Kiwibank is the next to raise fixed rates - but it has left its one year rates unchanged, still sub-4%.
They follow ANZ and ASB, leaving BNZ and Westpac the final big banks to move up - which will probably now come very soon.
ANZ kicked off this latest round of mortgage rate increases exactly a week ago. ASB chimed in with even higher rates on Friday, April 1, 2022.
Kiwibank's rate increases are of an increasingly steeper nature - although they have left their one year rate unchanged at 3.99%. All other rates have been increased by between +20 bps and +64 bps
We think both BNZ and Westpac will be along soon with their own chunky increases - either today or over the next one or two days.
Driving this is the rise and rise of wholesale swap rates. A quick check of the swap rate chart below paints the picture effectively. They are now rising at their fastest pace since 2013. And also notable, these rises are actually faster than equivalent Government bond rates although their trend is up too. Long term swap rates are flattening off, and long term Government bond rates seem to have topped out. But not short term ones yet, so we are getting rate curve compression locally.
Going forward, it will be worth keeping an eye on what happens in Australia, specifically how the RBA reacts to the flood of election promises released by the Budget in Canberra. There is a heightened possibility the RBA will worry about what has been unleased there and will bring forward its rate increases significantly in their attempt not to be caught behind the eight-ball as inflation there takes off. Inflation in Australia is a curiosity, well below what is being recorded in most other western economies. Any sharp move could trigger a market-moving change. But an argument against it coming pre-election is strong - no central bank governor want to be accused of meddling in the politics of an election. But markets may well move up on the expectation the RBA will have some catching up to do after the event.
And sharp rises in Australia, even from their very low base, will have echoes in New Zealand, even those from the secondary market, well before any from Philip Lowe.
Kiwibank has also raised its term deposit rates from +10 bps to +50 bps. Of note to savers prepared to fix for two years is a 3.20% rate. Their popular six month rate is 2.10%, nine months is 2.25% and on year is now 2.70%.
One useful way to make sense of these changed home loan rates is to use our full-function mortgage calculator which is also below. (Term deposit rates can be assessed using this calculator).
And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options. But break fees should be minimal in a rising market.
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Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.
| Fixed, below 80% LVR | 6 mths | 1 yr | 18 mth | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
| as at April 4, 2022 | % | % | % | % | % | % | % |
| ANZ | 4.45 | 4.20 | 4.55 | 4.85 | 5.15 | 5.99 | 6.09 |
 |
4.49 | 4.19 | 4.75 | 4.95 | 5.29 | 5.89 | 5.99 |
 |
4.19 | 3.99 | 4.39 | 4.55 | 4.79 | 4.99 | 5.09 |
 |
4.45 +0.26 |
3.99 | 4.85 +0.30 |
4.99 +0.20 |
5.45 +0.46 |
5.79 +0.64 |
|
 |
4.19 | 3.99 | 4.29 | 4.55 | 4.89 | 4.99 | 5.09 |
| Bank of China | 4.15 | 4.05 | 4.35 | 4.55 | 4.75 | 5.15 | 5.35 |
| China Construction Bank | 4.15 | 3.95 | 4.35 | 4.50 | 4.75 | 5.09 | 5.20 |
| Co-operative Bank [*=FHB] | 3.79 | 3.69* | 4.19 | 4.50 | 4.75 | 4.99 | 5.09 |
| Heartland Bank | 3.49 | 4.05 | 4.25 | ||||
| HSBC | 4.09 | 3.95 | 4.49 | 4.69 | 4.89 | 5.04 | 5.19 |
| ICBC | 3.85 | 3.69 | 3.99 | 4.25 | 4.55 | 4.85 | 5.05 |
 |
3.99 | 3.75 | 4.19 | 4.35 | 4.69 | 4.99 | 5.05 |
 |
3.95 | 3.95 | 4.39 | 4.55 | 4.75 | 4.99 | 5.09 |
Fixed mortgage rates
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116 Comments
Let’s spare a thought for those poor souls that thought they were doing the right thing by borrowing to their maximium DTI ratio to get on the ladder… for a better future for themselves and their family.
MSM was full of stories in 20/21 about how prices were going to the moon with Tony giving us his 25 reasons why etc
The Church was in the herald app telling us rates would be low for long and there was a possibility they would be at 1% in a year. (so why would anyone lock in historically low rates and fix for 5 yrs?)
