Thursday, Aug 28, 2008
Northern Rock: yet more of your cash down the drain
MoneyWeek: Northern Rock: yet more of your cash down the drain
Surprise surprise – Northern Rock's mortgage loans are going bad more quickly than the Government expected. But it's just the tip of a very big iceberg. As banks make borrowing money ever more difficult, Britain is heading for a major slump...
Posted by damien @ 11:46 AM (813 views) Add Comment
20 Comments
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1. george monsoon said...
Well written argument, showing that those "bankers" are really up to their necks.
So what do we do now? any ideas.
I have no cash, but I also have no debt. What are my options?
2. Retired Banker said...
George-
Try and stay employed, and also acquire a skill that will enable you to emigrate to Australia, Canada, etc.
3. plato said...
1. george monsoon said.
So what do we do now? any ideas.
I have no cash, but I also have no debt. What are my options?
Lots of people including myself are in this position. It's the Big Question. My future is in my pension and it ain't looking too good. We have a collective problem here as those with some savings whether movable or immovable are watching them depreciate in real terms.They could end up with no cash as well. This is why some suggest gold. Those without cash can only look at debt to 'progress'. That's the system and so it's about sitting tight and hoping that circumstances improve. Debt is not an answer.
I would love to hear any 'options'.
..
4. icarus said...
george, one possibility is to study a market and play it when you think you've mastered it. At the moment my pension plan is my betting exchange account. I play the horses successfully and my account builds up exponentially - as the bank builds up the bets get bigger. There are lots of races, so lots of material to analyse (results are on a computer programme, along with the means of analysing them). Also, it's possible to have a fair number of (relatively) small bets, so if things aren't going swimmingly you are still well in the game and you can analyse how to improve and get things back on track. Golden rules - don't buy tips and bet with an electronic exchange so that you (almost) cut out the middleman.
Others may prefer other betting media but this one works for me. It's a lot better than having a Pension Fund jobsworth investing money for you.
5. need-a-crash said...
@4. So you're effectively saying the only option to make money is to gamble with what you've already got?
Surely that's insane, cash in the bank at high interest won't depreciate that much over the next few years and we only have to wait 1 maybe 2 years for this hpc to finish.
6. icarus said...
@5 - for all I know the banks may be skint and my exchange account is definitely increasing. I call it investment. If you want to call it gambling that's your privilege.
7. techieman said...
icarus - i agree and disagree with you at the same time! Yes if you can punt around the markets and are successful then thats fine. BUT i wouldnt recommend that to anybody for a start (and i am speaking from experience as you know - granted its my view) you have to be a bit an@l, second you have to embrace SOME risk, third as you probably know most small punters (90% of small spec commodity traders for example) lose. I suppose it takes years to think you have something that works and then a few more years of blood sweat and tears to make it work or find it doesnt.
Like most things in life you have to pay your dues and my other pearl of wisdom is that what you think moves the market in a specific direction often doesnt.Be wary of those who fit market moves to the news, it mostly doesnt work like that.
If anyone here is interested i would look at the following (Richard Dennis turned $500 into around $200m). It might inspire you to start or it might scare the sh1t out of you.
http://www.tradingblox.com/originalturtles/story.htm Goto : http://efsl.wordpress.com/2008/06/04/richard-dennis-turtle-traders-system/ and click on "turtle trader system rules....pdf"
8. techieman said...
need a crash - wait 1 to 2 years??? I dont think so!!
9. Tim said...
If you're worried about the safety of your money in your bank then you should switch to Northern Rock. It's the safest bank in the UK. Why? Because the governemnt has underwritten all the debts!
10. techieman said...
Tim.... at the moment!
If they withdraw it? Well unlikely i know (as unlikely as the run was in the first place?) but never say never.
