Interest Rates

[Perry]

What was it comrade commissar Cullen said:
........an ideological burp!
Take some indigestion remedy. As David says,
it's all about lots of meetings and reports
which give the impression that someone's
actually working/doing something useful.

[Davo36]

The RBNZ have over 500 staff apparently.

They contract out the actual making of money.

You'd have to wonder what they all do!?!

[speights boy]

Fed confirms $10b stimulus cut

The Federal Reserve says it will cut its monthly bond purchases by an additional $US10 billion to $65 billion because of a strengthening US economy.
It's doing so even though the prospect of reduced Fed stimulus and higher US interest rates has rattled global markets.

[Wayne]

And the OCR not increased
http://www.nzherald.co.nz/business/n...ectid=11194132
without a strong indication that it will rise in March either.

[Davo36]

Only $65 billion per month in life support now. Man the US economy must be going great!

That's $216 for every man, woman child, each month.

They've obviously got a long way to go I reckon. And it all appears so normal. For 75 years, money printing was considered a bad thing, now it's "Just a walk in the park Kazansky".

[Fenix]

Only $65 billion per month in life support now. Man the US economy must be going great!

That's $216 for every man, woman child, each month.

They've obviously got a long way to go I reckon. And it all appears so normal. For 75 years, money printing was considered a bad thing, now it's "Just a walk in the park Kazansky".

Except it doesn't go to every man, woman and child. ;(

[speights boy]

Except it doesn't go to every man, woman and child. ;(

Many investors in US shares from around the world would have been very happy with the returns it assisted in generating.

[speights boy]

Talk along these lines will affect how some people look at future debt levels.

OCR may go to 5%: BNZ

Questions around the OCR will likely now move to whether the Bank will ultimately move back to neutral or have to overshoot to the high-side, as is historic precedent.

While our official forecasts see a 4.5% peak in the OCR in late 2015, we see upside risk to this view. A peak above 5.0% is certainly plausible.

Market pricing is now closely aligned to our view of a 25bps hike in March and 125bps by year-end. However, we are increasingly mindful that at some point this year the RBNZ may feel compelled to undertake a 50bps move.

[Wayne]

Talk along these lines will affect how some people look at future debt levels.

And not a bad thing in itself.
I see credit card spending has jumped and the number paying the card in full every month reduce slightly - some habits are hard to break.

[Davo36]

Talk along these lines will affect how some people look at future debt levels.

OCR may go to 5%: BNZ

The sky is falling!

[Fenix]

What would 4-5% OCR take the floating rate to?

[speights boy]

The sky is falling!

It certainly will for some with large mortgages, if they reach 8% floating.

I know a few people who have been using the low rates over the last year or two to reduce their debt as much as possible.
They are happy they did so.

[speights boy]

What would 4-5% OCR take the floating rate to?

The OCR was 5.0% in Dec 08

At that time the average floating rate was 8.0%

[Davo36]

So SB, some time ago you were saying my mentioning the OCR could go up a lot was just nonsense and that you felt it might go up 1% max.

Seems you have come around to my way of thinking...

Yep interest rates could get back to 8% but we'd see a huge housing crisis result, there'd be soooo many people defaulting it wouldn't be funny. So I think the politicians would try to avoid this at all costs. Because they'd be out at the next election if it did.

[north shore]

3% margin, whatever happened to the 2%margin over the ocr that I think it was Bolger used to go on about before Kiwibank was created?