Friday, 16 January 2009

Savings rates cut to 0% for first time

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20 comments:

Justintime said...

that cause people spend money rather than saving them in the bank. therefor pushing aggregate demand to increase output.

18 January 2009 at 13:37
Nicky said...

Further reduction of saving rates to 0% caused many things.For instance, people who save money are loosing now because of the current inflation RPI which is 3%. So for them would be much better to spend the money rather than save them in the bank...

18 January 2009 at 17:23
Kamit Chingis said...

i agree.so now people will take their money out of bank and will spend them.that will boost economy.however that will mean that banks will not have enought money to give credits and etc.

18 January 2009 at 18:39
Susan said...

It is an indicator that the UK is expericing a hard time when the banks and building societies are encouraging people to spend instead of saving money.

18 January 2009 at 19:17
Aaron 施 said...

Banks need to realise that they have a duty to their depositors as well as to their other customers.”

18 January 2009 at 20:11
chaoya zhuang said...

The bank want depositors to spend their money. So they cut the saving rate to zero, in order to encourage people to spend their money.

18 January 2009 at 21:29
qiongke said...

this behavier of bank will lose attraction from depositors,it may boost economy a bit ,but probablly won't help a lot.but in anothr side ,it will save some cost of banks,lighten the pressure.

18 January 2009 at 21:47
Anonymous said...

This is very funny, 0 saving rates? Seriously, I think this situation will not last for long time. 0 saving rates means almost nobody will save money for no etxa earning, therefore banks get not enough money for investment. Ok, except lending money for investment, how could banks earn? Banks will close, people will lose jobs, consumer confidence will reach the bottom, the start of another economic crisis.

19 January 2009 at 07:31
Anonymous said...

more money will be spent in market

19 January 2009 at 11:50
Anonymous said...

The way is not very nice but hopefully it will be effective.
Someone has predicted the reduction of the rates , now it comes true.

19 January 2009 at 11:52
Fabio xu said...

Government are trying their best to stimulate the economy.The first step is to let people spend money.Let's see the effective in the following days.

19 January 2009 at 12:04
Andy Nan said...

That's probably the best the goverments can do

19 January 2009 at 13:05
Oliver.Ma said...

This indicates that the government tries to make people spend more money in order to stimulate the economy

19 January 2009 at 13:35
Anonymous said...

it is a possible way to stimulate consumption but i dont think its not a sustainable strategy for economy growth because 0 saving rates means banks are hardly to make profit.

19 January 2009 at 13:45
Anonymous said...

Just as expected.
-Young

19 January 2009 at 15:18
Anonymous said...

There was still no clear recover of investment and innovation by firms eventhough the interest rate is zero leading to more of a danger for the economy.
-Alex B

19 January 2009 at 15:19
Anonymous said...

Money injection and increase in spending to recover the economical growth was needed. However, recovery does not seem to be clear eventhough the interest rates have reached 0%.

19 January 2009 at 15:21
Anonymous said...

Above comment is by Harry Kim by the way. Lol.

19 January 2009 at 15:21
Justintime said...

i am waiting BOE to print money and then drop pounds to me.
^O^

19 January 2009 at 19:18
Justintime said...

Banks don't work like some normal firms you have knew. Are you going to take out all of your money from bank becasuse saving rate is zero? 0 rate do encourage people spend but that doesn't mean nobody gonna to save money and let me tell you,every economics activity needs banks like paying wages, money transfer and so on.And firms borrow money from banks. from these sorts of thing bank can make enormous profit and 0 rate only make bank slowing down their cash flow for security. That is something i think people should be aware.

19 January 2009 at 19:33

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