Monday, Sep 17, 2007
A run on these 3 banks matter of time?
Mail: More banks told to prove they are safe
It is understood that there is particular focus on Bradford & Bingley, the Alliance & Leicester and Paragon, all three of which have high loans-to-savings ratios: they lend out far more than they take in deposits.
Posted by confused76 @ 04:14 PM (1310 views) Add Comment
18 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. harold said...
Oops:
http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/23135/default.stm
No doubt the sub-prime problem will be contained...
2. Mark said...
A&L share prices is plummeting
3. David 20040_0 said...
Look,
Just because Northern Rock is in trouble doesn't mean the others are...
4. Orwell said...
Harold,
There is no Sub Prime problem..
Love David Smith.....
5. James said...
confused76, yet more financial illiteracy from you. ALL banks lend more than they take in deposits. http://www.investopedia.com/terms/m/multipliereffect.asp . Moreover, Paragon's not a bank.
6. Alan said...
Having a high savings to loan ratio isn't so bad.
Wait till the figures for defaults come out. Then you will see which societies have led in a reckless manner.
Dropping IRs will provide a temporary cushion against defaults - that's why some folk are shouting at Darling to "get 'em down". The need to raise IRs to 6% to defeat inflation has been ignored.
Look out for the VIs and the journalists they sponsor.
7. David2007 said...
Link not working
http://www.thisismoney.co.uk/news/article.html?in_article_id=424388&in_page_id=2
House's always go up, Bank's always make money
8. uncle chris said...
Ooops - 31% down on the day - really glad I took a substantial amount out this morning - don't fancy queueing round the block. If the Chancellor (whatsisname) hadn't lied (I know that's what politicians are all about, but still) by saying that Northern Rock had a good loan book, then I might not be so worried. But with blatant (to those with a bit of nouse) deception being practiced by the government, I don't trust the lot of them.
9. Orwell said...
Did you really take that out Chris?
I saw Alistair Darling as well and he looked very shifty on Sunday on the politics programme with Andrew Marr.
I do see a fair amount of lies in Court now....
10. bidin'matime said...
link not working?
11. (cr) Ash said...
Would it be wrong of me to panic - all my accounts are with A&L - I've got less than £35k so I'd be 100% protected if the worst happened.....right?......
12. su said...
I found the link by going to "home page" on the Mail then clicking on "news" followed by "city news".
13. su said...
I am so impressed! You guys predicted these would be the ones to watch.
Congratulations by the way, bidin'matime, on selling your house just at the right time. Takes an accountant's brain to get the timing spot on! ;-)
14. harold said...
And this is interesting, these guys have lost ca 40% since March:
http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/23420/twelve_month.stm
But surely we need more land for development...
15. inbreda said...
where will they put all of the immigrants and divorcees?!?!?!?!?!?!
THIS MUST BE A SUPPLY AND DEMAND PROBLEM!!!
16. European-bear said...
There has never been an absolute shortage of houses in the present cycle (evidence - rents have not increased)...the last fews years of HPI have been driven by easy credit lent to anyone with a pulse who asked for it. And everyone with the pulse did it because houseprices only ever rise. And banks lent it because house prices only ever rise. Now the banks are facing the consequences......they borrowed money to lend to any one with a pulse at any multiple of income as their business model. And of course because there were lots of people with pulses it drove the price up so it became a self fulfilling circle. The international credit crunch has now starved the banks of the cash to lend to those people with pulses so HPI has now suddenly lost its oxygen. I really hope Northern Rock or some other big bank goes under to make sure this business model is not kept afloat...but Labour has guarenteed deposits in NR so bankruptsy for NR is now looking a little less likely. But even if not, there will be cautious lending for some considerable time which means that the market will only have buyers with mortgage offers of x3.5 salary plus a credit history plus evidence from their employers. No more liar loans to people with pulses...that makes houses less afdfordable so watch HPC go down down down down down...and with a bit of overshoot, maybe 40% decline or more in the next few years.....
17. European-bear said...
Inbreda. There was always a supply and demand problem. The demand was for credit and supply was effectively infinite with all the exotic mortgages on offer. Credit crunch = no more supply of mortgages. So how are people going to buy all those houses?
18. voiceofreason said...
Today: oversupply of money = asset inflation = demand for assets.
Tomorrow: under-supply of money = asset deflation = no demand for assets.