Did anyone loose money with the Northern Rock instability?

thebeak

I didn't hear anything on the news...Was what the Bank of England did enough to prevent any loss to people with mortgages etc?

Aegis

No-one with a bank account or mortgage lost out at all. However, many investors lost a LOT of money through the devaluation of their shares. Some people had the misfortune to buy at 1200p and now still hold them at the 85p level a loss of over 90% of their investment.

However, none of the people who were standing outside branches for hours to access their money would have lost anything at all had they stayed where they were.

thebeak

Sounds like the mass hysteria contributed the the share prices plumetting - not a good situation for those involved!

Aegis

thebeak wrote: »

Sounds like the mass hysteria contributed the the share prices plumetting - not a good situation for those involved!

Share price is pretty much entirely dictated by market opinion. After all, the shares are bought and sold at prices that the shareholders are willing to buy/sell at!

Mithos

thebeak wrote: »

Sounds like the mass hysteria contributed the the share prices plumetting - not a good situation for those involved!

Exactly... perhaps someone can give an example, but as far as I know no one (in the sense of a customer) has ever lost money from a Building Society or a Bank going "bust". People just go panic mad, whenever things run out people go nuts, petrol strikes etc as an example.

jon3001

Mithos wrote: »

Exactly... perhaps someone can give an example, but as far as I know no one (in the sense of a customer) has ever lost money from a Building Society or a Bank going "bust". People just go panic mad, whenever things run out people go nuts, petrol strikes etc as an example.

Never heard of Bank of Credit and Commerce International (BCCI)?
http://en.wikipedia.org/wiki/Bank_of_Credit_and_Commerce_International

Although I belive creditors got 'most' of their money back. Eventually. I'm sure some people queueing outside NR will remember this well.

Bernard_Coleslaw

jon3001 wrote: »

Never heard of Bank of Credit and Commerce International (BCCI)?

..which didn't go bust.

It was closed down due to dodgy practices.

jon3001

Okay. But if they hadn't stepped in...

cube101

Sounds like the mass hysteria contributed the the share prices plumetting - not a good situation for those involved!

spot on there but im afraid anyone buying from 1200 and holding all the way down was asking for trouble. I bought some of these my self at about 700 but had a pretty tight stop loss as i know that buying against the trend and trying to pick a bottom is very risky so you need to have a point where your going to get out. I trade mainly forex but do also hold some equitys but have the same general ethos for both that in any market at any time, anything can happen. No matter how much you think you might know the future you dont, so alway define your risk and stick to it like glue! the old trading saying of 'cut your losses and let your profits run' is THE most important rule what ever you trade or invest in. Always know what your willing to lose.