November 2008 Archive
Yes the grass was greener in Dubai than in Leicester or was it ?
2010 and beyond is looking bad
Next year – in a single year – the UK will borrow a staggering 8pc of GDP. The fiscal situation now looks worse than at any time since the Second World War. Brown has managed to surpass even the havoc caused by the deeply incompetent Labour governments of the mid-1970s.
I'll sue I tells ya!!!
And the complications begin.
Nov. 29 (Bloomberg) -- The European Commission denied it’s blocking France’s 10.5 billion-euro ($13 billion) bank-rescue plan and said the two sides are still negotiating. “We haven’t blocked the plan, because we haven’t taken a decision,” Jonathan Todd, spokesman for European Competition Commissioner Neelie Kroes, said in a telephone interview today. Kroes held talks with French finance minister Christine Lagarde yesterday, and both sides are keen to reach a deal “as soon as possible,” Todd added.
AT LAST the truth is out (again) part 4
A Modest Proposal google video part four to complete the series
Government manipulation will not save the housing market
The stubborn refusal of lenders to turn on the mortgage tap means hundreds of thousands of borrowers are stuck on unaffordably high rates. And nothing Alistair Darling said last week will make any difference.
BTL: it's a mess out there!!
An addition to the conspiracy v stupidity debate
Under fire for his role in the near-collapse of Citigroup Inc., Robert Rubin said its problems were due to the buckling financial system, not its own mistakes, and that his role was peripheral to the bank's main operations even though he was one of its highest-paid officials. "Nobody was prepared for this," Mr. Rubin said in an interview.
goodbye JJB ???
Barclays, which has lent JJB about £60m, has appointed Grant Thornton to advise the bank on JJB's future business plans. Advisers from KPMG are working with JJB on its negotiations with lenders. JJB has already been in dispute with HBOS, another lender to the company, over its banking covenants. In September, JJB said HBOS was wrong to say it had breached a key lending covenant. Speculation is mounting that Barclays is now worried about the company's financial position. Industry sources claimed recent like-for-like sales at JJB Sports had fallen significantly and some suppliers, such as Puma, have stopped worked with the company. Certain credit insurers have also refused to provide cover to the company's suppliers.
Why would anyone want to save - or is that the Plan
One of the first Building Society to hit zero as a savings rate for some of its accounts, one has to ask why keep your money there at all, is this all part of a cunning government plan - I think not as they really are not smart enough, only a matter of time before Badgers on the road to the IMF just like Healey was!
A humorous take on the recession by Tim Lott
Our writer looks around him and sees no signs of the recession. Is it just him, or is everything fine?
What a mess
If the recession is shallow and short, then we might just about scramble through. But if not, then we will be in a huge mess, having to tighten policy while we're still in recession. Most of us are still reeling from those dreadful borrowing figures revealed by the Chancellor in his pre-Budget report last week. If you cannot borrow more and you cannot raise more in tax, you have to cut what you spend. The only issue is how savage this process will turn out to be.
Mr Smith I presume.
THE Bank of England and the European Central Bank are set to cut interest rates significantly this week as Britain and Europe dive deeper into recession. The Bank, which has cut its rates by two percentage points in the past two months alone, surprising the markets with a 1.5-point cut earlier this month, is urged by economists to cut by a further point this week.
Looks like mortgage lending "debrief" is unravelling
"Ray Boulger at John Charcol, the mortgage broker, said: "Less than a month after the breakfast meeting rolling out the Brown/Darling master plan to intimidate the major lenders into passing on the full 1.5 percentage point rate cut in their standard variable rate (SVR), the one with the lowest SVR and by far the largest proportion of its lending on SVR pulls the plug for all new lending on that rate. "Not only did the master plan not last for life, it didn't even last until Christmas." So, after Darling Browns finger wagging and stwong words, the first and one of the biggest lenders dares to make a business decision. With the VAT plans and now the lending tuff-talk both looking as robust as my kids strawberry fool, who is going to blink next?
Government house price data 'flawed'
The Government's official house price index, produced by the Land Registry, has been accused of misleading homebuyers and policymakers after it emerged that it excludes repossessions and auctions on the grounds that they do not reflect the 'full market value' of the sale.
We're all maxed out. What we need is another goverment bailout..
FEARS are mounting over the financial health of Britain’s biggest boiler-maker Baxi, one of a string of companies wrestling with heavy debts as the recession continues to bite.
Government desperate to stop the house price implosion
Alistair Darling has admitted that he will 'almost certainly' have to deliver a second dose of financial life-support to Britain's ailing economy
LONDON — Could the British government’s plan to borrow and spend its way out of a recession lead to
Mr. Hargreaves sees the pound falling to $1.25 — it was at $1.54 on Friday — and he has recently moved £20 million into United States Treasury bills and instruments denominated in, among other currencies, the Norwegian krone.
China wants to recruit our finance "experts" - are they mad?!
Out-of-work finance staff in the UK and US have a new reason for optimism about their employment prospects – especially if they speak Mandarin. Chinese financial institutions are set to exploit the widespread job losses in western financial centres as a result of the credit crunch by next month embarking on a hunt for people willing to relocate. The Shanghai Financial Service Office is sending delegations to New York, Chicago and London to recruit specialists in risk management, asset management, product research and development, macroeconomics and policy analysis. However, the salaries on offer in China are unlikely to meet international standards. [No silly bonuses? Awww, diddums]
Robert Shiller, the Yale economist who forecast both the bursting of the dotcom bubble and America's property crash, is warning Britain's homeowners to expect things to get every bit as bad on this side of the Atlantic. "consumers should be wary of the comforting excuses many analysts find for explaining why Britain's housing market will be hit less hard than America's"
Top end London property falls 3.6% IN A MONTH
Its started here too, nowhere is safe from the crash
The world’s economic outlook is uncertain. Bankruptcy and massive layoffs take place daily in the United States and Europe. The International Monetary Fund (IMF) just came out with its forecast. Less than 3 percent growth signals a global recession. World growth will be at 2.2 percent in 2009. How will Colombia fare in such a gloomy world scenario? The answer depends on the dose of pessimism made by the forecaster. There are some who believe that the best Colombians can do at the end of this year is try to have a good time, because 2009 will be so complicated that perhaps there won’t be an opportunity to celebrate again anytime soon.
Just a little bit of HPC pron
House prices are set to fall a further 36% over the next two years in what could amount to the worst post-war housing crash, according to the price of contracts being traded on the derivatives market.
Suggestions for Mandy's Survival Matrix?
"Lord Mandelson, the Business Secretary, is drawing up selection criteria for choosing which businesses and industries are of enough importance to the UK economy to warrant being saved". The minister has decided that a more interventionist strategy for industry is now required as Britain faces a probable recession. Can anyone guess what the wacky criteria will be?
Futures markets confirm the worst is yet to come
If UK mortgage lenders believe they have secured enough capital to tide themselves through a recession, they had better think again. A look at the residential property derivatives market suggests house prices have very far indeed to tumble before they reach their expected trough. Since peaking in August 2007, when the average house sold for £201,081, prices have fallen 16.4 per cent, reaching £168,158 at the end of October. Two-year derivatives contracts are now pointing to a further fall of a third to about £113,000. This implied 44 per cent peak-to-trough decline would wipe out all gains since the summer of 2002
Good luck - you'll need it.
A last-ditch attempt to block the planned Lloyds TSB takeover of Halifax Bank of Scotland has been launched. A group of businessmen, bank customers and shareholders is to seek a legal ruling over Business Secretary Lord Mandelson's decision to allow the deal.
The art of speaking while saying nothing
Lord Mandelson has conceded that it was difficult to tell whether the economy will grow by the rates forecast. "No-one can foretell how short or long, how painful or painless, the recession is going to be," he told the Guardian newspaper.
The threat of repossession will continue to hang over homeowners in arrears despite government plans to offer them more help.
Better read this - before - you do your xmas shopping!
Major department stores and mall-based chains have cut prices up to 70 percent to move out mounds of excess inventory stuck in the pipeline since the financial crisis hit in September and people snapped their wallets shut. Big moves of merchandise happen every year — but usually after Christmas. This year stores are desperate to shed inventory even before Thanksgiving. At warehouses operated by Liquidity Services Inc., a leading online auction company for surplus goods, there are rows and rows of pallets of offloaded merchandise ranging from jewelry to consumer electronics. "This is about survival. This is not about muddling through the holiday season,"
Metrovacesa, the troubled Spanish property company that bought HSBC’s European headquarters at Canary Wharf less than two years ago, wants the bank to buy it back...Metrovacesa has failed to refinance debt secured on the building, and has decided to offer the 45-storey tower back to HSBC for £838 million – £150 million less than the record-breaking £1.09 billion that the Spanish company paid for it...
THE plummeting decline of the Welsh property market will not bottom out until 2010, experts warned last night.
The government rescue scheme
"SCARBOROUGH Council is one of only two local authorities in Yorkshire and Humberside to pilot the Government's new Mortgage Rescue Scheme ... The scheme aims to help up to 6,000 of the most vulnerable households avoid the trauma of repossession over the next two years." - Just before the election. What a coincidence!
Anne Ashworth's pantomime
"The Bank, or so it is said, would prefer that the banks devoted their cash to small businesses, rather than supporting house prices that are now more affordable for first-time buyers" "The Chancellor did little else to bolster the housing market, neither ensuring that more struggling borrowers are saved from repossession, nor introducing new concessions for first-time buyers" these clowns did enough to inflate the BTL bubble. Anne, she is the pantomime village i@iot
Supply and demand:0)
Chief Executive of the Agency, David Ireland, says: "The government is fixated on just building more homes, but we are convinced that returning more empty homes to use should be part of the solution too". ...why would this be? GB and HMG heavily in the house builders pockets? How much did Barrat, Wimpey etc. put into the coffers of NuLab during the boom times, anyone know???
A fatal flaw for Prime Ministers (particularly Labour Prime Ministers) is that they quickly tire of the humdrum world of domestic politics, and hanker for an historic legacy-defining role on the world stage - Blair being the exemplar. What Mandelson says at the end of this article will leave some of you speechless - those that haven't kicked in their monitor screens in, in a fit of rage and expletives first, that is. There has to be a stage beyond 'delusional', in which case, these two have reached it.
Government trying to keep prices from falling - a hopeless task
MailOnline: 700,000 'will fail to meet mortgage' as lenders are warned: Treat home repossessions as a LAST resort
Mortgage lenders have been ordered to treat home repossession as a last resort.
"Labour isn't working" 2009
This was a year of financial panic as oil prices spiked, banks collapsed and stock markets tumbled. But it is likely that 2009 will be the year of the dole. Unemployment, already higher than at any time since Labour came to office in 1997, is expected to climb to almost three million by 2010, according to the Confederation of British Industry. The turnaround in the UK employment market has been astonishing. The pace of job losses, led by the shake-out in the banking sector, has astounded analysts: the Centre for Economic and Business Research (CEBR) has forecast that 300,000 private-sector jobs will have been lost in the six months to the end of this year alone.
How does this pan out ?
Did we have funds bottom feeding in the last property downturn ? Will this affect the dynamic this time around ? I guess it will not cushion the falls because the funds would have to be massive to affect the UK housing lead balloon.
Prices to fall 30% says FT
"... They also suggest that the housing market will not return to today’s level of pricing for another 10 years." "Modern flats in northern cities such as Leeds, for example, are already being sold at discounts of more than 50 per cent to their newbuild value two years ago." "The agent predicts that it will take around eight and a half years – until 2016 – for prices to recover to 2007 peak levels."
And so the buyers strike begins..........
Quote:"The UK and Italy struggled to sell bonds on Thursday in a fresh sign of the difficulties governments are facing because of the debt needed for economic stimulus packages and bank recapitalisations. " "Roger Brown, global head of rates research at UBS, said: “The UK auction was dire. I do not remember one as bad for shorter-dated bonds. It is an ominous sign of trouble ahead." "Both the UK and Italian governments had to offer an extra 10 basis points compared with similar existing debt to entice investors to sell £3.75bn in four-year bonds and €1.4bn in three-year bonds respectively. The Italians also raised a lower amount than expected because of worries over weak demand"
Gordon Brown's Downfall - The prequel
New Gordon Brown Downfall - The prequel Video. Been working on this a while, but it all came together this week especially the ending. Hope you enjoy - no cursing this time. http://thecrownblogspot.blogspot.com/2008/11/gordon-browns-downfall-prequel.html
View and Counter View
A Chinese view on UK debt.
Sensible move, imho.
A reprieve for house prices?! The distortions at the border of the charge zone will cause some interesting changes, people who paid 20k extra to be just inside will feel flumoxed! But, on the whole, this should help support west london prices a little bit, and, will hopefully end the war on family cars. Do you think Boris discovered the fraud of global warming?!
We will follow US house price crash
Britain needs to reflate its mortgage markets to save its economy and its banks. Problem is, few want to borrow and there is precious little money to lend.
A millenia of cruel inflation
Gold at 530pounds, up at its all time high, following an exponential trajectory that began when the last vestiges of the gold standard were removed in the 1970's. We are on a trajectory back to the gold standard, because, a revaluation of gold, to pay off all the debt, is the only way to deal with the debt crisis. The graph above shows how gold price has risen via a millenium of inflation. Beginning with the clipping of the coignage, such as reducing the amount of gold in the sovereign coin, accelerating with the first Bank of England in the 1600's, culminating in this century's boom following the Federal Reserve and the final capitulation from the ending of the gold window in the 1970's.
Britain Trending Towards Bankruptcy
Britian is a Big Version of Iceland
Just imagine getting banged up for saying house prices will fall!
WOW a REAL CONSPIRACY!!! Conservative immigration spokesman Damian Green, was arrested earlier in connection with an investigation into a series of leaks from the Home Office. He was held on suspicion of "conspiring to commit misconduct in a public office," the Metropolitan Police said. Just imagine getting banged up for saying house prices will fall!
Down a whopping 49% - a stimulus package should fix this no problem!
Only 179 containerships were contracted in the first eight months of this year, down 49 percent on-year, Clarkson reports. This compares with a record 566 contracts in 2005, 479 in 2006 and 530 in 2007.
Survival of the fittest
The real problem facing estate agents who have never worked through a downturn is that the methods they used to use are no longer enough. "Back in the old days..." Mr Smith begins, before realising that he is talking about last year. "It used to just be a question of throwing properties out there and seeing who catches them."
What is it like to be a mortgage broker?
The usual serise. Actually, this particular broker seems have some decency. She claims she would recommend the best options (SVR, negotiating with lenders directly, etc) for the customers, even if that means, as a result, she doesn’t make a commission fee, which itself is the bizarre consequence of credit crunch.
The 21st century will see almost a thousand times greater technological change than its predecessor
"The paradigm shift rate (i.e., the overall rate of technical progress) is currently doubling (approximately) every decade; that is, paradigm shift times are halving every decade (and the rate of acceleration is itself growing exponentially). So, the technological progress in the twenty-first century will be equivalent to what would require (in the linear view) on the order of two hundred centuries. In contrast, the twentieth century saw only about twenty-five years of progress (again at today's rate of progress) since we have been speeding up to current rates. So the twenty-first century will see almost a thousand times greater technological change than its predecessor."
How to diversify your risk - Buy a whole street cos it is cheap
London-based boutique fund manager, Managing Partners Limited, has snapped up 18 of 48 homes in one street in Portsmouth in the south of England and intends to buy another ten because prices have fallen so much. Read on.......
Now who'd have thought it....?
“THEY said you couldn’t create islands in the middle of a city,” shouts a property advertisement over a jammed Dubai motorway. “We said, what’s next?” The range of answers has become gloomier by the week, as the debate moves from whether the Dubai property bubble will burst to just how bad it is going to get. Some nervous bankers think property prices could fall by 80% or so in the next year or so.
Export demand collapse - how dire is the situation?
“It’s absolutely unprecedented,” for production to show a 12 per cent drop from September to December, said Richard Jerram, chief economist at Macquarie in Tokyo. “That basically tells you that export demand has collapsed,” he said.
Want to book her for your local social club do - and then throw pies at her...here's where...
Not a new article - but hey it's Friday...'Find out how to book Kirstie Allsopp as the after dinner speaker for your next event by calling TMC Speak Out.......'
Russia hikes rates to stop investors fleeing the currency
Russia's central bank increased its key interest rate to 13% from 12% in an attempt to help stop currency losses. The rouble headed for its largest weekly fall in five years, and has fallen approximately 1.9% this week. For the second time this week, Bank Rossii, the country's central bank, widened the rouble's trading band by about 1% or 30 kopeks. Russia's has spent $148bn (£96.4bn) of its foreign currency reserves since August to stop a fall of the rouble.
CBI - "a thawing of the housing market is remote"
Retailers are preparing for a black Christmas as spending among consumer crumbles to a 25-year low. The Confederation of British Industry's (CBI) latest distributive trends survey revealed that the vast majority of retailers had posted lower numbers in the first half of November compared to a year ago. Its headline reading came in at -47, down from -27 in October to stand at levels seen in August when the survey hit its lowest level since starting in 1983. Looking forward, retailers are not expecting Christmas trading to alleviate much of the pressure they are under, with a -40% fall in year-on-year sales volumes expected.
what are they expecting? going back to 1929??
The group reported a halfyear loss of £61 million but said it was scrapping dividend payments this year, slashing spending by £30 million and cutting costs by £75 million to conserve cash. It said it was trading comfortably within its banking covenants. Browett said: "We have been back to 1929 to look at consumer demand recession experience and in all reasonable scenarios we should be fine." Woolworths' woes could create weeks of disruption as it sold off stock, Browett warned.
Bottom feeder bait
"The price of the average property in Britain now stands at £158,442, a fall of 0.4pc from £158,872 in October, Nationwide's house price index shows. Prices are 13.9pc lower than at this time last year. These figures are less doom-laden than last month's, when the month-on-month fall was 1.3pc and the annual decline reached 14.6pc. So does this mean that the housing market is about to turn a corner, or do prices have further to fall? And if we haven't yet reached rock bottom, how much longer before we do? We asked the experts – economists, mortgage brokers and estate agents – for their predictions." Despite my title, most of the article is quite reasonable but check the predictions made by Peter Bolton King of the National Association of Estate Agents near the end of the piece.
maybe he is seeing sense now?
A landlord trying to sell a house in an exclusive part of London has been forced to slash the asking price by £1.2 million after it went unsold for 12 months. The four-storey property in St John’s Wood went on sale at £2.8 million on last December, around the time the market peaked. It was cut to £2.25 million last month and again to £1.6 million - 42 per cent below the original valuation - on November 19.
We cannot solve a debt crisis by incurring more debt
Picture the US as the Global Fire Department (GFD). In the last ten years or so the GFD became extremely irresponsible. It ignored the fire safety of its own firehouse, which became choked with highly flammable material (i.e. debt and derivatives), and relaxed the rules about the health and fitness of its firemen (i.e. oversight and regulation were weakened). Seeing this, the good citizens in the neighborhood (i.e. other western nations) also adopted the same attitude. And why not? If the fire department itself didn't care about all that dead wood and turpentine piling up in its own back yard, why should they? A whole raft of nations from the UK and Australia, to Bulgaria, Poland, Iceland and Romania bought the same highly flammable "growth" model. Borrow - spend - inflate assets - borrow
Land registry: -1.5% MoM, -10.1% YoY
The annual rate at which house prices in England and Wales are falling continued to accelerate during October to hit a new record of 10.1%, figures showed. The average home lost a further 1.5% of its value during the month to stand at £165,529, according to the Land Registry. It was the 14th month in a row that the annual rate of growth has declined, leaving property costing around the same as it did in the summer of 2006.
The Debt Trap
Alistair Darling’s emergency budget is pregnant with dangers. His package will not achieve his objectives of shortening the recession and hastening recovery while the borrowing the UK will have to undertake will impose major costs on future taxpayers, endangering the long-term health of the economy. On the face of it, Darling is delivering a significant economic stimulus in 2009-10 through his temporary VAT cut and other measures. The Treasury reckons cyclically-adjusted net borrowing will rise by 1.9 percentage points of gross domestic product (GDP), the largest increase since 1992-93. This package will contribute to record headline borrowing of £118 billion in 2009-10 or 8% of GDP.
Rightmove on "understanding realistic prices"
Despite the downturn in the property market, Rightmove has reported a significant increase in demand for well-priced properties.In its November House Price Index, Rightmove indicated that over the last month consumers have been putting their homes on the market with an average 7 per cent discount on the year before. However, Rightmove said in the last few weeks, it has experienced a significant increase in email and phone leads from its website, with 1.1 million leads being generated in September from 38 million visits.It said savvy buyers were looking harder and keeping an eye on the market for when prices have dropped to a level they can afford.
Retail stocks have plunged – but they will get cheaper still
In recessions, companies fold. It's sad, but that's just what happens in downturns. And on the British high street, the failures are starting to stack up as high as the unsold stock in retailers' storerooms. Yet this week's high profile collapses of Woolworths and MFI may turn out to be more than just a sign of the cyclical times. They could signal the end of the high street as we know it.
1984 Alert 1984 Alert
Daily Mail: ANALYSIS: A salutary warning to any opposition MP planning to expose the Government's misconduct
Last reference to this story was pulled off this site
The bailout now costs more than anything else ever.
And the figures here do not get anywhere near today's $8.5 trillion, and rising, bank heist. Its good to put these abstract figures into context.
Now this is handy!
Our Price have updated their database for selling prices from 1995 to 2000; the ones from 2000 were already on there because they get this from HM Land Registry. (I typed in a road at random to generate a new URL)
Anyone happy with this deal?
Existing shareholders agreed to buy almost 56 million shares, which represents just 0.24% of the new shares on offer, at a cost of £36.7m, making an immediate paper loss of £5.6m. The gap between the offer price and the current share price also means that taxpayers have made an immediate paper loss of £2.3bn based on Thursday's closing share price.
Housing Market Risks in the United Kingdom
House prices in the United Kingdom rose rapidly in recent years. The run-up, larger than any other in U.K. history, leveled off early last year. House prices are currently declining at rates faster than those seen in the early 1990's downturn. The housing downturn, however, is far from complete. Using the price-rent ratio as a guide, house prices are likely to fall at least a further 30 percent before leveling off. Given the historic links between housing and real activity, the downturn is likely to be associated with very slow growth. Going forward, we recommend the price-rent ratio as the appropriate measure of housing valuation.
Terrific Property Market
Dont worry about it, they ain't any forced sellers, there ain't any rising unemployment, there ain't any oversupply of properties for rent in London.It is time to buy, buy,buy......
AEP cites Citigroup internal note indicating gold could hit $2000 in 2009
"Gold is poised for a dramatic surge and could blast through $2,000 an ounce by the end of next year as central banks flood the world's monetary system with liquidity, according to an internal client note from the US bank Citigroup." OK just another gold story, but from Citi this time
Yikes. Even the Yanks think we're screwed
It's looking as if the fall in British house prices will be further than expected. Britons simply do not save enough to supply their banks with enough to lend to fund the debt requirement implied by their housing prices. You have to wonder which potential house buyer is out there who a) is a good credit risk b) has a 20% down payment c) is willing to buy an asset depreciating at 2% a month. Bank liabilities in the US amount to 20% of the size of the economy. In Britain, the figure is 285%. Ask yourself then what might happen to Britain.
UK's Dollar Debt
Now you tell us!
The Government has finally admitted what most of us long suspected – that Northern Rock was the most "irresponsible" of Britain's mortgage lenders. The admission is a marked retreat for the Treasury, which insisted after the bank was nationalized that its mortgage book was "good quality". Treasury secretary Lord Myners said "Foreclosures are higher in Northern Rock than in other mortgage lenders because its lending was more irresponsible. It is as simple as that." Northern Rock's controversial 125% 'Together' mortgages accont for a third of their mortgage book, half of their arrears and three quarters of their repossessions.
No recovery for a few years - and so say all of us
Stocks rally is a big raspberry!
The Dow Jones is now on a 1,000 point, four day winning streak in a defiant bear market rally that defies the ever darkening economic backdrop and the awful cowardly terrorist attacks in Mumbai. So as the ghastly slew of economic data continued unabated yesterday the reality is that this mini rally has probably a lot to do with month end portfolio adjustments from cash and bonds into stocks. Look at US 10 year Treasuries yields which are below 3%, so the bond market is blowing this rally a big raspberry.
Citi says gold is going to go to 2000, goldbugs rejoice?