"For all of these reasons it’s my view that mortgage interest rates of zero percent are extremely unlikely – but that there’s a possibility that we could see fixed rates at one percent, or lower, by the end of next year if economy activity (as measured by the Gross Domestic Product figures) hasn’t picked up substantially, before that.
One thing is certain though. Mortgage interest rates are going to stay lower, for longer. Of that, we can be quite certain"
So everyone will know someone who just made this very simple, now costly decision:
1, Interest rates will stay low for long, or won’t rise much when they do.
2, House prices only ever go up, so it will cost me more next year to get on the ladder.
Investments are always about risk and timing - don’t ever believe there's never a bad time to buy when it's a 25-30 year commitment on a non-liquid asset.
And don’t believe anyone who say’s prices will only fall 10% - they are vested and talking their own book.
No one know’s what’s going to happen - we have never been in this situation before.
Have we ever had a situation where interest rates have tripled in less than 2 years? - that’s what we’re looking at if they get to 6.3% by May 2023
But ok, well on a fundamental:
In the first 5 years on a 30 year P&I mortgage there is less than 10% principal payed back. After 10 years, you've paid back less than 20%.
So, you’re effectively renting the property from the bank for the next 30 years (and making compulsory savings), and now the landlord has just doubled your rent, and will keep putting it up until it’s probably triple what it was when you moved in.
And they will evict you if you don’t pay it (with your life savings as their security)
Sadly, most young people who have never had a mortgage don’t understand this fundamental - they think buying a home or a rental is a one-way investment for them, rather than a bet on stable or falling interest rates and rising values.
Probably because its not a fundamental by any stretch of the imagination.
It might help if what DDDDebt said was true. But like so many on this website he's not capable of (or not willing to?) checking his "facts", nor are those like yourself that are blindly agreeing with him.
What DDDDebt fails to mention is that it varies with interest rate and is highly sensitive to them, but even at 7% interest rates after 5 years you've paid 5.9% of the mortgage (basic math, 5.9 is > 5 ), and after 10years at 7% you've paid just over 14% of the mortgage.
Maybe at somewhere north of 10% interest rates his numbers are right, but that is not the reality we live in.
EDIT FYI, at a constant 18% interest rate, it take ~17.5 years (over half the mortgage term) to pay down the first 10% of the mortgage, at 1.8% interest its less than 4 years.
I think you’ve missed my point.. or I’ve made it confusing sorry.
What I’m saying, is that in a world without capital gains, rapidly increasing interest rates, and stagnant prices (or falling as they are now) it’s better to rent (vs paying interest) and put the difference in savings (vs paying principal).
But you’ve illustrated the point nicely - the 'fundamental' is that most people don’t understand how little principal the are paying in the first 5 or 10 years.
Yes, it will obviously always vary, but most mortgage calculators (like the above from interest.co) only show repayments - not the P&I split.
Buyers need to use a more advanced version like this:
I'm not back tracking anywhere - I'm confused where I am spouting rubbish?
Are you arguing my use of the word 'fundamental' as description for understanding the P&I dynamics of a table loan they have committed to?
Sorry, but I think it's of central importance for buyers to understand clearly their risks, especially when a bank or broker doesn't spell it out for them.
I wish they would just ask their broker/banker the simple question - how much will I have paid off in 5 years, 10 year etc.
Then they would better understand that in a stagnant market - they are better to wait and buy when prices are clearly on the move back up.
Before then, why take the risk? - without capital gains there is no leverage.
But, in a falling market like we have now... I have a lot of sympathy for those who believe a banker or broker who tells them 'it's a good time to buy'. They've just been conned.
The Reserve Bank and successive governments have created this problem in their silly ideologically driven support for ever rising house prices. If there is a collapse, they should receive their fair blame and they should react to undo the damage they do to these most affected folk.
The approach proposed by some party in Australia looks interesting: a bail-out amount per adult. For those without a house, to help them through the hardest times following the crash. For those with one or more house, to be paid against their debt to reduce its value. Per person, not per house. Undo some of the money printing they've been doing in the last few years.
Better than just continuing to bail out speculators as they've done for the past couple of years - enriching them - or just bailing out banks.
It's unkind to rub reality in the face of the ones that bought into peak property bubble.
The suspension of disbelief required to believe a dysfunctional backwater like Auckland was worth more than Melbourne, Sydney, London or New York was a spectacle.
