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Kathy
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Northern Rock
- Thread starter Aldaniti
- Start date
Tout Seul
Senior Jockey
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On a day that may see some huge movements in the global stock markets some might get a little reassurance from the following article.
http://business.timesonline.co.uk/tol/business/columnists/article4327589.ece
I have long held that that the ' mark to market' rules were too inflexible, as in the example of house valuation I posted before. Thankfully there is a growing body of opinion that now accepts the view expressed in the article.
Unfortunately the writer focusses on the upside in the US economy, which whilst it be beneficial to us, is driven by a surge in exports. Of course our ability to produce tangible exports is far less than the US and the engine of our economy are the invisible exports generators, particularly the financial sector.
Amending the 'mark to market' rules could free our banks to resume their traditional lending roles (under a very watchful eye) and therefore start generating the income that these isles need if we are to overcome the impact of higher fuel and food prices which is the real crisis that we need to address.
Anyway I suspect that a few fortunes will be made and lost today and that the events of this week will give a reasonable indication of the competence of the market analysts and Government economists. I hope the week ends on an optimistic note.
http://business.timesonline.co.uk/tol/business/columnists/article4327589.ece
I have long held that that the ' mark to market' rules were too inflexible, as in the example of house valuation I posted before. Thankfully there is a growing body of opinion that now accepts the view expressed in the article.
Unfortunately the writer focusses on the upside in the US economy, which whilst it be beneficial to us, is driven by a surge in exports. Of course our ability to produce tangible exports is far less than the US and the engine of our economy are the invisible exports generators, particularly the financial sector.
Amending the 'mark to market' rules could free our banks to resume their traditional lending roles (under a very watchful eye) and therefore start generating the income that these isles need if we are to overcome the impact of higher fuel and food prices which is the real crisis that we need to address.
Anyway I suspect that a few fortunes will be made and lost today and that the events of this week will give a reasonable indication of the competence of the market analysts and Government economists. I hope the week ends on an optimistic note.
A&L are not in "difficulties" I think some people need to look up the real meaning of the word (in a business sense). This is not Land of Leather.
Looks like Santandeer will be buying them out shortly anyway
Havent read that article just yet TS, but i am a little cautious, because this has been the writers mantra for some time and if i recall rightly, hes made some right howlers with his predictions in recent months
However, hes been pretty adamant that the oil price has been a speculative bubble (and logically that has to be true doesnt it?) and should fall back quite quickly fairly soon. If it does so, then inflation may be easier to control and a much needed cut in interest rates could follow.
Easy isnt it?
K
Kathy
Guest
If you listen to certain people on this forum there is no house price crash, there is no possibility of a recession coming and all the banks are doing just absolutely fine. It's all just a well overdue correction evidently that is overplayed by people like me that love to scaremonger and spread vicious rumours and the media of course who would not be able to sell their newspapers without some financial scare story to drip feed the silly people that actually read their trash.
And then of course there is that very remote possibility that some of us actually know what is really happening. I am not afraid to admit that I have lost £25k in the last few weeks on the stock market, I may get it back, I may not. There are going to be some very difficult times ahead for many of us.
And then of course there is that very remote possibility that some of us actually know what is really happening. I am not afraid to admit that I have lost £25k in the last few weeks on the stock market, I may get it back, I may not. There are going to be some very difficult times ahead for many of us.
Bar the Bull
At the Start
There is a house price crash. There will be a recession. The banks are in trouble.
Shadow Leader
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- 9,884
It's the apparent gloating over the recession/house price crash and the gleeful reporting of it that sit uncomfortably with me.
Nobody wants a recession, increasing inflation or unemployment, but the "house price crash" is, in general, something to be pretty gleeful about, in the same way that the fall in the price of computers and cameras in recent years is a happy event.
Obviously not if you're a seller of these items, as Jessops, for example, have painfully found out, but most people benefit from falls in the prices of things.
Obviously not if you're a seller of these items, as Jessops, for example, have painfully found out, but most people benefit from falls in the prices of things.
Harbinger
At the Start
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- Mar 22, 2004
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- 11,282
House prices are high. Media and opposition politicians moan that it's impossible for people to get on the property ladder.