Interesting theory on why some people believe in so many conspiracies…
I argue that our brains are belief engines: evolved pattern-recognition machines that connect the dots and create meaning out of the patterns that we think we see in nature. Sometimes A really is connected to B; sometimes it is not. When it is, we have learned something valuable about the environment from which we can make predictions that aid in survival and reproduction. We are the ancestors of those most successful at finding patterns. This process is called association learning, and it is fundamental to all animal behavior, from the humble worm C. elegans to H. sapiens. Unfortunately, we did not evolve a Baloney Detection Network in the brain to distinguish between true and false patterns. But such erroneous cognition is not likely to remove us from the gene pool....
Still thinking of buying a house anythime soon?
House prices are set to fall a further 36pc over the next two years in what could amount to the worst post-war housing crash, according to the price of contracts being traded on the derivatives market
Can we have some as well
For richer or for poorer.....
'You loser!" screamed Katie, aiming a vase at her husband. "You've destroyed my life,'' she continued, hurling it. "Just look at my hair, look at my nails! You loser, you jerk, you nobody."
I'm a gold bull but when Citigroup says they are bullish, then it kind of makes you think.
The bank said the damage caused by the financial excesses of the last quarter century was forcing the world's authorities to take steps that had never been tried before. This gamble was likely to end in one of two extreme ways: with either a resurgence of inflation; or a downward spiral into depression, civil disorder, and possibly wars. Both outcomes will cause a rush for gold. "They are throwing the kitchen sink at this," said Tom Fitzpatrick, the bank's chief technical strategist.
Don't be lured into buying equities..
Why you should remain wary of equities Shiller told us that, in real terms, the S&P fell 80% in the 1930s. So far it is only down 54%. This means you still have a once-in-a-lifetime opportunity to lose a lot of money very quickly. Will you take it?
Food inflation will be 3.5-7% next year
[USA data contradicts predictions of 0% inflation for next year]. "The Agriculture Department is forecasting that food prices will increase 3.5 to 4.5 percent in 2009, compared with an estimated 5 to 6 percent increase by the end of this year. Some economists project even steeper increases next year up to 7%. A reason that overall food prices are expected to continue increasing is the lag between price increases for basic commodities and for finished food products in the grocery store, particularly for meat and processed foods. “For the last 21 months, food manufacturers, restaurants and livestock producers have been absorbing significant costs that in my view are likely to be passed on to consumers in 2009 and beyond,” said Mr. Lapp, a former chief economist at ConAgra Foods.
Brown admits Houses are "Unaffordable"
The Prime Minister was joined by housing minister Margaret Beckett for a breakfast meeting in Downing Street with industry leaders, including from the Home Builders Federation, the Federation of Master Builders and the Council of Mortgage Lenders.He said the problem in this country was not that we had overbuilt but "the question has been the affordability of housing".
The tyranny of consensus
90% is a big drop in profits
No company can take this kind of drop on the chin... expect layoffs.
Workers to fight 100 jobs losses at Cheshire BP plant
WORKERS have pledged to fight the proposed 100 job losses when the BP/Castrol oils plant in Ellesmere Port closes down. The oil giant intends to shut the Stanlow site and transfer work to plants in Europe, which would then provide lubricants for the UK market.
BROOKSIDE Close is the latest victim of the credit crunch.
Once one of the most famous addresses in Britain, the close is to go under the hammer for as little as £550,000. Developers initially hoped to fetch £2m for the West Derby semi-detached houses and bungalows, including the infamous number 10, where wife-beater Trevor Jordache found his last resting place under the patio. But with the credit crunch crippling the housing market, auctioneers Allsop have listed the 1980s red brick properties with a guide price of between £550,000 and £600,000.
They are begging for a bailout and layoff staff!!!
About 850 agency workers are to lose their jobs at Jaguar Land Rover in the West Midlands and Warwickshire. The IT and engineering staff at plants in Castle Bromwich, Solihull, Whitley, and Gaydon have been told their jobs will go by the end of the year.
"The crisis may not end in 2009," he said.
ArcelorMittal, the world's largest steelmaker, said it was likely to start short-time working and cut production at its German steel plants in December. Two of Britain's most high profile retailers DSG and Kingfisher underlined the severity of the economic slowdown with downbeat results and gloomy outlooks, while variety story group Woolworths went into administration. Britain's retailers face a brutal downturn in consumer spending, amid sliding house prices and rising unemployment
EA: "at least 12 months to bottom"
The latest Nationwide house price survey has been published. House prices have fallen by 4.3% over three months. In London, asking prices for homes are being slashed by up to £100,000 to secure sales in the run-up to Christmas, the Evening Standard says. Wales correspondent Mark Hutchings and David Miles, chief UK economist at Morgan Stanley, discuss how the housing market can recover.
Just when you thought it was getting safe - you will have to outbid the sharks!
Top drawer stuff
Before this secular Bear Market is over, we are going to new lows in all indices, more than 3500 banks will close, unemployment will surge, there will be violence in the streets and people will kill you to get what you have. Every one of the 17 macro factors detailed in The Big Rollover is converging and coming to fruition. Sorry—but this is what we see in the future. Could we be wrong? Of course. No one has a crystal ball that can see beyond the hard right edge of the charts. No one can tell the future with complete accuracy. All we have are our many years of research and the fact that everyone has now begun to see, hear and feel the power of The Big Rollover.
Pettifer Construction in administration
The firm employed around 150 staff. The source said: “Things are happening very fast there and everything is in the hands of the administrators.”
Cant afford a house? Steal one!!
Ambitious thieves not content with household burglary tried to pinch an entire Dorset property
we just keep getting screwed
Council tax payers face a rise of 10 per cent in their bills – but not until after the next election. The rise, which will mean more than £120 on the average bill, looks certain because of town hall losses of nearly £1billion in failed Icelandic banks. Gordon Brown moved yesterday to delay the inevitable price to tax payers of the fiasco by allowing councils to keep their Icelandic losses – totalling £944million – off the books this year.
Claims that Britain is on the brink of bankruptcy are a misunderstanding. Every pound of savings is a pound borrowed.Shock. Horror. VAT could go up after the next election. Or it could go down - or stay the same. The same can be said of income tax and council tax and road tax. It can also be said about public spending, government deficits, the FTSE index, the oil price and the price of fish. So what? Britain's political debate has descended into farce. The fault for this lies largely with Gordon Brown and Alistair Darling - not because of the contents of the Pre-Budget Report, which was sensible from an economic standpoint, but because of their political failure to explain why it made economic sense.
That's right, blame the economy
"The slump in house prices eased off in November with prices falling by just 0.4%, according to the Nationwide, the UK's largest building society. The mortgage lender said the rate of price falls "moderated significantly" when compared with October's 1.3% fall. House prices are down 13.9% from November 2007, easing from a 14.6% annual fall in October. However, Nationwide warned that the poor economy would continue to put pressure on the housing market." (isn't it the other way round? The house price bubble bursting has dragged the economy down?)
Fionulala's Time Machine still humming smoothly
"... This brings the annual rate of house price falls to 13.9%, down from 14.6% last month. The price of a typical house is now £158,442. This is about £25,000 less than this time last year but is still about £25,000 higher than in November 2003."
Also increased numbers of homeowners trying to let a spare room
Prices have been cut by an average of £16,941 by sellers, which is a national decline of 6.5 per cent. The figures vary by region. London has seen the biggest falls, with sellers in Westminster having £108,166 knocked off the price of their home. It is the latest sign that sellers are adjusting to lower house prices, having been in denial for months. "The months ahead are a great opportunity for cash buyers", said some twit. Tamara Smith, of EasyRoommate.com, said: "In recent weeks, we've seen a threefold increase in the number of live-in landlords on our site. Some people, potentially struggling with mortgage payments or in negative equity, are choosing to rent out a room in their house rather than sell at a significantly discounted price."
Off-topic, here's a story about house prices
"Median nominal prices in California are now down 47% according to CAR and 42% according to DQNews - and those declines are in less than 18 months! The CAR housing numbers reflect Oct 2008 which are actual sales in late August and September (read pre-stockmarket meltdown)." [Note: the Case-Shiller index in the table shows "only" a 21% decline nationally at present; but Mish reckons the CAR index is far ahead of the Case-Shiller index and therefore reflects the likely picture a few months from now.]
5bn kitty for new agency
Globrix asking prices survey
Asking prices for homes are being slashed by up to £100,000 to secure sales in the run-up to Christmas, according to property search engine Globrix. In the last two weeks, prices have been cut dramatically as sellers have finally faced up to the "new reality" of the depressed London market after months of denial. In Camden the average reduction is £55,728 while in Chelsea the average price has dropped £100,797
BBC BTLs bleeting at losses and over valuation.
Was on telly tonight (see iplayer) ... But with property prices crashing all around him, Bill’s worried about the value of his investment. So he went to see Tony McKeon, the director of Residential Lettings Group, to find out about the state of the market: He told Bill: "Your honeymoon period is over… so obviously you’re forking out of your pocket to cover the mortgage on the property that you had bought. "The rental income coming in is a lot less than you originally thought you’d achieve on your property." Tony also gave Bill a valuation on his flat. He believes it's worth £215,000. So in just one year Bill has lost £60,000! But Bill isn't the only buy-to-let landlord that has lost money.
Speedy Hire revenue up but 492 jobs cut
Speedy Hire has made 429 of 492 planned job cuts, closed 33 depots and reduced its vehicle fleet by 260 units, despite reporting a 22% rise in revenue.
it will purchase up to $600 billion in mortgage debt
The federal government committed an additional $800 billion to two new loan programs on Tuesday, bringing its cumulative commitment to financial rescue initiatives to a staggering $8.5 trillion, according to Bloomberg News. Most of the money, about $5.5 trillion, comes from the Federal Reserve, which as an independent entity does not need congressional approval to lend money to banks or, in "unusual and exigent circumstances," to other financial institutions. To stimulate lending, the Fed said on Tuesday it will purchase up to $600 billion in mortgage debt issued or backed by Fannie Mae, Freddie Mac and government housing agencies.
Less people "flipping" houses
"Furniture retailer MFI has gone into administration - citing falling demand for big ticket items, cash-flow problems and the withdrawal of credit". The union's Yorkshire regional secretary Tim Roache said is was "disappointing that the landlords of the shops pulled the plug and did not give the management time to turn it around".
The real truth behind Citigroup bailout
The dilemma Paulson has created with his inept handling of the crisis is simple: If the US Government paid the true value for these nearly worthless assets, the banks would have to write down huge losses, and, as Levy economists put it, ‘announce to the world that they are insolvent.’ On the other hand, if Paulson raised the toxic waste purchase price high enough to protect the banks from losses, $700 billion ‘will buy only a tiny fraction of the 'troubled' assets.’ That is what the latest nationalization of Citigroup is about. It is only the beginning. The 2009 year will be one of titanic shocks and changes to the global order of a scale perhaps not experienced in the past five centuries.
Trade is drying up - the bailouts aren't working are they?
The cost of shipping dry bulk commodities such as iron ore, coal and grains plunged to its lowest in nearly 22 years on Wednesday, as demand for raw materials in China and the rest of the world continued to tumble amid the economic crisis.
Threat to 600 jobs at factories
Cosmetics factory Budelpack International COSi at Maesteg, which employs nearly 400 people, has gone into administration. Last month the plant, which makes brands such as Clinique and Body Shop, cut its workforce by more than 200, blaming a sales slump.
All this liquidity - it's all hype, hype, hype
The Federal Reserve's new $800 billion effort to combat the financial crisis is designed to make credit more accessible to shaken consumers who aren't sure they want more debt. Households and lenders may not respond much because of the wealth destruction from plunging property and stock values, and the deepening economic slump, economists say.
Say good bye to pic & mix!
Trading in Woolworths shares was suspended this morning as talks to rescue the beleaguered retailer continued. But following the breakdown of the talks the board plans to place the group's retail arm and distribution business into administration. However the holding company and 2entertain - a joint venture with the BBC - will not be placed into administration.
So even the dark lord could not save it with his voodoo magic.
The cost of insuring against the British Government defaulting on its gilts in the next five years surged to 100 basis points above libor at one stage yesterday, before closing at 88.2 basis points. In comparison, insuring against leading banks failing to pay back their debt now stands at 58.8 basis points for BNP, 65.2 for Commerzbank and 68.6 for Credit Agricole. In the UK, Lloyds TSB is priced at 95 basis points and 99.2 for HSBC.
Leave the whisky alone Darling!
The chancellor has admitted to MPs that he made a mistake in raising duty on Scotch whisky, which would have led to a 29p rise in the price of a bottle. Alistair Darling caused an inadvertent storm with his proposals to offset the cut in VAT by raising duty on spirits.
BCE Takeover May Collapse on Insolvency Concerns
Teachers’ Pension Plan may collapse after auditor KPMG said the C$52 billion ($42 billion) deal, the second-biggest leveraged buyout, would leave the Canadian phone company insolvent.
Northern Rock hikes mortgage rates
Into the fourth year of house price declines! Not so sure it will take as long as that here!
Nov. 26 (Bloomberg) -- New-home sales in the U.S. fell in October to the lowest level in 17 years as the credit crunch deprived potential buyers of needed financing. Purchases dropped 5.3 percent to an annual pace of 433,000, lower than forecast and the fewest since January 1991, the Commerce Department said today in Washington. The median sales price decreased to a four-year low. Other Commerce reports today showed consumer and business spending tumbled last month.
Gold stocks tipped amongst others
"We all know what is causing the huge falls across virtually every asset class. It’s the global margin call, deleveraging on an unprecedented scale, forced selling of everything – call it what you will. Assets – the more liquid the better – are being sold off wholesale, regardless of their fundamentals, to raise cash to repay debt. But at some point this deleveraging has to end. What we all want to know is – when? And what will be the best performing asset class when it does?"
Updated: Staff at troubled kitchen retailer MFI were called to a meeting this morning where they were told the company has applied to go into administration. A notification of intention to file for administration was filed with the High Court last night and the company is expected to go into administration this afternoon.
House prices drop £100,000 in two weeks
ASKING prices for London homes are being slashed by up to £100,000 to secure sales in the run-up to Christmas.
The tsunami is getting ever closer
As the world slips into recession, it is also on the brink of a synthetic CDO cataclysm that could actually save the global banking system. It is a truly great irony that the world’s banks could end up being saved not by governments, but by the synthetic CDO time bomb that they set ticking with their own questionable practices during the credit boom. Alternatively, the triggering of default on the trillions of dollars worth of synthetic CDOs that were sold before 2007 could be a disaster that tips the world from recession into depression. Nobody knows, but it won’t be a small event.
This is a real worry - he may nationalise them!
Business Secretary Lord Mandelson has intervened to attempt to save variety store group Woolworths. It is understood that Mandelson's office called in Woolworths' lenders – which include Burdale and GMAC - for an emergency meeting yesterday as the retailer tottered on the brink of administration.
Keep throwing money about finally something will work
U.S. mortgage rates dropped by the most in at least seven years as a Federal Reserve pledge to buy $600 billion of debt succeeded where seven cuts in the central bank’s benchmark rate had failed. This initative is intended to lower the cost of borrowing for home mortgages, for car loans, for small business loans, for student loans and for credit card debt. “I was sitting in my underwear getting dressed in the morning when it came on TV, and I told my wife, ‘Rates are going down today,’” said Henry Savage, president of PMC Mortgage Corp. in Alexandria, Virginia. “Instead of buying stocks in stupid banks, the government finally is going to make a move to clear assets from the market.”
Blame Game now it's the Quants that did it
Quants - lapsed physicists and mathematical virtuosos were the ones who both invented these oblique securities and created software models that supposedly measured the risk a firm would incur by holding them in its portfolio. Without the formal requirement to maintain debt ceilings and capital reserves, the commission had freed these firms to police themselves using risk tools crafted by cadres of quants. ...the quant community needs to undertake a search for better models [too right!] —perhaps seeking help from behavioral economics, which studies irrationality of investors’ decision making, and from virtual market tools that use “intelligent agents” to mimic more faithfully the ups and downs of the activities of buyers and sellers.
Iceland inflation soars to 17.1%
Hyperinflation on the horizon?
The European Commission has unveiled an economic recovery plan worth 200bn euros (£170bn) which it hopes will save millions of jobs across the region. Its president Jose Manuel Barroso said he thought the plan was "timely, temporary and targeted". The EC expects member states to contribute 170bn euros while the European Union will give 30bn euros. Mr Barroso said it was important that EU members acted together in a period of "exceptional crisis".
So, For A Service Based Economy ..... ?
"The service sector of the British economy contracted 0.4 per cent in the quarter to the end of September, in the biggest contraction since 1990, according to data published on Wednesday." Where's my handcart? I'm off to Hell!
No clue whatsoever!
Within days of announcing a cut to VAT, a document published online (by mistake) has indicated that the Government were actually thinking of raising the rate of VAT to 18.5%. No doubt, this will probably rise to about 20%+ to pay for the associated cash splurge by messrs Brown & Darling. Being a citizen in the UK these days is like being strapped in the back of a car whilst the car is being driven by a pair of blind drunk lunatics.
The Guardian's view: let the housing bubble deflate in an orderly fashion
"This financial crisis began with housing, .. any hope of its ending must lie with housing" "Politicians have spent the past couple of days arguing over the government's £21bn boost to the economy. That is a big number, dwarfed by what is going on in the mortgage market... last year's net total of £108bn of new home loans has shrunk to around £40bn this year and could fall below zero next year... a hundred-billion-pound business will shrink to nearly nothing" "The .. priority must be to allow the property bubble to deflate in as orderly a fashion as possible ... over the longer term, house prices must come down and orgiastic lending and wild property speculation must be curbed." "To turn property into a private asset is to court bubbles, buy-to-let madness and supply problems"
Update on real house prices
The No Monkey Business blog updates its own version of real house prices relative to a sustainable trend, based on the full Nationwide data from 1957. The ratio has dropped from the peak of 132 to 112 but the trend itself, at 2.8%, is probably overstated after an unusually long period of extreme overvaluation. The ultimate low is expected to be worse than the 20-40% real price decline No Monkey Business was predicting before the banking crisis, in which case most if the drop is still to come.
It'll get worse before it gets better
"De-leveraging, the unavoidable consequence of the credit contraction, is far from finished and will continue to create a never ending stream of forced sellers. Major stock markets should fall by as much as another 50%; in which case, FTSE will bottom out below 2,500. As unlikely as that may seem to some, it is no more than should be expected given the unprecedented conditions and the abiding lessons of history."
Taking Stock after the Action
The Crumblin' Rock, B&B, Bonuses, banking traumas and where regulation went wrong.
Vince Cable's sound views
One difficulty in all this financial turmoil is knowing who to listen to, who is talking sense and has a grasp of the complexities of the matter. We've heard some dreadful disingenuous nonsense from some members of the Govt. Vince Cable is still in my opinion one of the few whose views should be taken very seriously.
Oh dear god
This couple bought their "luxury" four bedroom house in 1999 for £159,500. In 2006 they MEW to fund the purchase of a BMW Z4 and also enter the BTL business, buying a £110,000 terraced house to rent out. They also rack up £50,000 in credit card debt to fund their lifestyle. By late 2007 they can't pay their bills and put their property on the market for £400,000. Estate agent asks them to drop the price by £20k, but despite this still being more than enough to clear their debts they refuse. House gets repo'd earlier this year. The amount they owe on the mortgage is now £330,000. House is sold at auction this month for £255,000."We are reeling with anger. We can't believe how uncaring it is to sell the house for such a ridiculously low price."
Taylor Wimpey to offer equity to lenders
Good Piece on Chancellor Darling's Response to the Crosy Report
This article is somewhat sceptical about whether Sir James Crosby's main recommendation of a state bail out of the wholesale mortgage markets will really occur, and warns of the dire consequences for home-owners if net mortgage lending really does fall to zero in 2009.
The guv'nor is angry
Net new mortgage lending may next year shrink to below zero, a situation quite without precedent even during the last housing market crash of the early 1990s, when the problem was never lack of mortgage finance but rather its cost. Today it is the reverse. The main reason for this intensification in the mortgage famine is that lenders have approximately £160bn of mortgages to refinance next year, yet beyond the Government, no obvious way of doing so. Nobody is prepared to finance or buy mortgage assets right now. The securitisation markets remain closed. Bankers may have behaved recklessly in lending too much during the boom, but it is not in their nature or self interest to lend already overstretched debtors even more now that the bust has arrived, however much they are commanded to do so
Something must be done! Won't someone think of the children!
Independent: Stephen King: If interest rate cuts cannot solve the money shortage, turn on the printing press
As people hoard money, so output weakens and prices fall, as in the 1930s. For the world's central banks, it is time for unconventional acts of bravery. These acts are needed because the financial crisis is mutating. No longer is this a story simply about the unwillingness or inability of banks to lend. It is fast becoming a crisis of liquidation. Something must be done. The printing press has to be turned on. // Stephen King is managing director of economics at HSBC
Your job is next to go.
As redundancy washes away her affluent lifestyle, Julie Salt describes her first grim experiences of the Jobcentre. "Until recently, we were a family of five living in Henley-on-Thames [a rather posh part of the southeast with very expensive property!] with the security of a good salary and an affluent lifestyle. But my husband's redundancy from his job as director of an internet travel company has jolted us rudely out of our complacency. Like many of the 5,000 people who became unemployed yesterday, we fear losing everything. We are surviving, with a spending freeze on our lives, but we are rapidly realising how the economic structure that let us live like kings was a castle built on sand." [Part 1 of a 3-part series, links below the fold.]
Putting those scary numbers in perspective
It's difficult to comprehend the enormity of the numbers involved in the US bailouts so far - the figure currently stands at $4.6 trillion and counting. To put this in perspective, this is more than the costs of the Vietnam, Iraq and Korean wars, the moon race and NASA, the S&L crisis, the post WW2 Marshall plan to rebuild Europe, and the purchase of Lousiana put together, even adjusting for inflation. See the article for a more detailed breakdown of the mind-boggling figures involved.
File On 4 - 'Why my bank tried to evict me'
Current affairs program takes a look at the current housing market and concludes that it is brutal. By looking at prices of properties at auction and comparing them with previous sale prices from land registry data, calculates real price falls in the last 12 months could be as high as 48%! Features Roger Bootle and an HBOS employee on £33000/year who is being evicted by HBOS! Listen to 37 minute podcast here: http://downloads.bbc.co.uk/podcasts/radio4/fileon4/fileon4_20081125-1529a.mp3 Real bear food, and an excellent listen - enjoy.
Nation of brainless zombies can't understand why they are now in deep trouble
FDIC 'Coverage ratio' at lowest level since early 1993; bodes ill for industry
Shhhhh! The FDIC does not have enough reserves to guarantee deposits in the event of a systemic banking failure. The possibility of a run on the banks is very real. - comment
One for the ladies
By Harry Wallop A woman stands with her shopping trolley full of M&S shopping bags after their '20% Off Everything' sale on November 20 Photo: Getty Images
'Normal' - definition required
Gordon Brown has injected £37billion into Lloyds-TSB, HBOS and RBS, and extended billions more in support to other banks. Yet business groups say banks are still refusing to lend to some firms and demanding punitive rates of interest from existing borrowers. Restoring bank lending to "normal" levels is "the single most pressing challenge to domestic economic policy", Mr King said.
GB new tax avoidance scheme
Ministers have drawn up secret plans to increase VAT to 18.5 per cent after the next election. Labour sneakiness...
New Star nominating itself to be the first of many to crash
Looks like they are going to have to start selling a bit quicker!!!
Plans to raise VAT to 18.5% and they posted it by mistake on their website !!!!
The Treasury was tonight forced to deny that Alistair Darling was drawing up secret plans to raise VAT to 18.5% in the next parliament in an attempt to fill the £60bn black hole in the Government's finances. Officials insisted that a document outlining an intention to raise VAT to a record rate had been put on a website by mistake and that the chancellor had rejected the idea in the run-up to Monday's pre-budget report (PBR).
Myths of Home Information Packs
They have not had a good response in general. Point 5 was a good one in relation to HIPs and conveyancing fees.
Who will want to buy a house with these kind of projections?
The figures from the BBA follow a warning from Sir James Crosby that net mortgage lending could fall to zero over the next two years.
From 28th Oct - but worth a read....
Brilliant: BBC gets simple % saving wrong
I think this illustrates the general misunderstanding of % in this country. I'm presuming it's a "soft" degree journo reporting financial news, like the rest of these muppets. Ross was right. BBC, FYI it's 1.15(£10,000/1.175) = £9,787.23, giving a saving of £212.77.
Myths of Home Information Packs
They certainly haven't had a good press but they are still here. Point 5 was interesting about conveyancing fees and HIPs.
What would the payoff have been if he had been any good at his job??
