Post Race!

[NeedSomeAnswers]

I wasn't trying to defend or make excuses for her in any way. She failed spectacularly. I did feel a little sorry for her.

My interest was in how fast she was gone. Not a long drawn out process of denial and excuses.

Don't feel sorry for her, feel sorry for everyone else who's Mortgage rates which rocketed up after Liz's god awful economic decisions. My Mortgage was up for renewal and thanks to Liz I am now paying an extra £200 a month and I am one of the lucky ones. People who fixed later then me by a couple of weeks are facing much bigger increases.

Fun fact Liz is the shortest ever PM in UK history at 44 days, the previous shortest was George Canning at 119 days in 1827 and he had to die of Tuberculosis for his reign to end.

I'd have to say I like her willingness to walk away so quickly and let someone else have a shot

She didn't leave voluntarily she was forced out by her own party, in the UK if you lose the confidence of your own MPs they can force a no confidence vote which if you lose removes you from office. It didn't get that far because she was told if she didn't leave office a confidence vote would be held which she knew she would lose. This shows just how incompetent she was that she was forced out so quickly because her own party thought they faced political oblivion if she stayed

[dday9]

LSU is now ranked 18th

[dday9]

First, a bye week.

[dday9]

Then, Bama plays us in Deaf Valley.

[dilettante]

After 15 years of robbing savers the wheel has turned and net-negative interest rates are finally over. The wasters who bet against prudence and diligence are whining about their casino mortgages from their gaming chairs now? While avarice was king in lending why didn't they obtain fixed rate mortgages?

Sorry, but for my first house I assumed an 11.5% VA loan because it was far better than what was otherwise available, and I'm not alone. Cry me a river, I wasn't the fool who took out liar's loans during the worst period of personal economic destruction in modern history.

People are now retiring en masse and while it is now too late for many of them they are shedding the engorged economic ticks from their backs. The real question is how deep the damage due to waste and losses in the free money era have been and what the social costs will ultimately total up to.

[FunkyDexter]

robbing savers

I think that's inaccurate. At least, it is in the UK, not sure about the US.

Savers would only be getting robbed if interest rates were low while inflation was high. The reason we've had low interest rates in the UK for the last few decades is because inflation rates were low. Back in the 80s we had high interest rates because we had high inflation rates.

[dday9]

Interest typically has an inverse relationship with inflation, but in the US inflation and interest have been artificially low at the behest of the Federal Reserve because not only do they influence at what rate banks can lend money (interest) but they are also in charge of the printing of money (inflation). The main issue is that instead of allowing interest rates to rise during recessions the FED pushed interest rates artificially low (see dot-com bubble, housing bubble, COVID lockdowns) which did not allow a "healthy" recession to happen.

The money people I listen to are predicting a true depression or hyperinflation which are practically the same thing, just different sides of the same coin.

I would personally prefer a depression because that typically weeds out malinvestment whereas hyperinflation typically affects non business owners. It's much more likely to get extremely violent if hyperinflation happens.

[dday9]

Neither is good, but pretending that neither will happen is foolish.

[dday9]

On the other hand, Jayden Daniels threw 21 for 28 against Ole Miss.

[dday9]

He also set a school record for rushing touchdowns by a QB.

[wes4dbt]

Don't feel sorry for her, feel sorry for everyone else who's Mortgage rates which rocketed up after Liz's god awful economic decisions. My Mortgage was up for renewal and thanks to Liz I am now paying an extra £200 a month and I am one of the lucky ones. People who fixed later then me by a couple of weeks are facing much bigger increases.

Not sure what you mean by "renew" a mortgage. I've always had fixed rate, there is no renewal. Is that how how variable rate mortgages work, every year you renew to the current rate?

It was incredible how much your economy reacted from that one decision. I'm glad to see it seems to be moving back the other direction.

[wes4dbt]

Interest typically has an inverse relationship with inflation, but in the US inflation and interest have been artificially low at the behest of the Federal Reserve because not only do they influence at what rate banks can lend money (interest) but they are also in charge of the printing of money (inflation). The main issue is that instead of allowing interest rates to rise during recessions the FED pushed interest rates artificially low (see dot-com bubble, housing bubble, COVID lockdowns) which did not allow a "healthy" recession to happen.

I can't remember when inflation rose significantly and the interest rates went down. I also don't remember a big rise in the inflation rate after the dot com bubble or the housing bubble. The last major inflation problem was in the 80's and interest rate and mortgage rate went high. I remember getting 8% on a one year CD and mortgage rates were above 10%.

