The GFC Can be Solved.....

ILW

Bringing back prison for people who fail to repay debts would tighten things up a bit.

wastedtalent

You cant just try to shave everyones savings, those on the ball with withdraw all their money before it started, and those not on the ball would loose everything when the former collapse the banking system.

Thrugelmir

RenovationMan wrote: »

The new owner would have boughtit for £225k and so would require a much smaller mortgage than my £253k one, even if they arranged a 100% mortgage.

Still doesn't resolve the issue of reducing debt levels if you applied this across many borrowers. As there isn't the credit funding to support such an exit from the property market.

If you take the nationalised lenders alone. Over 50% of the current UK mortgage debt is on the books of lenders who are contracting their lending books.

StevieJ

Generali wrote: »

It's easy to mock.

What's another solution to the current travails though?

PS I told you that you wouldn't like it!

I think I would rather let the market decide where the irresponsible loans are, small bank failures should be left to go to the wall, large banks nationalised with no compensation, then sorted out and refloated on the stock market. BTW I would remove the bank account guarantees and somehow allow bank directors be sued for damages ( lift the corporate veil in certain circumstances).

Really2

ILW wrote: »

Bringing back prison for people who fail to repay debts would tighten things up a bit.

With the average year in prison costing tax payer £41,000 per place that solution would not sit well with those that work or have money.

Thrugelmir

StevieJ wrote: »

large banks nationalised with no compensation, then sorted out and refloated on the stock market.

Which banks are you referring to?

ILW

Really2 wrote: »

With the average year in prison costing tax payer £41,000 per place that solution would not sit well with those that work or have money.

These would be more like camps where friends and relatives had to pay for the debtors keep. Would hardly be used if people actually thought about tye consequences before running up the debts though.

Really2

ILW wrote: »

These would be more like camps where friends and relatives had to pay for the debtors keep. Would hardly be used if people actually thought about tye consequences before running up the debts though.

If you can't see the wrong in that you should have no problem seizing savings in reality.

Just as harsh, but easier to implement and at less cost.

Not what I want to happen, but if you have no problem jailing people for debt a similar society would have no problem taking from those not in debt as well.

If it would be hardly used, how does it get us out of the current situation? the problem is not more debt but current levels.

Joe_Bloggs

kabayiri wrote:-

This does sound like the debt cancellation policies in place during Biblical times.

Now, I might be wrong on this, but their policies seemed to guide them through several millenia.

Please enlighten the MSE readership as to the biblical policy and the overall success of it.

J_B.
ILW wrote:-

Bringing back prison for people who fail to repay debts would tighten things up a bit.

Check out Little Dorrit.

Thrugelmir

Generali wrote: »

It's easy to mock.

What's another solution to the current travails though?

PS I told you that you wouldn't like it!

The change is in progress already. Whether we like it or not. Very basic changes of financial policy are rippling through the system. Chaos theory does not require a volcanic eruption to effect change.