Scrutable

dyqik wrote: ↑

Mon Sep 26, 2022 4:25 pm

plodder wrote: ↑

Mon Sep 26, 2022 4:11 pm

dyqik wrote: ↑

Mon Sep 26, 2022 3:45 pm

Actual BoE statement seems to have led to the pound falling.

Ach I'm thinking about it too much. They're just gambling on what they think other people will do in response to rumours.

The BoE statement seems to be being interpreted as "This is fine" dog drinking coffee in burning building.jpg.

The BoE don’t have currency stability as a criterion to make decisions on, only inflation.

Grumble wrote: ↑

Mon Sep 26, 2022 6:09 pm

dyqik wrote: ↑

Mon Sep 26, 2022 4:25 pm

plodder wrote: ↑

Mon Sep 26, 2022 4:11 pm

Ach I'm thinking about it too much. They're just gambling on what they think other people will do in response to rumours.

The BoE statement seems to be being interpreted as "This is fine" dog drinking coffee in burning building.jpg.

The BoE don’t have currency stability as a criterion to make decisions on, only inflation.

Guess what a collapsing currency does to the price of imported goods, like energy, food, consumer goods and medicines...

plodder wrote: ↑

Mon Sep 26, 2022 4:43 pm

There's a gov statement that says "don't worry, we're going to unleash the productivity of the british farming sector in a couple of months" which is like 0.5% of the economy. Surely a bit early to be clutching at straws?

Late November sounds like the perfect time to rely on new activity in the British agricultural sector.

dyqik wrote: ↑

Mon Sep 26, 2022 6:40 pm

plodder wrote: ↑

Mon Sep 26, 2022 4:43 pm

There's a gov statement that says "don't worry, we're going to unleash the productivity of the british farming sector in a couple of months" which is like 0.5% of the economy. Surely a bit early to be clutching at straws?

Late November sounds like the perfect time to rely on new activity in the British agricultural sector.

You scoff but on Nov 23rd the government’s updated tractor quotas will be unveiled to gasps of admiration across the commonwealth

plodder wrote: ↑

Mon Sep 26, 2022 7:21 pm

dyqik wrote: ↑

Mon Sep 26, 2022 6:40 pm

plodder wrote: ↑

Mon Sep 26, 2022 4:43 pm

There's a gov statement that says "don't worry, we're going to unleash the productivity of the british farming sector in a couple of months" which is like 0.5% of the economy. Surely a bit early to be clutching at straws?

Late November sounds like the perfect time to rely on new activity in the British agricultural sector.

You scoff but on Nov 23rd the government’s updated tractor quotas will be unveiled to gasps of admiration across the commonwealth

That will definitely advanced the juche ideal of the Tory party.

plodder wrote: ↑

Mon Sep 26, 2022 4:43 pm

There's a gov statement that says "don't worry, we're going to unleash the productivity of the british farming sector in a couple of months" which is like 0.5% of the economy. Surely a bit early to be clutching at straws?

The farming sector, of course, relies on seasonal labour. Labour that needs to be available when and where it is needed, but is not needed year round.

So given the desire of the government to persecute the two categories of people who traditionally provide that labour - people travelling to the country to work and people who travel around the country to follow where agricultural is in demand - that productivity is already under massive strain.

They're planning a big loosening of non-EU immigration regs too though, aparrently. You know, the ones that don't have robust employment rights.

Just need to scrap that pesky Human Rights nonsense and we can bring back slavery to these green and pleasant isles.

There is one sense in which blowing up both the Nordstream pipelines has done us a strange kind of a favour. The Russians have removed a lot of uncertainty over how long this energy crisis will last. We now understand quite clearly it isn't a short term problem. Mr Nasty Guy won't have reformed himself, been re-accepted as a friend, and started selling us his gas again in the next few months.

The government has kept on gambling on "solutions" that only make sense if it is a short term problem. Now I think they have to wake up to it being a longer term problem, and do something consistent with that.

IvanV wrote: ↑

Tue Sep 27, 2022 8:56 pm

There is one sense in which blowing up both the Nordstream pipelines has done us a strange kind of a favour. The Russians have removed a lot of uncertainty over how long this energy crisis will last. We now understand quite clearly it isn't a short term problem. Mr Nasty Guy won't have reformed himself, been re-accepted as a friend, and started selling us his gas again in the next few months.

