i have said this since 2008 and still don't see why it won't work...

nickj_2

The_White_Horse wrote: »

so? the banks were bailed out for billions, so they can suck it up.

and where will that money come from ,

Generali

The_White_Horse wrote: »

the Govt should create a law that states that all people who took out a mortgage from 2000 onwards should pay it back at 1% interest.

the requirement being it must be a repayment mortgage.

a) many people will get more money in their pocket to spend to kick start economy

b) the banks get their money back plus a small amount of interest

c) the problem of thousands of interest only loans evaporates.

win, win, win.

I thought you were anti-Socialism. It's a terrible idea.

a) Savers will have less money as there will be no money to pay them and no money available for dividends, coupons etc
b) It's not the banks' money, it's their depositors and owners of bonds and equity. They won't get their money back.
c) Maybe but at a stroke you force every bank covered by the rule into insolvency.

Lose, lose, lose.

ruggedtoast

The_White_Horse wrote: »

so? the banks were bailed out for billions, so they can suck it up.

A lot of the bailouts were the taxpayer having to guarantee their worthless assets for billions though, rather than actual money.

This enabled them to keep trading and paying themselves mega salaries while encumbering the state with a selection of zombie banks.

http://en.wikipedia.org/wiki/Zombie_bank

ILW

nickj wrote: »

and where will that money come from ,

TWH must be a socialist. They never worry about where the money will come from.

chewmylegoff

The_White_Horse wrote: »

i'd like to see the maths before accepting these claims. also, how much would they get back from turning interest only into capital repayment?

i like that. you can just make some sort of lunatic proposal, and it's up to everyone else to prove that it wouldn't work. how about you produce the maths which demonstrates that your proposal is in any way feasible? would be helpful if you could do so by reference to the cost to the bank of financing the mortgage which it will only be allowed to charge 1% interest on.

The_White_Horse

didn't the banks make profits last year and this year? i though I read Barclays made a profit this year of £4bn.

ILW

The_White_Horse wrote: »

didn't the banks make profits last year and this year? i though I read Barclays made a profit this year of £4bn.

Barclays did not get government bail out money.

ruggedtoast

ILW wrote: »

Barclays did not get government bail out money.

They are all beneficiaries of the government underwriting the banking system without demanding any actual change.

Generali

ruggedtoast wrote: »

They are all beneficiaries of the government underwriting the banking system without demanding any actual change.

That's socialism though: people benefit due to client groups being targeted for 'help'.

That someone belongs to one of those client groups doesn't mean that they should lose out later. Better that the client group didn't exist in the first place.

CLAPTON

There seems some merit in the government printing money (QE) and distributing it fairly rather than giving it to the banks.
I see no particular reason why it should go specifically to those with mortgages rather than those renting or retired or in education or unemployed.