Nick Robinson tells Obama that Gordy keeps blaming USA...

chucky

ad9898 wrote: »

I think we are in just as deep, if not deeper than the Americans, they may have toppled the first 'domino', but we were playing the same game and lined all ours up next to the Americans.

So would Bradford & Bingley, HBOS, NR, RBS all have been absolutely fine if it weren't for American subprime ?, were their lending practises prudent ?, were they viable if we would have had any downturn in the economy ? would they have been totally safe going forward into the future ?

Or were they all playing 'The Pyramid Game' ?

I think the answer is obvious, America is a convenient scapegoat, for an atrocious business plan that was unsustainable.

disagree - HBOS and RBS was mostly exposed to commercial debt except that RBS had the ABN protfolio to worry about, Bradford & Bingley was a combination of commercial and BTL, NR we know.

The US was a much sub-prime bigger issue - 30% of debt is sub-prime. that's a big percentage where you can walk away and then not be responsible for your debt and the property invariably gets knocked down.
The UK is less than 20% sub-prime, where you are more responsible for that debt and the banks have more of an amount to recover

cannot really compare excpet that the banks did not have liquid assets.

cogito

Did anyone else get the impression that Barry O was simply repeating what someone was saying in his earpiece. To me, he looks totally lost without his teleprompter.

chucky

ad9898 wrote: »

Securitisation was brought about by Citigroup, London. Something that Crash must have overlooked with his 'started in America' barbs.

securitisation has been around since Index trades were first traded - i think sometime in the late 1990s. these were a tranche of bonds in an index.
the development was when companies specific parts of debt and mortgage books were put into an index. this is what Citibank where good at, they weren't the first. plus Citibank London would have been operating under Citibank NA which is a US entity.

mewbie_2

Whatever the finer points of the argument I think it was a good question from one of 'our' journalists - I don;t believe they ask such things in the States. Obama handled it well, apart from an initial pause. But I think the use is genuinely to think through the question which he actually answered. Rather than a British politician who simply answers whatever question they hoped had been asked. And finally, Brown did well not to blush deeply and apologise.

treliac

mewbie wrote: »

Whatever the finer points of the argument I think it was a good question from one of 'our' journalists - I don;t believe they ask such things in the States. Obama handled it well, apart from an initial pause. But I think the use is genuinely to think through the question which he actually answered. Rather than a British politician who simply answers whatever question they hoped had been asked. And finally, Brown did well not to blush deeply and apologise.

I agree and, from what I've seen so far, he seems to manage this whilst maintaining a diplomatic and easy manner (even though he is a little hesitant and deliberate in his speech at times). He has an engaging smile as well, though you may not have noticed, being a man.

Wookster

cogito wrote: »

Did anyone else get the impression that Barry O was simply repeating what someone was saying in his earpiece. To me, he looks totally lost without his teleprompter.

I thought he handled it very well indeed. He showed himself to be the composed, well spoken statesman that Crash is not.

ad9898_3

cogito wrote: »

Did anyone else get the impression that Barry O was simply repeating what someone was saying in his earpiece. To me, he looks totally lost without his teleprompter.

Disagree, I don't think you can underestimate the difficulty of doing what he did and doing it well, take Crash for instance, a stuttering bumbling fool.

scousethife

Rochdale_Pioneers wrote: »

Brown may well be embarassed, but not because Obama is sitting there shocked and fuming.

Why is he embarrase then?

Its is cos he's Labour? cos I know I would be embarrased about that too

Dylanwing

Quality moment, Obama handled it as well as he could, and it just highlighted what a useless lightweight Brown really is.

beingjdc

Here's what Obama said in March 2008. I'm with Rochdale on this, Obama has absolutely no problem with the concept that it "started in America" - on George Bush's watch.

Ironically, it was in reaction to the high taxes and some of the outmoded structures of the New Deal that both individuals and institutions in the '80s and '90s began pushing for changes to this regulatory structure. But instead of sensible reform that rewarded success and freed the creative forces of the market, too often we've excused and even embraced an ethic of greed, corner cutting, insider dealing, things that have always threatened the long-term stability of our economic system. Too often we've lost that common stake in each other's prosperity. Now, let me be clear. The American economy does not stand still and neither should the rules that govern it. The evolution of industries often warrants regulatory reform to foster competition, lower prices or replace outdated oversight structures. Old institutions cannot adequately oversee new practices. Old rules may not fit the roads where our economy is leading. So there were good arguments for changing the rules of the road in the 1990s. Our economy was undergoing a fundamental shift, carried along by the swift currents of technological change and globalization. For the sake of our common prosperity, we needed to adapt to keep markets competitive and fair. Unfortunately, instead of establishing a 21st century regulatory framework, we simply dismantled the old one, aided by a legal but corrupt bargain in which campaign money all too often shaped policy and watered down oversight. In doing so we encouraged a winner take all, anything goes environment that helped foster devastating dislocations in our economy. Deregulation of the telecommunications sector, for example, fostered competition, but also contributed to massive over-investment.

