Thursday, Dec 13, 2007
There's a problem...........Let's make it worse!!!!
Guardian: Banks act on meltdown fear
Speaking to the Guardian, the chancellor, Alistair Darling, welcomed the move: "This was both necessary and very welcome. It sends a very clear signal across the world that central banks stand ready to do whatever is necessary."
That's a quote that will come back to haunt him.
Posted by inbreda @ 09:13 AM (758 views) Add Comment
11 Comments
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1. David Smith's Sub Prime. . . said...
There is no Sub Prime. Mr. Murdoch told me.
Love David Smith aged 13 and a quarter.
2. paul said...
So the central banks move from:
"Right now I want everyone to be very calm, and not do anything too hasty."
to
"QUICK PAAAAAAANIIIIIIIIIC!"
3. ontheotherhand said...
"It sends a very clear signal across the world that central banks stand ready to do whatever is necessary."
I'm sick of this moral hazard whereby all the greedy leveraged speculators are saved. He's saying they won't let the gamblers fail. The central banks will print money and let inflation fly to erode debt. Anyone who has saved money over the last few years rather than bingeing on paper profits made in the tulip buying frenzy will be punished for their frugality.
Next time there is a bubble of any sort, I'm in with the majority. Borrow to the hilt with everyone else and then it's the bank's and government's problem.
4. handle_it said...
Has anyone openly questioned the prudence of this move yet ?
5. Icarus said...
"...do whatever is necessary", i.e. lecture them about moral hazard and then bail them out like an indulgent parent.
6. tyrellcorporation said...
Ontheotherhand... I'm with you on this one. I think we've all seriously misread the public mood and also the willingness of central banks, politicians and governments to 'finance' the feelgood factor indefinitely. I sold three years ago and have seen prices rise by another 30% in Exeter since that notorious 2005 rate cut - What a right royal f*** up!
7. japanese uncle said...
ontheotherhand
Nothing's wrong with saving. Just ditch GBP, but do stay away from USD.
EUR is better, JPY loos even better.
8. cornishman said...
Nicely put Tyrell!
Mind you, bear in mind that you probably wouldn't be able to sell for your '30% increased' price at the moment.
We will have the last laugh - eventually...
9. Submedia said...
Interesting move by the central banks. I knew it was bad but i didn't think such a move was necessary. The question is will the extra cash on the markets be used and will it be used for growth or just treading water. I suspect the latter in most cases. Risk assessment is the watch word in the markets and it is the risk that is proving difficult to factor. More money doesn't really change that. Housing market is still likely to stagnate and possibly fall 5 - 10% next year maybe more in some places. Debt is still going to be a huge problem. Anymore shocks and we are doomed i tell you doooooooooooooooooooooomed.
10. drewster said...
ontheotherhand,
I agree too - it really seems like there's no point in saving any more. Our great-grandparents generation had the benefit of inflation-proof gold-backed currency but we no longer do. Thanks to democracy you're safest sticking with the herd these days. That said I'll still hold off buying a house, at least until prices prices stop falling.
11. Wiltshire said...
What's that phrase about tilting at windmills? In the current situation £50billion seems to me like a smoke and mirrors exercise in convincing the majority that all is fairly well and the Central Banks/governments are going to win the day. Meanwhile there must be absolute panic in the offices on Wall Street and in the City. I think it was August when the Fed injected around $35billion and the ECB EUROS155billion (what's that? A couple of hundred million dollars?) into the system. Doesn't seem to have made much difference does it? At some stage the Central Banks are either going to have to admit the game is up or start letting banks fall by the wayside, after all they've got themselves into this pickle.