Taylor Wimpey down as cash worries perist
"They've still got banking facilities to be rearranged it appears that they're struggling in terms of support for an equity raise," says Panmure analyst Mark Hughes. "I think people are very concerned that the equity in this company is valueless or close to valueless."
Case-Shiller survey shows 16.6% annual decline in summer months as housing picture continues to dete
The home price plunge stayed on a record pace this summer, according to a widely watched gauge of national real estate markets released Tuesday. The S&P Case-Shiller Home Price national index recorded a 16.6% decline in the third quarter compared with the same period a year ago. That eclipsed the previous record of 15.1% set during the second quarter. Prices in Case-Shiller's separate index of 10 major cities fell a record 18.6%, while its 20-city index dropped a record 17.4%
US Taxpayers buy mortgage debt
"Under this new rescue plan - which is in addition to the already-announced $700bn bank bail-out - the Fed is to buy up to $100bn in debt from the troubled mortgage giants Fannie Mae and Freddie Mac. The central bank said it would also buy another $500bn in mortgage-backed securities - pools of mortgages that are bundled together and sold to investors." Could this put downward pressure on the dollar? Big dollar/sterling fall between 1-2.00GMT but apparently not sustained. Anyone anticipating a future dollar collapse and if so, by how much? (against gold or sterling)
US home prices still tumbling tumbling
As the Fed spends another gazillion dollars to shore up the global financial system, the market that started it all continues to collapse.
Goodwin’s $140 Billion Binge May Doom RBS to Nationalization
During nine years at the helm of Royal Bank of Scotland Group Plc, Fred Goodwin excelled at beating his peers. In 2000, he pulled in the richest paycheck among British bank chief executive officers. He carried out the world’s largest bank merger, making RBS Europe’s No. 1 lender as of June 2008, with assets of 1.73 trillion pounds.
Short but very sweet!
Daily Mail: Banks 'to freeze mortgages' as Treasury reveals house prices will plummet by a QUARTER next year
Mortgage lending could dry up completely next year leaving no-one able to afford to buy a new home, according to a devastating report. In a huge blow to Alistair Darling's plans for keeping Britain in tact through a crippling recession, experts predict banks could stop giving any loans to aspiring homeowners. Former HBOS chief Sir James Crosby believes net lending will drop to below zero for the first time on record as people pay more money back to banks than they take out. The freeze on new loans will see house prices collapse by a quarter next year, according to the small print of Mr Darling's own Pre-Budget Report.
Will they use anti-terror legislation to silence this heretic?
"As an anti-consumerism campaigner, I'm frequently labelled as irresponsible when I encourage people to stop shopping. But the government is being much more reckless, when they ask us to shop our way out of the crash." Over-consumption is also the root cause of environmental destruction, says Mr Boorman.
A bit off-beat - but it proves GBH knows very little indeed ...
See comment #2 >>> The Chancellor obviously has little grasp in reality. As a specialist developer of small industrial units with a few empty small units available around the UK, this change will have little or no impact on our empty rates bill. I presume he is looking to help owners and occupiers of lock up garages? I didn't realise that these made up 70% of the empty commercial buildings in the UK.
King: Expect bigger rate cuts
Sterling fell to a session low versus the dollar on Tuesday after Bank of England Governor Mervyn King said the bank may need to cut rates by more than they would otherwise as banks are slow to pass cuts on.
King: Banks need more $$
Bank of England Governor Mervyn King said U.K. financial institutions may still need more capital and the “single most pressing challenge” facing policy makers is to revive the flow of credit through the economy.
Bank issuing a negative assessment of housebuilders
Credit Suisse (CS) believes the trading outlook for housebuilders in 2009 is “extremely poor” as consumer confidence continues to dive and credit availability remains restricted. CS believes the resale of repossessed properties will act as a further drag on the housing market, forcing housebuilders to slash prices to generate sales income to keep the bank manager happy.
Britain's going bankrupt - keep selling sterling
"...we can't expect any soul-searching from the Government. Gordon Brown doesn't do mistakes. He won't admit he's wrong on his path for the economy. And that's why we haven't actually seen any massive change in direction here – it's just more of the same. We'll carry on as we were before - more borrowing, more public spending, and more taxes. And judging by previous experience, the current forecasts will be ludicrously optimistic. So who knows how deep the debt hole will really be next year. £130bn? £150bn? £200bn? Where does it end? Bankruptcy."
Another Lighter Note
. . . but what about, uh, the nation of Switzerland? Its two largest banks hold about 10 times the nation's total GDP on their balance sheets, which means writedowns could require an Iceland-style bailout by other counties. Once that happens, it may only be a matter of time before the kingdom of Great Britain and Northern Ireland declares bankruptcy. Business journalist Will Hutton noted in the Guardian that Britain's heavy dependence on financial services left the country looking like "a gigantic hedge fund" whose "fall could get out of hand." But the indomitable British spirit compelled Hutton to add, triumphantly, "we may muddle through."
Not quite Para-gone (yet)
UK buy-to-let mortgage lender Paragon Group has reported a 43% fall in annual pre-tax profits to £53.7m ($81m) following the credit market turmoil. Paragon slashed new lending by 75% to £1.13bn in the year to 30 September after its funding costs soared. The company, which specialises in lending to landlords, said 0.53% of its mortgage accounts were in arrears - a three-fold increase from last year.
On a lighter note...
Nov. 25 (Bloomberg) -- U.K. home loan approvals fell by more than half from a year earlier in October, the British Bankers' Association said, as a Treasury report forecast net new mortgage lending may fall below zero next year.
Another day, several more reckless throws of the dice ...
Mortgage lending by the UK's biggest banks has fallen sharply
Mortgage lending by the UK's biggest banks has fallen sharply compared with a year ago, a banking body says. The number of mortgages approved for house purchases was down to 21,584 in October, 52% lower than a year earlier. The figures come the day after a stark warning about the state of the mortgage market in a report by former banker Sir James Crosby. He warned that without government intervention, net new mortgage lending might shrink in 2009.
World's finance ministers need desperate soloutions
The radical measures announced in Alistair Darling's pre-Budget report reflected a growing belief among the world's finance ministers that desperate solutions are needed to head off another Great Depression. Other major economies are now expected to follow suit by considering increasing tax for their wealthiest citizens to fund tax breaks elsewhere. In America, President-Elect Barack Obama urged the new, incoming Congress to pass a major financial stimulus package "right away" to "jolt" the US economy back on track.
Will Labour go to the polls next ye and win?
Prepare for a general election next year – if not in the spring, certainly by the autumn. Alistair Darling's temporary tax giveaways (much of which – especially the VAT reductions – will be clawed back in 13 months time) has all the hallmarks of addressing the political rather than the economic cycle. Every cabinet minister will be under orders never to mention the "election" word. But it is inconceivable that Gordon Brown will want to risk losing the short-term advantages given by this pre-Budget report, before unemployment rises relentlessly to three million by the end of 2009.
Government commissioned report predicts house prices will plummet
New mortgage lending in the UK is set to evaporate next year as banks shy away from previous lending levels, a new report commissioned by the government has revealed.The Crosby Report, compiled by Sir James Crosby at the government's request, predicted that net new mortgage lending would fall below zero in 2009, down from £40 billion in 2008 and substantially lower than 2007's lending figure of £108 billion.
Well, eveyone seems to be over the moon with ZaNuLabours magical plan
The Chancellor was accused yesterday of using a flawed tool to stimulate the economy amid concern that the £12.5 billion temporary cut in VAT would not work properly. The reduction from 17.5 per cent to 15 per cent was too little to be effective, may not be passed on to consumers and could be neutralised by people deciding to save, economists said. “This will do very little to give the UK economy the impulses it needs,” Hermann Simon, from the management consultant Simon-Kucher & Partners, said.
The 800,000 people who will fund the costs of the pre-Budget report
Those earning between £40,000 and £100,000 will pay an extra £500m in total in National Insurance - an average of more than £150 per person.
Banks agree to follow the rules for a change
Homeowners who are struggling to meet mortgage repayments were given a lifeline yesterday as some of Britain’s biggest lenders agreed not to repossess properties until at least three months after borrowers first go into arrears. Repossession would only be sought as a last resort after other alternatives, such as a minimum payment plan, had been pursued. However the Council of Mortgage Lenders (CML) said that not all borrowers would be protected by the three-month “moratorium” on repossessions because only a handful of big lenders had agreed to the proposal. Customers with sub-prime or buy-to-let deals from smaller, specialist lenders could still be repossessed within three months.
Struggling homeowners get more money; struggling tenants don't
Homeowners facing repossession or struggling to meet mortgage payments after losing their jobs will receive extra support from the government following Monday’s pre-Budget report. The government focused its attention on helping existing borrowers in danger of losing their homes rather than first-time buyers who are having difficulty entering the property market. From April, the government has agreed to cover the monthly interest due on mortgages of up to £200,000 for eligible borrowers who have been out of work for at least 13 weeks and are having difficulty meeting their payments. Previously it only offered support to homeowners with mortgages of £100,000 or less.
Another bank teeters on the brink
Standard Chartered, the emerging markets bank that has been regarded as one of the winners of the credit crunch, yesterday joined other banks in bolstering its balance sheet through a £1.8bn cash call. Reversing its position from just three weeks ago when chief executive Peter Sands insisted the bank had a strong balance sheet, Standard Chartered admitted the economic climate was deteriorating. [Comment: Isn't amazing how things can change so fast in such a short time? To go from a strong balance sheet to £1.8bn short in just three weeks seems incredible to me.]
US government plan to pay peoples mortgages for them
The US government's 'Hope for Homeowners' program tells lenders to write down the principal on peoples loans to 90% of their home's current value, and lowers the interest rate so that the monthly mortgage payment is no more than 38% of their take-home pay. In return, the government would guarantee to pay off the loan if the borrower ever defaults. These rules only apply if the homeowner has missed three consecutive mortgage payments, a perverse disincentive to keep paying your mortgage. The new modified loans are re-defaulting at a rate of 50%. Thus the government is going to be paying for half the mortgages it is guaranteeing.
Next stop on the crash train: unemployment
"At a one-stop career center, candidates are feverishly applying for two months of temporary work with United Parcel Service. The pay was $8.50 [£5.60] an hour. There were 150 slots, and more than 300 applicants. A few years ago, these people were working. Now, with the nation’s jobless claims at a 16-year high, they are among the 20 million people expected to use federal workforce services in 2008, up from 14 million in 2005. Economists say the full impact is easy for lawmakers to miss. Many people apply for unemployment through the Internet, cutting down on actual lines. And those most in need are largely invisible - unskilled, less educated and disproportionately black or from immigrant communities."
Debt figures revealed to end international speculation that Dubai is in trouble
According to one of Dubai's top property bosses, the emirate has $80bn of debt outstanding against a total asset base of $1.3 trillion. "Dubai's growth has been at a rate of 13pc to 14pc a year. If this comes down to 6pc or 7pc or 8pc then fine. We've been running a long time and could probably do with a breather. We will use this time to learn lessons and become a stronger city." [Question: How much of Dubai's wealth is based on foreign investors piling in to their property market? I thought they were a bubble like all the rest?]
Cost of Bankster Bait and Switch Now $7.4 Trillion
Bait, because Congress was told that mortgages would be bought, switch, because they took over healthy banking institutions with the loot after gaining dictatorial powers. “The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago,” More analysis from Kirt Nimmo.
The housing market is beyond help
“They are resigned to losing the half a million deposit, and are happy to walk away on that basis, but the seller wants to pursue them for every penny they’ve got. They’re in real difficulty,” says the couple’s lawyer, Simon Thomas, a partner at Thomas Legal Group, a high-value property specialist focusing on London and the Cotswolds. “They’ve lost up to 70% of the value of their bonuses and their stock options – options collected over years and years. That was a big hit for them. They’ve gone from a position of strength, with a 15% deposit, to having no share values.”
Adviser to the Treasury Select Committe thinks Darings as mad as a box of frogs!
A University of Manchester professor who acts as a special adviser to the Treasury Select Committe said today that it was "incredibly risky" for Alistair Darling to have cut the rate of VAT, given the dangers of deflation. The Chancellor today cut the purchase tax from 17.5 per cent to 15 per cent as part of a £20 billion fiscal stimulus to help the economy through recession. He said that the cut was equivalent to putting £12.5 billion back into the pocket of consumers over the next 13 months.
Nationalizations take dramatic losses from the private sector and places them on the larger balance
It's not preferable, but all major U.S. financial companies will eventually be under government control because the alternative is so much worse, Hugh Hendry, chief investment officer at hedge fund Eclectica Asset Management, said Friday. All financials will be owned by the U.S. government in a year," Hendry said. "I bet you." Nationalizations take dramatic losses from the private sector and places them on the larger balance sheet of the public sector, he said. "It's not good," but society is vulnerable and society is going to have to intervene, Hendry said.
More Back Door Privatisation of Common Wealth Assets
Alistair Darling is to help pay for his spending splurge by making more than £30billion of cuts from Whitehall costs and selling off a series of state-owned household names. Among the British institutions earmarked for sale within the next two years are the Met Office, mapmaker Ordnance Survey and the Forestry Commission. The list is also thought to include the Queen Elizabeth II Conference Centre in Westminster. Channel 4 is excluded for the moment, but will be assessed by Lord Carter, the new communications minister. Gordon Brown set a target of raising £36billion from disposals by 2011 and more than £18billion has been raised so far, mostly by offloading surplus land and property. ^^^^^^^^^^^^^ However, the current financial turmoil means it is a buyer's market.
It's been a while - the Comedy Club is back in session
If one reads the views of some commentators on the buy-to-let industry, the situation appears unremittingly dire: one of failure, negative equity and collapse. Standard & Poor's recent study suggested that the fall in property values could lead to as many as four out of every ten investors being in negative equity next year. This month's Landlord and Buy-to-Let Show at the NEC in Birmingham, produced a consensus that success is still there for the taking if those keen to invest for the first time or add to their portfolios in the current market make sure they carry out thorough research on the homes they are investing in and the tenants they are taking on. Those buying now or in the near future will be buying at or near the bottom in the market.
What does the pre-Budget report mean for you?
Are proposed measures in the pre-Budget report as radical as Alistair Darling and Gordon Brown would have you believe? A summary of the key points for consumers.
New York sneezes; will London catch its cold?
New York may lose as many as 225,000 jobs and $6.5 billion in securities industry-related tax revenue over the two-year period ending in October 2009. “Wall Street is the engine that drives the economies of New York state and New York City, but the global credit crunch has slowed that engine down,” DiNapoli said in a news release. “This year is on pace to be one of the worst years ever on Wall Street.” Finance industry-related activities account for 12 percent of New York City tax revenue and up to 20 percent of state revenue, the comptroller’s office said. Before the crisis, the securities industry accounted for 5 percent of the city’s employment but almost 25 percent of wages, the office said. [Similar figures for London, presumably? How will that affect property prices in London?]
The situation is dire - stock market bounce is built on nothing
Nov. 24 (Bloomberg) -- Home resales in the U.S. dropped in October and prices fell by the most on record, signaling a deepening housing recession going into 2009.
Government borrowing is to soar and confirmed that the country will fall into recession next year
Speaking to Parliament as he unveiled a £20 billion package of tax cuts designed to boost the British economy in his pre-Budget report, Mr Darling said that borrowing would reach £78 billion this year - approaching twice what was originally budgeted for - and will reach £118billion in 2010.
The economy will bounce back quickly from recession and start growing again second half of 2009
He confirmed that from next week, Value Added Tax will be reduced from 17.5 per cent to 15 per cent, cutting £2.20 from every £100 of consumer spending. The VAT cut will last until the start of 2010, when ministers expect the economy to be recovering. Mr Darling said the measure meant the Government was putting £12.5 billion into the economy. However, some retail experts have questioned whether such a modest cut will be enough to stimulate consumer spending. Many big retailers are already cutting prices by as much as 20 per cent in order to lure customers back, with only limited success.
Mr Darling will borrow his extra billions for his measures from international investors.
Mr Darling will borrow his extra billions for his measures from international investors. He needs to reassure the international markets that fund his borrowing that the UK public finances will improve quickly once the recession is over, to stop investors demanding a higher return on Government bonds. That means that when the economy returns to growth, taxes will rise and Government spending will fall. In his speech, Mr Darling promised "to put in place measures to ensure sound public finances in the medium term, to ensure as a country we live within our means".
The Chancellor's pre-budget report speech in full
The full text of the Pre-Budget report statement to the House of Commons, delivered by Chancellor Alistair Darling.
Masive increase in money supply=rally in everything followed by hyperinflation. Game over!
The dollar and yen weakened on Monday as investor appetite for risk ticked higher on the back of rallying equity markets, following the US government bail out of Citigroup, the financial services company. US authorities said they would issue a guarantee covering $306bn of troubled mortgage-linked assets and inject a further $20bn in liquidity on top of the $25bn it had already received.
Add to this the 'reluctant landlords' that decide to let their propoerties while trying to sell...
Alistair Darling unveils £20bn tax cut package
Alistair Darling has announced a £20 billion package of tax cuts designed to boost the British economy in his pre-Budget report, balancing them with a tax increase for higher earners.
Useful recession page (found it by clicking prebudget whats in it for you!) lol
The banking crisis might be nearing its end, but the recession has only just begun. While unemployment hits the highest levels in a decade, the UK economy - long regarded as the strongest and most resilient in Europe - has now been tipped to be the hardest hit.
Germany has clung steadfastly to budget orthodoxy but the downturn has now begun to engulf Europe's
Euro-zone industrial orders plunged 3.9pc in September and Germany's IFO index of business expectations has fallen to the lowest level since the survey began half a century ago, heightening fears of a severe slump across Europe next year.
90 jobs to go as factory closes
This is the story of the housing crisis, the banking crisis and the global financial meltdown.
Everyone, everywhere was levered to the hilt, using piles of borrowed money to make leveraged bets on everything from real estate, to stocks, to currencies, to bonds, to companies themselves (LBOs), etc. With so many people maxing out leverage to drive returns, all it takes is a small decline in asset prices for all of them to go bust. Unfortunately, the decline in asset prices isn’t going to be small. Consequently, the value of equity capital will continue to get hammered.
“If you mark to market today, the banking system is bankrupt,”
Nov. 24 (Bloomberg) -- The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago
The Telegraph's live blog following the pre-Budget report
Global house prices fell for the first time on record over the past three months, underlining the extent of the downturn. • Britain among worst performers with 10% drop • Dubai, Slovakia and Russia see big increases
Wish we had the luxury to wait - in January we won't have an ecomomy
They think its all over, it is now !!!!!! - for the UK that is
Must be refering to Alister Darling's PB speech today!
Very suprised to find this at the TOP of this news blog! do they know something we've all missed? "Some of these prophecies concern the demise of the United States over the next year, which will be followed by man's final world war. This last war will be the result of clashing religions and the governments they sway. Billions will die! This time will far exceed even the very worst times in all human history." puts doomandgloom to shame - hardly worth buying a house then?
"The combination of being one of the most densely populated countries in Europe and a drop in supply of new homes may limit price declines."
why? makes no sense!
My instincts still tell me that any defation will be very shot lived.
Money off everything! In a country that has made shopping its national pastime, the idea of persistent falls in the prices of all or most products and services sounds like the ultimate bargain bonanza. Yet in an economy already beset by dangers and difficulties on all sides, the emergence of just this trend – deflation – is rapidly emerging as the latest peril to Britain’s prospects. With the “R” word, recession, already a grim reality, now it is the less familiar “D” word that is provoking fear and loathing among economists and officials. Behind this alarm lies the knowledge that, although sustained falls in prices across the economy might seem like a dream for shopaholics, in practice this can swiftly become an economic nightmare.
Greenpeace activists scale Bank of England on budget day to demand greater investment in green tech
Activists from environmental group Greenpeace scaled the Bank of England building in the City of London today, calling on the Government to invest in "green" industries as part of the response to the recession.
Biggest bank in the world nationalised plus taxpayers to fund car loans!
Worth a read occasionally. This made me especially angry: "If you're shocked by the thought that we as taxpayers may soon be financing car purchases, don't be...The motor makers want to exchange bonds or securities backed by car loans for Treasury bills - which would help them provide finance to those who might still want to buy a car, in spite of the inclement economic weather." If people want to buy brand new cars but can't get loans, they should try SAVING first. Oh no, car sales are falling! When did this country become so utterly perverted....
As businesses in shopping centers close, decreased foot traffic threatens the survivors
Without close inspection, you could chalk up the receding monthly sales at the Maui Wowi smoothie shop to cooling temperatures. But slumping sales began in April. You could argue that fewer people today can afford a $4 or $6 smoothie. But Maui Wowi also sells 99-cent coffee. Co-owner Paul Goldberg has a different theory: declining foot traffic at Spanish Trail Business Park, on Rainbow Boulevard near Tropicana Avenue. And it doesn’t help that most of the new office suites in the rear of the complex still don’t have tenants — another source of smoothie and spa customers.
Currency collapse imminent
Bullionvault: Gold Ends Week 6.6% Higher as Stocks Lose 8% to 11-Year Low; UK Gold Price Hits Record Closing High - Saturday 22nd November 2008
Gold is now trading at £545. On its way to £1000 and beyond. So, Icelandic conditions on the way. Recent price slump was desperate manipulation to keep the economy from presidential debates. But, in reality, gold prices aren't rising, they are remaining stable, the supply of gold and its value is always stable. What is happening is that currencies are slumping and asset prices are deflating in real terms. But you only benefit if you have a real store of value. Anybody without at least 10% of their wealth in gold and other real assets will be left totally exposed. Physical coins are best because the institution holding your gold in a vault could fall if they have cash reserves in a bank that goes under.
And now for some Euro News
German business confidence has plummeted to lows not seen since the early 1990s in the latest evidence that Europe’s industrial powerhouse has suddenly been thrown into reverse. The Munich-based Ifo index reported its business climate index had fallen much more sharply than expected from 90.2 in October to 85.8 in November, the lowest since February 1993. It was the sixth consecutive monthly fall in the index, which is closely watched as an indicator of future trends in activity. Businesses’ expectations about the next six months were the weakest since the pan-German series started in 1991 – and for almost 50 years using data for former West Germany, economists said.
Gordon Brown vows to keep recession short
Gordon Brown has promised to do everything possible to ensure that the recession is as short as possible. Mr Brown told the Confederation of British Industry annual conference: "Simply letting the recession run its course, to say there is no alternative, is not an option. "To fail to act now would be not only a failure of economic policy but a failure of leadership.
Can Darling’s VAT cut save the UK economy?
Alistair Darling's pre-budget report will focus on a 2.5% cut in VAT. But in a recession we shouldn't be trying to encourage consumption - we've done enough of that already, says John Stepek.
Fed Pledges Top $7.4 Trillion to Ease Frozen Credit
he U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago. The unprecedented pledge of funds includes $2.8 trillion already tapped by financial institutions
Pre-Budget moves sum up paucity of both country and political thinking
Telegraph: Pre-Budget report: Pre-Budget moves sum up paucity of both country and political thinking
The leaks on what will be announced in the pre-Budget report sum up the absolute paucity of both the country and of the political and economic thinking in the top echelons of government.
More doom, it's time to abandon the Good Ship Britania.
Basically, every indicator (though not the government's flawed statistics) are pointing down, irrespective of this tax freebie (which actually makes it worse). >>> "Official figures released last week show that the number of central and eastern European migrants from the so-called A8 accession countries registering to work in the UK is running at a three year low. This is yet another indicator of worsening labour market conditions."
Labour has lost their marbles, take their stuff
Retailers say VAT cut isn't enough to save the High Street
Leading retailers fear the VAT cut will be too little to save the British high street as the latest figures show "unprecedented" sales are failing to get shoppers to part with their cash.
Is allowing this a good idea?
The problem is a restriction of credit due to banks with insufficient capital. Why then, provide a safe haven in the form of government bonds? Understandably, the government cycles this flow of wealth back to the banks, but surely better for governments to refuse to provide any safe haven. This wealth would be obliged to go elsewhere. The UK government stimulus is a bit of a fake if it is funded by removing capital from the banking system. We are surely closer and closer to monetisation.
The rich get twitchy
Bleat Bleat Bleat
THE Daily Express today launches a crusade against the threat of hundreds of thousands of families losing their homes. On the eve of today’s Pre-Budget Report, this newspaper demands a proper amnesty to give struggling home-buyers a lifeline. Our crusade presses for an amnesty of at least one year’s grace for home owners slipping into mortgage arrears through genuine hardship. Other measures proposed, by housing charity Shelter, include allowing interest-only mortgages, extending the repayment term, repayment holidays and being able to put outstanding debt on to the mortgage.
