Comments on: Property decline - mortgage slow down http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/ Conservative Party Member of Parliament for Wokingham Sun, 12 Oct 2008 02:14:20 +0000 http://wordpress.org/?v=2.6.2 By: Bradley http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-20217 Bradley Wed, 07 May 2008 16:18:26 +0000 http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-20217 John, Why is it that the Bank of England are attempting to control the deflation in the housing market when they made no attempt to control the inflation from 2003-2007? Their primary role was to control the government's inflation targets (even though the current index used is generally considered to be completely flawed). This seems slightly hypocritical. regards Reply: They are doing so because the government is keen for them to do so - hence the U Turn from the Governor's original position last Autumn that banks had to sort themselevs out to thre current position of substantial assitance. It all goes to show there is no such thing as a truly independent Central Bank. John,

Why is it that the Bank of England are attempting to control the deflation in the housing market when they made no attempt to control the inflation from 2003-2007?

Their primary role was to control the government’s inflation targets (even though the current index used is generally considered to be completely flawed). This seems slightly hypocritical.

regards

Reply: They are doing so because the government is keen for them to do so - hence the U Turn from the Governor’s original position last Autumn that banks had to sort themselevs out to thre current position of substantial assitance. It all goes to show there is no such thing as a truly independent Central Bank.

]]> By: Steven_L http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13652 Steven_L Fri, 30 Nov 2007 02:23:19 +0000 http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13652 The used car market is very slow as well. Cars I looked at 6 or so weeks ago were still sitting there with rusted brake discs. I just got myself a very good bargain. It's not all doom and gloom. The used car market is very slow as well. Cars I looked at 6 or so weeks ago were still sitting there with rusted brake discs. I just got myself a very good bargain. It’s not all doom and gloom.

]]> By: Tony Makara http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13649 Tony Makara Fri, 30 Nov 2007 01:17:58 +0000 http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13649 It is interesting to see that Mervyn King looks uncertain about which way to turn with regard to interest rates. My feeling is that the BOE will want to cut but will be under political pressure from the Labour government not to as Gordon Brown wants to keep sterling as strong as possible. Brown knows a strong pound will not only mask underlying inflation but will be an insurance against oil and commodity prices on world markets. The one thing Gordon Brown fears is inflation undermining what he portrays as his robust economy. Gordon Brown knows that once those interest rates start coming down his beloved strong pound will fall too. The question is who will make the decision, the BOE or the government? Reply: The MPC will make the decision, but doubtless they will take into account any strong views planted by Downing Street. I am not sure Gordon wants a strong pound - if he does, he should be worrying about the recent decline against the Euro. It is interesting to see that Mervyn King looks uncertain about which way to turn with regard to interest rates. My feeling is that the BOE will want to cut but will be under political pressure from the Labour government not to as Gordon Brown wants to keep sterling as strong as possible. Brown knows a strong pound will not only mask underlying inflation but will be an insurance against oil and commodity prices on world markets. The one thing Gordon Brown fears is inflation undermining what he portrays as his robust economy. Gordon Brown knows that once those interest rates start coming down his beloved strong pound will fall too. The question is who will make the decision, the BOE or the government?

Reply: The MPC will make the decision, but doubtless they will take into account any strong views planted by Downing Street. I am not sure Gordon wants a strong pound - if he does, he should be worrying about the recent decline against the Euro.

]]> By: anoneumouse http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13640 anoneumouse Thu, 29 Nov 2007 22:51:27 +0000 http://www.johnredwoodsdiary.com/2007/11/29/property-delcine-mortgage-slow-down/#comment-13640 Hmmm, where is all this money that the Bank of England is making available coming from? Will they soon have to cash in more of the gold reserves? What impact will this have on the balance of payments? Reply: I think they are borrowing it, and creating some of it. No I don't think they are about to sell more gold - this PM only seels gold when it is cheap. The balance of payments will change little as a result of this. . Hmmm, where is all this money that the Bank of England is making available coming from?

Will they soon have to cash in more of the gold reserves?

What impact will this have on the balance of payments?

Reply: I think they are borrowing it, and creating some of it. No I don’t think they are about to sell more gold - this PM only seels gold when it is cheap. The balance of payments will change little as a result of this.
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