House prices fall. Media and opposition politicians moan that people are losing their investments.
Same as it ever was.
House prices fall. Media and opposition politicians moan that people are losing their investments.
Same as it ever was.
Shadow Leader
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Don't get me wrong Venusian, I'm more than happy to see house prices fall - however it sits uncomfortably with me to garner as much delight as some people seem to be over the situation, not least when you take a second to think where it might land a lot of people. Admittedly there are plenty who will have landed in trouble down to not thinking things through properly and biting off more than they can chew financially but dancing on their grave is not pretty.
K
Kathy
Guest
A TV programme (Dispatches) that some may find interesting on C4 at 8pm tonight - and of course some will say it absolute tosh!
Broadcast: Monday 25 August 2008 08:00 PM
(courtesy of C4/Dispatches)
As the credit crunch continues to leave Britain cash-strapped and high street banks report huge losses, Dispatches investigates who is responsible for the current crisis.
<H3>How The Banks Never Lose
</H3>As the credit crunch continues to leave Britain cash-strapped and high street banks report huge losses, Dispatches investigates who is responsible for the current crisis. Reckless lending and risky investments have been blamed for directly driving up mortgage rates and increasing the numbers of people losing their homes.
Dispatches investigates how the bank chiefs allowed this to happen and if lessons have been learnt from the Northern Rock crisis. Former investment banker James Max tracks down the banking bosses who have presided over the colossal losses to see if they will be held to account.
He examines the billion pound bonus culture and lifestyle of the City's wide boys and investigates how the banks are now seeking to make back the money they lost before the credit boom hit the buffers.
Featuring the results of an exclusive survey of bank lending rates, and how much money banks are re-claiming through them, the film also offers expert advice on how to cope with higher interest rates and shows how customers can take banking into their own hands.
Broadcast: Monday 25 August 2008 08:00 PM
(courtesy of C4/Dispatches)
As the credit crunch continues to leave Britain cash-strapped and high street banks report huge losses, Dispatches investigates who is responsible for the current crisis.
<H3>How The Banks Never Lose
</H3>As the credit crunch continues to leave Britain cash-strapped and high street banks report huge losses, Dispatches investigates who is responsible for the current crisis. Reckless lending and risky investments have been blamed for directly driving up mortgage rates and increasing the numbers of people losing their homes.
Dispatches investigates how the bank chiefs allowed this to happen and if lessons have been learnt from the Northern Rock crisis. Former investment banker James Max tracks down the banking bosses who have presided over the colossal losses to see if they will be held to account.
He examines the billion pound bonus culture and lifestyle of the City's wide boys and investigates how the banks are now seeking to make back the money they lost before the credit boom hit the buffers.
Featuring the results of an exclusive survey of bank lending rates, and how much money banks are re-claiming through them, the film also offers expert advice on how to cope with higher interest rates and shows how customers can take banking into their own hands.
Honest Tom
At the Start
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- May 2, 2003
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- 1,272
Just watched a recording of that programme and if there was a red terror group on the go just now I'd gladly join up. It's hilarious when you think of all the times we've been told that socialist policies will lead to a brain drain. Where would we have ended up without the guidance of these financial fkng wizards?
K
Kathy
Guest
Northern Rock were certainly not the only bank having problems were they. Lehman's have gone into liquidation and the knock on affect could be horrendous for the financial sector both in the US and here in the UK. It could well be a Black Monday here in the UK today on the stock exchange. We may be in for a bumpy ride in the days/weeks ahead.
K
Kathy
Guest
HBOS clearly in some trouble but light on the horizon with a possible merger with Lloyds TSB now on the cards.
Tout Seul
Senior Jockey
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HBOs is a prudently run bank which as the FSA confimed today is more than adequately funded. Today's action is a result of an attack on the shares by speculators who might have succeeded in causing a run. Prudent action to seek a merger even though the bank has done nowt wrong.
rabid capitalist market failure continuing to feed on its own carcass. The glorious day nears. Property is theft. Death to the speculators
Sheikh
At the Start
K
Kathy
Guest
K
Kathy
Guest
Courtesy of Timeonline.
