BOC rate hike this Wednesday? | General financial discussion | Discussion forum

As a money making proposition I can’t see it helping, most are 25 and done. Bonds are still paying last Octobers rates.

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As 'Widely' Predicted (even by my dog ) . . .

CBC Link ➡ https://www.cbc.ca/news/business/bank-of-canada-july-meeting-1.6904330

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Not to worry ... what goes Up, will 'eventually' come Down. But in this case, that could take a year, or more.

Good for us Savers, I guess ... but not so good, for most everyone else.

Dean

I can remember getting 5% interest on my elementary school savings account, back in the late 1960s. The schools in New York City partnered with Drydock Savings Bank and they sent someone around to collect our deposits in the classroom once a week, mainly in dimes and nickels, but they even took pennies!

My point is that 5% seemed normal for ordinary bank accounts at the time, and the economy was doing better, much better, in terms of both growth and income equality during those years. Maybe all of these attributes are correlated?

Retail and housing are still going like gangbusters, supporting inflation levels. The latter isn't going to slow down while Canada's population is swelling rapidly. Stopping all spending threatens economic slowdown.

Perhaps the one win-win thing we can do - at least for those of us in a position to do it - is reduce the massive amounts of interest going to financial institutions. We should perhaps try to:

1. Avoid debt.

2. Not buy on credit card, or at least use our least-expensive credit card.

3. Seek a lower credit rate. Often, just calling and asking can make a big difference. Or you can try other sources. Negotiate! Is a friend or family member willing to lend you briefly at a fair rate?

4. If you have several cards and are carrying a balance, pay all of them off every month except the lowest-rate, and let the balance sit there. None of the others will incur any interest. Use grace periods wisely!

5. Can you use a line of credit with a much lower rate? Keep in mind that, unlike credit cards, there's no grace period when you take funds from a LOC. Interest accrues immediately.

6. Delay purchases - even slightly. One can put things off into the next payment cycle with only a few days' delay, or save up instead of buying on credit.

Obviously, taking advantage of a sale that is ending will be an exception.

7. If you have savings, borrow from them instead and make sure to replay the amounts. Savings rates are almost always going to be less than borrowing rates, and savings interest is taxable. Reducing debt actually subsidizes itself, and using cash or debit reduces cost pressures on merchants that drive inflation.

8. Avoid bidding wars - such as pushing to get a particular new car (or other big-ticket item) that's back-ordered. Electric cars especially.

9. Avoid "influencers." They are self-described manipulators after your cash!
RetirEd

Pass it on to those you know!

Statistics Canada CPI numbers do reflect the increases in those capital goods, like homes, vehicles, and hammers. Just that their weights are low in the CPI because the typical CPI consumer doesn't spend anywhere near 60% of their expenditures on new homes, new vehicles, or new hammers.

With houses, the cost is a combination of purchase price and mortgage interest. The typical CPI consumer does not pay cash for homes. So, increases in purchase price have been partially offset by decreases in mortgage interest cost caused by previously declining interest rates.

The Representative Products of the Consumer Price Index and Basket weights of the Consumer Price Index… have the info the composition of Canadian CPI.

This sort of commentary never seems to change. CPI will never reflect our own personal CPI since we do not spend in the same categories at the same ratios as CPI is calculated on (the entire economy). I have confidence StatsCan does the best job it can to reflect what it is measuring on a regional and national scale and is meaningful for the purposes intended. It is a reasonable guideline for planning purposes for me at a macro level.

It's a perennial red herring for merchants and governments to tout a one-time or short-term boon as "inflation-fighting." But the discount prices keep rising, too. As long as that's happening, we're paying the price...especially those of us who have always restricted our purchases to the best deals.

For a couple of decades now, Coca-cola 2-litre bottles have been about 99 cents to a buck when on sale. About a year ago, the sales started getting a lot less frequent, and the buck-a-bottle has been AWOL for most of this year. I've seen $1.22, $1.25, $1.33 and $1.5 recently, but the $1.25 seems to be the new floor now. I stockpiled 50 bottles last week.

Produce and meat prices to fluctuate, as do energy costs, but the long-term trend follows the upward march of inflation.
RetirEd

HermanH said
I've noticed the same trend with Coke. I used to drink a 2-litre bottle every couple of days. Now, I've gone Cold Turkey. I'm happy to give them my business for a fair price, but I won't be gouged. I stocked up on 60 bottles when they had a $1 for 2L sale last year, but it was the last time I bought them. I lost another 5 pounds in the process.

The crazy thing is that I can find meat cheaper than fruit and veggies.  

My high school science teacher did an experiment where he dropped a piece of raw minced beef into a glass of Coke. 30 minutes later the meat was entirely dissolved. That’s when I stopped drinking Coke!

HermanH said

Rail Baron said

My high school science teacher did an experiment where he dropped a piece of raw minced beef into a glass of Coke. 30 minutes later the meat was entirely dissolved.

Another urban legend, like the claim that a nail will dissolve in Coke, overnight. Won't happen. I've seen entire mice only slightly broken down in bottles of Pepsi, (back when Pepsi still came in bottles.)  

I am guessing it will dissolve it, just like the stomach. But would take a looong time and you would have to replenish the coke regularly.

The real question is “so what?”