Northen Rock [Merged Threads]

Dithering_Dad

nilrem wrote: »

Some of the comments made by the 'merchants of doom' in this thread are absolutely ridiculous over the top and just helping people to panic, if the BOE had refused to help NR then there might be room for some concern but the BOE are backing NR How on earth could people's money be any safer!

I remember when the government used the gold reserves to prop up the ERM (Exchange Rate Mechanism), that didn't turn out too well. As I remember they used 6bn and still it failed.

How long with the BoE prop up NR - to the tune of 6bn?

goshdarnit

I remember a few months back Fox news (bad old Fox) were saying (when the US housing market was taking a fall) "now is the time to buy houses". Few weeks before when the stock market hit a massive fall, they were saying "no, now is the time to invest".

Now, being a total purveyor of doom, I read this as saying "please don't panic, although all our pundits have got out the market weeks ago, we really don't want you to as it could affect the economy, and we need ill-informed punters like you to keep the market from collapsing".

You watch the tv now and everyones saying "nothing to worry about", but no ones asked them if they still have money in NR, or what they would really do.

Do I think NR will collapse, it shouldn't, but the more people panic the more chance it has of doing so. What would I do, I would guarantee my safety and would have removed my cash already.

Now, if I didn't wantthis to affect a lot of other economic factors, I would tell others not to worry about it, risking there money, not mine.

harryhound

littlesaint wrote: »

I'd just like to point out that NR shares were 300p on mutualisation ten years ago. They remained at that level for about five years before they started their climb to 1200p. So people who were in it from the start, like me, have lost nothing.

Completely faulty reasoning. You have lost 900P just like me.

Dithering_Dad

it's gone pretty quite on here.. do you reckon the only people still in here are we none NR customers and everyone else has gotten their coats on and are right now stood in a queue on their high street?

Well, apart from those customers who trust NR and will end up walking home from Middlesborough

harryhound

Nick_C wrote: »

I think people who are saying NR could not possible go bust - the Govt will not let it happen - are being naive. Anything is possible, and as those of you who remember Black Monday/Wednesday will recall, the Govt can't control free market forces.

I consider myself lucky to have drawn my £32K from NR at the start of this week and put it into Tesco for an extra 0.2%. Right now, if I still had savings in NR, I would move it to Sainsburys. The loss of 0.05% interest is nothing compared to the possible loss of 10% capital.

As far as I know, both Tesco and Sainsbury are grocers, I didn't know they could call on an overdraft with the B of E?

Surely their deposits are a bit like NR's sub-prime mortgages; rapidly passed on to someone else to look after. Take a commission and find a "bigger fool" to carry the can .

isofa

cm233lh wrote: »

Withdraw the money and buy some more shares?

That may well be a good move, provided you don't mind the risk, personally I'd wait for a little longer and see what the share price does, and see if any takeover bids are mentioned, but no doubt you'll be able to pick-up some bargains if you are a canny investor!

[Deleted User]

harryhound wrote: »

As far as I know, both Tesco and Sainsbury are grocers, I didn't know they could call on an overdraft with the B of E?

Surely their deposits are a bit like NR's sub-prime mortgages; rapidly passed on to someone else to look after. Take a commission and find a "bigger fool" to carry the can .

Tesco IS royal bank of scotland, and sainsburys IS halifax bank of scotland :T :rotfl:

Nick_C

harryhound wrote: »

As far as I know, both Tesco and Sainsbury are grocers, I didn't know they could call on an overdraft with the B of E?

Tesco Personal Finance is a division of Royal Bank of Scotland (Natwest).

Sainsbury's Bank is a division of Halifax/Bank of Scotland

Something to bear in mind if concerned about the guarantee offered if an institution collapsed - Tesco/RBS is the same institution; HBOS/Sainsburys is the same institution (I'm talking about the Banks, not the supermarkets!)

Aegis

Anyone interested in game theory might notice some interesting resemblance to a multi-player variant of the Prisoner's Dilemma going on at the moment.

The best outcome for everyone is achieved when most people don't panic and hold on, but the fear of being one of the few who DOESN'T bail is driving people to contribute to the event they so want to avoid at all costs.

I read up on game theory while bored recently; it's quite interesting how it ties in to a lot of events like this.

Anyway, apologies for the little aside, but I thought people might like something that isn't doomsaying to read!

purch

I remember when the government used the gold reserves to prop up the ERM (Exchange Rate Mechanism), that didn't turn out too well. As I remember they used 6bn and still it failed.

........your memory seems to be failing you.

The Bank didn't use the nations Gold Reserves in 1992..........they intervened in the FX markets, buying sterling in a vain attempt to 'buck the market' which as any fool knows is impossible !!!

At the time Sterling was overvalued, just as yesterday Northern Rock was overvalued.

The Bank of England is not spending a penny 'propping' up Northern Rock....in fact they are making a tidy profit as NR is paying a hefty 'margin' for the funds they are borrowing.