U.K. Government seeks urgent cash injection
Wile E Coyote economy: what happens if we believe that asset prices will drop?
Even as recently as August, we were being told by the Bank of England that the real economic risk was inflation ... Now, just a few months later, oil has dropped below $50, commodity prices have fallen by 40 per cent and, five weeks before Christmas, British retails stores are slashing their prices by anything from 20 to 40 per cent. UK and US interest rates have been cut sharply and will go even lower, and the Bank and the US Federal Reserve are now predicting inflation may go negative – perhaps as soon as the middle of next year. All talk is of recession, deflation and depression.
Property owners patiently waiting for the recovery?
The number of empty homes in England is increasing because of the downturn in the housing market and a sharp rise in repossessions, a charity has warned. The Empty Homes Agency is urging the public to report homes left vacant for long periods so it can inform councils, which can bring them back into use.
Footballer turned BTL king
FOOTIE ace Robbie Fowler is down £12million in the credit crunch.The Liverpool legend’s property empire – once worth £30million – has plummeted 40%. Robbie ploughed his earnings solely into flats and houses. It worked at first because he tripled his fortune. He would never have anticipated the economic meltdown that has left the property industry in freefall. Because Robbie has put his money into the top end of the market, he’s suffering more than most. So renowned was he as the “buy-to-let king”, fans at his former club Manchester City sang to the tune of Yellow Submarine: “We all live in a Robbie Fowler house.”
Is this on top of Paulsons $700 Billion?
Nov. 23 (Bloomberg) -- Congress will send President-elect Barack Obama an economic stimulus package the day he takes office Jan. 20, two Democratic lawmakers said today. Senator Charles Schumer of New York said on ABC’s “This Week” program that the package will be between five and $700 billion. House Majority Leader Steny Hoyer, of Maryland, said on “Fox News Sunday” that he believed the Inauguration Day goal would be met, but he declined to put a price tag on the bill. “I think Congress will work with the president elect starting now and will have a major stimulus package on his desk by Inauguration Day,” Schumer said. “I think it has to be deep. My view it has to be between $500 and $700 billion.”
Nomura hatches plan for huge capital boost
Nomura Holdings Inc. is considering raising several hundred billion yen in capital to strengthen its standing amid the global financial meltdown, sources said Saturday.
Ambrose at his most extreme finest
If this crisis is botched by the major powers – as the lesser crisis of 1930-1931 was so botched by politicians stuck in a mould – we risk a self-reinforcing spiral into devastation. Matters are getting out of hand. The American bank JP Morgan has just told clients that the US Federal Reserve will cut interest to zero by February. This never happened in the Great Depression. You can’t cut below zero. At that point, deflation increases the “real” burden of debts at a compound rate.
Video - Rebound in housing coming says Dr Doom
Marc Faber says it is likely that reflation efforts of Central Banks will succeed and cause a rebound in asset prices, and yes that includes real estate - housing (he says this at 5.26 in the video). This will happen as money flows out of cash & Treasuries seeking higher yields. If this rebound does not happen and instead things go lower then it means we are in for something worse than 1929-1930.
Citigroup hovers on the brink of collapse
Executives of Citigroup, one of the biggest banks in the US, are in emergency talks with the US Treasury to gain much-needed funding, reports say. The bank is also said to have contacted certain shareholders to assess their interest in increasing their stakes as as it faces an uncertain future. Citigroup stock ended 20% lower on Friday as its board members met. Last week the company announced 52,000 job losses worldwide on top of 23,000 job cuts previously announced.
I am taking bets on which chain will go bust!
Suppliers affected by the credit insurance firm's decisions can include product manufacturers, distribution firms, advertising agencies, landlords or even clothes hangar designers. Retailers affected to date include JJB Sports, Currys and Focus.
£2bn MoD shortfall 'will hit jobs'
no room for Gordon then..lol
Recently protests had been held at the site by local people at plans by the owner to demolish some of the buildings, which had been added after the main building had been constructed, in order for the development of new housing. But Ayub Bhailock, a consultant with Freemont Denbigh Ltd, said permission for demolition of certain buildings had been issued three years ago, in conjunction with Denbighshire Council, the Welsh Assembly Government and Cadw.
It must be like this in the UK too, but of course no-one will admit it
"If I do 50% less volume, then my staff has to go down 50%," he said. "I'm just trying to hold on to the good salesmen I have." Customer traffic is way down, according to Park. "They're still worried about 'Am I going to lose this job? Can I make it through this Christmas season?' That's what they're thinking."
Rage in Iceland
Iceland is the first country whose economy has toppled, destroyed by a deflating housing debt bubble that is sinking the world economy. They are calling for the gov to step down for these errors. Perhaps we should do the same to our chancellor who fell asleep with a smug smile while our bubble floated up into blissful insanity? Rage is understandable but not always useful. Better to channel it at protecting yourself now. Get rid of debt, keep your job, invest wisely if you don't trust cash in the bank.
I wouldn't say hilariously candid, more like sad truths!
More 'secret' talks
The speed of the economic decline has not just hit the motor industry. A number of large British-based industrial groups are also considering asking the government for financial support. If help is not given tens of thousands of jobs are at stake.
Yawn. Delusions of Grandeur!
Scotland is about to enter its worst recession since 1980, but will still fare better than the rest of the UK, economists have predicted. The study by the Ernst & Young Scottish ITEM Club said Scotland's GDP was likely to contract by 0.4% in 2009. But it said this would be significantly better than elsewhere in the UK, where there will be a fall in output of 1%.
Merry Christmas from Gordon Brown
What troubles me is that the need to give a tax boost to the economy, which most of us would accept is desirable, is being used to conceal a really dreadful underlying fiscal position. If people realise that, they will realise that there will be a long squeeze on their living standards for a decade or so, as this deficit in gradually corrected. The rational response is to correct their own personal balance sheets, pay off debt as fast as they can, and get to work on improving their pension, because the Government in 10 or 20 years' time won't have the funds to help them. Golden periods don't feel like golden periods at the time. People who took out big mortgages, in effect borrowing to finance a standard of living they could not really afford, now face a harsh adjustment.
Got nequity? Repossession, repossession, relocation
Property permabull Anne Ashworth suggests that if people are having trouble repaying their mortgage that they defy the laws of gravity, sell their homes and downsize. Genius. Forget that no-one will buy it, even if it is priced way below your mortgage, and forget the fact that if you're in a studio flat in central london (one of the worst affected areas) that you can only downsize to a garage. Why does the Times still employ ditzies like her?
Housing is now a non-buy
In what will be seen as a major about-turn by Britain's central bank, Charlie Bean pledged to do more to prevent major credit bubbles developing in the economy. He also acknowledged tacitly that central banks around the world did too little to prevent the housing boom from emerging in previous years. His comments, made at a conference in Istanbul, are likely to have serious implications for the path of Britain's housing market in future years.
Hyperinflation or deflation - the jury remains out
Fiscal spending is part of the problem, not the solution. At this stage, the dynamics over the coming years are shaping up. Investors may want to consider whether to take advantage of the panic buying of U.S. dollars to diversify their holdings. Typically, when a currency appreciates, the money is invested broadly in an economy; in recent months, most of the money flowing into the U.S. was invested in short-term Treasury Bills. We very much doubt that all this money will stay in the U.S. once the panic abates. Indeed, whereas just about everyone seems to be concerned about deflation, the risk of not only inflation, but hyperinflation increases with every step taken down this road.
VAT cut by Christmas
Bad timing. An announcement of this cut, but today is 22nd November... The only plus is that I don't think anybody cares about a 2.5% change in VAT (good example of EU restrictions though). Probably £300 is a fairly substantial family gift but you are only going to save £7.50 .
Obama has a dream, over to you Gordon
Obama; "We'll put people back to work rebuilding our crumbling roads and bridges, modernizing schools that are failing our children, and building wind farms and solar panels". Gordon; I'll cut VAT for XMAS - D'Oh.
Debt securitization is dead - so we're headed only one way!
"Neoliberal economists in the last three decades have denied the possibility of a replay of the worldwide destructiveness of the Great Depression that followed the collapse of the speculative bubble created by unfettered US financial markets of the 'Roaring Twenties'. They fooled themselves into thinking that false prosperity built on debt could be sustainable with monetary indulgence. Now history is repeating itself, this time with a new, more lethal virus that has infested deregulated global financial markets with 'innovative' debt securitization"
Beware when a CEO says that his bank is fundamentally sound....
75,000 job cuts at Citigroup. Today it looks like a very optimistic figure.
Boo, Hiss, he's behind you!! The B(w)anker
Never mind wicked stepmothers, ugly sisters and evil witches. As London’s pantomime season gets under way for the Christmas season, there is a new villain in town – the banker. As the effects of the economic crisis make themselves felt, writers of the annual children’s entertainment are turning away from traditional characters and looking to the capricious world of international finance to find their baddies.
Cardiff Bay - 50% off
Deflation? Could this move be the very beginnings of the return of inflation?
Sony is planning big price rises in the UK because of the strength of the yen against sterling, in a move that threatens to put extra pressure on Britain's embattled retail sector. The Japanese electronics giant said it had informed trade customers in the past 48 hours of the price increases in Britain and Ireland driven by the yen's rise against the pound and the euro.
Badger to the rescue with ergh ... more debt
The Chancellor, Alistair Darling, is spending the weekend putting the final touches to a package of tax cuts and big increases in public spending. The measures, designed to revive the flagging economy, are to be announced in Monday's pre-Budget report. It is understood Mr Darling will say tax cuts will only be short-lived and taxes will have to rise in the future.
bye bye buy to let
Soaring numbers of buy-to-let investors have fallen behind with their mortgage and face losing their property, official figures revealed yesterday. The worst economic meltdown since the First World War has spelt disaster for many who took out one of Britain's 1.1million buy-to-let loans. The figures, from the Council of Mortgage Lenders, show a rise of nearly 50 per cent in defaults for these mortgages
Darling Hands tied
This article seems to contradict a previous proposal by Darling, as you know there is a lot of pressure on Uk banks to lend. Lending cannot be maintained at 2007 levels even for existing borrowers because 50% came from NR. I then expected that Darling would stop the run-down of NR and re-enter the market to supply credit. However, it seems that Granite which supplied NR with funds through securitisation has now gone into run-down and split from NR. So how Darling will be able to force the existing lenders to supply credit seems to me impossible because there is now only 50% of capacity left (which they don't want to lend anyway). NR seems to be gradually distilling itself into a collection of the very worst loans also.
It's not a depression. Its a Dark Age!
The scale of our problems has still not been understood. In essence the domestic banks are largely bust. The Government’s £500 billion bailout plan is primarily designed not to keep banks lending to small firms and to homebuyers but to prevent an unimaginable financial calamity.
more banks fail
Three more banks - two in California and one in Georgia - failed Friday, bringing to 22 the number of institutions forced to close in the wake of the financial crisis. The Federal Deposit Insurance Corp. said the banking operations of Downey Savings and Loan Association of Newport Beach, Calif., and PFF Bank & Trust of Downey, Calif., were acquired by U.S. Bank (USB, Fortune 500) of Minneapolis.
Gold Up This Week
NEW YORK, Nov 21 (Reuters) - Gold rallied above $800 an ounce on Friday, ending the week 8 percent higher, as mounting economic uncertainties and strong physical bullion demand triggered a bout of heavy buying. Investor confidence was shaken after shares of Citigroup, the second-largest U.S. bank by assets, tumbled for a fifth straight day, as the company looked at options, including a sale of parts of the company or a merger. Anyone have an opinion as to whether this is a temporary blip or not ?
The downturn spirals out of control
After many years of being overlooked in favour of more glamorous statistics such as GDP or inflation, unemployment is back in the headlines. A fortnight ago 20,000 jobs were lost at well-known companies. It is chilling to realise that these job losses are only the ones that we know about, because they have all taken place at publicly listed companies. One of the biggest challenges facing Alistair Darling in his PreBudget Report is how to create an environment in which employers feel comfortable about keeping staff. However, the Chancellor is far more likely to concentrate on initiatives such as rises in tax credits for poorer families, child benefits and winter fuel payments.
Prices to continue to collapse on the back of real estate - Why? Financial leverage is dead
Fears of deflation at home and abroad are looming larger as prices of commodities including oil and metals have begun to plummet amid the ongoing financial crisis, following those of shares and real estate. The opposite of inflation, deflation refers to a decline in general price levels, which creates expectations that they will drop further, choking consumption.
Celebrating the crash
I love stories about falling house prices. Yes, there is the wretched prospect of repossession for some. Yes, there are years of negative equity ahead for the many. But who in their right mind thinks £200,000 for a new build flat is a good thing, while £100,000 is bad. Greedy developers and bankers, that's who. Plus the foolish people who thought buy to let was a road to easy riches. The property market will recover. But when it does the goverment and regulators should not shy away from reining it in. If we're lucky we will never see real prices back at 2007 levels.
short, sweet and to the point
In the world of real business, the mood of chief executives has taken a discernible turn for the worse
Humour in our darkest hour
Early 1990's all over again, house prices have a long way to come down..
Banks are seeing an increase in the numbers of homeowners deciding voluntarily to hand back their properties because they cannot afford to keep up mortgage payments. Voluntary repossessions involve the bank selling the property at auction but this will not show up in official figures as a repossession because there has been no court order.
MailOnline: Number of landlords falling behind on mortgage repayments soars by 50% as buy-to-let boom turns to nightmare
Soaring numbers of buy-to-let investors have not paid a penny of their mortgage and face losing their property, official figures revealed today. The worst economic meltdown since the First World War has triggered a nightmare for the army of people with one of Britain's 1.1million buy-to-let loans
A bunch of BTL landlords are getting a bit grumpy about the state of the housing market. In particular they are looking for the government to force banks to lend them more money at interest rates below what banks currently are offering. They are using the argument that tenants may be made homeless unless banks lend more money, and more cheaply than they are now. Here is the text of the petition:
"the world economy has been used to using $4 to $5 of credit for every $1 of GDP growth."
The deterioration of the global economy in the wake of the ongoing U.S. housing bust and subsequent credit crunch is accelerating at a frightening pace.
Monday should be an interesting day!
On Monday, the chancellor will admit, by implication, that the government's industrial policy of the past decade has been something of a disaster. Actually to call it an industrial policy is a bit misleading - but what I mean is the Treasury's celebration over many years of the UK's growing economic dependence on the City of London and financial services. The City contributed around a third of our economic growth in the recent past and about 10% of total output.
A slow train wreck in progress!
Key Indicators Suggest Deep Recession
the situation is graver by the day and there are dreadful implications for consumer spending.
Investors stampeded into US government debt yesterday, viewing it as the only safe haven from a new round of losses in the rest of the credit markets and another plunge by stock markets around the world. Unprecedented demand sent interest rates on a whole range of US Treasuries to record low levels, in a flight to quality that surpassed even the effects of the mid-September panic. By contrast, corporate bonds, mortgage securities and other debt instruments continued to plunge in value, amid growing concerns that a global recession will lead to a new wave of defaults and losses.
On July 1 Iain Wright, the Under-Secretary of State at Communities and Local Government, announced that the number of empty homes in England had risen to 762,635, the highest level for nine years.
yes give to people who dont pay tax....as per usual
Towns and villages across England are bracing themselves for 'bombshell' news on the location of hundreds of new and upgraded gipsy and traveller camps. Work on some of the proposed 7,500 extra pitches will get the go-ahead within weeks under a controversial £97million scheme.
Bedlam Pick of the Week
215,000 German jobs threatened by crisis
BERLIN The German economy could lose up to 215,000 jobs in 2009 amid the global economic crisis, Germany's Bild newspaper said Friday, citing a survey it compiled.
mounting losses from credit cards, mortgages and toxic debt could overwhelm its efforts
Citigroup Inc faced a crisis of confidence on Wednesday as investors questioned the survival prospects of the U.S. banking giant, and its shares tumbled 23 percent to a 13-year low. The second-largest U.S. bank by assets has been reeling on concerns that mounting losses from credit cards, mortgages and toxic debt could overwhelm its efforts to slash costs and add deposits. Last month, Wells Fargo & Co dealt a blow by derailing Citigroup's bid to buy Wachovia Corp. and check here : http://www.marketoracle.co.uk/Article7366.html Citigroup: If this is the day of reckoning, and this is the time to start confessing, I will be the first to volunteer. I can no longer stand here before you and refute the fact that Citigroup is effectively insolvent.
Now it is US land prices falling, farmers in trouble
David Kanable at the Oregon Farm Center, a mill near Madison, Wis., was paying $7.25 a bushel for corn in June. “We never had a farmer lock in at that price. They wanted $8,” Mr. Kanable said. Now this Thursday, the mill was paying $3.17 a bushel. When commodity prices were feverish, the price of good farmland exploded, too. Cropland values rose about 20 percent in the Midwest farm belt last year, capping a multiyear rise. The market for land is definitely weakening. One reason is that the investors and part-time farmers are once again dropping away. " Farmers are trying to survive by cutting costs, planting less, using less fertilizer, owning cattle instead etc. Plan for food shortages ahead I recon, unless the dollar drops and US farmers can be profitable again.
Repossessions in July, August and September jumped sharply by 12 per cent and, according to the Council of Mortgage Lenders, full year numbers are expected to soar by 70 per cent compared to 2007.
Hmm this comming from a major shareholder in JJB??
David Herro, the veteran chief investment officer of Harris Associates, one of the US's leading activist funds and a major investor in UK companies, has said that the global economic slump could be more than half way through.
Reading between lines it looks like DSG (dixons, pcworld etc) might go bump
"Much depends on how much confidence the suppliers have in the business and things could quickly unravel after Christmas," he said. JP Morgan analysts are equally gloomy. "We expect the results to look very poor and give little support for those concerned about the group's prospects to survive the downturn intact," they said in a preview note.
Excessive property prices in desert wasteland show signs of instability
More anecdotals than data, but Dubai property falls must be inevitable, more than anywhere else on the planet. Will be a shame to see all those footballers' investments take a tumble
Citigroup for sale who will buy?
It is clearer each day we brits are being lied to about the real state of our economy
Singapore's economy shrank between July and September, confirming it was the first Asian country in recession in the current financial crisis. The island's economy shrank 6.8% in the third quarter, according to government data, worse than the first estimate of 6.3% the government made last month.
Jeff is always good value
Jeff Randall argues that the root cause of this economic misery is debt, and no recovery will be lasting until the Government starts to redeem its IOUs.
More downward pressure on residential house prices
The number of properties repossessed by mortgage lenders rose by 12% to 11,300 in the third quarter of the year, the Council of Mortgage Lenders (CML) said. The number of borrowers in arrears also went up compared with the previous quarter, by 8% to 168,000. The number of repossession orders made by the courts in England and Wales rose by 3% to 29,516 in the same period. The figures suggest that many more people are likely to lose their homes as the economy falls into recession.
Lets stop infrastructure funding and divert resources to justifiable projects like the Olymipics
Can they do this legally - surely some terror law covers this
The plant's 5,000 employees will be laid off for the duration of the closure without pay.
Boom 2 Bust!
More than 130 families a day are losing their homes to banks and building societies, shocking figures will reveal today. They show soaring numbers of people are paying the price for 'super-size' loans taken out during the property boom.
Just wait for Euro Parity. They're coming.
"As the pound struggles against other major currencies, the president of the European Central Bank has told Sky News that Britain is "welcome at any time" to join the euro." You think its bad now, imagine an ECB affecting our liquidity because of decisions made in Germany.
Wow, its really happening, only to 2003 levels, long way to go.
What IDIOTS borrowed that much money?! "With the median price of Southern California homes down more than 40% from its peak, the housing market has now slid further than most economists expected. The median sales price for homes in the region fell to $300,000 in October, a level not seen since 2003 and a 41% drop from the peak price set in the spring and summer of 2007, according to San Diego-based MDA DataQuick."
If Goldman Sach's gets cheap, n its bought by China, will China have taken over US Treasury?!
* Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz) shares fall as much as 25.5 percent to $4.77 * Bank of America Corp (BAC.N: Quote, Profile, Research, Stock Buzz) shares fall as much as 10.6 percent to $11.68 * JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz) shares fall as much as 18.5 percent to $23.21 * S&P financials index .GSPF falls as much as 8.5 percent * Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) shares fall as much as 11.1 percent to $49.00
Darling The Bank Enforcer
Alistair Darling is so exasperated by the 'moral failure' of banks to help small firms and families that he is poised to toughen the law. The Chancellor is studying legal options to end the 'unacceptable' behaviour of the banks towards companies struggling in the downturn. The Government argues that when the taxpayer-funded recapitalisation scheme was agreed, the banks entered into an undertaking to restore lending to 2007 levels. But Mr Darling also has a range of legal options open to him, including the creation of a 'bank enforcer' to supervise their lending behaviour, or the imposition of a cap on the interest charged for business loans.
Current situation in Israel, coming soon, to a town near you?
freerealtime: Banks reduce maximum mortgage financing: Union Bank will lend only up to 60% of a home's value.
Israel's banks have tightened their mortgage policies in recent months. In addition to raising their mortgage interest rates, they have also reduced the maximum funding they will extend to borrowers, even safe borrowers. Some banks have also stopped working with Ezer Mortgage Insurance Company Ltd (EMI), and will not provide borrowers with financing amounting to 90-95 percent of a home's value.
Mail/Littlejohn in biased article shock
A list of members posted on a website shows it to be a declining rump of lecturers, school teachers, social workers, trade union officials and former councillors. Many of them have never had a proper job in their lives and harbour dubious histories, in some cases descending into outright criminality.
Subprime Ripples out in the USA
YouTube of CNN. "They don't believe in free enterprise or free market. They want socialism for themselves. They want a handout and a net for themselves. To hell with everybody else, but give it to them. And I think, really, what we're seeing now — with them, with the banks — we're seeing the end of capitalism, the end of capitalism as we know it ..." – Michael Moore
Suspension of Foreclosures in US
Fannie Mae today issued a notice to its loan servicing organizations and retained foreclosure attorneys directing them to suspend foreclosure sales on occupied single-family properties as well as the completion of evictions from occupied single-family properties scheduled to occur from November 26, 2008 until January 9, 2009
Krusty bashing !!
Kirstie and Phil self professed property experts make a return to the UK's TV screens with a more muted version of their long standing delusionally bullish UK property candy floss show titled location, location, location that helped feed the get on the property ladder frenzy of the last few years
The top 5% is sucking up more & more money from the middle class.
congress congresswoman maxine waters economy bailout recovery fannie mae iraq bush gitmo habeas corpus
Auto companies need to submit a plan
Democratic leaders said Thursday there is no deal on aid yet for the Big Three U.S. automakers, and asked the chief executives of those companies to return to Congress with concrete plans on how they would use federal funds to turn their companies around before getting any money from Washington. "Until they show us the plan, we cannot show them the money," said House Speaker Nancy Pelosi, D-Calif., at a press conference.
Confusing article from the FT
The painful consequences of abandoning asset auctions
Holders of toxic mortgage-backed securities had pinned their hopes on the American government’s plan to buy large piles of the stuff through auctions as part of the Troubled Asset Relief Programme (TARP). The decision on November 12th to abandon that approach in favour of direct capital injections has left them shattered.
Yee Yeeha! No Problem Buddy!
Nov. 20 (Bloomberg) -- The U.S. may need to spend another $1.2 trillion to recapitalize the eight largest financial institutions and stabilize the markets because private investors won't take the risk, an FBR Capital Markets analyst said. ``The sheer size of the capital deficiency, coupled with the opaque nature of credit risk, will keep private capital sidelined,'' Paul Miller said in a research note yesterday.
Yeeha! Anyone else want some cash, just see Mr Paulson!
US senators reached a bipartisan agreement on a bill to support the ailing auto industry, with an announcement expected this afternoon. The Dow Jones industrial average, which had been down more than 200 points in morning trade in New York, rose by 78 points to 8,075.89 at lunchtime as investors welcomed the news. Wall Street had been bracing itself for the possibility that Washington would not approve an emergency $25 billion (£16.7 billion) bridging loan to bail out America’s car industry in time to avert the bankruptcy of at least one big manufacturer.
How to go to confession in order to get absolved for your sins
"Sir Tom told the meeting he was "sorry" about the financial and human cost that the bank's troubles have caused". So are we. But dont worry, nothing will ever happen to you. You may even be rewarded with a lordship later on for service rendered to GB.
anyone keeping count?
Daily Mail & General Trust's (DMGT) Associated and Northcliffe newspaper divisions have already cut 400 jobs in the past two months as part of a £100m cost-cutting drive.
Goodbye Taylor Wimpey............................