Mass formation psychosis.
I strongly believe that we should introduce non recourse loans for this situation.
The banks should shoulder the risk of a securitsed loan. It would help them to lend responsibly.
I'm unsure of the NZ bankruptcy laws in regards to these scenarios, would be great if another poster could shed some light.
And interest rates higher (banks exposed to more of the risk) , and deposit requirements higher. And thats assuming the house prices are in fact lower, developers will be paying even higher interest rates again, so supply would be likely be reduced. Unless the govt is going to set up a new ministry of works and state housing corporation to build them they would likely be more expensive than you think.
In the USA where the vast majority of Mortgages are full recourse?
Does teh Uk even have non-recourse mortgages at all?
"For three reasons, this menu variation likely reflects price discrimination and not variation in risk across customers. First, all mortgages in the UK are made with recourse to the borrower, making default extremely rare." (https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2021/pr…)
Nope guess not. So not sure wtf you are on about?
All I know is property doomsayers all seem to think "this time it's different".
It's pretty clear 2020 wasn't the last time the government's going to pull the "free money" lever.
Houses aren't getting cheaper to build, anytime soon.
While the whole planet deteriorates, the slower pace and remoteness in NZ will always make it a desirable place to live.
Whether Auckland is more or less expensive than Sydney or San Fransisco is sort of immaterial. If the argument for massive sustained drops in value in NZ will bear fruit, the same will happen to markets across the world.
I know you like to think in multiple dimensions but there's only one that matters.
Do you also synergise, and uncover new paradigms?
I quite enjoyed the little rant about "property doomsayers", then without missing a beat "as the whole planet deteriorates". Doomsayers eh?
Benchmarking prices against global cities (that have much more going for them) is a useful indication of whether one is in an overpriced market.
No global housing markets do not necessarily move in lockstep.
Maybe the slower pace and remoteness of Easter Island will make it a desirable place to live too? Be quick.
Which dimension is the one that matters to you? There are three spatial and one temporal dimensions that we are able to interact with.
I don't know what synergising or uncovering new paradigms is. Just a thought, but maybe lay off huffing your paint.
It's not really up to me.
South Africans value NZ, because well, South Africa has become a less pleasant place for quite a few people over the last few decades.
Ditto Brits, whether right or wrong, there's a perception that Europe is going down the toilet - great value Villas in Italy though.
People from developing Nations will also pay the premium, for reduced corruption and better opportunity.
So I guess from the position of someone born in a first world nation, who went to the meetings when young where they were guaranteed highly valuable property for virtually no effort, it's a right ripoff.
Maybe you will get to be that right broken clock. Maybe the best course of action is to just wait, wait, wait. People who've been telling me a pretty similar story for the past few decades don't seem to have made superior choices so far.
Synergising and uncovering new paradigms is the same sort of nonsense speak as "thinking multi-dimensionally". We used to just call it schizophrenia.
The best course of action in Auckland is not waiting, it's leaving.
Waiting for a bit before buying a lousy house here is probably the second best option with the impending correction.
Britain is a big place. Can't speak for all of it but moving from the Home Counties to Auckland is a downgrade.
It sounds like we should add schizophrenia to the list of things where you don't actually know what you are talking about.
We can call what you do as black and white thinking if the concept of one dimensional thinking is too hard for you to grasp.
I'm happy to admit that's what I thought would happen. But I've been wrong before and will be again.
It will be interesting to see of the Govt/RBNZ look to pull one more rabbit out of their hat. Reality is if house prices materially crash before the end of Labour's term. They will not govern again for another 12-15 years.
What happens after the central banks has pulled the last rabbit out of the hat?
And is it the ruling political parties personal mandate to ensure that NZ permanently has unaffordable housing (by any historical measure), and if they can't do that, its off to the opposition? Sounds like a pretty crazy paradigm to view the world from.
The opposite might actually happen - that if house prices do drop and more people can afford housing, Labour might (oddly) get credit for delivering what they campaigned upon (delivery affordable housing). Boomer and Gen X parents will be happy as they don't need to be bank of Mum and Dad, and millenials and gen Z are happy as they can afford to buy a house.
It would only be the property investor association types that are unhappy about house prices coming down...but they tend to be National voters regardless so would never vote Labour either way.
