Massive bailout for banks: Get ready for inflation.

merlinthehappypig

I haven't posted for a while because of other issues, but it's interesting to see how much worse things have got, even in that short space of time.

Much has been said about the difficulties of selling a house in the current market, but we have returned home today to yet another failed purchase attempt.

That's three of the four houses we have tried to buy in the last 3 months or so that have failed to progress to completion because the seller's won't, or can't, move.

We had one refuse to even start the process until they found somewhere, even if it takes months. One where the chain collapsed because two people couldn't get the mortgages they agreed in principle and today's entrant for the stupidity hall of fame where they failed to mention a serious neighbour dispute and said they can't find anywhere to buy 'because of the low price they were forced to accept'. At least this one was a little different as they quoted the bible in their letter to justify telling us about the dispute rather than the solicitor (don't ask......).

This house was being purchased on a 15% LTV, mortgage offer agreed (which has gone up 0.35% since we applied) and yet another £1000+ in wasted survey and legal fees up in smoke.

I think someone is trying to tell us something or at least having a good laugh at our expense.

Seriously I despair at trying yet again. We are the next best thing to cash buyers, yet can't find anyone willing or able to sell.

These people must be wearing the world's largest pair of blinkers.

tomstickland

http://news.bbc.co.uk/1/hi/business/7351073.stm

The Bank of England is poised to launch a new lending programme for UK banks in an effort to break the logjam in the credit market, the BBC has learned.

merlinthehappypig

dolcevita wrote: »

Can't move is the problem here merl.

People no longer have savings or any "slack" in their finances. All the money they have is tied up in their house in the form of "equity"

And this perceived equity (which is not really money) is all they have to spend on their next house.

Or they need the extra to repay the debt on their existing house which has been spent through MEWing. So their is no room to manoevre. And without massive HPI they have nothing.

It is pathetic.

So, they (and HPI cheerleaders) expect buyers have to pay inflated prices and get into massive debt because sellers have overstretched themselves and now expect buyers to pay for it.

It's pathetic.


F*ck off is what I say. Why should I and other sensible, prudent, financially discilplined people have to pay the price for your greed and stupidity.



and if anyone wants to say I am making sweeping generalisations, you can F*ck off as well. Because I know it to be true of a large part of the population.



(excuse my language, I don't mean to be offensive, but this type of thing annoys me because it is symptomatic of the attitudes that have got us to this situation)

You've said what we feel - I didn't express it like that because, quite frankly, we've had just about the worst week ever and simply don't have the strength or inclination to care any longer.

It's a stupid time to buy, but we really need to buy because of family circumstances.

I wouldn't normally wish financial misery on others, stupid or otherwise, but if they can't see what is happening then they deserve what they are going to get.

We'll sit on our money and come back in when the time is right.

neverdespairgirl

!!!!!!? wrote: »

Of course it can go down too but probably not so fast that you can't minimise your losses by selling it, if you chicken out.

If it goes back to $850 I'll be taking a punt.

Unlike houses, of course, it's a very liquid asset.

Not for me personally, I'm too risk adverse.

neverdespairgirl

merlinthehappypig wrote: »

You've said what we feel - I didn't express it like that because, quite frankly, we've had just about the worst week ever and simply don't have the strength or inclination to care any longer.

.

Much sympathy - you are in a difficult position.

Generali

tomstickland wrote: »

http://news.bbc.co.uk/1/hi/business/7351073.stm

I don't see how the Government morally can bail out any bank before the equity holders are wiped out. That's what happened with NRK and that's what should happen to any other insolvent company.

The banks will carry on paying dividends to their shareholders (for an example of why look what happened after BARC cut its dividend in the 90s) yet we're taking on all the risk (presumably).unless the BoE is going to hit the banks with margin calls each time the value of the assets they're swapping drops in value.

obsessed_saver

Why can't the government just offer mortgages directly to people? At least they'd cut out the greedy banks in between.

Neillgb

So the BOE have given the banks the opportunity to offload their dodgy invesments on the taxpayer. Call it offering bonds so it sounds like a solid investment. 'Get out of jail free' card is more appropriate. Loads of bubbly in the bank boardrooms tonight, yet another opportunity to abuse their customers/taxpayers!

dean_ham

Trollfever wrote: »

Just testing my new signature.:hello:

nice sig very fitting

John_Pierpoint

Special thanks to !!!!!! & Generali, who seem to have a insight into how things will pan out.

Just one plea, when posting alphabet spaghetti, please give us ordinary mortals some sort of "naming of parts" so we can keep up: http://en.wikipedia.org/wiki/Residential_mortgage-backed_security.

Am I right in thinking that our American cousins had little or no experience of variable rate mortgages until the sub-prime mortgage crooks came on the scene? That goes some way to explaining why the victims appear to us to be unbelievably stupid? (and possibly why those highly paid rating agency staff could not not recognise a "pig in a poke")

Similarly perhaps the novelty of making a double turn out of selling a mortgage to a mortgagor and then selling the debt, with an annual service charge, as an "investment", made some UK banks fool hardy?

In some ways it feels like the "names" at Lloyds, who got a return from the crops on the farm and another from pledging its capital value as a guarantee on insurance policies. (Another imported American disaster - "Nobody told me that juries can set damages for people crippled/killed by industrial pollution").

Stagflation is here and we are all going to suffer ?!?