That's about as far back as my memory goes. lol

[Shaggy Hiker]

I have heard that the 30-year fixed rate mortgage is a US anomaly. I imagine we'll hear whether or not that's the case.

I don't see the fed as having pushed interests rates 'artificially' low. What's the 'normal' interest rate? Without that, it isn't artificial. They certainly influence interest rates, but they were trying for a 2% inflation rate and weren't getting it. In fact, there was a risk of deflation, which sounds good until you look at a place like Japan, which has frantically been trying to get some inflation for the last couple decades.

Our economy is primarily driven by us buying stuff. That stuff could be material goods or it could be services, but us buying stuff is the bulk of the economy. With deflation, people put off buying (cause it will be cheaper if you wait), and a nasty cycle sets in.

I'm not particularly concerned about either hyperinflation or depression. The former is easy to define, the latter is not so easy. Both are quite bad, and both have been predicted for decades. They're kind of the extremes when it comes to meltdowns. Could happen...probably won't, but like any other disaster plot, people like to think about them.

[dday9]

By the FED pushing artificially low interest rates it incentivizes spending which encourages malinvestment.

Deflation does cause people to put off buying stuff because it could be (important distinction in the word could) cheaper in the future, but there is the concept of time preference. Take for example purchasing a business critical need, you could purchase it today knowing that it could be 1/2 as cheap next year, but then you risk losing out on the gains that could have been made by making the purchase. There is a risk/reward equation that goes into it, but that is the job of the entrepreneur and the person who does it well is rewarded in the form of profit.

The basic theory of the Austrian business cycle proposed by Mises and furthered by Rothbard is that when it is easy to borrow money (i.e. money is cheap) then that risk/reward calculus gets skewed and the entrepreneur cannot make an informed decision. What winds up happening is that companies can borrow money very cheap, make purchases that they might not necessarily need, there is this artificial boom, a credit crunch occurs, and then the company starts making layoffs and selling assets which cause the bust.

[dday9]

But if you look outside of offence, LSU held Ole Miss to just 166 rushing yards. A staple of the Ole Miss offence.

[dday9]

It got to the point to where Ole Miss absolutely had to rely on the pass to make up loss ground and so they abandoned the run which all but eliminated the play action and RPO.

[dday9]

Lane Kiffin needs a strong run game to take the pressure off his young QB.

[dday9]

Don't get me wrong, Jaxson Dart is a phenomenal quarterback, but he is still young and prone to poor decisions. Then again, ask any QB and they will tell you that a strong running game will usually translate to an easier passing game.

[dday9]

Except for the Steelers this year. Najee Harris was running well against the Dolphins, but it is tough to win games when you QB throws 3 interceptions.

[wes4dbt]

Don't get me wrong, Jaxson Dart is a phenomenal quarterback, but he is still young and prone to poor decisions. Then again, ask any QB and they will tell you that a strong running game will usually translate to an easier passing game.

I don't trust QB's they're always making passes. lol

I think about every coach wants a good running game. It opens up play action passes and slows down the pass rush. If you can't run the ball even when the defense is committed to pass defense, your in for a long day. Once in a while you'll have a team that passes to open up the run but it's usually the other way around.

[dday9]

Ohh, that’s nice. We have a dad joke opener to our morning meetings and I’m going to lead with that.

[FunkyDexter]

Not sure what you mean by "renew" a mortgage

In the UK, our fixed rate mortgages will be for the full term, usually 25 years, but will have a shorter "fixed period" in which the rate is fixed and there are penalties for paying early, usually 3 to 5 years. after that they typically fall back to a variable rate. What most people do is "renew" at the end of the fixed period - basically get a new fixed period at a new rate. So if you're in a fixed period when the interest rates jump you're OK... until the end of your fixed period when you can suddenly find yourself in dire straits, particularly if house prices have dropped in which case you can find yourself in negative equity, saddled with a house you can't sell and a mortgage you can't afford.

I'm looking at being pretty badly screwed because I have two fixed rate buy to let mortgages that are due for renewal in Feb 2024 which is likely to be about when interest rates peak (though hopefully not now Rishi and Hunt are in charge - I'm not a big fan but at least they're far more responsible than Truss and Kwarteng). Thankfully I've been pretty responsible. My equity level in each is well above 50% and even an interest rate of 6 or 7% won't take the mortgage payments higher than the rental incomes. I won't take a loss as such but I will see a significant cut in profits, probably about 7 or 8 hundred a month. Thanks Liz

On the interest/inflation thing I can think you can look at it either way. DD is right that raising interest rates curbs inflation so you would argue there's an inverse corelation. Personally I look at it the other way, high inflation causes central banks to raise interest rates, leading to a direct corelation. I would argue that looking at historical data indicates that a direct corelation is a more accurate way of looking at it:-

I think that's because interest rates are within our control while inflation typically isn't. So inflation tends to be the driver which interest rates respond to.

