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Post by vinny on Nov 22, 2024 11:51:22 GMT
I don't expect miracles from any party of government, I'm just glad that we, the people, can still sack the bastards.
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Post by AvonCalling on Nov 22, 2024 13:54:51 GMT
So sorry you never learnt to say please There is no extra money when interest rates go up. Because borrowing is depressed the effective money supply will actually be smaller than it otherwise would have been. And if we have lower interest rates than other countries then money will move to those countries to receive the higher interest payments which also has the effect of raising their currency relative to those using low interest rates. But doesn;t that just support Zany's original point that increasing taxation is a better way of suppressing spending as the extra tax raised can be used for either fixing some of the years of under investment or paying down the debt. |
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Steve
Hero Protagonist
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Post by Steve on Nov 22, 2024 15:47:19 GMT
So sorry you never learnt to say please There is no extra money when interest rates go up. Because borrowing is depressed the effective money supply will actually be smaller than it otherwise would have been. And if we have lower interest rates than other countries then money will move to those countries to receive the higher interest payments which also has the effect of raising their currency relative to those using low interest rates. But doesn;t that just support Zany's original point that increasing taxation is a better way of suppressing spending as the extra tax raised can be used for either fixing some of the years of under investment or paying down the debt. No because he want to keep the interest rates low and that will just lead to money flight to better supported currencies |
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Post by AvonCalling on Nov 22, 2024 16:15:13 GMT
But doesn;t that just support Zany's original point that increasing taxation is a better way of suppressing spending as the extra tax raised can be used for either fixing some of the years of under investment or paying down the debt. No because he want to keep the interest rates low and that will just lead to money flight to better supported currencies I have re read all of Zany's posts and conclude that he most definitely is not saying he just wants to keep interests rates low. It is clear to me that he is saying he thinks raising interest rates disproportionately affects the poor. From my reading you are saying raising interest rates does not disproportionately affect the poor.
The lowering of interest rates and capital flight is dependent upon other factors I would say such as interest rates in other countries and the stability of those countries. I feel that you would have to be slightly more analytical when assessing the pros and cons of interest rate rises and tax rises as a means of suppressing spending. I would also argue that I believe that inflation isn't being driven by demand per se...as an example people aren;t buying more food and energy and driving up prices. To my mind inflation is supply side driven here not demand side (unless we are talking about assets where it may be different) and so I think it is muddle headed to increase costs to suppress demand as people will always need food and energy and are probably not buying more of those essentials than they were say a few years ago.
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Post by Zany on Nov 22, 2024 16:18:00 GMT
So sorry you never learnt to say please There is no extra money when interest rates go up. Because borrowing is depressed the effective money supply will actually be smaller than it otherwise would have been. Please! Interest goes to the person or group who lend the money. That person rarely has loans themselves and is generally wealthy. So to control inflation we approach people who have already got loans and charge them more for them, this has the effect is reducing their ability to spend and reduces inflation. Sadly the people who have loans are not rich so the inflation control measures are paid for by the poor. I wonder who came up with that idea? IMO. Interest rates should be driven by supply and demand like any other commodity. It should not be used to control inflation. That is true, though I fail to see how that changes my point on using it to control inflation. |
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Post by Zany on Nov 22, 2024 16:23:45 GMT
But doesn;t that just support Zany's original point that increasing taxation is a better way of suppressing spending as the extra tax raised can be used for either fixing some of the years of under investment or paying down the debt. No because he want to keep the interest rates low and that will just lead to money flight to better supported currencies No. I want interest rates to rely on market forces. |
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Post by Zany on Nov 22, 2024 16:26:37 GMT
No because he want to keep the interest rates low and that will just lead to money flight to better supported currencies I have re read all of Zany's posts and conclude that he most definitely is not saying he just wants to keep interests rates low. It is clear to me that he is saying he thinks raising interest rates disproportionately affects the poor. From my reading you are saying raising interest rates does not disproportionately affect the poor.
The lowering of interest rates and capital flight is dependent upon other factors I would say such as interest rates in other countries and the stability of those countries. I feel that you would have to be slightly more analytical when assessing the pros and cons of interest rate rises and tax rises as a means of suppressing spending. I would also argue that I believe that inflation isn't being driven by demand per se...as an example people aren;t buying more food and energy and driving up prices. To my mind inflation is supply side driven here not demand side (unless we are talking about assets where it may be different) and so I think it is muddle headed to increase costs to suppress demand as people will always need food and energy and are probably not buying more of those essentials than they were say a few years ago.
Spot on. |
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Steve
Hero Protagonist
Posts: 3,698
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Post by Steve on Nov 22, 2024 16:34:07 GMT
No because he want to keep the interest rates low and that will just lead to money flight to better supported currencies I have re read all of Zany's posts and conclude that he most definitely is not saying he just wants to keep interests rates low. . . Ahem . . Hence my objection to using interest rates to suppress spending instead if using taxation to achieve the same thing. . . Zany also seems to believe the money lenders to governments are rich individuals. Actually far more they are pension funds trying to best serve their hard working members on average salaries of ~£32k and net in debt. |
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Post by Zany on Nov 22, 2024 17:46:12 GMT
I have re read all of Zany's posts and conclude that he most definitely is not saying he just wants to keep interests rates low. . . Ahem . . Hence my objection to using interest rates to suppress spending instead if using taxation to achieve the same thing. . . Where does that say I want them kept artificially low? I don't want them artificially raised to control inflation. Gosh I'm sure the young couples with children, big mortgages on over expensive houses will be pleased that the extra £300 they are paying each month on their mortgages is not only fighting inflation but putting more money into pension schemes. Meanwhile the retired can be pleased the homes they paid 80k for are now worth 400k without lifting a finger, grateful that the young and poor at picking up the tab. |
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Steve
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Post by Steve on Nov 22, 2024 20:35:36 GMT
I never said artificially low. But when the only reason they rose from historically low figures was to fight inflation then you're asking for base rate to be kept at the below 1% it was from 2010 to 2022 and use tax instead to limit money supply. Well that would cause a run on the £ big time. www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp |
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Steve
Hero Protagonist
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Post by Steve on Nov 22, 2024 20:47:26 GMT
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Post by Zany on Nov 22, 2024 20:58:32 GMT
I never said artificially low. But when the only reason they rose from historically low figures was to fight inflation then you're asking for base rate to be kept at the below 1% it was from 2010 to 2022 and use tax instead to limit money supply. Well that would cause a run on the £ big time. www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp I never said you did. I have set no minimum or max. If interest rates rose due to market forces (supply and demand) that's fine. I wont repeat the rest. |
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