Mervyn King warns against 'premature' interest rate rises

[bobspud]

I've never understood this. If something is too expensive then you cannot afford it. What has that got to do with your employer?

Your complaint is about the standard of living that you've become a custom to, believing it is your right.

^ This

[scooterscot]

Is it me, or does this have 1992 written all over it?

That depends. Did the UK go to the IMF with cap in hand in 92?

[DimPrawn]

My house is getting richer everyday.

[Ticktock]

Maybe you missed all the media scare stories about poor couples that were sat in the local Starbucks moaning about how the house prices were going up faster than they could save a deposit? Wishing to see them suffer because the system was pushing their survival buttons is crass. Maybe you are a post thatcher child and think you have an entitlement to own your home, but the fact is for most of history, property ownership was outside the grasp of the average person and with the population shape changing its not going to go change anytime soon.

Well I rent, as I couldn't afford to buy a place. Not having enough money to buy a place was on 2 factors - my salary times a sensible amount did not equal a 1 bedroom flat; and my monthly pay minus rent, bills and food did not leave enough to save a deposit within any foreseeable time. Now as a contractor, I am saving away, hoping to buy with as small a mortgage as possible at some point in the next few years, but I still recognise that this is not a possibility for the average wage earner.
Wishing to see people suffer is an emotive way to phrase it. Do I think that people should borrow money they can't afford and face no consequences? No I don't. Do I think that if they can't afford the loan they took out against collateral then they should lose that collateral? Yes. That's what the contract they took says.
As for me thinking I "have an entitlement to own your home" - reread my post. I said that I was unwilling to borrow unrealistic amounts to buy a house, so I didn't borrow and didn't buy. I don't think that points to thinking I have an entitlement to buy.
Oh, and the "most of history" argument is crap. There are lots of things we didn't have for "most of history" - that doesn't mean we shouldn't aspire to them now. Half-decent healthcare for an example.

[bobspud]

Well I rent, as I couldn't afford to buy a place. Not having enough money to buy a place was on 2 factors - my salary times a sensible amount did not equal a 1 bedroom flat; and my monthly pay minus rent, bills and food did not leave enough to save a deposit within any foreseeable time. Now as a contractor, I am saving away, hoping to buy with as small a mortgage as possible at some point in the next few years, but I still recognise that this is not a possibility for the average wage earner.

Ok so lets calm the initial rhetoric down a little and have a serious debate.

As I have said. having small a mortgage as possible is not always the most sensible Idea. 2004 - 7 I earned enough money to pay off my house almost twice in spare cash.
But I would have only had about 3 months cash left around when I had finished and would have still had various things knocking around on interest free credit and various small fry commitments. (common perception then was if you have the cash but can have the credit for free why spend the cash) However I was a total dick and in that time bought stupid sports cars suits and partied like a total knob in their early 30's with infinite cash. as it was as the market collapsed in 2008 I had about 6 careful months laying around by accident and made some sensible attempts to restructure what I considered to be grade 0 bottom of the pile crap that is unsecured and as such their risk. not get out of paying it just defere it for a few months and pay for the privilege The fight that I got was astounding. Being told that a crappy interest free card wants to convert your dept into secured and go for bankruptcy is quite a sobering experience while you are trying to figure out the best way to pay them in full. I suggest you dont try it.

As the six months cash was running out and as everything was getting worse I spoke to company administrators and started to investigate using the benefits system. Good luck with that! I hope you don't think you are paying into it for support. Their line was no you need to be on benefits for 13 weeks before you qualify for any interest only help under the scheme to help keep you in you home and you wouldn't have qualified because until a few months ago you still had too much money...

The break in my dawn was realising that apart from the suit on my back I had NOTHING that a debt collector could take. From there I was able to tell the various card companies to do their worse but I would go for bankruptcy and there was **** all to take... Ironically that saved my house.

Wishing to see people suffer is an emotive way to phrase it. Do I think that people should borrow money they can't afford and face no consequences? No I don't. Do I think that if they can't afford the loan they took out against collateral then they should lose that collateral? Yes. That's what the contract they took says.

Its not emotive. Markets can turn against you and when you finally get a mortgage you will note that no one will ask if you can pay if they make your interest rate 10 times what it is when you ask for the loan... I saw guys in the 90's crash struggling to buy a sandwich at lunch when the interest rates shot up to over 17%. I can remember watching my then team leader crying in the open office as the interest rates rocketed again and again on black wednesday. To hear someone begging for a mass market correction just because the market is hot and they want on is wrong.

As for me thinking I "have an entitlement to own your home" - reread my post. I said that I was unwilling to borrow unrealistic amounts to buy a house, so I didn't borrow and didn't buy. I don't think that points to thinking I have an entitlement to buy.
Oh, and the "most of history" argument is crap. There are lots of things we didn't have for "most of history" - that doesn't mean we shouldn't aspire to them now. Half-decent healthcare for an example.

Aspiring to them means that you have to take a risk because no one is going to give it to you for easy money and just because the market is outside you comfort zone, it doesn't mean that its wrong or need to change...

[doodab]

I've never understood this. If something is too expensive then you cannot afford it. What has that got to do with your employer?

Your complaint is about the standard of living that you've become a custom to, believing it is your right.

You need to look beyond individual circumstance. If a large proportion of the population cannot afford accommodation, rented or owned, or cannot afford to heat their homes and put food on the table, you are going to have a problem persuading them to keep on working. People don't like seeing their standard of living reduced, and when most people are experiencing that while a few obtain vast wealth it tends to ccreate resentment.

vive la revolution.

[Ketchup]

You need to look beyond individual circumstance. If a large proportion of the population cannot afford accommodation, rented or owned, or cannot afford to heat their homes and put food on the table, you are going to have a problem persuading them to keep on working. People don't like seeing their standard of living reduced, and when most people are experiencing that while a few obtain vast wealth it tends to ccreate resentment.

vive la revolution.

Exactly this.

If people see they are left with a coupel of hundred pound a month for themselves after their rent and bills are paid, there will always be a draw of life on benefits

[AtW]

Why do you think the dollar or any other currency is safe? especially the Euro..

USD is backed by combined power of 10 aircraft carrier groups.

EUR is backed by superiour German manufacturing.

GBP is backed by ?????

SKA is now keeping USD/EUR in currency accounts to hedge the risks - this country is run by morons who have no real business experience and I have no confidence in their economíc policies anymore.

[scooterscot]

You need to look beyond individual circumstance. If a large proportion of the population cannot afford accommodation, rented or owned, or cannot afford to heat their homes and put food on the table, you are going to have a problem persuading them to keep on working. People don't like seeing their standard of living reduced, and when most people are experiencing that while a few obtain vast wealth it tends to ccreate resentment.

vive la revolution.

I just don't think Brits will get off their armchairs though.

Even still, those squeezed living standards continue to be miles above the majority of people in this world. Many people still have to walk miles every day just to get fresh water, how is this the 21st century?

[shaunbhoy]

The only complaint I have about house prices is that they are massively out of whack with salaries. When I was a permie i certainly couldn't afford to buy in the area where I worked

So rent instead then. FFS it's not rocket science.
Nobody has a god-given right to own their own home. If it is beyond your means then just accept it and move on.
Remember, the country needs people like you for us homeowners to snootily look down upon.

HTH