As a result, Fitch has downgraded its rating on Taylor Wimpey’s debt from B to CCC which is well into “junk bond” territory. A forced liquidation is now a possibility, says Fitch. The credit rating agency says: “Fitch now believes default at Taylor Wimpey is a real possibility, with a distressed debt exchange, such as debt-for-equity swap, looking increasingly likely. “Although Fitch believes it less likely, a forced liquidation of the company is also a possibility.”
and the job losses keep growing without the magic beans
It takes the number of job cuts threatened in Wales this week to more than 750, including 337 jobs at the Hoover factory in Merthyr Tydfil. Twenty jobs have also been cut at a drug factory in Ceredigion, and in north Wales 20 jobs will go in Llangefni and Denbigh at a farm machinery firm.
Have the VI's had their day?
ONE of the central principles of the Scottish property market – the "offers-over" price – will die out with the introduction of next month's Home Reports, estate agents said yesterday.
The higher the G number the less likely any concrete outcome...
The leaders of the rich countries went to Washington to save the world from sliding into deep recession. We asked key politicians, commentators and economists whether they succeeded and what we should expect, and hope for, in the coming weeks.
Yet petrol and Diesel is still too high!!!
Any bets on 2 years?
Job cuts rise as global recession plays on
"I'm still having conversations with people. But it doesn't look good."
let em fail...........
UK Government remains firmly in touch with reality
Housing minister Margaret Beckett is urging the house building sector to remain on task and continue building in the face of the economic downturn....................
Stuatz earlier Christmas cheer for property investors
Homebuyers and investors could benefit from the current market as developers try to sell off their housing stock, says Assetz. The company says that as lower interest rates take effect, coinciding with increasing pressure by banks on developers to sell existing stock and the cost of LIBOR continuing to fall, the cost of financing property purchases is set to dip even further in the run up to Christmas. It says that this, combined with banks putting pressure on struggling developers to reduce housing stock could meand discounts of 30 - 40% bringing about the lowest prices for new build housing ever in the UK.
Let's Hope This Bank Doesn't Run Out
"As the nation's financial crisis spread earlier this fall, several thousand people pressed forward in a line to make a withdrawal from a bank in suburban San Diego. The line stretched out the building, up the street and past the fire station. They walked away with boxes filled not with money but vegetables, fruit, pasta and juice." Food Banks are running short here in the UK too. Christmas and cold weather coming as well ..........................
Is Albania the new chapter of holiday and investment property destination?
A Mediterranean country with beautiful frontage on both the Adriatic and Ionian seas and its great landscape and long range mountains, Albania is a country that is attracting a lot of attention from international property investors, large corporate companies and holidaymakers. Albania is undergoing huge improvements in infrastructure and developments, and offers fantastic opportunities for property investors. New Airport, roads, NATO member, EU expected in 2014, Albania is experiencing an increase on tourism year on year. Albania property prices are the cheapest in all of Europe at least 70% cheaper. Beach apartments starting from just £20,000 and capital city (Tirana) apartments cost from only £19,000. Albania has not shown any econimoc downturn due to the current financial crisis.
LOL, Indian companies outsourcing call centres to the UK
Christmas in 2008 could have been the gloomiest in UK in recent decades but for Indian companies, which are coming to the rescue of Britons, facing lay-offs in the face of a looming global recession. This week, Indian call centre major Firstsource sparked early Christmas cheer in Northern Ireland by announcing plans to create 160 more jobs in the region.
BORIS Johnson has announced plans to create 50,000 affordable homes and kickstart the housing market
The Mayor said he wanted to build the ambitious total, including 30,000 social housing units, within three years. The £5 billion scheme will attempt to get middle-income families on the property ladder and ditch previous mayor Ken Livingstone's target that all new schemes are 50 per cent affordable. Mr Johnson said: "These plans aim to put London on a strong footing for the eventual upturn in the housing market." The scheme will see: ● Stalled developments receiving public money to go ahead, in return for providing affordable homes. ● Unsold new houses being bought and made affordable. ● More flexible schemes for existing social tenants who aspire to own their own home. ● An increase in the number of family-sized homes available to rent or buy.
Winter bounce !?!
Same facts as a post below this, just a slightly different spin ..."Mortgage lending rose by nearly 7% during October but it remained well down on 12 months ago, figures show. A total of £18.7 billion was advanced during the month, compared with just £17.5 billion during a "weak" September, the Council of Mortgage Lenders said. But the figure was still 44% lower than the £33.38 billion lent in October 2007, and it was also down on August's advances of £19.66 billion. Despite the increase in lending during October, the Council of Mortgage Lenders (CML) warned that demand was likely to remain subdued due to falling house prices and the deteriorating economy. " (I do like that last sentence. A lot!)
Commercial property shares crash – but they're not cheap yet
It's not just Britain's houses that have fallen in price, the value of commercial property has slumped too. Property company shares have crashed 43% in the last year. And as the recession really starts to bite, they're going to come down even further.
Oh so all those who were "long and wrong" are now saved???
look how much money they are losing, 25billion wont last long.
The companies are seeking aid as industry-wide sales have plummeted to a 17-year low. GM this month said it lost $4.2 billion in the third quarter and almost $73 billion since the end of 2004.
Peugeot Citroen cuts 2,700 jobs
Rolls-Royce plans 2,000 job cuts
this is not a 100-year storm for the American economy; it’s a millennial rite of passage for all man
it’s a millennial rite of passage for all mankind. Treasury Secretary: Millennial? Fed Chairman: I didn’t say I agree with that. I merely said that’s what’s being said. Treasury Secretary: I accept the 100-year storm concept. But let’s not get carried away by the public mood of gloom. Yes, I know debt liquidation and price deflation continue to be at the heart of our economic challenges and remain our most significant downside risk. I know real estate prices are down as much as 50% in some sectors and stock market barometers are down nearly 70% from their former peaks. And I know all about the tsunami of home foreclosures. Citigroup: I can no longer stand here before you and refute the fact that Citigroup is effectively insolvent. Martin D. Weiss, Ph.D.
Krusty Krusty Krusty
Market oracle.co.uk: Kirsty the Phil's Location, Location, Location Returns as UK House Prices Crash
Finally, Kirstie has been forced to recognise the fact that house prices can actually fall which follows earlier near religiously opinionated programming that fed on and reinforced the fervour that gripped much of the country as annual house prices roared ahead every month by more than that which people earned in wages, that house prices are a one way bet.
Stony Broke Fresh Rumblings From Northern Rock
A serious trauma for the UK mortgage market
I'd have settled for four-star
"IT could have been cheaper to stay in a five-star hotel for the last year than to own a house in Northern Ireland, according to dramatic figures released today. The University of Ulster's Quarterly House Price Index today reveals that the average house price in Northern Ireland has slumped by £46,881 over the last 12 months, meaning the average house has fallen in value by £128 a day." ... "Incredibly, according to the survey, at least 10 per cent of estate agents reported no sales during the three-month period and many other agents had less than five sales."
Lots of graphs and great info on the housing bubble.
Just about the only good thing to come out of the housing bubble is that many financial analysts are coming to see the virtue of the Austrian theory of the business cycle. Specifically, though Greenspan did his best to blame deregulation and foreigners who saved too much, many people now think that the Maestro's ultra-low interest rates in the wake of the dot-com crash may very well have sowed the seeds for our current crisis. Naturally, there is more to the story of the housing boom than simply saying, "The Fed chairman did it." But the original Misesian insight has withstood the test: it still seems that the Fed was a necessary condition for the worst speculative bubble in world history.
Deutsche Bank to axe roughly one in seven traders
FRANKFURT, Nov 19 (Reuters) - Deutsche Bank will cut roughly one in seven jobs in its trading business, or about 900 staff, its single biggest reduction to investment banking since the onset of the global financial crisis, sources with knowledge of the matter told Reuters.
How even the mighty can take a tumble
As many hedge funds suffer big losses and anxious investors yank out their money, the town synonymous with the riches of their recent glory is now hurting. In Greenwich, Connecticut, the luxury car dealers are quiet, the prices of mansions are declining and the retailers who have made a good living serving its wealthy residents are complaining about a sudden drop in business. "Everything is down. We started to see it in the summer, but October is when the bottom caved in," said James McArdle, whose family has run McArdle's Florist and Garden Center in Greenwich for 98 years. "Housing sales are down and so that always cuts into our market. Fewer buyers, fewer makeovers."
Genuine signs of massively increasing gold sales from World Gold Council
121% increase in gold sales over a year ago. Mints around the world have run out of gold. German gold demand up 533% on a year ago. Swiss demand up 500%. This is from the World Gold Council, reported in the Financial Times. Whether gold is about to increase in price is of course up for debate. Really, I'd just like to see a thread with the hot flame and over 50 posts due to boredom....
It will all blow over in months......180 months
Home prices fell in four out of every five U.S. cities in the third quarter, a record spurred by distressed foreclosure sales across the country. The median price of a U.S. home declined 9 percent from a year earlier and sales of properties with mortgages in default accounted for at least a third of all transactions, the Chicago- based National Association of Realtors said today. Prices fell in 120 U.S. metropolitan areas, rose in 28 and were unchanged in four, the biggest share of declines in data going back to 1979. The financial turmoil sparked by the collapse of the U.S. subprime mortgage market has caused $666 billion of losses for U.S. banks, lenders and insurers. U.S. companies slashed 1.4 million jobs in the last six months, the biggest cut since 1975.
NAEA latest cry for Government help
The National Association of Estate Agents is calling for more action from the government to prop up the property market. More than half - 54% - of estate agents surveyed said they did not have confidence in current government policies and that more must be done, including a suspension of Stamp Duty. They also called on the Bank of England to further cut interest rates.The survey further revealed that consumers are cutting their asking prices on property - a difficult decision that is already helping the market.
A good indicator of the real situation out there..
LONDON (AFP) – Freight shipping prices for transporting dry raw materials collapsed in November, slammed by the global financial crisis, slowing economic growth and falling commodity prices, industry experts said
This crises appears to be much more serious than we are being told..
The financial crisis is deepening, with the risk of seriously disrupting the system of international payments. This crisis is far more serious than the Great Depression. All major sectors of the global economy are affected. Recent reports suggest that the system of Letters of Credit as well as international shipping, which constitute the lifeline of the international trading system, are potentially in jeopardy.
Not all that bad eh!
Can they beat the big 'D' ?
Amid the worst financial crisis and market meltdowns since the 1930's, the world's top-20 central bankers and finance ministers are busy at work, inflating the world's money supply, slashing lending rates, and crafting stimulus packages, in order to prevent a normal recession from morphing into a Great Depression. The ECB has cut interest rates by 100-basis points to 3.25% since early October, and is telegraphing another 50 basis point cut at the next policy meeting in December.
A website to watch
At least eight more banks announced their participation in the Treasury Department's share purchase program in the past two days, adding roughly $1.48 billion to the total amount of taxpayer money to be invested in the institutions.
House Prices Recovering at an Astronomical Rate
The number of properties changing hands rose for the second consecutive month in October as sellers began to price their homes more realistically. Earlier this week it emerged that sellers had cut their asking prices by almost 3pc in just four weeks.
What sites do they have in the UK?
BASF says now sees full-year profit below 2007 level * Says to cut production at about 100 plants * Says could reduce working hours at its sites * Shares drop 13.1 percent
On your bike, Mr Watanabe
Introducing Britains New Super Bank
Lloyds TSB’s shareholders today voted through the bank's rescue takeover of HBOS, owner of Halifax and Bank of Scotland, with 96 per cent of investors backing the deal. A merger between the two banks, brokered by Prime Minister Gordon Brown in September, will create a lender with 145,000 staff and 3,000 branches across the UK. At today's meeting, shareholders also supported Lloyds TSB's plan to raise £5.5 billion to shore up its balance sheet, including £1 billion from the Treasury which will buy preference shares in the bank. Until Lloyds TSB pays back the Government’s £1 billion investment, it will not be allowed to pay bonuses to its directors
Roubini advocates yet another massive fiscal stimulas package!
Short interview with Roubini.
Shafted on all fronts!
National Savings & Investments (NS&I), which runs the popular savings account, said the total Premium Bond monthly prize payout would drop from £87.8 million this month to about £57 million in January 2009. The number of Premium Bond prizes will fall from 1.54 to 1.1 million.
home prices would likely sink further and not rise, dimming the appeal of homeownership
In a deep and sustained downturn, home prices would likely sink further and not rise, dimming the appeal of homeownership, a large part of suburbia's draw. Renting an apartment - perhaps in a city, where commuting costs are lower - might be more tempting. And although city crime might increase, the sense of safety that attracted city-dwellers to the suburbs might suffer, too, in a downturn. Many suburban areas have already seen upticks in crime in recent years, which would only get worse as tax-poor towns spent less money on policing and public services. In a modern depression, the swelling ranks of the unemployed would likely change the landscape of the country, uprooting people who would rather stay where they are and trapping people who want to move.
Paulson's TARP Programme comes under the spotlight
Nov. 19 (Bloomberg) -- Every time Treasury Secretary Hank Paulson updates us on the government’s efforts to stabilize the financial system and announces the latest twist in the Troubled Asset Relief Program, I get a sinking feeling in my stomach. I know he will introduce a host of new acronyms for new lending facilities to rescue new asset classes from new and anticipated distress. And I know that, no matter how hard I focus on what he says or how many times I read the press release and accompanying stories, I won’t be able to get my arms around the details.
Dear Leader Gordon Brown
They can't give it away. So bad is the economic situation that the Government will have to admit next week that it cannot stimulate the economy by fast-tracking great capital projects. So complex are the systems now, so unwieldy the planning process and so untrusted the Government, that the proposals and partners do not exist to build our way out of the downturn. Many billions of pounds are already stuck in the system, unspent. The £43 billion Building Schools for the Future programme, for instance, that aims to rebuild 3,500 schools in 15 years, managed in its first three years to rebuild... 13.
only fools rush in
A property search website, Globrix, said price cuts on homes last week averaged £16,871 across the UK. The UK property market is in the middle of the worst slump in living memory because of the credit crunch and a subsequent mortgage drought. Average prices, according to the biggest lenders, have fallen by about 15% in the past year and sales have fallen by more than half.
British Land, the UK's second largest property company, has posted a loss of £1.3bn after it was for
Rental demand on the up... sure sure...
And since most BTLs are "interest only"...
"Around 1.3m homeowners with an interest-only mortgage could be facing financial problems, research claims today." These are mostly BTLs, who in the past bragged to have made a fortune but will soon lose a fortune "If the UK does become blighted with deflation, not only does it mean people hold on for lower prices on cars, houses and big ticket items, it also means mortgages will grow relative to wages and other prices" BTL = Buy To Debt
An open letter to my kids on what the current economic crisis has taught us, and how they can learn
You are both too young to read this letter now. But in a decade or so, I suspect you'll be hearing about the events of autumn 2008 in your history class. You might wonder what it felt like to live through a global crisis. And when you learn about the years just before the crash - the houses that magically doubled in value, the no-questions-asked mortgages - you'll surely ask what all of us crazy old folks could have been thinking.
Spain 'to slide into recession'
Spain is likely to slip into recession in the fourth quarter and stay there into 2009, Bank of Spain head Miguel Angel Fernandez Ordonez has said. His comments followed figures showing that the Spanish economy had contracted by 0.2% in the third quarter, the first shrinkage since 1993. "The scenario for the next quarters is very similar to that of the third quarter," Mr Ordonez said. The eurozone officially entered recession last week. CSFB analyst Giovanni Zanni said: "We have a slightly worse forecast for Spain than for the rest of the euro area."
CNBC, however, has been paying very close attention and keeping a running tally of actual spending
Try $4.28 trillion dollars. That's $4,284,500,000,000 and more than what was spent on WW II, if adjusted for inflation, based on our computations from a variety of estimates and sources*. Not only is it a astronomical amount of money, its' a complicated cocktail of budgeted dollars, actual spending, guarantees, loans, swaps and other market mechanisms by the Federal Reserve, the Treasury and other offices of government taken over roughly the last year, based on government data and news releases. Strictly speaking, not every cent is a direct result of what's called the financial crisis, but it is arguably related to it. £££££££££££££££££ has anyone done this in the UK?
With a Debt Based Money Supply, No Other Outcome Is Possible
Things may seem bad now - with fears of a world recession looming - but they could be set to get much worse. A real-world analysis of a controversial prediction made 30 years ago concludes that economic growth cannot be sustained and we are on track for serious economic collapse this century. In 1972, the seminal book Limits to Growth by a group called the Club of Rome claimed that exponential growth would eventually lead to economic and environmental collapse. The group used computer models that assessed the interaction of rising populations, pollution, industrial production, resource consumption and food production. Most economists rubbished the book and its recommendations have been ignored by governments, although a growing band of experts today continues to argue cont.
Cracks showed long before it all caved in
This blogger is on my favourites list - always insightful. Page takes 20secs to load up. Everything written in this newspaper, by all the journalists and by the editorial writers is from the point of view that what HAS to happen is to get spending started again. Get money into the system. If the banks won't do it by spending/loaning then lets get the consumer to do it by tax cuts ( which is just Bush's stimulus checks by another name.) Every word written here ignores utterly, never mentions at all, the possibility that the real problem is the outstanding cliff of bad debts. No one is willing to write a word about how that debt is what is stopping the financial sector from being able to do its job. No one wants to say that even big firms have to go bankrupt.
Budget Deficit Means 1,500 Jobs On The Line; At Least 2 Train Routes Could Be Completely Removed
1,500 Jobs On The Line; - [I don't think they have realised!] NEW YORK (CBS) ― The MTA reportedly is ready to make deep cuts in its budget that could lead to reduced service, layoffs and more crowded trains. Sources tell CBS 2 the association board is preparing a worst case "Doomsday" scenario that will be presented during its monthly meeting on Thursday. When describing the agency's budget crisis last week, MTA CEO Elliot Sander said, "The word 'Draconian' is not inappropriate."
the job losses increase daily....this sounds more like a depression day by day
Is Britain set to turn into Japan?
Latest figures show that prices in the UK are falling at the fastest rate for 20 years. It's good news that essentials such as petrol and food are getting cheaper, but there's a dark side to falling prices - we could soon be in serious danger of a Japan-style deflationary slump.
Retailers battle for survival. Seconds away, round one, ding ding!
Marks and Spencer is turning to a tactic it has not used since the business was in the doldrums in 2004, in a sign of its anxiety about the retail climate. The retailer will on Thursday hold a one-day “20 per cent off” sale – its biggest pre-Christmas promotion for four years – to stimulate flagging revenue, according to people familiar with the retailer’s plans.
What happens when they run out of interest rate s to cut?
There could be more cuts in UK interest rates, according to the minutes from the Bank of England meeting at which rates were lowered from 4.5% to 3%. The Bank's nine-member committee voted unanimously for the cut on 6 November, but considered a bigger one. The Bank's own calculations showed that a cut to 2.5%, or even lower, would be needed to stop inflation falling too far below its target next year.
Homeowners with interest-only mortgages face financial ruin as their property prices plunge
Around 1.3million homeowners with an interest-only mortgage could be facing financial problems, research claims today. The terms of their mortgage mean they pay only the interest on the loan each month, and they are failing to save money to pay off the capital, says the report from investment firm Liverpool Victoria. Forty-one per cent were hoping to use the increase in the value of their property to pay off their loan in the future. With prices plunging at a record rate, this is not an option for many homeowners who bought in recent years. Prices have now dropped to October 2005 levels. It raises fears of a worrying 'mortgage gap', with an estimated £75billion of mortgages on their properties.
Lenihan to sanction huge bank rescue plan
The Government is on the brink of launching a multi-billion euro rescue plan for the country's banks as the share price of a second major institution fell below €1 yesterday. Officials are going through an expert report forensically examining the loans given out by the banks to work out their levels of bad debt.
Mortgage lenders to demand 20pc cash deposits
THE housing market suffered a new blow after it emerged last night that house buyers will have to come up with at least 20pc of the value of properties they plan to buy. The move will mean buyers will have to produce deposits of €54,000, based on the average price of a house at the moment. One of the largest lenders in the State, KBC Homeloans said it would now only provide mortgages for 80pc of the value of homes. Mortgage market experts said other lenders were now likely to follow KBC.
Sales of For Sale boards slip to all time low
"As a sign of the times, orders of For Sale boards have reached an all-time low, while printing firms reliant on estate agency have also been hit." But what about all those 'For Rent' signs that must be required according to the BTL VIs ....................... ?
Told you so, this is the next war zone ...
"Every year $50 billion goes up in smoke because of the world's inability to control the sea. According to a recent World Bank report condemning the staggering inefficiency of heavily subsidised fishing fleets, the money is squandered as fishermen vie with each other to chase the ever-diminishing stocks of fish, building bigger and bigger boats in the process. If world fish stocks were rebuilt, today's catch could be achieved with about half the current global fishing effort. But a measured approach is impossible when no one owns the sea. It is a classic tragedy of the commons: if one country leaves the fish alone, another will reap the benefits. The result is a rush that will only stop when the fish have disappeared."
Deflation v's Inflation
The spectre of 1930s-style deflation in the British economy loomed yesterday after figures showed that prices of many goods slumped last month as recession tightened its grip. Consumer price inflation posted its biggest drop since records began in 1992, falling to 4.5 per cent last month from a 16-year peak of 5.2 per cent in September. The drop could lead to further aggressive interest rate cuts. Rates are already at a 54-year low of 3 per cent.
Six months ago, Cara Watt had the world, quite literally, at her feet. A former airline pilot - who
mail: A very middle-class recession: One moment you're planning your holiday, the next you're on the abyss...
Last year, he was told his team made £300million for the corporate arm of the Bank of Scotland. With a bonus, his salary could exceed £150,000 in cash, with share incentives. His job, the whole family felt, was utterly safe - until the day a few months ago when, with no warning, he was made redundant.
And they made such a fuss over endowment shortfalls?
Nearly half of people with interest-only mortgages have no investment in place to repay the money they owe, research has shown. Around 2.9 million homeowners are on interest-only deals, but 45% of these are not contributing to an investment to repay the capital they have borrowed, according to LV. Instead 41% of people plan to repay the money they owe by selling their house and cashing in the equity. Despite falling house prices, many of these homeowners hope to raise enough money to not only repay their debt, but also to buy a new property. Borrowers have not been obliged to have an investment plan linked to an interest-only mortgage since the early 1990s.
Charles Hugh Smith writes about resistance to debt writedowns
The discussion concerns America but is not irrelevant to our plight either: "Today's "trend that will stick": writing down housing values and mortgages to reality will be resisted by lenders, homeowners and government every step of the way, lengthening the recession. Why will this resistance lengthen the recession/depression? For what happens when writing down bad debt (uncollectable debt, debt based on impaired assets, etc.) is resisted, we need only look at Japan 1989-2002 for an example: hiding bad debt and acting as if assets will rebound to bubble heights someday leads to decades of stagnation."
Game over. Suckas.
The Wall Street stockbroker had used FlatRate Moving, a high-end moving service, a half-dozen times over the years. They moved him from a modest apartment on the Upper East Side to a grander one on the Upper West. He called when he moved to an even better building in Midtown. Most recently, FlatRate helped settle him and his wife and child into a 3,000-square-foot loft in Soho, one of Manhattan's priciest neighborhoods. FlatRate got another call two months ago. The client was packing up his family for a two-bedroom apartment in the less expensive Park Slope, Brooklyn. He had lost his job and was no longer in a position to pay the $3,000 to $5,000 a month he'd shelled out before. "We did the move almost at cost"—for under $1,200, says FlatRate's vice president of marketing.
I wonder how many fraudsters have not been prosecuted yet.....
The Black Swan Theory - Fool or Genius ?
Recent figures from the ESPC have shown that it is easier than ever to secure a home at a bargain price, with 75% of properties going for below their advertised fixed price. And as there is less competition in the market, buyers are realising that it's easier than ever before to get their first-choice home. With Bank of England's decision to dramatically slash interest rates, providing that the new rate is passed on to customers by the major banks, we're expecting more first-time buyers to start considering taking their first step on the property ladder, which will swell the number of sales even more. If you miss the boat and prices start to rise again you won't be able to buy the home you want or to get on the ladder. It's only when it's too late that people start to realise that
Is there a way out? Clear all debts maybe!
It's a minority but growing view, including from 86-year old former Goldman Sachs chairman, John Whitehead, at the November 12 Reuters Global Finance Summit in New York. As disturbing evidence mounts, he said: "I think it would be worse than the depression. We're talking about reducing the credit of the United States of America, which is the backbone of the economic system. I see nothing but large increases in the deficit, all of which are serving to decrease the credit standing of America.