But DD is also right in that interest rates aren't the only way of affecting inflation, you can raise tax rates or reduce quantitative easing. So a government does have the option to go for high tax rates and low easing to keep inflation down while having high interest rates. This would make bubbles less likely to form as people would be disincentivised to borrow to invest. It's a low interest approach that caused the great crash in the 20s and I think you could argue it's led to a bubble in the UK housing market today.

[FunkyDexter]

That Post...

[FunkyDexter]

...was way too long...

[FunkyDexter]

...for post race

[NeedSomeAnswers]

The wasters who bet against prudence and diligence are whining about their casino mortgages from their gaming chairs now? While avarice was king in lending why didn't they obtain fixed rate mortgages?

Not sure what you mean by "renew" a mortgage.

In the UK our Fixed rates last for 2 or 5 years, that how long you can fix for, thats the system. My Fixed rate ended so I had to remortgage where you obtain a new fixed rate otherwise you automatically go to a higher variable rate.

Maybe you could have looked that up before spouting nonsense about casino mortgages!!

[dday9]

I like the casino.

[dday9]

I go sit at the digital blackjack game at the bar.

[dday9]

They serve me free alcohol while I play and $20 can last me hours when I bet only $0.10 a hand.

[Shaggy Hiker]

But DD is also right in that interest rates aren't the only way of affecting inflation, you can raise tax rates or reduce quantitative easing. So a government does have the option to go for high tax rates and low easing to keep inflation down while having high interest rates.

No, for that to happen, you have to have a functional government. That won't be happening in the US. If one party were to try raising taxes, that's ALL the other party would be talking about at the next election, which is never more than two years away.

From a political perspective, this behavior is entirely correct. Politics is a zero sum game. You only win with somebody else losing, so anything that gives you advantage is worth doing. From a good governance perspective, however, that means that rational behavior will only happen when one party has been utterly flattened, which happens only during major war or depression in the US.

[Shaggy Hiker]

In the US, we typically have fixed rate mortgages of 10, 15, or 30 years. Alternatively, we have what is called an ARM, which is generally fixed for some number of years, then floats. It sounds like the UK has something like the ARM, but nothing like our 30 year fixed rate mortgages.

[dday9]

What if a political party gets majorly depressed about a war? What happens then

[Shaggy Hiker]

Bankers in the UK have it a bit better. A borrower with a 30 year fixed rate can calculate whether or not to refinance as interest rates drop, but the banks have no means to real means to force them into refinancing at a higher rate as interest rates rise. The banks kept trying to get my parents to get a second mortgage, or refinance, throughout the 80s, because they had a 6.25% interest rate. Now, there are people with 30 year mortgages paying less than 3%, and likely loving it. Not much incentive to pay off a mortgage early when you get more in interest on a bond fund than you are paying on your mortgage.

[Shaggy Hiker]

What if a political party gets majorly depressed about a war? What happens then

Historically, that means we get the Gettysburg Address.

[Shaggy Hiker]

Lincoln was not the main speaker at that event, and pretty much mailed it in. He scribbled down some notes and kept it brief. Less is often more.

[Shaggy Hiker]

This has been a bit serious for the Post Race.

[Shaggy Hiker]

It's almost as if we had something to say.

[Shaggy Hiker]

Almost....

[dday9]

Don't read this post.

[dilettante]

In the UK our Fixed rates last for 2 or 5 years, that how long you can fix for, thats the system. My Fixed rate ended so I had to remortgage where you obtain a new fixed rate otherwise you automatically go to a higher variable rate.

Maybe you could have looked that up before spouting nonsense about casino mortgages!!

Nonsense? How is it my fault if you live in the casino? It doesn't change the facts.

I'm not sure how a system made up exclusively of ARMs could have arisen. Was there never competition from local banks, savings and loans, or credit unions? No wonder films like "It's a Wonderful Life" are such a mystery to you. I suppose that's also why so many rent in Potter's Slums.

Seriously, you have my sympathies. Is the interest paid on fixed term bank deposits (CDs here) always variable as well?