UK Inflation over 18% / BOE Interest Rate at 7%

[NotSure]

nothing to do with the rate hike. Everything everywhere is tanking.

Everything bubble -> Everything bust!

And what do you think created the 'everything bubble'? And why is 'everything' tanking now?

Nothing to do with interest rates?

How much are growth companies (for example) future earnings worth when the risk-free rate is zero? And how much are they worth when it's 5%? In which environment would you pay more?

[1nvest]

Guardian

Kwarteng committed a schoolboy error by pledging further tax cuts in a full budget planned for later this year. If the markets are worried about the state of the government’s finances and the increase in borrowing needed to fund your plans, it is not the wisest course of action to add to those concerns.

Leaving the BoE having to (hopefully) step in to correct things, whilst rating agencies look to mark the UK down to a D rating (default). Unless of course on top of firing the Treasury secretary and binning the OBS report that conflict with Truss' expert opinion, she also looks to remove BoE powers as well.

Worst still is that her hoped for growth is rapidly a fading prospect, a more assured Labour government dictate (large majority) in two years time (unless a GE is invoked earlier) is bound to totally reverse course, making the UK a even more unattractive inward investment mid term choice.

[GrahamPlatt]

Just come across this graphical presentation - https://youtu.be/bYRk5NdTljQ

[ursaminortaur]

The BoE has raised interest rates to 3.5%.

https://www.theguardian.com/business/2022/dec/15/bank-of-england-raises-interest-rates-to-35

The Bank of England has raised interest rates by 0.5 percentage points to 3.5% in an effort to combat double-digit inflation that has caused a widespread cost of living crisis.

Members of the central bank’s monetary policy committee voted to increase the cost of borrowing after the consumer prices index (CPI) in November showed annual inflation of 10.7%.

The move takes UK rates to the highest level since October 2008, and comes despite expectations that the UK is falling into a long recession. However, it marked a slowdown in the pace of rate rises, after the MPC increased borrowing costs by 0.75 percentage points at its meeting in November.

It was in line with forecasts by City analysts who said the MPC had avoided a more aggressive increase after inflation fell from 11.1% in October and forecasts suggested price rises have peaked.

Nevertheless, the rise will pressure ministers to support households hit by the double-whammy of high energy and food prives and a jump in monthly mortgage borrowing payments.

A recession is expected to last through much of 2023 as consumers struggle to maintain spending and businesses terminate investment plans.

[1nvest]

Have the plebs pay for their own holiday pay (cut real wages by 10% and 5 weeks paid holiday becomes 5 weeks self funded holiday pay)



We need slaves migrants to come and work here, as the local plebs wont otherwise serve us. Employ a slaves 'apprentice' for a year at £4.81/hour - and that's far more cheaper than having to fund housing/feeding/clothing them oneself.

Oh the plebs are revolting ... as ever ... haw haw haw!

[tjh290633]

Another timid action by the Bank, with the inevitable effect on the exchange rate, and hence on consumer prices.

They really are an absolute shower (with one obvious exception).

TJH