I am not going to shed a single tear if the property investor association types are unhappy. They can cry me a river for all I care. It is high time that they learned that all asset classes are subject to variability and risk (including cash, due to inflation), and that what goes up can as easily come down. After all, this is what makes allocating and managing investments an interesting activity.
"How is it a crazy paradigm when that's exactly what they've already done?"
Is your argument that all past behaviour is rational?
Or every government and central bank decision is rational?
Every financial bubble the size of our housing market is the result of human beings collectively acting together in a highly irrational manner.....and we will all suddenly become rational at the same time.....and that is when a tipping point of collective people realise property prices aren't going any higher and the all try to sell at the same time....we might be starting to see the start of that now when you look at all the new listings starting to pile up.
Have a read of Shiller and Akerlof's book 'Animal Spirits' if you want to understand where I'm coming from. Thinking Fast and Slow by Kahneman as well if you want to better understand rational behaviour/decision making (and how often we think we're being rational, but we're not at all).
"It would only be the property investor association types that are unhappy about house prices coming down"
Coming down = my next house becoming affordable and sane relative to wages? Yes, excellent, plz.
Coming down = negative equity, trapped in the house I'm in, further plans for family derailed? Yea, not so good.
I own one house, and will only ever own one house at any given time.
If it does all come crashing down I do feel empathy for those who through good intentions (buying a family home) are financially harmed.
We should have never allowed this situation to eventuate.....Yet if you speak against the status quo, you get covered in tar and feathers (the DGM have to be silenced, don't listen to them because they are always wrong) by those who have wanted to exploit the situation for their own personal financial self interest. They got the profit, and other people will suffer the consequences. Where's the accountability for that? Should they have to pay for the social damage caused to society?
Sad state of affairs that our society to end up here....but I've been warning of the consequences (financial and social) of the outcomes on here for quite a while and either been getting ridiculed or ignored. I guess if does all come tumbling down, I'm not going to gloat because its going to cause a lot of pain for everyone.
Witnessed the outcome first hand in the US during the GFC, including stress related deaths in the aftermath of the bubble bursting. Hence my warnings on here how we needed to be cautious and how things can go wrong.
Milk...straight into stinky cheese. Be quick.
This "reset" has been coming since the GFC. We avoided taking our speculative medicine by using the printing press to artificially depress rates in a way, and to a level, never seen before. Rates so low they didn't even appear in the appendices of Property Finance text books as an example. Asset prices boomed as a result in the frothy lolly scramble that followed.
I for one look forward to the return to values that are supported by incomes.That is quite a way back for current sellers...
Hi Brock Landers,
You state above:
I remember not long ago when the clown chorus were on here assuring first home buyers that interest rates will remain near zero for the next few decades.
Can you (or anyone else here) provide a reference for who in the "clown chorus" said interest rates will remain near zero for the next few decades.
OR could it be that you're the CLOWN? 🤡
TTP
uhm... so, foreseeing interests going up to 9/10% is not anymore in the realm of sci-fi.
I kinda prefer this way, cause too much debit is something that makes me nervous. Higher interests will drain a bit of it.
You see an upcoming recession coming, but I am not sure about that.
By recession you mean zero or negative GDP? in the next 6 months?
That's pretty bold.
And you look sure that the response will be reverting OCR to almost-zero? Even with high inflation?
And even if that happens... would you think that banks will be eager to lend money around in a recession? Will that benefit the housing market?
I am curious of what you mean, I might be not understanging.
Can you elaborate?
I don't think we will see 9-10% interests rates. A couple of key indicators showing signs of recession starting in the next 6-12months (timing may vary). Negative GDP for two consecutive quarters.
Bold, maybe, I'm just reading the tea leaves as I see them
OCR won't revert to zero (probably), I'd wager an increase in OCR until the recession starts and probably no cuts until we are deep into it as the RBNZ is usually pretty slow to act. RBNZ Is going to be in a pretty tough spot if inflation stays high but I don't think it will.
Hopefully that clears things up?
yup, better.
So your actual timeframe would be in the order of 24/30 months before rate goes down again?
And in any case you don't see OCR going back to covid level.
this is my interpretation.
I think housing market will recede circa 36 perc in real terms in the next 18 months compared with last November (between actual depreciation and high salary inflation), after that I think we are in uncharted territory. But I base that on the belief that we will get to a bit north than 7% of interests.
How much you think house market will lose in that timeframe?
