Consumer confidence high = high rates.
Today we have informed the data of consumer confidence in Germany and Italy with better results than expected. This would mean that the economy is improving in both countries with the danger of inflation that would entail. We do not know if the ECB was aware of these facts, but yesterday was very hard insinuating that in August could raise interest rates 0.5 points.
It seems that Europe is doing well, thus, mortgages could go worse, so definitely if you go to hire one, you should think of a fixed-rate mortgage.
Written by Carlos Lopez on June 27, 2006 with 3 points.
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# 1, warrenbuffet-2
In Spain, where our growth model is based on construction, tourism and domestic consumption (need to live up to date and indebted) we are going to spend quite badly.
I can think of 10 reasons are:
First, because the level of mortgage debt is well above what families can afford.
Second, because the salaries have remained stagnant in many casos.Ni even the CPI.
-Third, because inflation of 4% is a real disaster, even though the emerging countries we are exporting deflation hands full. (Where inflation would be absent these deflationary pressures: 15% minimum)
- Fourth, because tourism is diverted to cheaper destinations.
-Qunto, because the competitive advantage that led to the massive influx of immigrants, and of which benefited in its day the countries around us, is a phase that will end soon.
- Sixth, because they will not take much to raise taxes (VAT, INCOME, HERITAGE, etc.)
- Seventh, because it fuels continue to rise.
- Eighth, because the consequences of globalization are just about to begin, and we will see massive layoffs and relocations.
- Ninth, because sooner or later, will be uploading the welfare state with the premise of being competitive. Health, education, welfare benefits and other services free of charge, will pay.
- Decimo. A very significant and extremely worrying because it is becoming cheaper to buy certain products in France than in Spain.
All this, with rising mortgages, will generate a break not only in the property sector, but consumption in general.
Pray for Germany and France did not really start to pull the economy, because otherwise we are going to come very bad light.
What worrisome is that the Euribor to 12 months which is published every day, seems to confirm this hypothesis: is accelerating. 26/6/06 to day, to 3.458%.
UYUYUYUYYYYYYYYYYYY THAT COMES THE LOBO ¡¡¡¡¡