More toxic trash thrust on the UK Taxpayer
Bradford & Bingley has admitted there is little it can do to tackle self-cert mortgage fraud where borrowers lie about their income. The revelation emerged during a grilling of B&B’s chief executive Richard Pym and chairman Rod Kent at a Treasury Select Committee session held this morning as part of a wider banking crisis enquiry. Richard Pym says the nationalised lender is attempting to tackle the fraudulent loans held on its buy-to-let portfolio, but says there is little in the bank’s armoury to stamp out self-cert fraud.He says: “One of the emerging issues within our books is mortgage fraud. There is a fraud element in our book and we regret that.
Is this what brown means by building new schools....
Building work on new Aberdeen schools could be halted unless the council provides a loan of up to £17.5m. Aberdeen council has been asked to provide between £3m and £17.5m to keep the £120m 3Rs project on track after its financial backer collapsed.
Independent News & Media to cut 90 jobs
But I thought Assetzz said it's a good time to be a landlord?
"Rents fell for the first time in five years between July and October as home-movers flooded the rental market with properties that they could not sell." a good read... unless you are BTL
yes you can......
Putting the UK national debt in context
Despite the condescending 'P4AC' writing style, this is an informative read. Author proposes that the UK debt situation is not as bad as reported, when taken in context. Good to read some articles contrary to the Zeitgeist. Have yet to verify his assertions myself however....
Pepsi Bottling to slash 3,000 jobs
who would be this stupid?
BUY TO LET INVESTMENT OPPORTUNITY- currenntly tenanted until 15th August 2009 @ £995pcm.
Buy-to-let market 'is now closed'
The buy-to-let housing market is "closed", the boss of nationalised bank Bradford & Bingley has said during scrutiny from a committee of MPs. Executive chairman Richard Pym said that so many deals had been withdrawn that the market was completely different to a year ago. He also said a higher proportion of B&B's customers were in arrears compared with the industry average.
How zombie companies suck the life from an economy
Once a company needs state aid to remain viable, it becomes a monster. The usual justification for government backing for an industry is that it’s a temporary measure, just to see it through the hard times. But income tax was also a temporary measure when it was first introduced...
Adrian Ash talks sense
"The twilight of gold appeared to have arrived," claimed Professor Ferguson, stepping out of the lecture hall and into his gypsy fortune-teller's tent, in his 1999 tome, The Cash Nexus. "True, total blackout is still some way off," he forecast, and "gold has a future, of course, but mainly as jewelry."
Can't moan Gordy's paid my Icesave money back with interest!
Phil is offering lower price!!
Did anyone watch Location Location Location. Survival Guide on Channel 4 last night?. I was sligtly amused that Phil offerred £130k and £150k to two £180k (overpriced) house, which would be unthinkable until a few weeks ago. But Kristy still seemed couldn't bring herself to do it. She even claimed that she always adviced people to buy at a price that they can afford. Ha!!
Everyday there are more job losses around the UK, this must be as bad as the 80's if not worse
The Warrington-based firm has already shed 30 employees in May.
Car firms can't be bailed out like banks
Wolseley to shed 2,300 more jobs
Plumbing and building materials firm Wolseley says it is to cut 2,300 more jobs, the majority in the UK, and close more than 200 branches. Wolseley, which owns the Plumb Center and Build Center chains and operates in Europe and North America, said it had already cut 5,000 posts since August. It added that trading conditions were expected to worsen in the short-run. "We continue to react swiftly to market conditions with aggressive but measured cost reduction," the company said.
developers run off with poor homebuyers cash
10 days ago, the BBC reported that the development was going ahead, in spite of the fact that a number of redundancies had been made and none of the depositors could get through to the company. Sounds like the BBC are complicit in money escape.
Its Doom, begorra, Its Doom
UK commercial property capital values have plummeted by the largest ever monthly figure in the Investment Property Databank’s 22-year history, at -4.3%, according to the UK Monthly Property Index for October 2008 In the IPD index published today it showed all property total returns falling to -3.8%, fractionally deeper than the monthly returns recorded last December, which were -3.7%, which the IPD said ‘served to emphasise that the UK commercial real estate market has now fully entered a ‘double dip’ phase.
Just about sums it up - Stormy weather ahead.
The UK will enter a recession as severe as that of 1991, with the economy shrinking 2.5% from its peak before reaching a trough late next year, according to a sharply revised forecast from employers’ body the CBI. Unemployment is expected to reach 9% by 2010, leaving nearly 3m people out of work. In 2009, the economy is expected to contract by 1.7% against a growth forecast of 0.3% made in September.
CPI & RPI latest
Official figures show that UK inflation fell to 4.5% in October, as oil prices and transport costs fell. The Consumer Prices Index (CPI) measure reached 5.2% in September. This was the highest level for 16 years. The Retail Prices Index, (RPI) the alternative measure of inflation, which includes housing costs, fell from 5% to 4.2%, the biggest fall since 2003. The Bank of England has said inflation could fall below its target of 2% next year - and might drop as low as 1%.
Now rents are falling alongside house prices
A glut of unsold homes has flooded the rental market, driving down rents at the fastest rate on record. The Royal Institution of Chartered Surveyors (Rics) said new instructions to sell flats and houses had been at record levels in the past few months. However, Rics said many people who cannot sell their homes have decided to let their properties, and this increase in supply has pushed rents down. The proportion of surveyors reporting lower rents was its highest since 2003.
Piling on the pain
Pop. There goes another housing bubble. Two years ago, you could barely move without bumping into someone who'd given up on pension plans and savings in favour of bricks and mortar. The buy-to-let boom was the single most important contributory factor to the meteoric rise in UK house prices. Bad enough that the value of property has fallen by at least 15%. Now RICS says rents are falling too. It's not difficult to see why. The market is saturated with unsold flats and houses. This is an alarming development for buy-to-let investors. Until now they could take comfort in the fact that house prices might recover in time. But with rents falling too, and the cost of remortgaging escalating, the monthly cashflow will force many to sell their properties in a falling market.
Greenspan's nemesis paints a horrific picture
[Apologies for straying slightly off-topic] Paul Volcker, the former chairman of the US Federal Reserve, has warned that the economic slump has begun to metastasise after a shocking collapse in output over the past two months, threatening to overwhelm the incoming Obama administration as it struggles to restore confidence. "What this crisis reveals is a broken financial system like no other in my lifetime," he told a conference at Lombard Street Research in London. "Normal monetary policy is not able to get money flowing. The trouble is that, even with all this government protection, the market is not moving again. The only other time we have seen the US economy drop as suddenly as this was when the Carter administration imposed credit controls, which was artificial."
Twenty percent falls, according to Rightmove
House prices have already fallen by 20pc from their peak, according to one of Britain's largest property websites [no, not this website...]. Evidence suggests that prices will continue to fall sharply, with sellers dropping their asking prices by almost 3pc last month, Rightmove reported. Agents are reporting sales at 20% below peak asking prices. The number of new sellers has fallen to 20,000 a week (down from 35,000 a week a year ago). Full Rightmove press release link in comments below.
How the market failed
"To this day, the willingness of a Wall Street investment bank to pay me hundreds of thousands of dollars to dispense investment advice to grownups remains a mystery to me. I was 24 years old, with no experience of, or particular interest in, guessing which stocks and bonds would rise and which would fall. The essential function of Wall Street is to allocate capital—to decide who should get it and who should not. Believe me when I tell you that I hadn’t the first clue." Michael Lewis, author of "Liar's Poker", explains where it all went wrong.
Gordon did for Iceland
Weak Currency, Weak Economy and Weak Governement
Gordon Brown's recent criticism of George Osborne for talking down sterling has received much press. But surprise surprise it appears Gordon Brown did exactly the same thing himself.
But Paragone said rents would rise in the crash!
It’s good news for tenants and bad news for landlords: according to the latest survey from the Royal Institution of Chartered Surveyors (RICS), residential rents fell dramatically in the third quarter of this year. The record fall comes thanks to the lettings market being “flooded” by unsold properties being put up to let. This news tallies with my own personal experience. Recently, I made an offer to rent a property in a city in the Southeast. The previous tenants had lived there for two years, paying £1,800 a month. I offered the landlord £1,650 a month, which he promptly accepted -- saving me £1,800 a year. And I'm not alone. Disclosure: The author sold to rent in 2005, and has no plans to buy till 2010/11
In it for the long term!
Between 20% and 40% of buy-to-let (BTL)landlords will fall into negative equity if house prices keep on falling at their current rate, a report says. The credit ratings agency Standard & Poor's says that by June this year BTL mortgages had a repossession rate greater than ordinary home loans. It warned that financial problems were concentrated among BTL mortgages granted in the past two years. The report was based on studying 200,000 BTL loans, 20% of the total. "We believe that the BTL sector could suffer above-average loss severities on repossession cases due to a concentration of certain property types that are witnessing above-average price declines," said Kate Livesey, an analyst at S&P.
RICS Housing market survey
Transactions fall further though lead activity indicators improve.
Just for fun
Good explanation of some of the Sterling risks from Crash Gordon's 'just keep borrowing' policy
"a triple financial crisis: a combined banking crisis, sovereign debt crisis and sterling crisis"
Yes you read that right. SEVENTY-FIVE-THOUSAND JOBS!
Recession to claim 8% of London jobs
Buy to let mortgages less risky? Maybe not.
Buy to let mortgages are seeing higher reposession rates than owner occupier mortgages, 3.7% are in arrears vs 2.9% and 40% face negative equity vs 20% for owner occupier mortgages.
Citigroup to cut more than 50,000 jobs
Citigroup set to cut 75,000 jobs Breaking News US bank Citigroup has announced plans for up to 75,000 job cuts, up from a previously announced total of 23,000. Citigroup said in a statement that the cuts represented a reduction of about 20% of its staff, leaving the bank with 300,000 jobs worldwide. The cuts will come from redundancies, the sale of units and natural wastage, the bank said.
anyone catch the chris Moyles show this morning??
"But the perfect tonic to Monday Blues....yes Phil and Kirsty from Location, Location, Location and other such offshoots! Such lovely lovely people..Definitely cheered me up this morning - absolute legends of the property world." ...'WHAT!!!!!!!!!!!!!"
The Quicker The Better
British homeowners are slashing the asking price on their property by as much as £6,500, as some estate agents reduce the value of deals by as much as a fifth in an effort to shift houses. According to Rightmove, the property search website, the average asking price of a home in England and Wales in the four weeks to November 8 was £223,000 - a 2.9 per cent decline on the previous month and the biggest fall since records began in 2002. Over the year, the asking price fell by 7.1 per cent and Rightmove said some estate agents are selling houses for about 20 per cent under peak prices. Miles Shipside, commercial director of Rightmove, said: “Some sellers could avoid months of disillusionment and despair if they started marketing at an asking price a lot closer to where the evidence".
Banking in the internet age
People aged over 40 are often amazed by what is happening online. Sometimes they find it difficult to consider things the way those born in the 1970s do. The world is changing fast. For example, many business people - the younger ones - are avoiding banks altogether as a source of funding. Instead they are going to cooperative ventures such as Zopa, where you borrow money from other people, rather than banks.Bank accounts as we know them will become obsolete for millions of people within a matter of a few years (for many they already are obsolete).
London 'worst hit in recession'
battered by wrong-way bets on Volkswagen AG shares and plunging stock markets
A failure could have repercussions for Merckle's holdings, which span as many as 30 companies in the cement, machinery and pharmaceutical industries, said the people. VEM holds about 25 percent of the Heidelberg-based company, and, including holdings by affiliated companies, Merckle controls at least 86 percent in total, according to Bloomberg data.
Instead Brown prefers to buy banks
``There is a view that all treatments should be available. Unfortunately, that's not possible,'' said Peter Littlejohns, NICE's clinical and public health director. ``There is a limited pot of money.''
The FT interviews Jim Rogers
A small set of interviews with Jim Rogers. Someone I enjoy listening to.
Well-maintained fourbed detached house in one acre seeks three-bedroom cottage with small garden for serious relationship.” Welcome to the world of the property lonely hearts: house-swap parties at which agents, desperate to keep sales moving and the commission rolling in, attempt to match would-be buyers and sellers.
The current situation, neatly summed up
There are five fundamental questions that went unanswered at this past weekend's G-20 summit in Washington. In their attempt to show solidarity, the world leaders skipped over the complicated and contentious questions. But that's no long-term solution. Once they go home to their respective capitals, the finance ministers and other officials who met in Washington are going to be forced to make some tough decisions. Here are five puzzlers that will demand to be sorted out in the months ahead:
Rightmove: -2.9% MoM, -7.1% YoY
Rightmove reported a decline of 2.9 per cent in asking prices this month, to £222,979. Asking prices have fallen 7.1 per cent this year, the biggest annual decline ever recorded by Rightmove. The number of homeowners selling their properties has dropped by 43 per cent in the past year, as falling house prices deter potential sellers. But Rightmove said tighter constraints on mortgage availability were likely to ease next year. Miles Shipside, of Rightmove, said: “Whenever it does, there is likely to be a degree of pent-up demand fuelled by historically cheap borrowing and cheaper property, lessening the advantage of those in a privileged position to proceed now.”
Another government wheeze that needs deciphering
The Treasury is apparently considering dangling the lure of lucrative shares in the banks to pension funds and other City investors to reduce the cost to taxpayers of its bailout plan. The preference shares pay 12 per cent a year and the idea is to allow City fund managers to buy some in the hope that they will be encouraged to purchase further ordinary shares in the three stricken banks.
Debt to be monetised
Its happened. The first mention of printing money as a solution in the mainstream UK press. Let us put our(your) doubts aside, we are facing a deflationary recession and its going to be a stinker.
Deleveraging is the big news, not interest rates
A bit of an older article, but really it illustrates the point quite well. Also there are probably no low deposit mortgages left. Chose this link because the BBC one has already been posted. See http://news.bbc.co.uk/1/hi/business/7729291.stm. Leverage is what props up house prices, not interest rates. And the banks are being forced to pull the 95% (20:1 leverage), 90% (10:1 leverage), 85% (7:1), and now we are looking at 75% (4:1 leverage). This is the biggest determinant of house prices, not the interest rates. The BOE can't force anyone to lend at higher ratios, so all the interest rate stuff won't help house prices. I am sure Mark Wadsworth has pointed this out. The important thing to understand is that the *main* lever is still with the banks and they are using it.
this stinks......can we expect any less these days?
manchester news: HE chairman of the North West Development Agency has taken on another job with one of the region's biggest developers.
John Whittaker, UKIP MEP for the north west, said he felt there could be a potential conflict of interest with Mr Gray's new job. "One has to be a little suspicious", he said. "It looks to me like a conflict of interest. Bryan Gray has a place on the NWDA board so he's certainly got influence there. Peel's done terribly well out of this." It is understood that Peel decided to employ Mr Gray only after the NWDA's last-minute decision to extend his contract on Wednesday.
Do these employ anyone in the UK?
Real estate faces another major downturn
And the ultimate victim in the real estate depression and a nationwide economic slowdown will be individuals and families who bought the condominiums at ambitious prices beyond the scope of their income. "Young people in their 30s bought condominiums with heavy debts and these people will go bust as they lose their jobs and as their income declines,"
Halifax spokesman Martin Ellis states "We are comfortable with the view that there will be a 20% fall over 2008 and 2009". So if prices fall 15% this year, will they drop by just 5% next year? "We don't want to be too specific about next year," he replies. Jonathan Davis, spokesman for housepricecrash.co.uk says next year reality will kick in, even more than in 2008. "Next year prices will fall by 15-20% because unemployment is kicking in, house repossessions will rise rapidly and houses will go through auctions at previously silly prices - and banks aren't lending," he predicts. After forecasting the end of the house price bubble for several years his worst predictions appear to be coming true.
I'll be the judge of that
Senior industry sources said that car companies were eager not to be seen “holding out a begging bowl”. “We are not asking for subsidies for a dead-end sector. We are asking for help to tide a healthy industry over an unprecedented period of turbulence,” said one.
Basket case economic policy not allowed to be criticised
George Osborne has defended his warning that sterling could be about to collapse saying it was his job was to tell the truth about the consequences of ballooning debt.
The car industry's era of glamour has been replaced with something a lot bleaker
"This is a depression, not a recession," said Professor Garel Rhys, a leading car industry expert at Cardiff University. If you want an example of the pain suffered by the global motor industry, look no further than our own domestic market. The speed with which the downturn has suddenly hit has shocked the industry. In September new UK car sales fell a stunning 21pc, and came off an 18.6pc drop in August. But the fall was even larger last month, down 23pc. "October was the steepest monthly fall since June 1991, the height of the early 1990s recession," said Paul Newton, automotive analyst at Global Insight. "It is a stark indicator of the depth and speed of this economic slowdown... How long this translates into real job losses is just a question of time."
The 'D' word.
The White House: November 15, 2008 President Bush Attends Summit on Financial Markets and the World Economy
One of the things we did, we spent time talking about the actions that we have taken. The United States has taken some extraordinary measures. Those of you who have followed my career know that I'm a free market person -- until you're told that if you don't take decisive measures then it's conceivable that our country could go into a depression greater than the Great Depression’s. So my administration has taken significant measures to deal with a credit crisis. And then we worked with Congress to deal with the credit crisis, as well.
Halp Halp O Halp!!!!
"The living dead" - they can be kept alive but really they are just ghost companies. That is the shocking description of the state of many of Britain’s housebuilders by Alastair Stewart, analyst at Dresdner Kleinwort. He sums up the housing market neatly in one word – carnage. Job losses are soaring, firms are going bust every day, house and land values are plunging and new-home construction has collapsed to levels not seen since the 1920s. Taylor Wimpey's share price has plummeted 98% while rival Barrats has dropped 95%. Builders have closed down sales offices and laid off workers. Government ministers are starting to panic.The Homebuilders Federation is calling for government action to halt the housing crisis.
The UK, again the poor man of Europe.
"The only hope is that the Government / Bank of England steps into save the ailing Pound, however these clowns are notoriously slow off the mark, and we have them to thank for this sorry situation." ...fat chance!!!!!!!!
Northern Rock is no longer to be run down, and will instead become a state-owned bank. Without NR handing out 125% mortgages, the remaining banks cannot maintain 2007 levels of credit supply (or more probably don't want to). NR must therefore, arise like a phoenix to resume its former role. NR will presumably become an entity unlike other banks, with a non-profit mandate of credit expansion. International funding will be obtained by tax-payer guarantees for NR mortgage securities. Well, to me, this seems to be illegal under EU state assistance, also essentially this must count as an extension of government borrowing and so push the pound down further, and presumably this must also push up real long-term interest rates.
House price crash will gather momentum next year.
JP Morgan, the US investment bank, is drawing up plans to axe thousands of jobs across its worldwide operations. The move is likely to mean redundancy for hundreds of City workers, compounding the growing sense of crisis in London's financial services industry and the broader British economy.
Products are being repriced after the 1.5 per cent cut, but banks are still eager to get their hands
The 7 per cent interest rate is long gone, but it's still not too late to get a good deal. "The message is that the banks still want your cash, and the longer they get to hold on to it, the better for them. This means that despite the turmoil of the past week or so, fixed-rate deals that tie their customers in for a specific period (usually a year) remain competitive,". "But if you want the very best rates, you have to move now as repricing is still going on." But memories of the collapse of the Icelandic banks are still sharp among UK consumers. No wonder many savers are cautious about where they put their money; not only do they want a good rate of return but they also need to feel sure their cash will be safe. "Don't put your eggs in one basket," even if you are below the £50,000.
A snapshot of the current situation - no wonder world leaders are in a huddle!
From department stores and convenience chains to call centers, managers who only a year ago had to scramble to fill holiday jobs are seeing a surge in the number of seasoned applicants - many of them laid off in other sectors and desperate for a way to pay the bills.
Phil Spencer (of 'Krusty and Phil' fame) still ramping
This is, after all, the cheapest time to buy property for years – and it could prove one of the best. If you have the cash to get into the market today and are able to drive down the price further, you’re set to become even wealthier in the future. If you think I’m being overoptimistic, just look at those who bought during the dark days of the early 1990s – and what happened to the value of their homes in the decade that followed. This time around, as then, confidence will eventually return – it’s all just a question of time. In a Credit Crunch Special edition of Location, Location, Location, my television co-host, Kirstie Allsopp, and I look at the property troubles of three sets of people affected by the current market [AND PRESSURE THEM INTO BUYING UNSUITABLE OVERPRICED HOMES]
David Smith says no
Many people say to me that they keep reading house prices are falling at a record rate, but that their memory of the housing bust in the early 1990s is that it was a lot worse. House-price data from the two main lenders, Halifax and Nationwide, suggests a record annual fall, down 14.9% and 14.6% respectively. Other house-price measures, however, continue to point to smaller falls. The government's DCLG figure is down 5.1% since last year, while the FT index is down 6.2%. Last week, at a Chartered Institute of Housing conference, I shared the stage with David Orr, chief executive of the National Housing Federation. He reminded us that the factors that pushed up prices have not gone away, and their research suggests shortages will push prices up 25% over 2011-2013.
Merry Christmas from the Goblin King
Brown says that the case for trying to rescue the economy through tax cuts was now "unanswerable", and "What you want is fiscal action that can show results as quickly as possible." Doh, about as much use as a sticking plaster on a broken leg then.
Late Night Steamy Article (18+)
Wholesalers also offered sexual favors to co-workers. To drive up their commissions, some enticed loan underwriters at their companies to approve questionable applications. A vice-president at Washington Mutual who once wielded $500 million to make loans recalls an incident in which a female wholesaler wanted him to approve a loan that didn't fit guidelines. The manager, who requested anonymity, says the co-worker, wearing a low-cut shirt, knelt down at his desk and said: "I really need this. What do I have to do?"
How the Market sees the UK
Europe's economy officially collapsed into recession for the first time since its inception during the third quarter, boosting hopes that the European Central Bank will be forced to cut interest rates again in December. In spite of further expected rate cuts in Europe, the euro continued to strengthen against the pound, as investors speculated that the recession would be deeper and longer in the UK than on the Continent.
The advanced economies will face stag-deflation (stagnation/recession and deflation) rather than sta
--Obama will inherit an economic and financial mess worse than anything the U.S. has faced in decades: the most severe recession in 50 years; the worst financial and banking crisis since the Great Depression; a ballooning fiscal deficit that may be as high as a trillion dollars in 2009 and 2010; a huge current account deficit; a financial system that is in a severe crisis and where deleveraging is still occurring at a very rapid pace, thus causing a worsening of the credit crunch; a household sector where millions of households are insolvent, into negative equity territory and on the verge of losing their homes; a serious risk of deflation as the slack in goods, labor and commodity markets becomes deeper; the risk that we will end in a deflationary liquidity trap
George's steely determination against protectionism!
Rate cut forecast
Capital Economics outlook for the mortgage and housing market expects to see low interest rates, possibly 3%, but even this they conclude may not stop the housing market correction running its course.
Still in denial
"Research by Impartial shows that British homeowners are dramatically under-estimating the reduction in the value of their properties over recent months." ... "Homeowners under the age of 34 actually believe the value of their property is still increasing. They reported an average value of £173,960 in July, increasing to £176,056 in September. By comparison, the average Londoner seems more realistic – believing their house value to have dropped by £46,361."
A bold move by Scottish estate agents
DOZENS of homes will be sold at knock-down prices in a one-off, multi-million-pound, property clearance sale today, estate agents have announced. Some houses will have discounts of up to 40 per cent, and nearly £100,000 off. The sale follows the biggest price fall in at least 16 years in the Scottish housing market.
Keep hold of your pounds they may stretch further than you think!
Almost 1m homes are standing empty across the United Kingdom, and the vast majority – more than four out of every five – are believed to be owned by private landlords. An empty home could just as easily be a rundown terrace house in an urban back street as a luxury newbuild apartment in a city centre filled with identical blocks. It might be empty because a glut of rental property means no tenants, or because vandalism, or simple disrepair, has made it unlettable.
The US is an oil importer, burning up 25% of the world's production
I don't mean to imply that every part of the country will suddenly undergo a spontaneous existence failure, reverting to an uninhabited wilderness. I agree with John-Michael Greer that the myth of the Apocalypse is not the least bit helpful in coming to terms with the situation. The Soviet experience is very helpful here, because it shows us not only that life goes on, but exactly how it goes on. But I am quite certain that no amount of cultural transformation will help us save various key aspects of this culture: car society, suburban living, big box stores, corporate-run government, global empire, or runaway finance.
How will Job Centre Plus cope with this lot then?
