State of the Market

[dsc]

At least 0.25%, outside chance of 0.5%. Only 15% of mortgages are SVR and fixes have already priced in large hikes for those renewing. Rate increases operate with long lags - effect so far is about 1/3rd of total effect. Looking at 18 months for full effects to wash through. Housing crash is all but guaranteed, recession later in the year and next year, most likely.

Can't say I've seen effects when it comes to spending habits, at least in the local area, everything is rammed with people on the weekends. Absolutely crazy amounts of families everywhere. London is on another level but that is probably heavily tourist driven. Then again as you say loads of people are on fixed rates, so don't care at this point.

[jamesbrown]

Can't say I've seen effects when it comes to spending habits, at least in the local area, everything is rammed with people on the weekends. Absolutely crazy amounts of families everywhere. London is on another level but that is probably heavily tourist driven. Then again as you say loads of people are on fixed rates, so don't care at this point.

Exactly, and this is clear from the retail sales figures at the moment - effect hasn't really made it through yet, but those with fixed rates and high LTV due to renew in the next year or so (perhaps up to a couple of million people) will be panicking and that will feed through to retail sales in the coming 3-9 months. Housing crashes also impact retail sales and prices are determined at the margins and by credit availability - the narrative is basically set in now, but there's a long lag with increasing IRs.

[dsc]

Exactly, and this is clear from the retail sales figures at the moment - effect hasn't really made it through yet, but those with fixed rates and high LTV due to renew in the next year or so (perhaps up to a couple of million people) will be panicking and that will feed through to retail sales in the coming 3-9 months. Housing crashes also impact retail sales and prices are determined at the margins and by credit availability - the narrative is basically set in now, but there's a long lag with increasing IRs.

I think a lot of people forget or simply don't get that's interest rate increase effects are slow, minimum of 6 months I think from what I read somewhere. Then there's a whole load of people that say BoE is only making people poorer yet not fixing inflation - well that's the whole idea, to make people poorer to stop buying tulip and thus driving prices down as demand falls off a cliff. The issue I see is that slowly salaries are starting to creep up and employment is going up, if that speeds up, then best of luck in trying to lower inflation.

I think with the above, even more companies will put a hold on the UK overall in terms of projects / investment and we might see even less contracts...especially as EU inflation is dropping faster.

[Fraidycat]

Then there's a whole load of people that say BoE is only making people poorer yet not fixing inflation - well that's the whole idea, to make people poorer to stop buying tulip and thus driving prices down as demand falls off a cliff.

There are whole classes of people who are not directly effected by interest rate increases, those who rent, those who have paid off the morgtage, those who have only small mortgages left, those who live with parents, those that have long fixes. None of those groups is directly effected.

They will have a cause a recession with mass layoffs and increased unemployment. Then those that get effected will be from all groups listed above not just those with variable rate large debts.

[mangled]

...So you're looking at 800 - 900 assuming front office or HFT work...

If I was an actual gun with functional programming, working inside/onsite gigs, I'd just go work for Janestreet, probably better all round and you're in an office 3/days week anyway.

I think you mean go and work for Jane Street on a permanent basis ? Can you (or anybody) give ballpark estimates for what equivanent salaries would be at JS compared to contract day rates elsewhere in the City for similar roles ? I've been trying to break into the financial sector for a while now and am considering resorting to a spell on the dark side if it gets my foot in the door...

[swamp]

You need to be careful not to mistake the current IT job market, which seems to be in the toilet, with the wider job market, which is doing rather well:

https://www.ft.com/content/0ec5e354-...f-3f9500dc4d59

Maybe there was a lot of over-hiring in IT during the pandemic, and what we're seeing now is just a correction?

[northernladuk]

You need to be careful not to mistake the current IT job market, which seems to be in the toilet, with the wider job market, which is doing rather well:

https://www.ft.com/content/0ec5e354-...f-3f9500dc4d59

Maybe there was a lot of over-hiring in IT during the pandemic, and what we're seeing now is just a correction?

To me it feels like we've talking about IT contracting going down he toilet for many years now. Mostly driven (IMO) by the fact contracting has long outstripped perm resourcing as the standard recruiting method in IT departments. Every man and has dog has been going contracting as soon as possible for many years so more people have entered the fray in a shrinking arena due to tech changes and offshoring.

Still plenty of roles and good livings to be made for the majority but the average bods just entering aren't finding it to be the golden goose it used to be.

[TheDude]

I think you mean go and work for Jane Street on a permanent basis ? Can you (or anybody) give ballpark estimates for what equivanent salaries would be at JS compared to contract day rates elsewhere in the City for similar roles ? I've been trying to break into the financial sector for a while now and am considering resorting to a spell on the dark side if it gets my foot in the door...

Jane Street might be setting the bar a bit to high for a first job in finance. Most contractors already in finance and working for banks wouldn't have much chance of getting into Jane Street either.

What is your skillset and how have you been trying to get into finance? I would start at one of the banks first.

Not all banks are the same and if you want to get your foot into the door it will be easier to get into a League Two firm like RBS or Barclays who set the bar a lot lower than Premier League firms like Goldman or Morgan Stanley.

For a perm role with a few years experience you could be looking at between 50k to 90k. A few years banking experience and you could be looking at up to 120k if you move around a bit.

[JustKeepSwimming]

There are whole classes of people who are not directly effected by interest rate increases, those who rent, those who have paid off the morgtage, those who have only small mortgages left, those who live with parents, those that have long fixes. None of those groups is directly effected.

They will have a cause a recession with mass layoffs and increased unemployment. Then those that get effected will be from all groups listed above not just those with variable rate large debts.

Renters absolutely suffer with rate increases. Most landlords are on interest only mortgages. Their costs go up and they just pass it on, equally many are now selling up as other uses of capital are more competitive.

Millennials are going to get absolutely rekt'd over the next few years.

Rate rise tomorrow and as far as I'm concerned the future is set. BoE is crashing the economy come hell or high water.

Everyone of us should be looking for a harbour job, even if at a lower rate/salary. Retail Banks, utilities and public services.

Hunker down ladies.

[swamp]

Still plenty of roles and good livings to be made for the majority but the average bods just entering aren't finding it to be the golden goose it used to be.

I also think some more peripheral IT roles are in decline. For example, in my last two gigs we've had no testers. I also see fewer devops engineers -- the developers are expected to write their own kubernetes config etc.

Cyber security roles are the exception to this, of course.