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I know somone's going to slap me for saying this, but I wonder what Mr Keen's predictions are for rates now ? might have to look at his blog again.
What makes You think they will Evan?
We are the bottom of a rate cycle and they pretty much only have one way to go. Its the old boom bust cycle repeating itself over and over.
We are the bottom of a rate cycle and they pretty much only have one way to go. Its the old boom bust cycle repeating itself over and over.
What makes You think they will Evan?
"Nah, they can't go up much more, no point in fixing now!" - and I'm assuming they even put that much thought into it. History will repeat irself as usual.
IRs have to come off the historical lows.
Because when the RBA dropped them to 3% the financial world looked like ending. Today it doesn't look like it's going to end, so 3% is no longer justified.Why should they rise?
Our economy is not looking good and even if it did
it's not like we are a 3rd world country to justify high interest rates.
Because we've got one of the strongest economies in the western world.Why should we have the highest interest rates in the western world?
Our dollar is going up because commod prices are going up (think global recovery), and because our IRs are higher than the most others.Our $ is now going up, I think it's time for the RBA to lower our cash rate.
It's easy to have both fixed & var rate loans against a property. These loans can be set up at different times. EG Fix today for 4 yrs at 80% LVR..... wait for for increased equity, then get a 2nd loan (from same lender) secured against the same IP. The 2nd can be fixed or var, the 1st loan doesn't affect anything (except it must be the same lender).Why would you want to fix rates if you are continually accessing equity?
Have a read of the RBA governors speech today. He thinks the economy is looking stronger than it was 3 months ago.
Depends on your view point I guess.
Now that they feel that possibility has passed and we'll pull through, they need to look further ahead as to what is likely to happen with the new perceived scenario ie. no depression, high inflation on the way etc. Better to prepare and plan their strategy now than only start thinking about it when we're in the midst of 9% inflation.
If on the other hand you believe the world is still yet to collapse, then yes - you'd have to disagree with them looking to increase rates as their next move.
I know he does but the economy has not tanked because of all the massive gov spending and the FHBG. Wait till that comes to an end....
They better hurry up with those infrastructure projects because I get the feeling many more people could be looking for work soon...
And if people don't work they can't spend and the gov won't collect taxes so the budged deficit will be even bigger
Our problem re rates is not world factors but the lack of competition when 92% of all loans is from 4 suppliers. The banks can screw us and there is almost nothing we can do.
Except buy bank shares!
I have no idea what is going on with IRs and global recovery. Mr Market seems to think it is all hunky dory right now anyway! But we know he has been wrong before...
Jobs matter, it is all about jobs.