The Lemon Fool

AsleepInYorkshire wrote:Is recession the worst of our fears?
AiY(D)

Or is it Putin's twitchy finger

pje16 wrote:Or is it Putin's twitchy finger

It's not helping.

AiY(D)

AsleepInYorkshire wrote:Is recession the worst of our fears?

Is stagnation hovering?

AiY(D)

I think it just makes the misery official..

jackdaww wrote:but i am baffled that the markets have held up this far.

On my bank savings account the interest rate is 0.05% versus inflation of 6.2%. Think the poor savings rate is part of the reason people don't want to hold cash today.

IMO quite possible we'll get 2 quarters of negative growth. However,... longer war in Ukraine goes on, more we'll get used to it and will become like Afghanistan in the background and not in the forefront of all our thoughts, and in the headlines. So by the third quarter or end of the year its possible we'll have a recovery as poss a short recession dampens inflation, and china comes out of self imposed zero covid. Just going on my past investing history (since 2017/8) when everyone is doom and gloom, usually a good timevto pick up bargains, when you've had a good run, that's time to be nervous.

US teeters on brink of an official recession with -1.4% Q1.
https://www.cnbc.com/2022/04/28/us-q1-gdp-growth.html

Surely every other major economy will fall into line too.

Amazing what a massive 1.4% can do

vand wrote:US teeters on brink of an official recession with -1.4% Q1.
https://www.cnbc.com/2022/04/28/us-q1-gdp-growth.html

Surely every other major economy will fall into line too.

What are the Fed going to do about it?

Is recession looming? Possibly not a foregone conclusion.
https://twitter.com/Geo_papic/status/1519666363941502976?s=20&t=oEgzAGcD77JYbnlDiGKUfA

Probably going to become a self fulfilling prophecy - people think there's going to be a recession, so they cut back and in so doing cause a recession.
Mind you, who can blame them when you see double-digit inflation worries...

https://www.bbc.co.uk/news/business-61319867

Mind you, the interest rate in the UK averaged 7.17 percent from 1971 until 2022. But I suppose a rise from the historically low base we'd been on since then is the problem, rather than the absolute number?

Gilgongo wrote:Mind you, the interest rate in the UK averaged 7.17 percent from 1971 until 2022. But I suppose a rise from the historically low base we'd been on since then is the problem, rather than the absolute number?

Are you sure that statement is correct? Over the 51 years from 1971 until 2022, the interest rate (presumably what is called the Base Rate) averaged 7.17% ? Considering that since mid 2009 it has been below 1% that seems surprising.

Dod

Dod101 wrote:

Gilgongo wrote:Mind you, the interest rate in the UK averaged 7.17 percent from 1971 until 2022. But I suppose a rise from the historically low base we'd been on since then is the problem, rather than the absolute number?

Are you sure that statement is correct? Over the 51 years from 1971 until 2022, the interest rate (presumably what is called the Base Rate) averaged 7.17% ? Considering that since mid 2009 it has been below 1% that seems surprising.

Dod

Interest Rate in the United Kingdom averaged 7.17 percent from 1971 until 2022, reaching an all time high of 17 percent in November of 1979 and a record low of 0.10 percent in March of 2020.

From:https://https://tradingeconomics.com/united-kingdom/interest-rate

I haven't looked at their numbers but I suspect geometric averages, much like compounding (the other side of the same coin), can feel a bit unintuitive

-sd

servodude wrote:

Dod101 wrote:

Gilgongo wrote:Mind you, the interest rate in the UK averaged 7.17 percent from 1971 until 2022. But I suppose a rise from the historically low base we'd been on since then is the problem, rather than the absolute number?

Are you sure that statement is correct? Over the 51 years from 1971 until 2022, the interest rate (presumably what is called the Base Rate) averaged 7.17% ? Considering that since mid 2009 it has been below 1% that seems surprising.

Dod

Interest Rate in the United Kingdom averaged 7.17 percent from 1971 until 2022, reaching an all time high of 17 percent in November of 1979 and a record low of 0.10 percent in March of 2020.

From:https://https://tradingeconomics.com/united-kingdom/interest-rate

I haven't looked at their numbers but I suspect geometric averages, much like compounding (the other side of the same coin), can feel a bit unintuitive

-sd

Unfortunately I cannot get the link to work.

Dod

try this one
https://tradingeconomics.com/united-kin ... erest-rate

It had a double https://

Ps try the 25 year view of the chart
or even the "MAX" one

pje16 wrote:try this one
https://tradingeconomics.com/united-kin ... erest-rate

It had a double https://

Ps try the 25 year view of the chart
or even the "MAX" one

Thanks. Yes a quick look at the history of our Base Rate shows that for long periods during these 51 years Base Rate was very high. I had not appreciated that as for about half of that time I was living and working overseas. So I can accept that the figure is very probably correct. It is the very low rate since mid 2009 that has thrown me. Mind you that is about half a generation and we have got used to these very modest rates and the resultant modest cost of borrowing. Presumably a lot of recent borrowing has been locked in at these low rates for mortgages and much commercial borrowing so the effect may not be as dramatic or immediate as might at first be expected, although presumably the B of E has taken that into account in its forecasts.

Dod

My interest in financial affairs started in the early 80s so my introduction was to high base rates and hunting round the best places to save your money
no internet back then
Oh how THAT has changed since 2009

Gilgongo wrote:Mind you, the interest rate in the UK averaged 7.17 percent from 1971 until 2022. But I suppose a rise from the historically low base we'd been on since then is the problem, rather than the absolute number?

I think this is the problem with rising interest rates;

https://tradingeconomics.com/united-kin ... ebt-to-gdp

BoE

Bubblesofearth wrote:I think this is the problem with rising interest rates;

Hm. Is there any current socio-economic time-bomb that can't be traced back to 1980's? Debt, low wages, low productivity, inequality...

For the US at least, the answer may be "no", it seems: https://ourfuture.org/20120318/reagan_r ... _in_charts