London bankers were facing a new wave of redundancies today as Britain headed for 20,000 job losses in five days. Citigroup is to send redundancy notices to 10,000 workers worldwide, many in Canary Wharf, while Royal Bank of Scotland is to shed 3,000 investment bankers, including hundreds in the City, within a month. In addition, Clydesdale and Yorkshire banks are to axe 350 jobs next year, the union Unite said today. The scale of the cuts means 20,000 jobs have gone across the country since Monday as the economic downturn strengthens its grip and sends unemployment soaring. In just a week some of the country's biggest names - including BT, Virgin Media, GlaxoSmithKline and Taylor Wimpey - have slashed jobs.
Full length programme: Property - the end of the affair?
BBC2's The Money Programme investigates whether buying, or renting is more profitable over the long term. (Full recording)
G20 could be bun fight
Tensions at the start of the G20 summit run high as Prime Minister deems return to 1930s policies ‘unacceptable’ “If we get into a situation where countries made decisions irrespective of what happened anywhere else, then we will see the same problems of other times. The dividing line here is between an open society capable of trading round the world, against a protectionist response that happened in the 1930s and is totally unacceptable.” The EU said that it was ready to take action against the US at the World Trade Organisation if aid for the stricken US car industry was judged by the European Commission as illegal under international rules.
Crash, Plunge, Meltdown!!!
We had been warned the housing market was in meltdown. But now come signs the plunge could be even worse than we had feared - as even 'For Sale' boards themselves are not selling.
Reality dawns, the housing market is BUST
Homeowners will have to wait a decade before property prices return to 2007 levels, a leading estate agent said yesterday
Times takes over the comedy club
First-time buyers hoping that falls in house prices will mean they finally make it on to the housing ladder may be disappointed — because the size of deposit required by lenders means that by the time first-timers have saved up, buy-to-let investors with big deposits will have snapped up all the bargains. Savills said that it did not expect mortgage availability to improve for first-time buyers until at least 2010, by which time, it predicts that house prices will be on their way back up, meaning that would-be homeowners could miss out on the chance to secure their first home at a good price.
Poor BTLers :(
Buy to let landlords face increasing competition from developers who are unable to sell their new build properties and so are renting out brand new apartments and houses. This increases the amount of properties available to rent at a time when demand from tenants in some areas is likely to fall as unemployment takes a grip and pay increases become a thing of the past. Meanwhile, BTLers continue to be squeezed by the shortage of mortgages. ‘It's about time lenders started to play ball and pass the rate cuts on to landlords,’ said Simon Gordon of the National Landlords Association. ‘Part and parcel of the government bailout was the requirement for lenders to start lending to consumers. It's critical for the health of the property market for landlords to have access to mortgage finance"
Even companies that make bad cars are woth bailling out
Yip Yip finar finar To big to fail...Anyone got a note of their pension commitments? To big to fail, and many muni bonds downgraded to junk, WHO exactly wants in on that action? I hope it is not my pension fund! Why exactly is the USD so strong?
HBOS shambles latest
HBOS says that it could face nationalisation if its proposed takeover by Lloyds TSB is not approved by shareholders. It said it would need significantly more capital were the deal with Lloyds to collapse, making the loss of private sector status more likely. HBOS urged shareholders to vote in favour of the merger. Two former top bank executives had opposed the deal, saying it should remain independent.
Greed and human nature lead to the financial crisis, not some conspiracy.
Almost overnight, the talking heads went from perpetuating the euphoria of investors to rushing to pronounce the economy dead. Last year, when lenders started dropping like flies as foreclosures rose and margins were called, the problems of Wall Street became more and more apparent, and lending guidelines were tightened to the point that many individuals were stuck in their time-bomb loans, and thus began a vicious cycle. But what led to this? Here is a visual guide to help you understand the events leading up to the bailout.
Repossession, repossession, repossession
This is just a general sort of reminder for Monday evening at 9 o'clock. We can discuss on Tuesday who had the overwhelming urge to smash their TV in, and who succumbed to it ...
You can't make this stuff up, boy America's in trouble.
Neel Kashkari, the fox appointed to guard the henhouse and front the multi-trillion dollar bailout, faced angry questions from Dennis Kucinich and Rep. Darrell Issa during a hearing today, as Issa accused him of playing a “bait and switch” game with taxpayers’ money. Cash n Carry, I mean, Kashkari, did not do well in the proceedings, have a listen to the youtube clips on the original source, here.
Food Riots in America will Cause UK House Prices to Rise
Sorry I can't Remember, it's my age: Celente Predicts Revolution, Food Riots, Tax Rebellions By 2012
The man who predicted the 1987 stock market crash and the fall of the Soviet Union is now forecasting revolution in America, food riots and tax rebellions - all within four years, while cautioning that putting food on the table will be a more pressing concern than buying Christmas gifts by 2012. Gerald Celente, the CEO of Trends Research Institute, is renowned for his accuracy in predicting future world and economic events, which will send a chill down your spine considering what he told Fox News this week. Celente says that by 2012 America will become an undeveloped nation, that there will be a revolution marked by food riots, squatter rebellions, tax revolts and job marches, and that holidays will be more about obtaining food, not gifts. satire should be censored - it's no jo -
Living by card and die by card
Some 497 million purchases were made on on debit cards in September, a 12.7% rise on the previous month, according to UK payments association Apacs. Is this because a) we are out of recession now b) we are spending while we can c) just a blip d) paying off debt by racking up more
Could the UK repeat Japan’s 1990s experience
Could the UK repeat Japan’s 1990s experience of minimal growth, falling asset prices and deflation?Both countries share similar characteristics prior to the initial downturn. Unemployment was low and inflation was under control, but just starting to rise. Asset prices soared, driven by increased borrowing. While there are similarities, there are also some important differences. The UK does not suffer from Japan’s excess capacity created by overinvestment. Unfortunately, the UK also has some less favourable characteristics. It starts the downturn with a weaker fiscal position than Japan and a very low household saving rate.
Coming to a town near you ?
Nov. 14 (Bloomberg) -- Icelanders will take to the streets in their thousands tomorrow to protest the government's failure to clinch a $6 billion International Monetary Fund-led loan while countries in less dire economic straits jump the IMF queue.
Mortgage availability update (LTV's)
Mortgage deals for people offering a 10% deposit have almost evaporated from the market, according to figures obtained by the BBC. Only 66 deals of this kind are still available, compared with 586 three months ago and 1,197 in February. The figures, from Moneyfacts, reveal how the dramatic financial downturn has almost killed off traditional deals for those without large savings. Mortgage brokers say they will not return until house prices level off.
The great British property myth
"Booms and busts may come and go, but in the long run the British people know that 'you can't go wrong with bricks and mortar' and that 'renting is dead money'. But is this really the case? In conjunction with the BBC's The Money Programme, we decided to run the numbers and find out whether buying a house in Britain really always makes more financial sense than renting one."
Fun: Hedge Fund Managers caption competition
US Gov Bonds auction - "There’s just no interest in it."
Following up on my post on Monday on what to watch this week - Treasury sales as the US tries to fund itself and the bailouts. Not a train wreck yet, but getting closer. Yield on 30 year bonds - "the lowest since regular sales of the security began in 1977". Shorter term - "The U.S. sold $34 billion in four-week bills yesterday at the lowest rate on record." The article goes into some more technical central bank theory related to a Bernanke speech in 2004 which I don't fully understand. He was talking about a Zero Interest Rate Policy ZIRP. I think he is saying that a ZIRP, and increasing the money supply, discourages people from hoarding cash in their portfolios and encourages investment into higher yielding corporate bonds and stocks, which is needed to get the economy going again.
What investors should fear the most – the state
You can't buck the market forever. And even though there have been plenty of bail-outs, prices just keep on falling. But governments don't seem to learn…
Brown Makes an Ass of Himself Abroad
"Gordon Brown tonight called on the world's most powerful industrial nations to agree a programme of immediate and coordinated tax cuts to prevent the global economy sliding deeper into recession." The sheer arrogance of this amazes me, has any other leader, ever told other countries around the world to cut their taxes ? Is it just me or does anyone else think that Gordon Brown has lost it completely ? I know there is a tendency for Brits to stand behind a leader and prove that British is best but this is getting embarrassing.
Mortgage repossessions in Northern Ireland has rocketed by a massive 93% during the third quarter of
The figures reveal the true extent on the credit crunch on property owners with a soaring number unable to keep up repayments on their homes.
Property: The End of the Affair ?
Browns' Debt Iceberg
Mail Online: Official figures are only the tip of a terrifying iceberg of debt that amounts to £150,000 for every family
Take a look at this depiction of an iceberg. It provides a frightening illustration of just how much trouble we are in, and explains why the markets are in turmoil and the pound is in freefall as investors around the world lose confidence in Britain.Our true Debt is 157per cent of our GDP.This makes us the most indebted nation in the developed world, paying interest of £263million a day.
Bankruptcy numbers rocket
Surprised more isn't being made of this by the media - businesses going bust up 26.3% YOY, people going bankrupt up 9.5% YOY - and remember that's completed bankruptcies so all entered the system a while ago.
This is a snapshot of the world, interesting
JCB announces almost 400 job losses
The plant manufacturer has already announced over 700 job losses this year but said the extreme deterioration in business levels and confidence around the world has lead to a significant reduction in orders. *******WITH ALL THIS DAILY BAD NEWS, WHEN WILL HOUSEPRICES REALLY DROP, OR WILL SELLERS CONTINUE WITH STUPIDITY?*********
will this affect houseprices?
The eurozone has officially slipped into recession after EU figures showed that the economy shrank by 0.2% in the third quarter. This follows a 0.2% contraction in the 15-nation area in the previous quarter from April to June. Two quarters of negative growth define a technical recession. The news was widely anticipated and follows data showing that Germany and Italy, two of the biggest eurozone economies, are already in recession.
Surviving the recession, hang onto the job you have
This is from the Wall Street Journal, but I think it applies to the UK too and not just managers "A growing number of professionals are saying "no, thanks" to prospective employers asking them to change jobs. Spooked by the shaky economy, 46% of U.S. middle managers polled in mid-September said switching employers in the current environment is risky, according to a survey by Accenture Ltd. Just 13% of respondents said they were actively looking for a new job, down from 30% the last time Accenture conducted a similar survey in 2005. When an employer needs to lay off workers, "sometimes it's last in, first out,"
HSBC is considering repossessing its own Canary Wharf headquarters
The banking giant HSBC is considering repossessing its own Canary Wharf headquarters, as it holds talks with the troubled Spanish property company that owns the building. Metrovacesa, which bought the building from HSBC for more than £1bn in a sale and leaseback agreement in 2007, is facing increasing financial difficulties and looks unable to service the debt it raised from HSBC itself to buy the skyscraper. HSBC helped Metrovacesa at the time by giving it a bridging loan of £810m, with the idea being that it would be refinanced. The crash in the real estate and mortgage markets completely changed the parameters in the debt market, however. The loan comes due on 28 November and it looks almost impossible that it will be rolled over.
But it's different here!
Scottish house prices have suffered their biggest quarterly fall for at least 16 years, according to research by Lloyds TSB. The bank's Scottish House Price Monitor showed the average domestic property dropped in value by 4% in the three months to 31 October. It said the fall was the largest in the 16-year history of the monitor. Whilst prices are still up 4.9% on an annual basis, they have fallen by upto 9.1% over the last quarter.
Housing market 'far worse' than figures suggest
Online estate agent says latest figures underestimate fall in prices by two-thirds
peak to present decline GBP vs Euro -22% - try to keep up HPC
"Should the depreciation of sterling turn into a rout, we may even see the current policy of aggressive cuts in interest rates by the Bank of England suspended, if not reversed. For the moment, the Bank seems content to watch sterling fall." ....would this be because his paymaster GB sold half the countries gold reserve when gold was at an all time low and then bought euros at an all time high (euro/ GBP exchange rate was 1.60 euro to the pound). The question needs to be asked: did he do this to capitalise on a destroyed sterling, and keep sterling, or did he do this to capitalise on a destroyed sterling and use its destruction to force the UK population into believeing that it is imperative we join the Eurozone???
UK home values 'to plummet 50pc from peak'
UK property prices could fall by 50pc from their peak within the next 12 months. A conference of the Royal Institute of Chartered Surveyors (RICS) was told that about £100bn (€125bn) could be wiped off the value of UK properties. So says Savills.
Cyclical thinking - well done!!!!
"Yolande Barnes is head of research at the property company Savills, which publishes its house-price forecast today" .....says it all really!!!!
Should Government stop throwing money into the money hole?!
Very amusing, please watch!
A Quick Look At The Stats
Sinking crude prices are a tremendous blow to this oil-driven economy. The stock market is also suffering huge losses, dragged down by the country's oil giant Petrobras. Meanwhile, Brazil's real is down 35% against the dollar, since oil set a record high in July. President Bush and other officials will meet Friday and Saturday to discuss the global financial crisis. Credit has stopped flowing, economies have slowed down, consumer prices have soared, unemployment is on the rise and stock markets are plummeting. Central banks have initiated programs costing trillions of dollars, but there is little sign that the crisis has abated.
BBC -" we all knew the bubble that was getting ever more inflated, couldn't last forever"
Escalating property prices have been a staple of dinner party conversation for years. But in the last year, they have been replaced by a new topic: falling property prices. There is no doubt that many people made a lot of money out of property in the last 10 to 15 years, while many others in their 20s and 30s have seen their dream of home ownership slip away. But we all knew the bubble that was getting ever more inflated, couldn't last forever and would eventually burst. Burst it did, around autumn last year - and we have been on an economic downward spiral since then.
We won the battle of the Wharf
BBC turns on Brown at last!
Sir John said Labour "has as much financial blood on its hands as any banker". He said Mr Brown took credit for the years of economic growth he inherited from the Tories in 1997. And the former Tory PM accused Mr Brown of presiding over a debt-fuelled boom in property and asset prices.( ...more in the Times)
Germany goes into recession
The euro fell to a two-week low against the dollar after Germany's economy entered its worst recession in at least 12 years, spurring speculation the European Central Bank will cut interest rates. The 15-nation currency also pared gains against the yen after a German government report showed the biggest contraction over two consecutive quarters since 1996. The yen declined versus the Australian dollar, after yesterday surging the most in three weeks, as currency intervention by the Reserve Bank of Australia fueled speculation other central banks may follow suit.
Will we see a run on the pound?
"Congratulations (of sorts) go to the UK as British household debt is highest in history. I have long maintained that the UK was in as bad a shape as the US, if indeed not worse. Evidence is starting to build to support that thesis. The pound is highly likely to roll back the entire move up off the 2001 low, if indeed not a lot more. Central bankers are going to be shocked at how little they can do about this." Mish doesn't use hysterical language like "meltdown" lightly, and he has been right every step of the way so far. I think I'll move my assets away from Sterling for a while.
There's the "D" word again.
WASHINGTON (Reuters) - George Soros, chairman of Soros Fund Management, testified at a U.S. House Oversight and Government Reform Committee hearing on Thursday: * Said "a deep recession is now inevitable and the possibility of a depression cannot be ruled out." * Said hedge funds were an integral part of the financial market bubble which now has burst. * Said hedge funds will be "decimated" by the current financial crisis and forced to shrink their portfolios by 50-75 percent.
No end in site for Sterlings demise!
Sterling has been falling sharply against both currencies as the news from the economy has darkened over the past couple of months, and today it slide to below $1.49 and hit a record low of 84.57 against the euro. "The UK is looking at the steepest recession of the G-7 countries and the sharpest cut in interest rates," said Simon Derrick, a currency strategist at Bank of New York. "Investors are cautious about putting their money here when they can get a better return elsewhere." Bank of England Governor Mervyn King yesterday indicated that more aggressive interest rate cuts lie ahead as the Bank's Monetary Policy Committee does everything within its power to limit the length of the recession that the UK now faces.
Last of the bubbles
Thought I'd introduce a bit of culture amongst the general vulgarity here. Until recently the art market was being cited as withstanding all the crunching going on. Not any more. A Hirst for a couple of quid? Overpriced. However, I'd take the Bacon for a hundred - I'm just a poor art collector.
Sterling Crisis 2008
The foreign exchange markets are witnessing heavy and sustained selling of sterling which continues following the Bank of England's inflation report and statement on the economy. The British Pound has fallen below £/$1.50 to currently stand at 149.12, and to a new low against the Euro of 119. The fast developing sterling crisis illustrates the systemic failure of the Bank of England and Labour Government to manage both the economy and the credit crisis and marks another marker following last weeks panic interest rate cut of 1.5%, as the government took control of monetary policy back from the Bank of England and effectively ordered the Bank to cut interest rates by 1.5% despite inflation hitting 5.2%.
Fixing up the US T-bill repo market
N.Y. Fed: Treasury Market Practices Group Endorses Several Measures to Address Widespread Settlement Fails
Special collateral repo rates cannot exceed the Treasury general collateral repo rate. As a result, settlement fails across a variety of CUSIPS can similarly become widespread and persistent when the Treasury general collateral repo rate is near zero – as is currently the case. [here, the NY Fed are proposing a penalty system to stem the spread.] TMPG understands that the creation of such a facility is not possible in a short timeframe. Progress by the private sector on the preceding initiatives should not be dependent on the development of a backstop standing Treasury facility.
Does anyone remember the low of 1.0360
The closest we came to that was in February 1985 when Sterling was around 1.0360. Could we get back down there?
Friends Provident city centre job losses
Friends said it would quit its offices at the Manchester Express building from the end of 2009 and consolidate operations at its site in Spring Gardens. The firm employs 465 people at the Express building, in customer service, IT and other head office functions. The Unite union claimed today that 280 jobs would go as a result of the shake-up, but Friends said the final number of redundancies would not be known until a consultation period is completed.
Is this a wise move?
The developers of Hull’s tallest building have been given a two-year deadline to begin work on the £100m scheme. Formerly called Clarence Mill, the skyscraper scheme has been renamed Manor Mill after developers Manor Property Group. The development includes a 21-storey tower, 10-storey hotel, 9-storey building for student accommodation, a casino, restaurants, offices and shops. A spokeswoman for Kingston-Upon-Hull City Council said it was approved on the condition that building work start within two years to ensure the project does not stagnate.
Those hoping for a quick end to falling house prices are likely to be disappointed. Evidence suggests we are still a considerable way from the bottom. In a housing bubble, on average prices lose 70% of the gains made on the way up before bottoming out. So if this is a typical bubble, the fall would be £97,000, taking the price of the average house back down to just £103,000, down 48.5% from the peak of £200,000 last year. Some commentators, however, see the gloomy headlines as far too alarmist. One is Stuart Law, chief executive of property investment specialist Assetz, who predicts UK house prices will fall 10-15% in total from their peak last year, based on the FT index, which has fallen only 4.8% so far.
BBC does its bit to tow the "deflation anytime soon now" line
Obviously no-one has told the BBC that the Bank of England's inflation predictions have persistently and consistently underestimated inflation for at least five years. This latest is particularly pernicious, and is akin to church leaders telling the impoverished to ignore their current hardships and think instead about a wonderful afterlife of bounty and comfort.
Merryn talks sense as always
So the point stands: if you can't get a loan, what difference does it make that base rates are the lowest they have been since the 1950s? We endlessly hear, not least from Gordon Brown, about how there is massive "pent-up demand" for property in the UK. But this isn't a concept that makes any sense in economic terms: demand isn't demand unless it is backed by cash.
Arbury Park is like a construction site. It's like a rubbish dump
Welcome to Arbury Park, a "contemporary, attractive and vibrant" private development of 900 homes in affluent Cambridge.The master developer, Gallagher Estates, promised shops, cycle lanes, bus routes, a multi-function hall, all-weather sports pitches, children's play areas, and even a "sensory garden" for disabled families. But............The pavements on their street are still unfinished. "They said it was going to be a new luxury place but Arbury Park is like a construction site. It's like a rubbish dump," said Mr Macaulay. Antisocial behaviour has flourished. Residents, many with young families, complain of hooded gangs roaming the streets and robbing garden sheds.
Would the UK be in a position to do this with? No ....perhaps borrow $100 billion instead.
Japan is preparing to tap its foreign exchange reserves to the tune of $100 billion (£76.2 billion) in an offer to the International Monetary Fund (IMF), government sources have told The Times. The Japanese offer, which will be unveiled tomorrow in Washington, will dramatically increase the IMF's ability to lend to emerging economies savaged by the global financial crisis. Japan is already the second-largest donor to the IMF, and has the world's second-largest stash of foreign reserves - some $980 billion.
Tokyo's Heartland bar is a barometer of the times...
"Peter, 36, a former sales trader at a large US investment bank, believes that the women of Heartland have developed a sixth sense for layoffs. “The five-year reign of the Roppongi Hills scene bred a pretty canny strain of Japanese woman. I fell in love with at least one of them. It is scary to see how quickly they've disappeared from the bars. And they started disappearing early: these girls are a market indicator to which we should all pay attention.”
The pound has nowhere to go but down
With unemployment up, interest rates in free-fall and a recession looming, the pound is suffering. And with sterling so weak, the Chancellor will have to deliver a very carefully-considered pre-Budget report to avoid sparking a currency crisis.
When will the world learn - "you can't buck the market"
The Kuwait's stock exchange has been closed until 17 November following an unprecedented court order. A local court ordered the closure after investors complained that the government was not doing enough to stem heavy stock market losses. The emirate's stock exchange, the second largest in the Arab world, has fallen 43% since June. Kuwaiti sovereign wealth funds have bought hundreds of millions of dollars of stock, but the slide has continued. The central bank has also injected billions of dollars into the system in an effort to protect the Kuwait from the global financial turmoil.
Are we seeing the start of financial education for the masses? One to watch
"In this timely six-part series, historian Niall Ferguson tackles the story of money and the rise of global finance. He argues that behind every great historical phenomenon – empires and republics, wars and revolutions – there lies a financial secret. " Haven't read his book so don't know how much I will agree with, but will reach an audience of a few hundred thousand no doubt, so will be an interesting one to watch
Peter Schiff had with Arthur Laffer on CNBC back on August 29, 2006
Housepricecrash.co.uk: 8/28/2006-Peter Schiff Predicts The US Economic Collapse With Unbelievable Accuracy
Consider watching this video of a debate that financial analyst Peter Schiff had with Arthur Laffer on CNBC back on August 29, 2006. Schiff predicted the deep recession that is now underway and made mention of China’s role in our unfolding economic troubles. Laffer’s talk about our economic policies “working beautifully” makes him look utterly ridiculous in today’s climate. Posted by malct @ 11:30 AM (65 views) Add Comment http://uk.youtube.com/watch?v=LfascZSTU4o
this has to be read...
“Greed is what the City represents,” said Geraint Anderson, a former banker at Dresdner Kleinwort, whose novel “Cityboy” — a sordid tale of excess and misdeeds in the City of London — has become a best seller here. “They cheat, they lie, they do all they can to make more money.”
OMG people returning things because they are skint, this is a new level
Shopping at Nordstrom in Miami this month, Maria Kakouris indulged herself with a $200 pair of satin-and-snakeskin pumps. Then came a spasm of buyer’s remorse. “Those shoes — they are still in my car with the receipt,” said Ms. Kakouris, a real estate agent. “I’m thinking, where am I going to wear them?” In less challenging times, Ms. Kakouris might have hung onto the shoes. But now she is more circumspect. “They’re going right back where they came from,” she said.
Really i thought we could weather any storm..
The Government added that the 'balance has tipped too far' against local stores in many town and city centres. ****NO DOUBT TESCOS WILL TAKE OVER****
Rightmove loses 300 estate agents a month
Property website Rightmove today reported that up to 300 estate agents were quitting the service each month as they struggled to survive the property downturn
Johnston to axe more jobs as ad sales stall
The Yorkshire Post and Scotsman owner has already slashed over 900 jobs, or an eighth of its workforce, this year. And boss Tim Bowdler warned that he would 'continue to look at managing costs' while the economic downturn intensifies. The turmoil in the regional newspaper industry was underlined by a grim trading updating from the company yesterday. Property ad revenues have plummeted 48% since July as the housing market ground to a halt, with rising 'situations vacant' adverts down a third amid soaring unemployment.
Even more new builds in manchester, like it needs them!!!
The scheme is planned to regenerate a massive site in Ardwick, near Piccadilly station, and will include 1,849 new homes, a hotel, offices and shops.
How will this affect the stockmarkets and shops if people cant get in to work!
The Rail, Maritime and Transport (RMT) union said its members at EDF Energy Powerlink will walk off the job for 36 hours on Sunday night and on 7 December.
Hedge funds lose $100 billion in assets
In the USA the government would be bailing out these fraudsters ...
