Darling considers second bailout...

dopester

SGE1 wrote: »

to allow people to start up businesses, invest some of their disposable income in property

If you won the lotto with say £12 million to play with.... would you start a business or building society lending your money allowing people to buy houses and apartments.

Some believe property to be significantly over-valued due to a massive 10 year credit expansion boom, and expect property prices to significantly correct over the next few years. Circa £35,000 in one year alone on average price house.... some people are waking up to reality.

You wouldn't worry about your borrowers losing their jobs, defaulting and so on? Lend away if you don't see any risks.

Cat695

SGE1 wrote: »

Not lending per se, just lending to the wrong people. I think there should be a reasonable level of lending, to allow people to start up businesses, invest some of their disposable income in property - these things shouldn't only be available to the very very wealthy.

But the reason why people are wealthy is because they are the least free with their money....and thats a fact

someone who is wealthy is not going to need to borrow money surely and especially not at high interest rates, of which the gov will do with them if they nationalize banks....look at NR for example...nice high interest rates

globalds

just trying to jump along to the next problem .
So the Government end up eventually owning a controlling share of a large percentage of the high street banks and force them to start lending.....
The politicians force the banks to lend to UK Businesses .....This is maybe repeated in half the countries on the planet ..
Isn't that Protectionism through the back door ...The very thing the free market economists are warning us against ?

mvengemvenge

SGE1 wrote: »

Not lending per se, just lending to the wrong people. I think there should be a reasonable level of lending, to allow people to start up businesses, invest some of their disposable income in property - these things shouldn't only be available to the very very wealthy.

I understand your angle, but the difference is that if someone chooses to save with a mutual or bank, they do so on the understanding that it will also be lending to people and that there are certain risks involved.

However, the taxpayer has not made a choice to put money into these banks, that's the difference.

lynzpower

You wouldn't worry about your borrowers losing their jobs, defaulting and so on? Lend away if you don't see any risks

this is really the issue for me .

If I were any high st bank right now, nationalised or not, Id be looking at the environment and saying - right then, we have 750,000 reposessions on the horizon for 2009. We as say HSBC for example would estimate say 10% of those repos will be ours. Ok, so we potentially have 75,000ish properties COMING INTO repo within the next 12 months. If we presume that each property is worth 200k - then our potential portfolio of repo stock from 09 alone is likely to be somewhere in the region ( on the fag packet) of £15000000.

If I were any bank Id want to see the environment such that people just start paying money back that they owe and start banking it nad limiting liability before lending it again to people who potentially cant pauy. Giving people potentially unserviceable debt to lodge on an unsellable asset could be the difference between the bank surviving and not.

However the difficulty is that banks wont lend not only to each other ( which Id like to see stopped anyway LOL) but for buying properties off each other.

baileysbattlebus

globalds wrote: »

just trying to jump along to the next problem .
So the Government end up eventually owning a controlling share of a large percentage of the high street banks and force them to start lending.....
The politicians force the banks to lend to UK Businesses .....This is maybe repeated in half the countries on the planet ..
Isn't that Protectionism through the back door ...The very thing the free market economists are warning us against ?

Isn't it the "free market" and "casino capitalism" that brought us to this in the first place? Along with greed, excessive debt, wild promises, speculation, lying and cheating. And I'm not talking your ordinary Joe here, I mean the commercial banks the investment banks, the hedge funds etc, the short selling that could cause a perfectly viable business to go to wall. Fortunately it didn't always work.

Hedge funds lost as much as €30bn (£24bn) after their move to short sell VW backfired when Porsche revealed it had secured 74pc of the equity and planned to seize control of its rival. This sent the shares soaring as funds scrambled to buy VW shares to close their short positions.

The little regulation we proved ineffective especially in finding "off balance sheet" toxic assets - hopefully HMG will make this illegal.

I thought protectionism was to protect companies and the country from foreign competition by using tariffs and import restrictions - introduced in 1930 by Smoot-Hawley the US imposed it during the Great Depression - it back fired though as other countries just introduced theri own tariffs, stopped buying goods produced in the US and ultimately led to the collapse of world trade.

Is keeping a company trading protectionism - is the US bail out of Chrysler and GM protectionism -

Is keeping a bank trading protectionism or guaranteeing savers deposits

Is forcing banks to lend money to businesses protectionism?

I ask because although I understand the protectionism of the Smoot-Hawley tariff, I don't really understand protectionism in the financial sector

ad44downey

Even more money down the drain. Labour really are determined to drive this country into financial oblivion

amcluesent

>The little regulation we proved ineffective especially in finding "off balance sheet" toxic assets - hopefully HMG will make this illegal.<

Clown won't risk that; people will start asking about the off balance-sheet wheezes he's been up to! All those PFI schemes for schools and hospitals mean taxpayers will be shelling out for another 25 years, at a total cost at least 300% greater than a straightforward public-sector works.

All aboard the ship of fools!

wymondham

This all brings to light how delicate our economy is. It does not take much to cause a problem in this day and age, when most of it is proped up with little more than 'confidence'.

I have this mental picture of Brown & Darling being crazed doctors, with a patient with a very bad cold comes in. They go through the A-Z list of drugs prescribing everything to ensure the patient gets better, when in reality they would get better on their own given time, and the drugs don't work but cost a fortune! You'd call these doctors incompitent would'nt you?!

Rochdale_Pioneers

The banks have have gone from lending far too much money to anyone to stopping lending money to almost anyone. Noone wants them to go back to irresponsible lending but without access to any credit a lot of good businesses will go under due to lack of cashflow.