OCR rates going down obviously depend on a variety of factors but 6ish months after recession starts they will start dropping.
OCR won't go to .25 again unless the recession is incredibly dire. I would hazard a guess at them going up and then back to the level we are at now and staying there for quite some time.
I'm probably on the same boat, prices dropping anywhere from 25-40%
I own my own home (half of the mortgage repaid)
I have an investment property being built at the moment. (yes my timing is impeccable)
Does that make me biased, maybe. Although I couldn't really care less what happens to house prices, I have really bought so that my kid can have their own home when they grow up. If it costs me a few bucks so my kid has their own home so be it.
Indeed.
I was convinced as well you were very long on housing. Looks like you fooled me. gotta give you a like
Yeah, I would prefer tones to be more "adults".
I personally find what is happening kinda entertaining.
I don't need to see the blood of anybody on the streets anyways :D
This is tragic.
Why would we want to rob our children of the pride and resilience of learning to stand on their own two feet without mummy and daddy? Carlos67 is the result of the handout strategy.
(Plus housing is a ridiculously bad investment choice at the moment)
I think we should aspire to return to a society where housing is achievable for our children with a reasonable amount of work and effort. The egalitarian society us kiwi children of the 80s were indoctrinated into believing that we had while we were growing up.
It's tragic that you think it's necessary to take such actions, tragic for the children stunted by playing life with cheat mode on, and tragic for all those who don't get to choose parents in such a fortunate position.
Oh my god, we actually agree on something.
It is tragic that I feel I have to do this but If I don't and housing gets worse and not better then I've probably done wrong by my kid given that I am in the position to buy (albeit at the worst possible time).
The kid didn't choose to have me as a parent and I may be able to help financially but she'll miss out in other areas. I mean, she will have to put up with my horrible personality.
Come on now, you can’t laugh at the people who said house prices can only go up and then say house prices can only go down…
I’ve got a balanced portfolio and I don’t plan on selling for 20+ years. Will history show that I bought at the wrong time, probably. But then people were saying it was the top when I bought my home and it went up 50% from there.
I said real house prices are only going to go down. The artificial scarcity of housing is going to rapidly dissipate over the coming years. But the central bankers are going to continue to water down the value of their tokens, so nominal prices might take a different trajectory.
Do you see the risk in buying an additional home, using the 50% equity that you have gained, in a period from which house prices by any affordability measure were already very expensive?
Its like saying house prices could have gone either way, but they went up, made a 50% gain so will use that to buy another house when prices have gone from very high to insanely high. As opposed to thinking, wow that was fortunate, best hedge my bets from here.
What I see with new investors now it its similar to winning a $1,000 on the pokies on a Friday night and deciding you're on a roll so take the proceeds to bet them all on red on the roulette table. As a result you could lose everything as opposed to having just made $1,000 and being thankful.
Each to their own - its worked for you so well done. Fingers x'd the market doesn't tank for your and your childs sake. But then hopefully it does for other childrens sake who are currently saving to buy.
I’ve paid off half of our mortgage + have the equity gain so we aren’t too bad in terms of debt/equity.
It is a risk but I can’t predict what will happen in the next 20 years when she wants to buy a place. Hopefully this means I’m in a place to help (not give).
honestly, I’ve got my fingers crossed for house prices to come down. But I feel I need to hedge for if they don’t.
I guess you missed the news last night Brock, as it turns out generous parents are now commonplace in getting their kids into a house. A good mate of mine keeps telling me his kids have just bought their own houses, what he is not telling me is he gave them the deposit to do so because one has hardly worked a day in his life to date and the other has a minimum wage job. Sorry you never got a hand up, its life changing to someone with the right attitude who puts it into a house, works to then pay off the balance as fast as possible and doesn't just piss it all up a wall.
But we paid 19% on our 25K mortgage . It was extremely hard times, had to warm our feet in the cow shit before work on those frosty mornings.
But dad. did you know people here in NZ are now paying 1 million dollars for their first home thats basically the same size as your first home ?
Yes son, but your generation is only paying 4% interest rates.
But dad, its guaranteed its going to 7% this year on some loans.
Listen here son, and listen real good, 7% is not 19%. OK ? Now go get me that Gin.
It was an extraordinary blessing for boomers to buy houses in the 1970's...high mortgage rates kept the real price of housing down, so you couldn't take out a large mortgage.
