We have Bloomberg news on in our office, as obviously we like to keep up to date with the latest financial news, (or is it because it is one of only 3 channels we can access? – you decide), but it is very informative. The other day an excited American boomed, “this is not just green shoots we are seeing here, but real flower buds now!”.
It was said with such an air of confidence that you could not help yourself but be carried away on a euphoric wave of good feeling – hell, I almost pledged my allegiance to the American flag, (though I didn’t).
Is it co-incidence or a little bit more that no sooner have England finally put Australia to the sword, or rather the bat, that there are reports in the press that the recession may finally be over?
Good sporting events often have a tendency to induce either mild hysteria or a return of “the feel good factor”, and a few great days cricket, some gold medals in the Athletics, and a bit of sunshine may have helped to do the trick again.
Amongst all the conflicting news and views around at the moment, there seems to be a strong level of consistency where the large loan mortgage and property market is concerned. At the £500,000 plus level for mortgages and the £1m plus level for property, activity has been relatively strong for a while now.
It has always been the case that the top end of the market seems to move six to nine months before the rest of the market, so the question is how long it will take this time before the activity begins to trickle down to the rest of the market.
I was up at the crack of dawn today for a quick comment on Wake Up To Money on BBC 5 Live, where the topic was the fact that LIBOR rates have now fallen substantially. 3 month LIBOR, which was so far out of kilter a few months ago and used as the main excuse behind lack of funds is now down at 0.75%, basically back to a “normal” level.
If this is the case, then why have rates not decreased?
For me Lenders at the moment are pricing based on three areas; cost, profit and fear.
Apparently alot of blogs are just rehashed ideas and comments from other blogs, according to some people, (you know who you are!). So I thought rather than produce my own today I would re-print Paul Masons’ Newsnight blog on the subject of inflation which, to be fair, is rather more eloquently put than my own random musings – dependent on your point of view of course.
Therefore, word for word see below (to follow Paul Masons blog click here).
Paul Mason | 19:17 UK time, Wednesday, 12 August 2009
Andrew Montlake, Director and Spokesperson for Coreco, gives his honest and forthright views on the mortgage market, economy and all things property related. Monty was voted "Mortgage Personality of the year 2008" and is the current holder of the British Mortgage Awards "Best Press Spokesperson" title. Expect expert analysis, delivered in a down to earth style with a side helping of exuberance.
