An interestign article in today's Sydney Morning Herald reports on one academic that says that interest rates could be zero by 2010.
http://business.smh.com.au/business/zer ... -524u.html
Browse Forums General Discussion 1 Oct 16, 2008 2:45 pm An interestign article in today's Sydney Morning Herald reports on one academic that says that interest rates could be zero by 2010.
http://business.smh.com.au/business/zer ... -524u.html Demolition August 2009, Construction Started September 2009, Completed December 2010 Re: Zero interest rates in 2010 possible! 2Oct 16, 2008 2:49 pm If it hits those lows its just as likely that you, i and just about everyone reading this will be out of work and wont be able to pay the principal anyway Re: Zero interest rates in 2010 possible! 3Oct 16, 2008 3:09 pm man, thats really not a good thing Built with Bentley homes in Doreen All moved in Dec 2009 Now for the garden! Our stuff so far viewtopic.php?f=31&t=16532 Re: Zero interest rates in 2010 possible! 4Oct 16, 2008 3:40 pm Will the last person leaving Australia please turn out the light...I think this perhaps a touch alarmist....by that I mean the learned academic who made the statement....unfortunately this is the same guy who made a little bit of sense last week... Re: Zero interest rates in 2010 possible! 5Oct 16, 2008 6:12 pm Even if they drop to the predicted 4.5% that makes paying mortgages a LOT easier. We would pay ours off in a couple of years...
Very alarming. I am glad my husband and I have very stable careers in healthcare / government. Re: Zero interest rates in 2010 possible! 6Oct 16, 2008 6:23 pm karol I am glad my husband and I have very stable careers in healthcare / government. Lucky you're not in NSW - our state govt is looking to cut lots of jobs! I have a govt job but luckily in times of low FX and unemployment - people always come back to universities to retrain After 4 years - we're in! Re: Zero interest rates in 2010 possible! 7Oct 16, 2008 6:31 pm Apparently there's a no forced redundancy clause in our contracts. Definitely feels better knowing that.
It's really quite scary how much people are freaking out. Things a probably going to get very bad. Re: Zero interest rates in 2010 possible! 8Oct 16, 2008 7:01 pm My husband and I are both employed by the govt, me state and he federal. The money is not as good as the private sector but the security is worth it!
We have a fixed interest rate for our mortgage. Not long ago when interest rates were going up I was freaking out that we hadn't fixed it for long enough and now I am freaking out that we have fixed it for too long! Re: Zero interest rates in 2010 possible! 9Oct 16, 2008 7:29 pm Setting fixed interest is like washing the car. If you want it to rain, just wash the car. If you want interest rates to drop, just fix your loan rate. Demolition August 2009, Construction Started September 2009, Completed December 2010 Re: Zero interest rates in 2010 possible! 11Oct 17, 2008 11:03 am Zero percent interest rates just means huge job losses - I'd rather high(er) interest rates and secure employment.
That being said, our biggest outgoing is our mortgage, and with lower interest rates (say half what they are now) we would have enough of a cash reserve in the form of an offset account to last a two years without work. Time to build up the "fat" people... China, India and Russia are not going to save us. Re: Zero interest rates in 2010 possible! 12Oct 17, 2008 11:40 am I doubt very much this will happen IMO. I think the current market crash was bound to happen eventually. You can only blow up a balloon so much before it pops. The market will get on it's feet again and things will sort themselves out. Now is the time to buy and people will begin buying again. If at first you don't succeed, try, try again. Then quit. There's no use being a damn fool about it. W.C. Fields Brought Established. Re: Zero interest rates in 2010 possible! 13Oct 17, 2008 12:37 pm I dont think there is any way Australia will ever come to the point of 0% interest. Maybe as low as 4% but we wont go down the same path that Japan took with there 0% interest rates.
stonecutter1309 karol I am glad my husband and I have very stable careers in healthcare / government. Lucky you're not in NSW - our state govt is looking to cut lots of jobs! I have a govt job but luckily in times of low FX and unemployment - people always come back to universities to retrain I'm all for government cutting jobs but not in health care! Governments waste too much money on pointless things but health care needs all the help and money they can get. $42 billion credit card debt / zero interest possible? 14Oct 17, 2008 12:49 pm I agree. Japan has the highest rate of savings in the world and people (consumers) do not like credit as much as here. Credit cards are not as common, the lending ratios for homes are nowhere near our lending ratios of 100%. They actually like using their own money there and they have plenty of it. The salary bonuses they receive twice a year (one at new years eve and the other in the middle of summer) add up to 50% to their nominal salaries. Then they go on their spending sprees and overseas holidays (they don't need credit to buy the biggest and the latest TVs). Last time I checked Aussie employers were not that generous to their common employees.
The lowering of the rates has a lot to do with the increase in supply (that is Japanese saving more) and drop in domestic demand (not borrowing as much). Do we think that all of a sudden Aussies are going to pay off all their $42 billion credit card debt they owe to the banks and go into net savings position and start using their own money to buy cars and wide screen tvs? Re: Zero interest rates in 2010 possible! 15Oct 17, 2008 2:42 pm What is the point of saving if it's 0% though? I love to have a nest egg, but I also need it to compound at at LEAST inflation levels to break even.
I'll be fixing at 5.5% regardless If it does drop to that kind of level, I won't feel too sad if we could get it lower because that's pretty freaking low. I feel bad for people who freaked out earlier in the year and fixed at 8.5% or higher You'd be pretty bummed. Car Loan sydney / car finance sydney / low interest 17Oct 17, 2008 4:44 pm I don't think anyone expects the rates to be that low. I'm not an economist (is there one amongst the readers who can correct me if I am wrong?) but I believe for the rates to be 0% there has to be long term deflation, ie everything from petrol to food price plummeting. With the aussie dollar staying low I can't see the price of petrol (which flows on to the cost of most things) or imported goods to be getting cheaper.
Yes I see your point about the fees, we already have that happening with Finance offered by car companies. Have you seen any 0% or 4.5% interest offers on new cars? You probably thought they were being kind and generous. Rather than buying the car with an $8000 discount and paying 10% on interest on the finance, that way you pay full recommended retail price for the car and fat brokerage fees. If the finance is for commercial purposes like a lease, hire purchase or chattel mortgage and you are not protected by the Consumer Code, you won't even know the effective rate you pay on the finance. Re: Zero interest rates in 2010 possible! 18Oct 17, 2008 8:31 pm It's a gimme that if mortgage interest rates fell to zero, we will have to pay the banks a few percent to look after our deposits, even after fees!
Seriously though, the best investment anyone can make is to reduce non-deductible debt. Having said that there are still plenty of opportunities in the share market, if you're patient. Geoff - Decophile. Re: Zero interest rates in 2010 possible! 19Oct 17, 2008 8:35 pm Sorry completely off topic... Eager love the new avatar ... mmmm cricket. Is our marriage back on? (after M3tricon tore us apart )
Back on topic.....Interest rates will not fall to zero... it's simply not going to happen. Jo I leave you to fend for yourself, figure things out yourself. Terrence Malick Re: Zero interest rates in 2010 possible! 20Oct 17, 2008 8:38 pm joles Back on topic.....Interest rates will not fall to zero... it's simply not going to happen. Jo I agree. Internal and External Building and Colour Consultant Online - Worldwide http://www.denovoconcepts.com You must be new to the internet. You're also the only person anyone here has ever heard of washing their garage wall. I hate to break it to you, there are insects and… 6 4863 I am building in claymore NSW and this is shown in the building envelope plan. … 0 10040 |