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Turner warns of low rates and peer-to-peer losses

Former chairman of the City regulator, Lord Turner, predicts low interest rates until 2020 and forecasts trouble from peer to peer lending.

 
Turner warns of low rates and peer-to-peer losses

The former chairman of the Financial Services Authority (FSA) Adair Turner has warned the UK could be stuck with low interest rates 'almost indefinitely'.

Interest rates have been set at a record low level of 0.5% since March 2009. Speaking to the BBC Lord Turner said any rate rise would be extremely gradual.

'Interest rates in the UK may not go beyond 2% by 2020,' he said.

He also voiced grave concerns over the future fallout of peer-to-peer lending.

With peer-to-peer lending, savers willing to lend are matched with those who want to borrow via an online platform.

He said: 'The losses which will emerge from peer to peer lending over the next five to 10 years will make the bankers look like lending geniuses.'

He also warned that the forthcoming referendum on whether the UK should leave the EU was creating great political and economic uncertainty.

7 comments so far. Why not have your say?

PaulSh

Feb 10, 2016 at 10:39

Warning us that the EU in/out referendum is creating great uncertainty? The man's clearly a genius!

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Tom Mozy

Feb 10, 2016 at 13:52

He said: 'The losses which will emerge from peer to peer lending over the next five to 10 years will make the bankers look like lending geniuses.'

Why not look at the leverage in the banking system, its use of derivatives or the absolute disregard to lending standards or regulation, or maybe the asset bubbles that are being blown up by the central bank, or the ponzi scheme that the Gilt market or govt bond markets are?

Just because p2p circumvents banks and is largly unleveraged. Crawl back in you hole Turner - what a waste of time article Citywire.

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colin overton

Feb 10, 2016 at 15:32

It's interesting that a Banker (sic) thinks that forever is 2010 or just after. Anyway aren't low interest rates good? Business costs low, inflation low, perhaps there is an implication that no-one wants to borrow money - is that so bad?

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colin fellowes

Feb 10, 2016 at 15:57

Yes, PaulSh he is clearly a genius and obviously blessed with excellent foresight. I believe he was chairman of the FSA in 2008 at the time of near total collapse of many major UK banks. So I'm not sure how much credibility we should give his latest comments.

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LandlordsandLetting

Feb 10, 2016 at 16:22

Sir Lord of All He Surveys Your Worship Baron Saint Adair Turner? Wasn't he the guy presiding over the now defunct Financial Services Authority before the near collapse of all banking and financial services? Well, I'll make a note of what he says and then file it in the waste paper basket.

Of course, I'll bet his mates who run the major banks just hate those pesky peer to peer lenders. I guess it's time to scare everyone.

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Clive B

Feb 11, 2016 at 13:42

He said: 'The losses which will emerge from peer to peer lending over the next five to 10 years will make the bankers look like lending geniuses.'

I've got money in Funding Circle. Worst thing that happens is I lose the lot. No threat to the UK financial system. No need for the government to bail me/FC out. Unlike the genius bankers who achieved both of those.

Guy's an idiot

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geoffrey mulford

Feb 14, 2016 at 10:52

I will have to stick up for Adair Turner here he is an intelligent guy. I would rather have him or Steve Keen running the show than most of the other Muppets out there.

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