HBOS bails out own fund as effect of credit crisis spreads
Patrick Hosking
The credit crisis inched closer to the heart of the British financial system yesterday as HBOS, the banking group, disclosed that it was bailing out a vast in-house fund that has been struggling to finance itself.
HBOS, which owns Halifax and Bank of Scotland, said that it would extend credit to Grampian, a $37 billion (£19 billion) Jersey-registered debt- financed fund, until market conditions improved.
The move came as the Bank of England disclosed that it had provided £314 million of emergency funding to a financial institution that it did not name, but which is understood to be Barclays.
Grampian, a so-called conduit or credit arbitrage fund, holds asset- backed securities and normally finances its investments by issuing short-term commercial paper. However, demand for commercial paper has dried up as banks and investors shun all but the most risk-free of assets in a flight to ultra-safe government bonds.
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HBOS’s decision to finance Grampian from its own resources means that it may have to raise £19 billion within six months — and most of that within weeks unless credit conditions improve. The average maturity of the Grampian commercial paper is just 55 days.
HBOS said: “Grampian will use facilities provided by HBOS to repay maturing asset-backed commercial paper until such time as market pricing improves to a level acceptable to HBOS.” The group said that the action would “have no material adverse impacts on HBOS” and added that it had liquidity lines sufficient to repay the entire £19 billion.
Grampian’s assets are held on the HBOS balance sheet, but do not have to be marked to market, enabling HBOS to ride out the storm without having to make big writedowns, according to one well-placed source. The fund is thought to have only about $300 million in securities backed by American sub-prime mortgages.
Many banks have built up conduits in recent years, but Grampian is the biggest in the world, equivalent to 57 per cent of HBOS’s £33 billion stock market value. Until recently conduits have been able to borrow short term at low rates and invest proceeds in higher-yielding longer-maturity securities.
Sources described Barclays’s use of the Bank’s emergency facility, which is priced at a punitive 1 per cent above base rate, as an operational issue and not related to fears over liquidity. It is the first time that the facility has been used since the credit market soured.
HBOS bails out own fund as effect of credit crisis spreads
Patrick Hosking
The credit crisis inched closer to the heart of the British financial system yesterday as HBOS, the banking group, disclosed that it was bailing out a vast in-house fund that has been struggling to finance itself.
HBOS, which owns Halifax and Bank of Scotland, said that it would extend credit to Grampian, a $37 billion (£19 billion) Jersey-registered debt- financed fund, until market conditions improved.
The move came as the Bank of England disclosed that it had provided £314 million of emergency funding to a financial institution that it did not name, but which is understood to be Barclays.
Grampian, a so-called conduit or credit arbitrage fund, holds asset- backed securities and normally finances its investments by issuing short-term commercial paper. However, demand for commercial paper has dried up as banks and investors shun all but the most risk-free of assets in a flight to ultra-safe government bonds.
Related Links
HBOS’s decision to finance Grampian from its own resources means that it may have to raise £19 billion within six months — and most of that within weeks unless credit conditions improve. The average maturity of the Grampian commercial paper is just 55 days.
HBOS said: “Grampian will use facilities provided by HBOS to repay maturing asset-backed commercial paper until such time as market pricing improves to a level acceptable to HBOS.” The group said that the action would “have no material adverse impacts on HBOS” and added that it had liquidity lines sufficient to repay the entire £19 billion.
Grampian’s assets are held on the HBOS balance sheet, but do not have to be marked to market, enabling HBOS to ride out the storm without having to make big writedowns, according to one well-placed source. The fund is thought to have only about $300 million in securities backed by American sub-prime mortgages.
Many banks have built up conduits in recent years, but Grampian is the biggest in the world, equivalent to 57 per cent of HBOS’s £33 billion stock market value. Until recently conduits have been able to borrow short term at low rates and invest proceeds in higher-yielding longer-maturity securities.
Sources described Barclays’s use of the Bank’s emergency facility, which is priced at a punitive 1 per cent above base rate, as an operational issue and not related to fears over liquidity. It is the first time that the facility has been used since the credit market soured.