Thursday, Jul 24, 2008
The bail-out voices cross the Atlantic....
Independent: Jeremy Warner's Outlook: Ministers may have to consider radical action as mortgage famine intensifies
"A possible halfway house would be to extend the scope of the Bank of England's "special liquidity scheme" to new mortgages, so that for a price lenders would be able to swap new mortgages for more liquid government bonds. Yet Mr King would be vigorously opposed to any such extension and, in a falling-out that would make the present strained relationship between the Bank and the Treasury look like a vicar's tea party by comparison, would fight any such notion tooth and nail. What is clear beyond doubt is that something has to be done. The debate as to what is about to get very heated indeed."
This is a fight Merv has to win...
Posted by rednose @ 01:20 PM (477 views) Add Comment
3 Comments
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1. doomwatch said...
How abut letting the "market" reach it's long term price-earnings ratio where it can be controoled from and regulated properly with
some meaningful legislation and new effective FSA group.
2. letthemfall said...
"Yet if you fall out of a window, it is surely much better that your descent be slowed by a safety line..."
This assumes that it is possible to tweak things to ensure a comfortable slowdown. Given the uncontrolled rise in prices it seems pretty unlikely that Govt fiddling will make much difference.
"In Britain, retail deposits account for little more than 50 per cent of outstanding mortgages."
Well, this is the crux isn't it? The money that inflated the house market was borrowed from the distant future under the disguise of securitisation. This can only be done for so long without a crunch, which is what we are seeing now.
3. icarus said...
"(The UK mortgage market) has driven one of the highest levels of home ownership on the planet, which must on the whole be thought of as a plus". Don't you feel sorry for those Germans living in those rented, high-ceilinged apartments in beautiful, 6-storey buildings near city centres that haven't been ruined by 'developers'?
Don't you love the Orwellian logic in this piece. The bankers messed up, it's not the bankers but John Citizen who suffers, so let's help the bankers in the hope that this time there'll be some trickle-down benefits to the public. Typical drivel from The Dependent