Tuesday, Nov 13, 2007
Carnage on Wall Street
BBC News: Carnage on Wall Street as loans go bad
A comprehensive article from the Beeb about the scale of the subprime problems: "The scale of the losses that will hit Wall Street banks could approach half a trillion dollars as large numbers of sub-prime home loans go bad." From the note at the bottom of the page, this is the first of many articles.
Still very much about the US rather than the UK though.
Posted by night @ 06:55 AM (381 views) Add Comment
4 Comments
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1. stillthinking said...
½ trillion !!! Gone !!!!
Makes the argument about British or American billion look a bit petty. So it must be that the recent increases in food are down to a bad harvest year. UK interest rates must have been set to cool the housing market i.e. politically set. So interest rates will be coming down next year, so in fact being forced onto a variable rate mortgage could be the best thing for some strugglers as they can lock into a more advantageous fix in 6 months. The US and UK banks are in bed with each other and if US banks have lost, the situation is mirrored for the UK banks, they are all international banks after all.
The BoE must be an exciting place at the moment. All of these enormous effects with a time lag but whats the timing of them.
Another thought, King commissioned his own set of statistics aside from the government ones. The only reason he must have done that because when he looked at the government ones the numbers must have just looked wrong against his own gut feeling.
The way these losses are presented always makes them look as though they are the banks money, and not impacting on the savings/pension schemes of the population. When will this unpleasant fact become public? The UK gov. guaranteed deposits but they haven't guaranteed pension schemes (which they windfall taxed as well), which might be hard to justify politically as they are both savings. Labour might have a hard time explaining why they have guaranteed the individual, but the pension schemes they have forced people into, and also restricted and regulated, face losses.
Pensions must have been given the biggest thrashing conceivable.
2. japanese uncle said...
As I mentioned before, what is unfolding before our eyes is, the demise of the Anglo-American financial business model, where 'reputable' financial institutions are making billions from the kind of operations no different from William Hill's and Ladbroke's. We will be seeing the loss of tens of thousands of jobs in the financial sectors, which will trigger many times more job losses in the construction and other housing-related industries along with the retail sectors that have been thriving on the financial/housing bubbles for the past decade and a half. From now, rigid economies creading real value-added, like Japan's and Germany's will be focused. Yen will dramatically appreciate and such process seems to have started already. USD will be reduced to something next to trash as the US is crippled with mother of all deficits of all kinds, while GBP will be devalued by at least 30%..Euro will remain remain strong relative to USD and GBP thanks mainly to the solid German economy notwithstanding Spanish economic disaster.
Under the new paradigm after the demise of the Anglo-American business culture, which was no better than musical chairs in which wealth is merely shifting from here to there under the zero-sum ceiling, 'brave' risk-takers will no longer be able to enjoy extraordinary reward (after all they are taking risks just to please themselves by becoming stinking rich, without a shred of honorable cause for the sake of the public and the mankind; why personal greed ought to be rewarded?)
3. Nmarks said...
That sounds like 911 times 2356.
4. down wave said...
stillthinking said... said: Another thought, King commissioned his own set of statistics aside from the government ones.
I wrote to Sir Mervin King in January this year. I received a generous 1 &1/2 page reply. I advised him that the statistics suplied were concocted and the people responsible should be brought to account as they were placing the UK economy in grave danger. That was not all of what I said and provided, but I can't write that here. All of you know the IR increases since then.
The BoE commission are now almost certainly relying on their own stats and making IR decisions on these, rather than what the treasury and ONS provide. These offices are all compromised by their obedience to Gordon Brown. Brown is and always has been in the emotional state of chronic anger. He thinks that he is always right and the World would be a better place if everyone did as he ordered. He thinks that if does not put things right, no one else will. Well you all and I know that WE are NOT always correct, therefore Brown has a serious life long psychological software problem and over the years it has become HARDWIRED.
Let me assure you all, Sir Mervin, against all odds and deception, is patriotic and honest as well has holding the highest moral and ethical standards and as he has recently demostrated, he will not compomise his steadfastness, not even for the security of his Job. PLEASE Name me another Man in the UK that would do that. Not even the Chief of Police Blair has balls of Sir Mervin's size.