Mortgage bail-out rallies markets, Light at the end of the credit crunch tunnel.

ultra10

Anyone heard of the "Dead cat bounce" well thats what this is, property prices have a long way to go down yet, we are only just entering what will be quite a long recession.. but hey for thoes brave enough to take on a mountain of debt at the moment, GOOD LUCK , I fear you might need it

Dan:_4

ad44downey wrote: »

Lazarus, sorry I mean justpurchased, I trust you'll be putting your money where your mouth is and buying banks and building company shares?

Or at least you would do so if you had any money .

Please, can't justpurchase post a piece of economic news like everyone else? On no, I forgot the golden rule - NO POSITIVE NEWS ON MSE!

Dan:_4

ultra10 wrote: »

Anyone heard of the "Dead cat bounce" well thats what this is, property prices have a long way to go down yet, we are only just entering what will be quite a long recession.. but hey for thoes brave enough to take on a mountain of debt at the moment, GOOD LUCK , I fear you might need it

Crytsal ball out again Ultra? - I wish I had the ability to see into the future, i'll make a fortune.

ad9898_3

Dan: wrote: »

Don't be foolish, no one is saying that.

I think you would be surprised at how many "foolish" people there have been in the last few years, add to this CC debt, personal loans, inflation, energy bills, petrol etc... and last but not least much higher mortgage costs for people coming off fixed rates getting back to 2007 peak will be a long time coming.

ultra10

The latest U.S.government bail out offers a blank cheque to ... who, exactly? The U.S. taxpayer will fund this latest version of private profits followed by socialised losses. Who gains?

Not the taxpayer; the losses are incalculable, according to the Paulson and Lockhart.

Not the housing market; this rescue does nothing to alter falling demand, and oversupply.

Aha! There's the winner: the U.S. government and the banks who have bought some time to prepare an orderly exit for some. I expect worse news to come out after the November election.

A poison chalice will be handed to the next U.S. President; a country without a credible currency; an economy bludgeoned by debt; hostile taxpayers; foreign investors fleeing.

Domestic recession, imported inflation, and emergency retaliatory measures abroad if the falling $ of 2009 threatens global financial stability.

Forewarned is forearmed, I think. Don't trust this 'bail out'. This merely postpones the problem: how to manage debt deflation at a time of persisten higher food, fuel and utility prices.

We mere mortals must be cautious, and ignore the sirens, luring us back to the rocks !!! IMO

Cannon_Fodder

I am struggling to understand how the need of a government to buy-up half of that country's mortgage business is good news.

Ok, confidence is a factor. This has an appearance of helping confidence.

But what happens when enough people start to wonder - "what about the other half of the mortgage market?"

Will people start to think "That sector is not as secure as the bought-up half, so lets shift away from those companies" ? - companies with better levels of sub-prime, which were "safe", start to become "unsafe" as their customers flee to the "now-safe" F&F...

Or questions like, "if it was bad enough for the government to have to step in, what else is there out there that is going to be hit next - I know, I'll pull out of the stock market (despite taking a 10% hit this year), so at least I'll come out of it ahead of the people who think the light at the end of the tunnel has been reached..." - enough people do that, and you have a stock market crash, to tack onto the "end" of the housing crash.

Possibilities ?

Dithering_Dad

ultra10 wrote: »

Anyone heard of the "Dead cat bounce" well thats what this is, property prices have a long way to go down yet, we are only just entering what will be quite a long recession.. but hey for thoes brave enough to take on a mountain of debt at the moment, GOOD LUCK , I fear you might need it

I'm also of this opinion. I'm waiting for the cat bounce to show signs of a slow down and then my entire pension portfolio is going into a cash fund. I'll continue to invest in my usual funds with my monthly premiums but will protect the bulk of my pension in cash.

The US cannot suddenly just find trillions of Dollars out of nothing to save these two companies, they will either have to borrow more or raise taxes. Both will plunge them and us into deeper recession.

This is it guys, this is the big one. Get your tinfoil hats and run into the basement.

justpurchased

Cannon_Fodder wrote: »

I am struggling to understand how the need of a government to buy-up half of that country's mortgage business is good news.

Ok, confidence is a factor. This has an appearance of helping confidence.

But what happens when enough people start to wonder - "what about the other half of the mortgage market?"


Possibilities ?

Half the exposure is better than all. + They are the biggest sub prime lender.
Surely this is good news for our banking sector, what is wrong with some of you! Do you not want that! Do you want banks to fold? Straight answers would be nice.

Cannon_Fodder

I don't believe anyone WANTS companies to fold etc.

But equally lots of posters here didn't WANT house prices to be artificially inflated to the levels they reached.

Some things are necessary to reach an equilibrium and start again.


Like the news that Nationwide are "protecting" Debyshire and Cheshire BS's, bringing them under their wing...well, isn't that just putting all your eggs in one basket?

"When" something hurts Nationwide, a bigger proportion of the market is hurt than before. Instead of accepting a small percentage of pain, today.

Back to F&F, maybe that's the problem over there - too much business in too few hands...that needs to be learnt from and avoided. Some lessons have to be painful to be heeded...

justpurchased

Cannon_Fodder wrote: »

I don't believe anyone WANTS companies to fold etc.

But equally lots of posters here didn't WANT house prices to be artificially inflated to the levels they reached.

Some things are necessary to reach an equilibrium and start again.


Like the news that Nationwide are "protecting" Debyshire and Cheshire BS's, bringing them under their wing...well, isn't that just putting all your eggs in one basket?

"When" something hurts Nationwide, a bigger proportion of the market is hurt than before. Instead of accepting a small percentage of pain, today.

Back to F&F, maybe that's the problem over there - too much business in too few hands...that needs to be learnt from and avoided. Some lessons have to be painful to be heeded...

But do people on here really believe my post will actually stop house prices from falling?

I am just surprised that any bad news is greeted with open arms.
Any good news and some of you go mad and accuse people of mad assumptions, is there a rationality problem on here (not aimed at yourself)