Then for the entire duration of the mortgage, rates dropped so it got easier and easier to service the loan, and at the same time the price of the houses have continued to go up....for many they are now around 25x the original purchase price....
Those buying now could find they have the reverse experience where low rates mean very high prices and large mortgages....with the risk of rising rates for the duration of the mortgage with little or now capital price appreciation (or even the possibility of falls if we do a Japan).
>It was an extraordinary blessing for boomers to buy houses in the 1970's...high mortgage rates kept the real price of housing down, [...] Then for the entire duration of the mortgage, rates dropped so it got easier and easier to service the loan.
Lets fact check that.
If they bought in the 1970s they experienced rising mortgage rates until about 1986 according to this graph. (https://teara.govt.nz/files/g-23100-enz.gif), and last time I checked 1987 would be more than halfway through the 25yr term typical of that era if it was taken out in the early 1970s.
Yeah, once again the facts aren't in agreement with the BS thrown around in the comments section.
Did that not work out for the boomers who 'inflated away their debt' from a point of relatively low debt to income ratios? Who's property prices are now 25x the original purchase price, and wages now 10x what they were when they purchased in the 1970s, with interest rate costs now a mere fraction of what they were at the point of purchase?
I'm sure they did it hard with a single income paying the mortgage from the first home purchased at the age of 23 after saving their deposit inside 2 years after receiving free tertiary education!
Sure the initial part might have been challenging in the 70's and 80's....but you are far better off buying in that period than now when the reverse cycle could now be unfolding....which was the point of my post....which apparently is BS.
If I was a develper I would probably look for alternative materials and new technologies.
Also, not doing it keeps pumping the costs of materials and work, which pumps inflation, which disallows for lower interest rates.
I don't see many escape ways, other than investing in productivity (you save money and the final product costs less and your margins are higher)
It's not that easy unfortunately. Any new material that is brought in has to go through rigorous testing before it is approved.
This takes a lot of time due to bureaucracy and rumor has it that those testing may be influenced by the big players in the material supply market..
I agree, but if the cost-benefit gets too much out of balance that might be the only viable solution.
I mean... the alternative would be to completely stall the building industry or to accept huge losses.
There are few options that have some green-ish light already.
Like this one https://qorox.co.nz/residential-commercial/
Ugly(for now) vs cheap...
The future is there, if the market wants it
It's amazing we allowed the Reserve Bank to use the same logic to drop rates over the past decade, isn't it?
What an orgy of living off the next generations we've had in doing so, though. Amazing opportunity to live beyond our means by foisting massive costs on generations of younger Kiwis.
So it we owe $320B on the house then it costs $12B interest to service it.
where does the next $12B come from if rates go over seven percent?
thats an extra $2400( if my math is right....calculator on iPhone can’t handle such numbers) for every man, woman and child.
Lol - I thought banks used swaps to manage the interest rate risk when carrying out duration gap analysis of their balance sheet (assets/liabilities).
If the swaps go up (liabilities) then they have to modify the rates of their assets (loans) to balance their liabilities.
Hence why its been bizarre that central banks have avoided fighting inflation because if they lose control of the inflation narrative and swap rates keep going up, then they may not be able to ensure swaps level out when they need them to.....result being that unless banks keep raising mortgages rates, they won't be able to balance the duration gap of their assets/liabilities and they essentially bankrupt themselves (or would they chose to bankrupt the mortgage holders first?)
Or are you implying that the RBNZ should step in and be the only entity that acts on the liability side of our banks balance sheets? And therefore the OCR + operating margin becomes the new mortgage rate for the country? Completely controlled by our central banks, with no other entities providing funding for banks portfolios? At which point we may as well just get rid of retail banks and everyone has a direct funding line to the RBNZ for mortgages because retail bank operating costs would be an inefficiency (waste of time and money).
I have to lol from time to time when I see debt speculators, crypto fans and growth stock bulls praying for a recession so that central banks come to the rescue of their assets (again) by pushing interest rates back to zero.
We have to be close to the end game (or significant financial change) when people start praying for the economy to fall apart so that we have some more QE/money printing and push the price of their assets even further up.....that is 100% unsustainable thinking.
When in a rational market that is representative of the health of an economy, high asset prices should result from a strong economy, not a very weak economy. Everything is back to front at present. If we had a strong economy we wouldn't need emergency interest rate settings. So asset prices shouldn't be high given how weak the economy is.
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