Financial Meltdown (The World)

[Kooky]

I read a bit more and not 100% sure anymore but this
http://www.fscs.org.uk/consumer/key_fac ... on_limits/

confirms it. Or calll +44 20 7066 1000

Thanks again, Lichty, but I may have to. Unless I'm missing something obvious (don't...) I really don't read it the same way you do.

[Burbage]

How timely:

http://www.telegraph.co.uk/finance/fina ... apses.html

[daffodil]

Some relief, albeit temporary?

http://www.reuters.com/article/newsOne/ ... 4L20080930

[slinky]

Interesting article on why a bailout shouldn't happen:

Bankruptcy, not bailout, is the right answer

One thing he says:

Talk of Armageddon, however, is ridiculous scare-mongering. If financial institutions cannot make productive loans, a profit opportunity exists for someone else. This might not happen instantly, but it will happen.

What do you financial gurus here think?

[Morrolan]

typical simplistic Libertarian chatter.

he already gets it wrong on the main point: it is not government regulation that caused this mess, it is the lack of oversight and governance.

it is not the sub-prime mortgage that caused this mess, it is the unsupervised repackaging of portfolios of sub-prime mortgages and selling them to everyone with a pocketful of cash and little sense as a prime instrument.

the rest of the article is merely a sales brochure for Libertarian viewpoints.

[slinky]

it is not the sub-prime mortgage that caused this mess, it is the unsupervised repackaging of portfolios of sub-prime mortgages and selling them to everyone with a pocketful of cash and little sense as a prime instrument.

OK, I can see that point, but, sub-prime mortgages were essentially bad business or bad economics weren't they? I mean, it doesn't really make any economic sense to loan big amounts of money to people who don't really meet any sound criteria to be able to pay it back does it? I guess I can't help but feel that if the lenders hadn't been so free to hand out the money to so many unreliable or unproven borrowers very little of the repackaging would have happened because it wouldn't have been needed.

[Morrolan]

it is not the sub-prime mortgage that caused this mess, it is the unsupervised repackaging of portfolios of sub-prime mortgages and selling them to everyone with a pocketful of cash and little sense as a prime instrument.

OK, I can see that point, but, sub-prime mortgages were essentially bad business or bad economics weren't they? I mean, it doesn't really make any economic sense to loan big amounts of money to people who don't really meet any sound criteria to be able to pay it back does it? I guess I can't help but feel that if the lenders hadn't been so free to hand out the money to so many unreliable or unproven borrowers very little of the repackaging would have happened because it wouldn't have been needed.

that may be the case, but firstly: why were these banks able to get away with this? lack of oversight: there wasn't a regulator who stepped in and said: those loans are doubtful, you need to provision them.
once something spirals out of control like this has and is, in effect, threatening the global banking system, simply saying: "we don't like government influence to begin with, so let them go bankrupt", is so irresponsible it borders on the insane.

his statements have no merit as they oversimplify the problem, incorrectly identify a cause and ignore a globally interwoven system, just to get a point (the Libertarian one) across.

[Lichtgestalt]

I read a bit more and not 100% sure anymore but this
http://www.fscs.org.uk/consumer/key_fac ... on_limits/

confirms it. Or calll +44 20 7066 1000

Thanks again, Lichty, but I may have to. Unless I'm missing something obvious (don't...) I really don't read it the same way you do.

Ok, phoned the FSA now and (at the moment) it's 35k per person per authorized company. Banks can share an authorization or be authorized seperately even if they own each other, i.e. RBS owns Natwest but both are registered with the FSA under two seperate authorizations meaning if you would have 35K with each of them both your deposits would be guaranteed. On the other hand if both banks share the authorization and you don't know you could be in for a rude awakening.

Luckily I invested all my money in the car industry...

[Fat Bob]

The car industry or a car?

Yes, litchy, that's the way I thought it was, and the RBS/NatWest example was what I'd also seen in the press. So you can spread the risk out. It's certainly a good reason to get paid your interest monthly rather than annually!

[baloo]

Asian markets took a hammering. ASX down nearly 4%. And this is AFTER they banned all short selling.

[Fat Bob]

FTSE down 2.5% in an hour. Well, we'll see what happens in a few days, months or years!

[baloo]

ugly ugly ugly
Even gold is dropping. Could it be we're seeing deflation in action ?
I think the JPY & CHF look like the safest places at the moment.

[Joseph27]

So what the fuck is next? I've got a headache, my super is down and it looks like credit markets are still effectively frozen. What does this do to the likes of Ford or GM who have been posting billion dollar losses - at what point do they start mass layoffs?

[Fat Bob]

It's sunny with a bit of cloud outside. I'm at work, and supposedly my company is in reasonable financial health, which means I should get paid at the end of the month.

[BFG]

So. Can I buy a house now?

[baloo]

Wait a couple more months and you can buy Wales with enough change left over to put a deposit down on InBev to ensure a lifetime supply of free Boddingtons.

[BFG]

Wait a couple more months and you can buy Wales with enough change left over to put a deposit down on InBev to ensure a lifetime supply of free Boddingtons.

Now that is what I call excellent economic strategy.

Not sure about the Wales bit though, unless there is a way (preferably painful) of getting rid of the sitting tenants...

[Burbage]

Wait a couple more months and you can buy Wales with enough change left over to put a deposit down on InBev to ensure a lifetime supply of free Boddingtons.

Now that is what I call excellent economic strategy.

Not sure about the Wales bit though, unless there is a way (preferably painful) of getting rid of the sitting tenants...

Well if you're gong to do it, during a great depression is the best time. Nobody cares about the poor people then. the other option is to form a fascist political party, take control of the government, invade France to provide a distraction and then gas all the Welsh.

[BFG]

Have you been reading my "Secret Plan Book"?

[Morrolan]

wow... RBA cuts a full 100 basispoints.

[baloo]

wow... RBA cuts a full 100 basispoints.

Yeah, that was a bit of a shock. They must really be worried. I can see the AUD falling down, falling down.

[Fat Bob]

Baloo the Sage.....

[Lichtgestalt]

Iceland is pretty fucked up at the moment I think I need a new job soon

[baloo]

More than what it already has FB. It was about SGD1.05 today. Would love to see it drop to below SGD0.90.

In the last 6 years the AUD has been below USD$0.50 and $USD0.92, it's a fun currency to hold.

[Fat Bob]

I can start my old songs again....

There is one Aussie dollar to the pound
There are two Aussie dollars to the pound,
There are three Aussie dollars, four Aussie dollars, five Aussie dollars to the pound

WE'RE SO RICH IT'S UNBELIEVABLE!

(OK, the Barmy Army came up with that one..... )