The government has kept on gambling on "solutions" that only make sense if it is a short term problem. Now I think they have to wake up to it being a longer term problem, and do something consistent with that.

The gas spot price has fallen a lot recently and is back to where it was before the invasion (but which is still much higher then over the previous years). https://www.erce.energy/graph/uk-natura ... pot-price/
The main reason being that Europe has filled up its winter gas stores.

However, the attack will surely drive up prices again, at least until markets calm down.

There's some Tory bloke called Jake Berry.

He's actually said something sensible. Yet the lefty twitter-morons seem outraged.

People know that when their bills arrive, they can either cut their consumption or they can get a higher salary, higher wages, go out there and get that new job.

This is a pro-union statement. It's exactly right. People need to be demanding higher salary, combining in unions to strike for higher wages and going directly to their line manager to say they'll walk into a new job unless they get their pay rise.

The only answer to the cost of living crisis is to get real wages rising, after the decade of falling real wages. The share taken by labour must be increased. Everything else is just temporary handouts and tax tinkering.

I'm as surprised as anyone that this obscure Tory said something so left wing. But let's celebrate his conversion.

Berry is the MP for where I grew up, and where members of my family still live. He's a prick. Even local tory voters want him out.

Fwiw, it's a fairly well-balanced seat in terms of tory/Labour vote, and something of a bellwether seat too, having voted for the party who got into government each election since 1964, other than Feb 1974 and 1992. The Borough council changes hands quite a bit, and many wards are themselves fairly even in terms of votes, except for a couple which just had by-elections and vote Conservative fairly heavily. Berry tried to use the fact that those two wards just re-elected tory councillors as proof that all is not lost for the conservatives.

He's a wally, and he'll be out at the next election.

The UK faces a “significant risk” of gas shortages this winter and could enter an emergency that would see power stations switched off, according to regulator Ofgem.

A second stage of a network gas supply emergency would enforce “load shedding” on the largest users such as gas-fired stations, Ofgem’s head of wholesale market management, Grendon Thompson, said in a letter accepting a request by generator SSE Plc that the regulator should urgently address the risk of possible insolvencies.

Russia has squeezed gas flows to Europe in retaliation for sanctions imposed by the West following Moscow’s invasion of Ukraine. That’s curbed global gas supply and increased competition for the fuel, raising the prospect of blackouts this winter as about 40% of the UK’s electricity comes from burning gas.

If generators are switched off, they would face “massive” imbalance charges and credit cover requirements that could drive them insolvent, SSE said in its request dated Sept. 28.

“Even if such an emergency does not occur, the risk that it could occur is likely to force generators to reduce their forward and day ahead trading, reducing liquidity in electricity markets, and raising costs for electricity consumers,” SSE added.

From here as the others are paywalled: https://financialpost.com/pmn/business- ... s-shortage

Meanwhile, Spain has published its budget for the coming year.

Things are approached differently here. I'll personally only benefit from a very small part of this, but it's nice to live somewhere that cares about the people.

lpm wrote: ↑

Fri Sep 23, 2022 3:12 pm

tenchboy wrote: ↑

Tue Sep 06, 2022 2:28 pm

lpm wrote: ↑

Tue Sep 06, 2022 2:20 pm

Jeez, the 5 year gilt rate. At midday it was 2.88%. Now 3.10%.

Insane movement. This is what totally absurd magic money tree borrowing by a reckless Corbynite Trussite government does.

Totally insane, who'd a ever thunk that the 5 year note generic bid yield for UK Government Bonds, as determined by the Principal Paying Agent in a commercially reasonable manner on the date falling one (1) Business Day prior to each Reset Date by reference to Bloomberg screen page "GUKG5" (UK Govt Bonds 5 Year Generic Bid Yield) or such other screen page, section or part of Bloomberg as may replace it would a hit 3.1%. As you say totally absurd & reckless. Couldn't agree more.

Now 4.00%.

Mortgage refixing is going to be the real blow to households over the next 2 years to the election.

Now 4.50%. The housing market is f.cked.

Up from about 1.80% since the overthrow of our beloved Boris in July. This is why you don't get rid of a highly competent, hard-working and incorruptible Prime Minister simply because he has scruffy hair.

lpm wrote: ↑

Wed Oct 12, 2022 3:30 pm

Now 4.50%. The housing market is f.cked.

