Credit Card Bond Sales at Zero, First Time Since 1993

WTF?_2

mean_momma wrote: »

As a 'hard pressed saver' I know not a lot about esoteric bonds, but anyone with common sense wouldn't touch 'hard pressed borrower' bonds with a barge pole! Especially since it appears not to be politically correct to expect the debt to be paid!

Indeed - that will be the inevitable upshot of the government forcing (some) lenders to provide free and easy credit to 2007 levels when the market simply won't support that......

WTF?_2

moanymoany wrote: »

Absolutely luvvy, you speak the truth my faithfull Indian companion! As I said in a post the other day, I think that a lot of people are going to max out their cc's to have a 'last good Christmas' and declare bankruptcy in the new year.

Did anyone see the Credit Crash Britain programme last Thursday?

http://www.bbc.co.uk/iplayer/episode/b00fcvrl/Credit_Crash_Britain_Money_For_Nothing/

Some prize credit junkies there. Best was the guy who ran up £62k of debt on his cards and now plans to declare himself bankrupt having enjoyed a life of luxuries and fancy foreign holidays. Even better, he's now set himself up as a debt advisor :rotfl: You gotta admire his chutzpah.


But to really make you shudder, IIRC the BoE are taking credit card debt as collateral (as well as such other high quality stuff like car loans) from the banks in exchange for treasury bonds under their emergency liquidity scheme - which must be up to something like a couple of hundred billion quid now..... So don't worry, the British taxpayer is there to carry the can for the UK credit industry.

bubblesmoney

!!!!!!? wrote: »

But to really make you shudder, IIRC the BoE are taking credit card debt as collateral (as well as such other high quality stuff like car loans) from the banks in exchange for treasury bonds under their emergency liquidity scheme - which must be up to something like a couple of hundred billion quid now..... So don't worry, the British taxpayer is there to carry the can for the UK credit industry.

:eek: wont be long before these treasury bonds have a lack of buyers. probably my oh was wise in preventing me from disposing off the wedding jewellery which she never uses. if the fuse blows on these treasury bonds then all bets will be off regarding any savings in uk banks and gold prices will go thru the roof, probably better to hang on to any gold jewellery left and to buy more instead of saving in an account giving less than inflation rates. atleast the jewellery wont disappear into think air if the banks go bust and govt stuck with worthless bonds no one in their right minds would want to buy and consequently govt wont be able to honour the bank defaults under the protection scheme.

WTF?_2

bubblesmoney wrote: »

:eek: wont be long before these treasury bonds have a lack of buyers. probably my oh was wise in preventing me from disposing off the wedding jewellery which she never uses. if the fuse blows on these treasury bonds then all bets will be off regarding any savings in uk banks and gold prices will go thru the roof, probably better to hang on to any gold jewellery left and to buy more instead of saving in an account giving less than inflation rates. atleast the jewellery wont disappear into think air if the banks go bust and govt stuck with worthless bonds no one in their right minds would want to buy and consequently govt wont be able to honour the bank defaults under the protection scheme.

That's my thinking exactly - even before the latest debacle there were rumblings about the Treasury having a tough time shifting new bonds ion the future. Recent events (slashing sterling interest rates) are going to make it an even tougher sell.

Once the govt can't sell its bonds, we are going to see an all-out crisis.

Anyone want to bet that Gordon ends up cap in hand to the IMF?

bubblesmoney

!!!!!!? wrote: »

Anyone want to bet that Gordon ends up cap in hand to the IMF?

the IMF would be extremely stupid to lend to a govt that insists on banks to charge less interest in an extremely risky credit situation and also at the same time they insist for the banks not to chase defaulters, plus the govt wants to bail out banks that had high risk stratergies. why would any sane person lend to someone who doesnt learn from their mistakes and spends spends spends in the goodtimes and exhausts the savings and come the bad times tries to get out of trouble by !!!!lessly spending more by borrowing more. if the govt cant save in good times and bad times then i wonder how it plans on paying back any loans. probably by printing notes but lenders wont be that stupid unless they have a gun to their head.

the usa doesnt seem to have learned as well. people buying houses should be responsible for the gains and losses if the prices change later. but there from the looks of it if prices rise they keep the profits but if the price crashes then they hand back the keys and the banks take the losses. this situation stands even after the hundreds of billions of dollars of bailouts. i wonder why any sane sovereign investment fund or any investment fund manager worth a penny worth of common sense even considers to put even a penny worth of their funds into any usa fund that invests in the usa property market under such rules at grass root level. guess common sense isnt that common with the high flying fund managers who just run after short term bonuses in their pay packages and to hell with fund valuations. the day i heard about the usa scenario about handing in the keys and the banks taking the hit and unable to chase the borrowers for the shortfall i decided i wouldnt ever invest in any fund that had even a pennys worth in usa real estate or its securities. the sooner everyone realises this the less they will get burnt by stupid policies of some governments regarding loan recoveries. if someone take a loan they should pay evevery penny back till their shirts are off their backs and keep paying till they repay every penny of someone elses money that they borrowed. there should be no free lunches for anyone.

mewbie_2

Are you sure it's not the first time since 1955 - he asked hopefully.

tomstickland

So, er, basically it's going horribly wrong. I can't resist the pleasures of rubber necking.

One thing I've noticed about the "house prices will never crash" posters is that even when prices are falling they are still in denial. I expect Gordon Brown to be like that - even if the whole thing comes falling down he'll be standing in the middle of the rubble saying "well, it was nothing to do with me."

poppy10_2

geoffky wrote: »

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Nov. 5 (Bloomberg) -- Credit card companies were shut out of the market for bonds backed by customer payments in October for the first time in more than 15 years, as investors shunned the debt amid the global credit freeze.

Did anybody even try to read the article? The link doesn't work.

bubblesmoney

poppy10 wrote: »

Did anybody even try to read the article? The link doesn't work.

try this link it works http://www.bloomberg.com/apps/news?pid=newsarchive&sid=awS5vZQvmwd4

Credit Card Bond Sales at Zero, First Time Since 1993 (Update1)

By Sarah Mulholland
Nov. 5 (Bloomberg) -- Credit card companies were shut out of the market for bonds backed by customer payments in October for the first time in more than 15 years, as investors shunned the debt amid the global credit freeze.
A weakening job market and a looming recession are making it harder for consumers to make monthly payments, eroding confidence among investors about the safety of credit-card-backed bonds. It's the first month since April 1993 that there have been no sales, according to Wachovia Corp. data. Issuers sold $17.1 billion of the debt in October 2007, the data show.