11. icarus said...
techie - it works for me. I put up a mere £400 a couple of years ago and it's now almost ten times that and growing. As I say, because you have lots of relatively small bets you can monitor how you're going and re-think if things are looking dicey, without the pain of losing a big chunk on one downswing. For that reason it may be different from most markets you've analysed. Can't imagine, under the circumstances how I'd do the lot back, but if I did I'd have lost £400 - I wouldn't carry on because something would have to have gone terribly amiss.
As for not recommending it to others, all I can say is that it works for me, I put a lot of work into it and I never stop learning and I did recommend that anyone does a lot of work before he/she starts - on a market of his/her own choice.
12. techieman said...
Icarus - yes I think your caveats are fine. "We" dont want to give an impression that these things are easy or there is no risk when the opposite is (as you know) true. Good luck with it!! The Richard Dennis thing is true - I havent made it up. I did try to be a tutle for a while but to be honest the drawdowns were too big for the level of risk i feel comfortable with. Having said that you might find the money management view interesting.
13. Ijjhall said...
Icarus
I have just invested a few hundred in a poker player I rate on a 20 per cent of winnings return...
If it comes off could be big given the money in poker...if not, only bet what you can afford to lose is the oldest and best maxim.
14. icarus said...
techie - cannot find the link you specified on that site, but anybody who sells a 'winning system' is deeply suspicious. Why not just do it oneself - or is he giving out the info for the good of mankind (in a zero sum game)?.
15. icarus said...
Ijjhall - yep, but the problem with old maxims is that once you scratch the surface they're less simple than they sound. Is a house purchase (at any time) a bet? Is a savings account a bet (given that banks can fail - £50k guarantees? well, there's no money in the pot, is there)?
16. shipbuilder said...
Can no-one honestly think of anything better than glorified gambling?
To me, this is part of the reason we are in this mess in the first place.
No offence intended to professional investors/traders - investing has its place, but there's no such thing as easy money.
Make a living out of something you love doing and you'll never have to rely on a pension.
17. plato said...
icarus
You 'invest' in the same way as I do.(I call it Exchange Trading) Probably our techniques differ but our results are very similar. Actually I find this an extremely interesting,exciting,enjoyable and 'clean form of investment. It took me 35 years to be in total control and consistent.leaving luck as the major wild factor. Doesn't always work but makes a far better profit than any other investment I have made to date. I also restrict myself to 3 sports,but concentrate on one in particular. Life is a gamble as we all really know. This is not an easy,quick road to fortune by any means and takes years of education and a certain type of disciplined mind to acheive,So I understand fully your suggestion. Those who succeed though are few,because of the requirements.
18. icarus said...
shipbuilder - your posts are usually more thoughtful than that. What's 'glorified gambling'. 'Make a living out of something you love doing' - what if gambling/investing is what you love doing? And who said anything about 'easy money'? Most of us on this site probably have day jobs too - what's wrong with supplementing one's income, maybe to the point of being able to give up the day job? Anyway, we're only symptoms of the real problem - the economy and the skewed reward system. Plato - good luck, but I hope you don't need it.
19. shipbuilder said...
Icarus, 'glorified gambling' covers the various schemes people have outlined here seemingly in the hope of making money with little effort - y'know, like the BTLers we all criticise. If you enjoy it and can make a living from it, all power to you, but we can't all do it - a big part of why our society is so screwed up is our expectation to get a lot by doing very little.
We're all worried about our futures and the best solution we can come up with is trying to make cash from cash? Isn't this how we got here? Are people incapable of creating anymore?
20. icarus said...
shipbuilder - nothing wrong with playing poker, horses etc. If you want a critique of the economy and society then you need to go to another blog. As I said, poker and horseplaying are only symptoms, if that. State-sponsored corporatism is the problem - Bush and his little brothers Blair & Broon, Russian oligarchs, Chinese princelings, repression, predatory privatisations, Israeli/American security industries etc. Challenges to this are emerging around the world, especially in Latin America, Thailand and Lebanon. I hope they succeed, and I hope my horses win tomorrow.