Villa05 wrote: » Stupidity Relates more so to govt policy of implementing measures that push up prices, whereas the economy and our people would be much better off if prices were affordable and stable. We are shooting ourselves in the foot by allowing double digit increases annually
Wanderer78 wrote: I'd actually argue, our relationship with property is actually more so to do with the complexity of human behaviour than the perceived idea of 'stupidity'.
Bob24 wrote: Agreed to some extend. But I’d still cassify 100% (or more!) mortgages and buying several rental properties in the middle of nowhere with these as stupidity. People stretching themselves financial to buy a place to live might have been reckless in some case but I can understand why they did it.
Ronaldinho wrote: » Higher interest rates are not going to cause a property crash in my view - it will take job losses as a result of a future recession and/or a massive supply glut.
Wanderer78 wrote: » I'd actually argue, our relationship with property is actually more so to do with the complexity of human behaviour than the perceived idea of 'stupidity'.
Andrew Beef wrote: » There should be statues of Bernanke and Draghi in every US and European city.
Villa05 wrote: The answer is in the question Keywords Ireland property mentality stupid
Bob24 wrote: Agreed with this and it explains stocks price changes pretty well internationally. But at the same time we also have to recognise that when it comes to property prices Ireland was in a special situation with stupid lending rules and buyers mentality. The factors you describe have applied to any European country (and more) but yet the major crash we had was an exception rather than the rule and some countries (even some not doing great economically) even maintained fairly stable house prices. So it cannot possibley be the the sole explanation for what we have seeing on our property market.
Andrew Beef wrote: There should be statues of Bernanke and Draghi in every US and European city.
Villa05 wrote: » 2008 was the bursting of a major bubble. What the central banks did was make money very cheap to reinflate the bubble. If the bubble is the problem and bursting it is nature's way of curing it reinflating the bubble is a problem for the future. I'm not sure heroic is the term I'd use
Zenify wrote: » GingerLily wrote: » Can the ECB have a negative interest rate? Or do you agree the ECB rate cannot be lower? The ECB do not do surprises. They have been very clear about their future plans. They will cut bond purchases this year and will then start to increase interest rates. Google Mario Dhragi articles and you will see.
GingerLily wrote: » Can the ECB have a negative interest rate? Or do you agree the ECB rate cannot be lower?
Andrew Beef wrote: And the response of the global central banks has been nothing short of heroic; th left would howl with derision, but we should erect statues of Ben Bernanke and Mario Draghi; these men saved the world.
Andrew Beef wrote: » One of the many points that people are missing is that the ECB (like other central banks) want interest rates to lag inflation. So when rates increase, inflation will have also increased. And if you have debt, inflations is very much your friend. People also need to realise that crashes a la 2008 are actually highly unusual. And the response of the global central banks has been nothing short of heroic; th left would howl with derision, but we should erect statues of Ben Bernanke and Mario Draghi; these men saved the world.
Bob24 wrote: » Deposit rates are negative already, but can the refinancing rates be negative? (I.e. why would the ECB lend with a negative rate?) I am not an expert but i don’t think they would (and not sure they are legally allowed). So yeah this plus the announcements the have made makes me think the only way for interest rates is up and the only question is when.
ELM327 wrote: » It can get lower, negative interest rates like the negative german bonds.
ELM327 wrote: » GingerLily wrote: » The ECB rate is 0%,it can't get any lower, there is only one direction it can move. It will eventually move, so that is why people are rightly predicting interest rates to rise. It can get lower, negative interest rates like the negative german bonds.
GingerLily wrote: » The ECB rate is 0%,it can't get any lower, there is only one direction it can move. It will eventually move, so that is why people are rightly predicting interest rates to rise.
Sierra Oscar wrote: » Just last week the European Central Bank took further steps to unwind it's bond purchasing programme that has been in place since the financial crisis. Interest rate rises are inevitable, and the ECB has been signalling that rate increases are on the way from 2019 onwards. That's not to say some unforeseen economic events will occur which torpedo the ECB's timeline, but as it stands they are on course for gradual rate increases from next year onwards.
BattleHardened wrote: » It could take a while though given the unrest in European elections at the moment.
Percy Judd wrote: » Why will interest rates rise, and by how much %? People have been predicting interest rate hikes for a decade now and it never materialized. Even if they do, I doubt it will 'crash' property. That would cause prices to fall alright, but a crash like 2008? Not a chance.
Claw Hammer wrote: » There are people who are wise after the event. Before the Great Crash "the fundamentals are sound", "the banks are well capitalised" "morgan kelly is an idiot", Its different this time, were phrase which were repeated constantly. After the crash, "it was the banks", "what was the regulator doing", "why didn't anyone listen to Morgan Kelly" were all phrases heard from the very same people. When interest rates rise, which they inevitably will, the howls will be deafening.
Wanderer78 wrote: » I'd actually agree with their statement, I suspect we have become to believe things such as 'credit crisis' can be the only triggers of a crash in housing prices, we are leading ourselves to believe that we have more or less solved these type of issues, but we actually have no proof of this. Again I do believe our next housing price crash will be more so due to 'external' factors compared to previous crashes. If this is correct, we probably should be preparing for this future crash now, but we don't seem to be doing that very well, if at all. This has the potential to be catastrophic for us all in relation to housing.
Wanderer78 wrote: » we probably should be preparing for this future crash now, but we don't seem to be doing that very well, if at all.
Zenify wrote: » Is it possible to add a poll to this thread?