Up from about 1.80% since the overthrow of our beloved Boris in July. This is why you don't get rid of a highly competent, hard-working and incorruptible Prime Minister simply because he has scruffy hair.

Hail Gordon Brown, PM for the past 14 years.

Our five-year fixed rate ends on 31st March next year (1.74%, not bad), and either we're going to be moving house with a mortgage offer that ends on that same day, or we're going to be staying here with a new mortgage.

The new house, without giving too many details, is a damn sight more expensive than this one, and the mortgage offer we've got is 3.38% for five years with Halifax, which isn't as good as we wanted, but is shitloads better than the best we could get now - 5.24% with Loughborough Building Society. Monthly payments are about £750 more per month on that rate than the one we have. Our current mortgage per month is less than that difference. We've gone for five years because of lack of confidence about where the market will be in two years time, and relatively little room for manoeuvre with the initial fixed term (we should have more in subsequent terms).

If that offer falls through (our sellers are being idiots and trying to buy a new build which isn't released until December), we won't be buying the house. And so, a remortgage. I've done an application for a remortgage on this house as a back-up, and for that we'd probably go for a two-year fix, as we have a lot more room for manoeuvre in what we can afford to pay. When we first bought the house in 2014, we were paying around £1,050 a month, and now we're over £300 per month less than that with considerably higher incomes and considerably lower LTV (lower debt, house value has doubled). Best we can do on that today is 5.64% with the Bank of Ireland at just over £1,000 per month. Thankfully, though, I asked my broker to stick an application in a couple of weeks ago, so we're on around 4.25% with Barclays. So that's (relatively) nice.

Still though. f.cked, innit.

We live in a very middle-class area, at my kids' school less than 5% of children qualify for free school meals, but you can already see the cost of living increases having a big impact.

The school has started working with local supermarkets and other shops to provide a foodbank that parents can collect from discretely by emailing the school in advance and has been promoting this in the last couple of school newsletters. They are also providing food parcels for the October week next week to help those wo rely on the hot school lunches during term.

There has also been an appeal for families to hand in winter coats, and other warm clothes for distribution to those that need them in the school. This is the first time either of these has happened, there is a uniform exchange but it previously only acted as a peer-to-peer way of exchanging logo'd uniform.

Many kids seem to have been withdrawn from extra-curricular activities, to the extent that the local scout troop no longer has a waiting list for any of the age groups, and spaces have opened up in lots of the other local clubs and activity groups too. Parents are also grouping together to provide after school care and taking their kids out of the paid-for after school club.

It just seems that since term started in mid-August things have changed a lot, people who were perhaps muddling through before simple can't do it any longer so they are making any cuts they possibly can and the school is stepping up to help where it can.

El Pollo Diablo wrote: ↑

Thu Oct 13, 2022 1:18 pm

We've gone for five years because of lack of confidence about where the market will be in two years time, and relatively little room for manoeuvre with the initial fixed term (we should have more in subsequent terms).

Having bought a house at the end just before the 90s house price crash, and with the variable interest rate (normal in those days) I was paying going up to 14% for a while, I can understand that fright at what might come in future when you take on those commitments. I was paying out 60% of my after tax income in mortgage payments at the worst of it. As a single man I could survive that, and later found myself with plenty of spare cash to pay down the mortgage as interest rates came down again. Inflation also eroded the mortgage - it was up to nearly 10% for a while in the early 90s. I had had some foresight of potential risk, and had only borrowed a 2.6 multiple of my income, rather than the 3 that was commonly offered. But many others suffered repossession.

Today house prices are a greater multiple of incomes, in part because there is a stronger expectation of lower interest rates. People are lent a higher multiple of their income in consequence. Someone on the telly was saying that interest rates of only about 7% would produce similar levels of pain as was seen in the early 90s.

Just had a chat with my mum. She's a governor at one of the local primary schools.

She was telling me that primarily due to the rise in the gas bill, but also other costs, they may have let at least one teacher go, because they won't be able to afford them.

It's annoying people only picked 2 or 5 year fixes, for high mortgage burdens. It's basic risk/insurance management - if X could happen and cause you serve problems, insure against X. I don't have much sympathy for people who failed to protect themselves on their biggest monthly expense.

monkey wrote: ↑

Thu Oct 13, 2022 5:14 pm

Just had a chat with my mum. She's a governor at one of the local primary schools.

