking tosh..

[splodgeyAl]

Originally Posted by truman

I think the 1/2 % relates to the ineterest the BoE charge..the interbank rate is likely to be higher..although I could be talking tosh..

Yeah. I think that's what I meant

[studentbob]

Interest rates are set at 0.5% for one reason only - so the banks can deleverage. They have so many bad debts that they couldn't possibly pay them off with their normal operating profits. That is why the central banks are sticking with low interest rates.

Of course Mervyn King and his cronies argue that what they are doing is trying to revitalise the economy by ensuring that there is a cheap money supply available, when in effect all they are doing is providing cheap money for banks to pay off bad debts, as very little or none of the money is filtered into the real economy.

When Lagarde suggests cutting interest rates what she really means is she thinks another round of QE is inevitable. More free money for the banks.

[MrSmith]

Originally Posted by PeteMorris

I'm slightly puzzled that the IMF Chief (Christine Lagarde) suggests Britain should (amongst other helpful suggestions) cut our interest rates.

I might be wrong, but it currently stands at half of one percent. How much lower can you go? Can it go negative? I presume that means a bank would charge you interest to deposit your money with them?

It puzzles me too, the banks got in a mess for lending money, the economies of the world were stimulated because banks lent money which people could spend, and governments wanted banks to lend money so people could spend it. It was spending borrowed money that made economies grow and ultimately the banking crisis. So the answer to the mess is to lend more money to stimulate the economy again.

[chem1st]

End the damn currency monopoly. The pound is worthless and the workers of society need a currency to trade. The workers of our society, the thing that society depends on for it to function, they need the ability to trade, they need the ability to work and receive but a small percent of the fruits of their labour.

They need an honest bob. It is not the £, it is not the $, it is not the €.

It has to have either intrinsic value (gold or silver coins), or at least some faith in it. People need to have the right to create their own currency and to trade it freely.

I trust an IOU from the local unemployed men FAR MORE than I do the BoE. Work for each other, work for free, tax free. Build your neighbour a shed, and have him build you one!

Abolish the anti stamp script laws.

We also need free-land.

End the land monopoly by imposing LVT. To use land, one must pay a tax unto the rest of society. This will ensure land is used productively. And not hoarded, left idle, claiming subsidy from tax upon the workers! Let people work the land for their own gain (and society as a whole), not for the private profit of idle landowners.

In but 3 months we can achieve full employment, all citizens and even foreign residents can be housed in conditions that provide dignity (within a few years), we can develop healthy housing for future immigrants, and even for tourists. And at the same time, we can increase our food production.

[chem1st]

We are but slaves to the usurers (banking cartels).

We are but slaves to the landowners (people owning land without working or occupying it and collecting economic rent - that rent should be communal - the land should belong to the people).

[Magnese]

The bankers are borrowing at 0.5% and lending at substantially more. They then pocket the difference and make large profits at the expense of people who bailed them out with their hard earned pay. They use the money to give themselves massive bonuses for what in effect is nothing more than extortion.

[Magnese]

I suppose that what I am saying is that bankers are scum.

[I1L2T3]

Originally Posted by studentbob

Interest rates are set at 0.5% for one reason only - so the banks can deleverage. They have so many bad debts that they couldn't possibly pay them off with their normal operating profits. That is why the central banks are sticking with low interest rates.

Of course Mervyn King and his cronies argue that what they are doing is trying to revitalise the economy by ensuring that there is a cheap money supply available, when in effect all they are doing is providing cheap money for banks to pay off bad debts, as very little or none of the money is filtered into the real economy.

When Lagarde suggests cutting interest rates what she really means is she thinks another round of QE is inevitable. More free money for the banks.

Indeed. We can go to 0.25% interest rates. Like you said the QE bit is the most important bit.

[MrSmith]

Originally Posted by chem1st

Build your neighbour a shed, and have him build you one!

Would it not be better to build your own shed and have your neighbour build their own shed?

[Jeffrey Shaw]

Originally Posted by PeteMorris

It seems the BoE set the rates and everyone else ignores it and sets theirs at whatever they like.

No. The BoE rate is merely a reference point against which financial institutions can set their own rates (e.g. "base rate + four percentage points" or whatever).

[MrSmith]

Originally Posted by chem1st

We are but slaves to the usurers (banking cartels).

We are but slaves to the landowners (people owning land without working or occupying it and collecting economic rent - that rent should be communal - the land should belong to the people).

Why do you consider yourself a slave, are you not free to choose your own path in life.

[Mecky]

Cut interest so we can buy more goods from overseas, how is that going to solve the UK economic problems? We need to manufacture and export but since other countries largely set the cost of living in the UK, that's unlikely to happen anytime soon.