Partial deregulation of the electricity sector enabled (inaudible). Companies like Enron and WorldCom took advantage of the new regulatory environment to push the envelope, pump up earnings, disguise losses and otherwise engage in accounting fraud to make their profits look better, a practice that led investors to question the balance sheets of all companies and severely damaged public trust in capital markets. This was not the invisible hand at work. Instead, it was the hand of industry lobbyists tilting the playing field in Washington as well as an accounting industry that had developed powerful conflicts of interest and a financial sector that had fueled over-investment. A decade later we have deregulated the financial sector and we face another crisis. A regulatory structure set up for banks in the 1930s needed to change, because the nature of business had changed. But by the time the Glass-Steagall Act was repealed in 1999, the $300 million lobbying effort that drove deregulation was more about facilitating mergers than creating an efficient regulatory framework. And since then we've overseen 21st century innovation, including the aggressive introduction of new and complex financial instruments like hedge funds and non-bank financial companies, with outdated 20th century regulatory tools. New conflicts of interest recalled the worst excesses of the past, like the outrageous news that we learned just yesterday of KPMG allowing a lender to report profits instead of losses so that both parties could make a quick buck. Not surprisingly, the regulatory environment failed to keep pace. When subprime mortgage lending took a reckless and unsustainable turn, a patchwork of regulators were unable or unwilling to protect the American people. Now, the policies of the Bush administration threw the economy further out of balance. Tax cuts without end for the wealthiest Americans. A trillion dollar war in Iraq that didn't need to be fought, paid for with deficit spending and borrowing from foreign creditors like China. A complete...

(APPLAUSE)

A complete disdain for pay-as-you-go budgeting, coupled with a generally scornful attitude toward oversight and enforcement, allowed far too many to put short-term gain ahead of long-term consequences. The American economy was bound to suffer a painful correction, and policy-makers found themselves with fewer resources to deal with the consequences. Today those consequences are clear. I see them in every corner of our great country as families face foreclosure and rising costs. I see them in towns across America, where a credit crisis threatens the ability of students to get loans and states can't finance infrastructure projects. I see them here in Manhattan, where one of our biggest investment banks had to be bailed out and the Fed opened its discount window to a host of new institutions with unprecedented implications that we have yet to appreciate. When all is said and done, losses will be in the many hundreds of billions. What was bad for Main Street turned out to be bad for Wall Street. Pain trickled up. And that...

(APPLAUSE)

... and that's why -- that's why the principle that I spoke about at NASDAQ last September is even more urgently true today. In our 21st century economy, there is no dividing line between Main Street and Wall Street.
The decisions made in New York's high rises have consequences for Americans across the country. And whether those Americans can make their house payments, whether they keep their jobs or spend confidentially without falling into debt, that has consequences for the entire market. The future cannot be shaped by the best-connected lobbyists with the best record of raising money for campaigns. This...

(APPLAUSE)

This thinking is wrong for the financial sector and it's wrong for our country. I do not believe the government should stand in the way of innovation or turn back the clock on an older era of regulation. But I do believe that government has a role to play in advancing our common prosperity, by providing stable macroeconomic and financial conditions for sustained growth, by demanding transparency and by ensuring fair competition in the marketplace. Our history should give us confidence that we don't have to choose between an oppressive government-run economy and a chaotic, unforgiving capitalism. It tells us we can emerge from great economic upheavals stronger, not weaker. But we can only do so if we restore confidence in our markets, only if we rebuild trust between investors and lenders, and only if we renew that common interest between Wall Street and Main street that is the key to our long-term success. Now, as most experts agree, our economy is in a recession. To renew our economy and to ensure that we are not doomed to repeat a cycle of bubble and bust again and again and again, we need to address not only the immediate crisis in the housing market, we also need to create a 21st-century regulatory framework and we need to pursue a bold opportunity agenda for the American people.