She was telling me that primarily due to the rise in the gas bill, but also other costs, they may have let at least one teacher go, because they won't be able to afford them.

Gotta say this is what some employers are telling unions.

monkey wrote: ↑

Thu Oct 13, 2022 5:14 pm

Just had a chat with my mum. She's a governor at one of the local primary schools.

She was telling me that primarily due to the rise in the gas bill, but also other costs, they may have let at least one teacher go, because they won't be able to afford them.

MrsG is a governor - their head has retired, and the deputy head has been appointed her replacement. There is an obvious internal candidate for the newly vacated deputy slot - but there won't be anyone new appointed to make up the numbers.

More significantly for the pupils' experience is that they don't expect to be able to offer any residential stays away. Previously, there was some scope for subsidising pupils whose parents couldn't afford the cost of transport/food etc; but there's nothing available for that - and that's before the additional fuel costs.

They may offer 'sleep overs' instead; where year groups will get some of the 'residential' experience, but done within the school premises.

The Head's retirement has helped overall, as the new head will have progressed less up the scale than the old, but times are tough, and some of the old 'fundraiser' events have been missed for the last two years, and will be hard to restart (and won't raise as much if significant numbers of parents are also feeling the squeeze) .

discovolante wrote: ↑

Thu Oct 13, 2022 5:34 pm

monkey wrote: ↑

Thu Oct 13, 2022 5:14 pm

Just had a chat with my mum. She's a governor at one of the local primary schools.

She was telling me that primarily due to the rise in the gas bill, but also other costs, they may have let at least one teacher go, because they won't be able to afford them.

Gotta say this is what some employers are telling unions.

It does not surprise me that this sort of thing is more widespread, which is one of the reasons why I posted the anecdote, I assumed it was an example of a discussion going on in many places, across many sectors. Think it hits pretty hard when it's happening at a primary school though, there are Consequences beyond people losing their jobs in that situation*.


*I'm not suggesting getting made redundant is not serious for people, it is, just that some jobs may effect other people more than others.

lpm wrote: ↑

Thu Oct 13, 2022 5:18 pm

It's annoying people only picked 2 or 5 year fixes, for high mortgage burdens. It's basic risk/insurance management - if X could happen and cause you serve problems, insure against X. I don't have much sympathy for people who failed to protect themselves on their biggest monthly expense.

Quite right, insurance is for the big risks of big losses. You pay a premium for insurance, and insuring lots of small risks isn't worth it, because they will likely average out. It's the big risks that matter.

Yes, mortgage is your largest outgoing. But accepting a premium on your interest rate can cost a lot. So we need to think about the premium and whether it is value. We tend to forget that there should be a premium for fixing, because another factor has meant that fixing in the short term has actually been cheap. That's because of the "customer engagement issue" - financial companies rip off the unengaged - and short term fixed mortgages is the high competition market focusing on engaged customers, whereas variable rate mortgages are for the unengaged. What happens for longer term fixed rate mortgages? Are you paying a premium? Is it a fair premium? I don't know, so I'm asking.

What kind of availability even is there for longer term fixed mortgages? Fixed rate mortgages for more than the short run were unavailable back in the 80s. The lenders had got burnt over longer term fixed rates they offered in the 60s, then the 70s came along. I knew someone my father's age who fixed a mortgage for all 25 years in the late 60s, and was paying 60s-type interest rates throughout the 70s and 80s, and even in the early 90s peak. He did very well, but his lender couldn't have afforded to have many customers like that. So such things became unavailable.

You don't entirely solve the problem unless you fix for the full length of your mortgage. You can fix for 10 years, but still come out of it after 10 years in a horrible pickle, and it is even harder to know what your life will look like in 10 years. At least it reduces the number of times you come out and are exposed.

I've never had a fixed rate mortgage. I gained more advantage from flexibility than from short term fixes, and the kind of flexible arrangement I wanted was not available with the fix-term lenders. Longer term fixes were not available again until I had little money borrowed any more.

I don't claim to understand the mortgage market, but a large majority of U.S. mortgages are fixed for the entire life of the loan, usually 30 years. So the idea that banks "can't" do that because of bad experiences in the 1970s or whatever is clearly wrong. But I don't know why.