IMF advises UK to cut interest rates

[d000hg]

Cutting personal tax will just result in the chavs buying more flat screen TVs and other imported goods.

Chavs don't pay tax Chavs don't have jobs. By definition I think - if they have jobs they can be common or working/lower class, but being a chav implies [parents] being on benefits doesn't it, rather than simply being anti-social teenagers?

[TimberWolf]

I quite like the idea of the poor paying my mortgage off. This would incentivate the poor to become rich, so that they don't have to pay their mortages off.

I think the poor can forget any ideas about getting rich for the foreseeable future.

[petergriffin]

I would have preferred a Maggie solution, where debtors hand back their house keys rather than having their houses paid for by the poor.

I quite like the idea of the poor paying my mortgage off. This would incentivate the poor to become rich, so that they don't have to pay their mortages off.

[Doggy Styles]

I would have preferred a Maggie solution, where debtors hand back their house keys rather than having their houses paid for by the poor.

If I recall correctly that was the Major-Lamont solution.

[TimberWolf]

I liked The Times headline. IMF recommends plan B.

Oh dear™

[doomage]

BoE can drop interest rates to 0 if it likes, but it won't help because the banks just won't play ball any more. Banks are creaming money off everyone and anyone at the moment, to repair their own balance sheets; they are not interested in the slightest in reducing their loan rates. So, savers get next to nothing, and people in debt have to pay interest which is far higher than it should be.

Another round of QE is going to decimate the stock market. Why? Because it'll be seen as evidence that the previous rounds didn't work and that we'll be left with a legacy of crap for even trying QE at all.

The only thing that would have worked would have been for everyone to put their hands up and admit that they f**ked up. And then move on.

WHS. Dropping interest rates only helps the banks make money, which they will use to justify another round of massive bonuses. They will not use this money to 'stimulate' the economy.

And what do you do next if 0% interest doesn't work? The problem isn't a lack of money supply, you can always print more, it's a lack of demand. Interest rates have been too low for too long, and yet the economy flounders.

Put interest rates up, money increases in value and people are richer without having to have pay rises. Admittedly people with debt are a bit fecked, but if a minority have to lose their houses which they couldn't afford in the first place then so be it. If forced selling increases, this lowers house prices and with it the cost of living. As the cost of living decreases (relative to earnings) economic activity increases, which creates jobs.

[ChimpMaster]

BoE can drop interest rates to 0 if it likes, but it won't help because the banks just won't play ball any more. Banks are creaming money off everyone and anyone at the moment, to repair their own balance sheets; they are not interested in the slightest in reducing their loan rates. So, savers get next to nothing, and people in debt have to pay interest which is far higher than it should be.

Another round of QE is going to decimate the stock market. Why? Because it'll be seen as evidence that the previous rounds didn't work and that we'll be left with a legacy of crap for even trying QE at all.

The only thing that would have worked would have been for everyone to put their hands up and admit that they f**ked up. And then move on.

[VectraMan]

I can't help feeling the keeping interest rates low, and cutting them even further is sending the message of doom to the public, and it'd be far better if they'd just put interest rates back up to 5% and pretended everything was now okay. Euro crisis? What Euro crisis! Housing bubble? No, house prices will only ever go up. Spend, spend and enjoy yourself. Etc.

[TimberWolf]

And the solution to the problems created by interest rates being too low for a decade and house prices shooting up in price is ...much more of the same, with bells on.

I would have preferred a Maggie solution, where debtors hand back their house keys rather than having their houses paid for by the poor.

[BrilloPad]

On the plus side, for once Merv does not have to write a letter stating that he is a fookwit.

[BrilloPad]

I sometimes wonder if the so called economic geniuses are really waht they claim to be.

What is the interest rate now ? 0.5%. What does cutting this mean ? 0% ? will it kickstart the economy ? As I recall the rates went down like a bomb during the credit crunch and have been staying at .5% for years. What difference will reducing it make ?

+1

The only things I can think of are cutting red tape and corporation tax.

Cutting personal tax will just result in the chavs buying more flat screen TVs and other imported goods.

Of course, we could always impose import tariffs. But I suspect that would lead us straight into depression.

[SimonMac]

I sometimes wonder if the so called economic geniuses are really waht they claim to be.

What is the interest rate now ? 0.5%. What does cutting this mean ? 0% ? will it kickstart the economy ? As I recall the rates went down like a bomb during the credit crunch and have been staying at .5% for years. What difference will reducing it make ?

0%, 0.25% or 0.5% I don't think it will make much of a difference, the only think I could think is that they want to reduce the QE as its having an effect on sterling against the Euro, but then again I know frig all about economics other than I got a £5 in my pocket and I can not spend more than that on my lunch today.

[fullyautomatix]

I sometimes wonder if the so called economic geniuses are really waht they claim to be.

What is the interest rate now ? 0.5%. What does cutting this mean ? 0% ? will it kickstart the economy ? As I recall the rates went down like a bomb during the credit crunch and have been staying at .5% for years. What difference will reducing it make ?