Update on UK household impact of higher rates:
- In Feb, I calculated that a 100bps rate rise has a -7% impact on disposable income.
- We are already 200bps higher, and expect a 5.5% base rate by 2023
- At +500bps, HALF THE HOUSEHOLD INCOME GOES TO MORTGAGE INTEREST PAYMENTS😵💫💀
Of all the words written about the catastrophe of the past week, this letter in the FT sums it up best of all. And it’s worse than we might have thought.
Here's a bonkers statistics:
England with 55 million inhabitants has been building 160,000-180,000 new housing units annually.
Austria, with 9 million inhabitants, has been building 70,000-80,000 a year.
That's 3x times more per capita.
@thomasforth@AntBreach@b_judah
Nearly half of Tory voters at the last election owned their home outright. Extraordinary stat from Economist. They won't be too concerned about mortgage rates
The #Brexiteers have created "little Britain" - destroying numerous advantages the UK had, one being the go to place for IPOs especially within Europe. Now #Paris is close to overtaking #London
All this for some "fish"
Just got off the phone with an investor for a big UK DB scheme who told me that they are throwing the kitchen sink to meet margin calls on their #LDI strategy. Bonds, equities, everything liquid is being sold (1/3)