Saturday, Apr 19, 2008
The figures are getting bigger
Guardian: £50bn move to unlock mortgage market
The BoE is preparing to unveil a plan to inject £50bn of funds into the financial system. The government is expected to issue bonds which lenders will be able to exchange for packages of mortgages lodged with the Bank as collateral. The £50bn may not be as much as the lenders were hoping for!!!!!!!!!!!!!! I think there should be a new law that forces all the media to put the zero's behind the pound sign 50,000,000,000!
Posted by who stole my pension? @ 05:31 AM (701 views) Add Comment
18 Comments
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1. Ijjhall said...
The Telegraph are reporting that unsecured credit card debt might also to be included - Elsewhere John Mcfall chair of treasury select commt quoting as saying he doesn't think it will stop at £50 billion and 'we will all have to swallow some pride.' Associated press, unlike BBC, openly tying this to Brown's slump in polls.
2. planning4acrash said...
BOE, FED, only different in name.
3. mark said...
criminal
4. dohousescrashinthewoods said...
The printing presses will be struggling to keep up. Or, in modern terms, they are going to need a very large and expensive tax-funded government IT project to redevelop databases across the financial system so they can store bigger numbers.
At this rate it will be Zimba-blighty-we by Christmas and Mugabe will be looking down his nose at us and handing out stingigng criticism to "those stable western economies who tried to lecture Zimbabwe on economic policy".
Remember the jubilee campaign to cancel Africa's debt because it could never hope to repay it? Now the boot is on the other foot and I can see the US and UK begging for mercy very soon.
5. A Saver said...
patrick.net in the US (v similar to our own housepricecrash) have a campaign against their taxpayer-funded bailout of reckless lenders and home''owners'' - we should do the same.
6. letthemfall said...
"Lenders have cautioned that even if the Bank does proceed with the plan to use mortgages as collateral, it is unlikely to mark a return to the situation a year ago when the mortgage market was characterised by cut-throat competition among lenders."
God help us if it does. I now think that this bailout is not about preventing banks from collapsing (as it might be possible to argue) but some perverse political expediency to maintain high house prices (as many believe). Is this the most appalling example of political economics ever? Note too that a bit of chicanery will keep the gilt for rubbish swap off the national debt. Quite sickening. We must hope that things are too far gone for this ghastly interference by the govt to make much difference.
7. Ijjhall said...
@letthemfall
Re your fears about maintaining house prices as the motivation - Just reread the Guardian Q and A on BOE bail out and it confirms that 'banking sources' have confimed this injection is all about maintaining current reduced lending rates - the banks must have put the fear of god into Brown the other day - rather than the start of another lending blitz. It is unlikely then that this will kickstart the return of 125 per cent deals and all the rest that the bubble/Brown needs to sustain it that bit longer.
8. J said...
I think the fall out from the housing bust will be bad, flat house price inflation once fallen to around 2022 then the new cycle will
begin to gather pace, its so simple really buy when fallen, and hold ,buy when fallen again hold, when fallen its just like a refletion of the opposite and save's you a fortune over a lifetime...............The banking system will recoup loses over time one
way or another or would not exist anymore..........
9. malct said...
wsmp
observation
your two articles very much on topic have 8+4 hits by noon
LP's Krusty Kirsty below has 35 hits
Opens the site up wide to critisism methinks.
10. malct said...
Charles Lindbergh's - September 11, 1941 Des Moines Speec
http://www.youtube.com/watch?v=K_F48oaOskI
11. uncle tom said...
I think it's pretty inevitable that the taxpayer will have to throw lifelines to the mortgage industry, but I'm hopeful that we will eventually get our money back, although that may require a reparation levy on all future mortgage interest payments - or something similar.
This is probably only the first of several similar aid packages.
However, this won't stop prices falling..
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