Colombian Vice-President Francisco Santos warned citizens to avoid pyramid schemes. "When someone promises to double your money in six months they are trying to trick you," he said. "Nothing is free in this world and that is not going to change." A number of bogus companies have vanished in recent months after promising depositors interest rates as high as 150%. Our correspondent says some of the schemes have actually paid out money to investors to launder drug profits. Pyramid investment schemes are said to be often more popular than regular savings accounts in Colombian banks, which charge high fees.
More jobs gone.
The telecoms giant BT is cutting 10,000 jobs, it has announced, as slump in the British economy begins to bite.
So why wasn't it a problem on the way up?
The Bank of England has often insisted that the relationship between house prices and consumer demand is tenuous. But now it appears to be engaged in a sober reassessment of the significance of house prices for the economy and its role in consumption, pointing to its particular role as collateral for bank borrowings. The Bank noted that its own data showed that the level of mortgage equity withdrawal had fallen sharply. Moreover, it pointed out that household indebtedness – much of it related to housing – had increased sharply since the 1990s slump, hitting 170% of annual income in 2008. "Lower house prices reduce the amount of housing equity that homeowners can borrow against.” The Bank noted that a resumption of lending was critical to its forecasts of economic recovery.
Riots in Columbia at collapse of get rich quick schemes
Colombian Vice-President Francisco Santos warned citizens to avoid pyramid schemes. "When someone promises to double your money in six months they are trying to trick you," he said. "Nothing is free in this world and that is not going to change." Wise words. If only the citizens of UK, its banks and its government had taken this rational approach. In Columbia they're called Pyramid Schemes. Here it's called the property market. In Columbia they allow the schemes to fail and prosecute the criminal behind them. Here the government taxes all of us, trashes public finances and the currency in order to bail the schemes out and reward those that run them. WE are the 3rd world economy here.
We told you so! (and so did many, many economists)
The US government has scrapped the central plank of its $700bn financial rescue strategy by abandoning plans to buy toxic mortgage-related assets which have weighed down the balance sheets of troubled banks and Wall Street institutions. In a sharp about-turn, treasury secretary Henry Paulson announced yesterday he no longer believed that purchasing assets would be the most effective use of the administration's bail-out fund. "The facts changed and the situation worsened," said Paulson, who added that he would "never apologise" for amending his approach in the light of changing circumstances. Instead, Paulson intends to use the bail-out fund for further injections of capital into banks in return for equity. This programme is likely to be broadened to non-bank financial institutions.
Credit destruction exceeds central bank printing, hence deflation
The price of white truffles has fallen 84pc. Fines wines have dropped 65pc. Lobsters are off 52pc. Deflation has reached the City. It has engulfed housing and now threatens to spread through the broader economy, lodging like a virus in the British and global monetary systems. Mervyn King, the Governor of the Bank of England, says it is now "very likely" that the UK retail price index will turn negative next year. This is a drastic reversal of the oil and food spike that played such havoc with monetary policy over the summer. The curse of deflation is that it increases the burden of debts. Incomes fall: debts stay the same. This way lies suffocation. [Personal gloat: it's nice to be debt-free and mortgage-free!]
the R word
The Bank of England says the UK has probably entered a recession in the middle of 2008 and is likely to continue to contract well into 2009. In its quarterly inflation report, the Bank warns that the economic landscape has changed dramatically since August. It says that the UK economy could shrink by 2% over the next year, much worse than its previous forecast. Bank governor Mervyn King also said the Bank would be prepared to cut interest rates further if needed. "[It is] very difficult to know precisely how long we'll be in recession," Mr King said. "I think we probably are in recession now." The Bank now also expects inflation to decline to 1% by 2010, below its 2% target, in a dramatic change to its last forecast. This would mean that the Bank had scope for further rate cuts.
Safe as houses
THE credit crunch is demolishing our building industry. Construction has been hit even harder than the finance sector. New homes, shops and offices stand unfinished and remain under scaffolding in developments across the country. Taylor Wimpey have seen their share value collapse from £5.7BILLION to just £105million. More than a million homes are waiting for buyers — but industry experts estimate there is only one potential buyer for every 15 properties. An auction in Leeds last week saw a flat that last year cost £400,000 go for just £159,000.
Brown's economic record exposed as a disaster
A former Prime Minister accuses Labour of squandering the golden economic legacy that it was bequeathedJohn Major Sixteen years ago an economic gale blew away a vital part of my economic strategy; now, a more comprehensive storm has undone the entire economic strategy of the Labour Government....... Who ignored the debt spiral as it built up? Who weakened regulation and allowed Northern Rock to offer 125 per cent mortgages? Who diminished Bank of England control over our banking system? Who wrecked final-salary pensions with a £5 billion-a-year tax levy? Who ignored the risks of the house price and equity boom? A glance in the mirror shows him (Brown) the culprit.....
Stocks beaten down by changes in bailout plan, concerns over consumer spending, economy
"A disheartened Wall Street fell for the third straight session Wednesday as investors absorbed another series of dismal corporate reports and news that the government won't buy banks' soured mortgage assets after all. The Dow Jones industrials fell 340 points, and all the major indexes dropped more than 3 percent." --- Well, duh, the banker takeover bill, known by the proles, in newspeak, as the "Bailout Bill" was about getting freedom to spend money freely on whatever, whenever, however much, without fear of any legal recourse. So, of course they won't buy bad assets if they have freedom to buy good assets!!!
Viva Liberty! Down with Keynes!!
As we enter the era of decline for the dollar (Sterling) all sorts of reforms will be used to address this decline and the economic instability it causes. However, reforms designed on Wall Street or in Washington will not work and will amount to nothing more than rear guard action by the moneyed interests that control the government. The only true path to reform is monetary freedom. Mises wrote (almost 100yrs ago) that the era of inflation will come to an end once people realize that the process of inflation is ongoing with no end in sight. At that point people will stop holding dollars and dollar-denominated assets. In conclusion: What we need is monetary freedom and we must tear down and destroy its opposite, the Federal Reserve. End the B(w)ank of (un)England and the ECBleurgh.
What can you say!
An Â£8 million block of London flats went up for grabs today in Britain's biggest free prize draw which is set to raise Â£600,000 for Great Ormond Street Hospital Children's Charity. Up to 200,000 entry tickets for the raffle to win the entire development of 11 Whitechapel apartments are being given away by property developer MIA Developments Ltd. The raffle tickets are being given to people who buy a Â£60 MP4 player from the developer who claims the move escapes sanction by the Gambling Commission because entry is then free, unlike other recent property raffles which have been shut down for not holding lottery licences.
The BOE did not say, that it is prepared to slash interest rates to zero to DESTROY the economy.
They talk to us like children, cutting interest rates to zero would destroy our currency, the value of our wages, pensions & savings. This is a tax on savers & socialist welfare for borrowers, but, our government has been run by bankers since the beginning of the Bank of England in the 1600's, &, via derivatives, they make more money selling debt, &, via lobbying, they have driven fractional reserve requirements to zero, so, they don't need us savers now. They will therefore destroy us. & don't think that it stops there, rates can fall heavily into the negative. I went to a shop today where I was told that the banks now charge 10% on switch payments. Charges plus low interest equals a negative rate overall for the economy, so stop using switch in shops, take cash. & please get some gold!
And the job cuts continue...
Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) plans to cut 10 percent of staff in its institutional securities unit and 9 percent in asset management, it said on Wednesday, as it copes with a deteriorating economy, disrupted capital markets and falling asset values.
The latest run................
The Presbyterian Mutual Society in Belfast has said it is stopping repayments to members because it cannot meet demand for withdrawals. The society, set up in 1982, is a separate legal entity from the Presbyterian Church in Ireland. The society has assets of £300m and about 9,500 shareholder accounts. The society's Colin Ferguson said "nervous investors" were moving their money because the PMS was not covered by the government's guarantee scheme. "The funds have not disappeared," he said. "It is simply a matter of the society having insufficient cash to meet the demands for withdrawals - the funds are now sitting in the commercial property that we own and in loans that we have made."
UK and Holland put thumb-screws on Iceland, revenge for viking attacks centuries ago
An international bail-out of crisis-hit Iceland appeared to be unravelling on Tuesday night as the International Monetary Fund withheld official backing for the $6bn plan...There are deep suspicions in Iceland that the UK government has put pressure on the IMF to delay the loan until a dispute over the compensation Iceland owes savers in Icesave, one of its collapsed banks, is resolved...but a government spokesman denied this saying London had “in no way blocked the IMF’s loan to Iceland". ..However, Dutch finance minister, told Dutch television that The Hague would oppose the IMF plan until their compensation dispute was resolved. “Luckily we have powerful allies as Britain and Germany have the same problem with Iceland,’’
Browns Sterling Crisis
The sterling crash has now begun in earnest. The pound has today (today!) fallen 9% against the Yen and is off 4% against the dollar to a lowly $1.56 with forecasts of $1.40 or lower next year. Against any other currency you may mention, it’s now plunging.
Guide to Deflation
The critical take-away is that we are indeed experiencing short term deflation. We call it disinflation here in the context of Ka-Poom Theory to keep readers from confusing the process with the start of a deflation spiral–which cannot happen under a floating exchange rate, fiat money system. The only way it could is if governments around the world all got together and decided to crash the global economy. That strikes us as unlikely. More likely one or more will move to reflate using currency devaluation.
Light relief to take your mind off sterling's death spiral
A is for America, the big swinging Richard whose dysfunction started it all. Think also of accountability (lack of); AIG(which has cost the U.S. $140 billion, and counting--who knew insurance could be so exciting!); assets (what assets?), and Adam Smith, who's slapping us about the face -- with his invisible hand. M is for where it all started: the mortgage (which, aptly, means death-pledge). Like the dog, it comes in a variety of breeds, "sub-prime" being a cross between a pit bull and a chihuahua.
Euro costs 84p
The interest rates rollercoaster continues to plummet
THE Bank of England said today it is prepared to slash interest rates to zero to save the economy. Governor Mervyn King said the official cost of borrowing would be cut to “whatever level is necessary” to boost confidence and stave off a long and deep recession. Because this worked for the Japanese :)
Seriously, is the plan to just try and waist as much fictional money as possible! Makes you wonder.
Nov. 12 (Bloomberg) -- U.S. Treasury Secretary Henry Paulson plans to use the second half of the $700 billion financial rescue program to help relieve pressures on consumer credit, scrapping an effort to buy devalued mortgage assets. ``Illiquidity in this sector is raising the cost and reducing the availability of car loans, student loans and credit cards,'' Paulson said in the text of a speech today in Washington. ``This is creating a heavy burden on the American people and reducing the number of jobs in our economy.''
Is it just me or is "recession" so yesterday? "Depression" is the new black!
Mr Clarke, 68, said the British economy is headed for a "catastrophic crisis" that will be "far worse than anything that has occurred in my lifetime". "There will be a very serious recession next year," he said in an interview with Telegraph TV. "I think the big problem in 2009 will be the catastrophic fall in consumer spending demand, spending in shops will get worse." Mr Clarke, who as Chancellor of the Exchequer between 1993 and 1997 led Britain's recovery from Black Wednesday, called for a temporary cut in VAT to boost spending. Speaking as the Office of National Statistics revealed unemployment has reached an 11-year high of 1.82m, Mr Clarke said the number of jobless could soon reach three million.
Government "woefully unprepared" in respect of rising unemployment
The Liberal Democrats have accused the government of being "woefully unprepared" to handle the 1.82 million revealed today to now be unemployed in the UK. The figure is the highest for a decade but the Liberal Democrats say the Jobcentre network had actually been scaled back to deal with the reduced number of unemployed people seen during the boom.As a result it says it is now struggling to cope with the consequences of the bust.Jenny Willott, shadow work and pensions secretary for the Liberal Democrats, has also hit out at the Conservative Party's call for tax breaks yesterday to help firms keep staff in work. She says: “The Conservative plans announced yesterday are not the answer. It didn’t work in the 1990s and it won’t work now. "Companies won’t take on staff they don’t need.
Banks latest move - Debt for equity swap considered
KPMG says that the banking industry is setting private equity style departments as their ownership of businesses increases in the worsening economic environment. It says that with bad debts multiplying in businesses and no market to sell on distressed debt, a debt for equity swap is an option for a lender whose interest cannot "crystallised".Philip Davidson, head of restructuring at KPMG, says: “We predict a large increase in debt for equity swaps as trading conditions worsen, particularly in the first half of next year. "This changes fundamentally the role of the bank’s relationship with a business, particularly where banks end up with a controlling interest. "Each of the big commercial banks has set up a department to manage their increased ownership responsibilities.
All this money and still it is recession.. it is a big joke..
U.S. Slump May Be Longest in Decades as Growth Fell Off `Cliff'
`Serious Recession' ``We're in for a pretty serious recession,'' Jeffrey Frankel, a member of the business-cycle dating committee of the National Bureau of Economic Research, said in a Nov. 10 interview with Bloomberg Television. ``There's a chance it'll be the worst postwar recession.''
There you go then. A year long hangover and then let the partying resume! Phew!
The Bank of England said today that the country is set for a deep one-year long recession with annual output set to shrink by as much as 2 per cent in 2009. In its quarterly Inflation Report, the central bank said that the country probably entered a recession in the third quarter of this year, and predicts there will be no recovery until the second half of next year.
Another Govt mantra crumbling
"Unemployment reached an 11-year high today when another huge increase in the numbers looking for work edged the total closer to the two million mark."
Bloomberg News should be congratulated for filing suit against the Federal Reserve
“The American taxpayer is entitled to know the risks, costs and methodology associated with the unprecedented government bailout of the U.S. financial industry,” said Matthew Winkler, the editor-in-chief of Bloomberg News. Another way that the media can begin to fix the blame for the financial meltdown is to cover the views of those who predicted the crisis and understand how it happened. Consider watching this video of a debate that financial analyst Peter Schiff had with Arthur Laffer on CNBC back on August 29, 2006. Schiff predicted the deep recession that is now underway and made mention of China’s role in our unfolding economic troubles. Laffer’s talk about our economic policies “working beautifully” makes him look utterly ridiculous in today’s climate.
Bank signals further rate cuts may be needed
Tell you what, just give everyone a million quid for free that will stop recession...
One for the gold bugs
Barclays Better Get Ready To Toe The Gummint Line Then
Some of Barclays’ biggest shareholders are threatening to vote against the bank’s £7.3 billion fundraising that includes a preferential placing to investors in the Gulf. Legal & General Investment Management and Aviva Investors are said to be concerned about the high dilution of existing investors and the cost of the funding.
Peston in 'sense of humour' shock
VW, the stressed German carmaker, is trying to raise €2.8bn (£2.2bn) from the European Central Bank. It plans to raise cash from the ECB in exchange for €2.8bn of securities backed by car loans. In effect, the ECB - and ultimately taxpayers in the eurozone - would be financing purchases of automobiles. Crikey, is all that comes to mind. What next? Perhaps Marks & Spencer will be able to dump its unsold jumpers and knickers on the Bank of England, in exchange for a bit of useful short-term credit.
Negative equity - scary figures
I realise that negative equity is going to be a big problem for many. Are these estimates not a bit over the top?
run forest run, run on the bank forest run...lol
ING Groep NV, the financial-services firm that got a 10 billion-euro ($12.6 billion) lifeline from the Netherlands last month, said writedowns amounted to 1.51 billion euros in the third quarter and may extend through year end. The loss for the quarter ended Sept. 30, the first since the company was created in 1991, was 478 million euros, or 22 cents a share, it said today in a statement. That was less than the 500 million-euro loss it forecast last month and compared with net income of 2.31 billion euros, or 1.08 euros, in the year-earlier period. ING rose as much as 3.8 percent in Amsterdam trading.
Manufacturing jobs fell to 2.86 million, the lowest figure since records began !
The number of people out of work in the UK in the three months to September jumped by 140,000 to 1.82 million - the highest in 11 years. The unemployment rate rose to 5.8%, up from 5.4% in the previous quarter, according to official figures. The number of people claiming the Jobseeker's Allowance rose by 36,500 to 980,900 in October - the highest monthly increase since 1992. Economists say unemployment in Britain could soon reach the two million-mark. The number of manufacturing jobs fell to 2.86 million, the lowest figure since records began in 1978. The so-called claimant count - those claiming the allowance - has now increased for nine months in a row and is 154,800 higher than a year ago.
the smallest gate in the world
Sellers getting desperate
Seem to be moving to a new stage in the cycle, from fear to capitulation. "Housing market sentiment, across all regions of England, Wales and Scotland, tumbled further this month. Asking prices of 200,000 homes on the market were cut in October (187,000 in September), by an amount on average equal to £20,194. Deeper cuts in asking prices over coming months are to be expected."
So what happens if further rate cuts?
As Gordon Brown plans his reflationary strategy, an old bogey has returned to haunt the Government's ambitions – the possibility of a sterling crisis. With the pound falling to a new 12-year low against a trade-weighted basket of currencies and an all-time low against the euro, it might be argued that it has already arrived.
That's not very nice.
Goldman, Sachs & Co. urged some of its big clients to place investment bets against California bonds this year despite having collected millions of dollars in fees to help the state sell some of those same bonds. The giant investment firm did not inform the office of California Treasurer Bill Lockyer that it was proposing a way for investment clients to profit from California's deepening financial misery.
The TUC has called for an increase in jobless benefits
The Government has been urged to increase jobless benefits to help the growing ranks of unemployed against a "catastrophic" fall in their income. The TUC said current levels of jobseeker's allowance were not enough to live on and would be worth more if they had kept pace with earnings over the past 30 years.
You can't make it up, he's actually relishing it. He think's its a good thing.
British Prime Minister Gordon Brown called for shaping a truly global society and better international coordination of fiscal and momentary policies in a speech at the Lord Mayor's banquet here on Monday. He said that G8, the International Monetary Fund (IMF) and World Bank must change to meet new realities and Britain and the United States must provide leadership in efforts to build stronger international order. And the British govern ent is to work with G20 partners to build new Breton Woods with reformed IMF. "Together we can seize this moment of change to create age of a truly global society," he said. "Today's challenges are birth-pangs of new global order."
It began with the banks. Then house prices began to tumble. In the months that followed, the shock waves spread, engulfing first high streets, then factories – and thousands of jobs. In this gripping account, Paul Vallely travels across Britain to meet the people whose lives – and livelihoods – have fallen victim to the domino effect that left a nation broken
No Tracker benefits for new borrowers
Tracker mortgages 'track' changes in the Bank of England base rate and have become increasingly popular over the past few years. More than four million people of the 11.7 million who have a mortgage now have the loans. Many of those on fixed rates have tried to changed to trackers to take advantage of the Bank of England cuts. However, banks and building societies have been accused of cynically manipulating the rates on offer to deprive new borrowers from benefiting from recent base rate cuts. The rates on offer are now comparable to the uncompetitive standard variable rates offered by lenders.
President-Elect Obama is no dummy, and if we're going to have that sort of dislocation I'm quite certain he wants George Bush to be the one who has his hands all over it - as well he should, given that this is his administration and Treasury Department, along with his Fed Chairman, that has created the mess in the first place. I put the odds of the plates falling within the next two months - and possibly within the next couple of weeks - at one chance in three. If the plates fall we are going to have a very serious "event" in this country in the markets and in the economy - much worse than what we've seen to date. As in 10 million jobs lost almost all at once. A depression. And a new leg down in the market - 30-50% - essentially straight down.
Russia faces its own Black Wednesday
Russia's central bank has raised interest rates a full percentage point to 12pc to prevent a collapse of the rouble following a day of mayhem on the Moscow markets, prompting concerns that the financial crisis may be spiralling out of control. The surprise move last night came after the authorities had spent $7bn of foreign reserves in a matter of hours trying to defend the currency, at a lower level. The central bank has now spent $84bn of its reserves over the last month. "If people lose confidence, we could have a massive run on the banks: then the game is up." Expecting trouble, the Kremlin has mobilised the police to crush dissent. "Anti-crisis groups have been set up in the regions to intercept any early indications of destabilisation," said the president.
The road ahead is grim
More than 5,000 job losses were announced yesterday by some of the UK's leading companies, ahead of new official figures that are expected to show the highest number of people out of work since 1998 – and well on track to exceed two million by Christmas.
$2 Trillion theft. They are simply common thieves on steroids.
The Federal Reserve is facing a lawsuit after it failed to comply with congressional demands for transparency and disclose the destination of at least $2 trillion dollars in bailout funds, underscoring once again the failure of top down socialism and the folly of trusting the foxes to guard the henhouse, underscoring age-old problem of top down socialism and letting the fox guard the henhouse. Sourced from prisonplanet
Why should i save, pay a mortgage or any bills... i am going on dole...
The Curzon development, built on the site of the old cinema of the same name on the Ormeau Road, may be sold to a housing association. Clanmil Housing confirmed to the BBC that it is in negotiations with the property's owner to buy all 61 flats.
No. 2 mall operator warns of bankruptcy
General Growth Properties Inc., the No. 2 mall operator in the United States, has warned that an ongoing slump in retail sales, combined with the credit market lockdown, has pushed the company to the brink of bankruptcy. Chicago-based General Growth Properties (GGP) said in an SEC filing late Monday that it has $900 million of property secured debt and $58 million of corporate debt that's coming up for renewal by Dec. 1. It also faces another $3.07 billion in debt that matures in 2009.
More chunky job losses
This is turning into a disturbingly steady flow of significant job losses, albeit this one's not until this time next year: Virgin Media, the content and communications group, is planning to slash 2,200 jobs, or 15pc of its workforce, under a sweeping restructure. The surprise redundancies, which are part of Virgin Media's planned cost savings of up to £120m over the next four years and are expected to be completed by 2012, were attacked by the Communication Workers Union (CWU).
The program will be offered to people who are at least 90 days behind on their payments, according to government officials. The goal will be to modify the mortgage - most likely by reducing the interest rate - so that the monthly loan payment is no higher than 38 percent of the borrower's monthly income. The government plan could help as many as 300,000 families that are delinquent in their mortgage payments, and the costs would ultimately be picked up by taxpayers. But people with knowledge of the details said Tuesday that it was more limited than a program advocated by Sheila Bair, chairman of the U.S. Federal Deposit Insurance Corp.
The revised bailout of American International Group Inc. marks a new phase in the government's effort to shore up financial markets: It's the first time cash from the rescue fund Congress created last month has been committed to a failing company. Taxpayers are ``keeping the zombie alive,'' said Robert Eisenbeis, former director of research at the Atlanta Fed. ``We keep getting deeper and deeper into these holes.'' and ``Are you going to do General Motors and Ford, and, if you do those, are going to go on and do retailers?'' said William Isaac, chairman of the Secura Group LLC. `` Where does it stop? That is a very difficult decision we are going to face.''
Coming soon to a bank near you.
In their most aggressive move yet to stem a tide of home foreclosures, the government and the housing industry said Tuesday they'll try to modify hundreds of thousands of mortgages to make them affordable. mortgage firms will rewrite the terms on some overdue mortgages so the homeowners won't pay more than 38% of their incomes. Modifications could include deferring some of the principal owed, lowering interest payments or extending maturities to as much as 40 years.
Gordon demands this and that again
Gordon Brown demands that the chief executives of the major credit card companies explain to ministers why they are hiking rates for borrowers. He wants "clear principles to apply to the costs people face on their existing debts" and a "new responsible approach to lending"; talk about the Pot calling the Kettle!
The man who broke Britain
GM: Stock down 90% this year as layoffs continue
General Motors' stock price plunged another 15% Tuesday as the battered automaker said it plans to lay off nearly 2,000 hourly workers.
Will sudden Sterling/Dollar/Euro devaluations cause correction here?
"Russia's ruble fell the most in two months and stocks tumbled as the central bank scaled back its defense of the currency amid the country's worst financial crisis since the 1998 devaluation." "Russia drained 19 percent of its currency reserves to stem a 17 percent slide in the ruble against the dollar since the start of August, prompting warnings of possible downgrades from Fitch Ratings and Standard & Poor's." Russian stocks fell 65 percent this year, compared with a 42 percent slide in the MSCI World Index of developed nations. - Look for more if oil continues to fall.
What happened to Anne's hair-do?
Has she put two fingers in a wall socket? Was she getting ready to go to a property dinner party? Her voice was breaking down, she was fighting tears... "let's be realistic!" never heard her saying these words
This is absolutely hilarious ...
"Amanda and Basil Rankine ran up debts of £120,000 after their mortgage advice business collapsed and they found themselves unable to afford their monthly payments... they managed to have a number of their 13 credit cards and loans written off, to the tune of £37,000, including the sum from HSBC... a legal technicality - which meant the lenders could only claim the money back while the court proceedings were going on - meant the couple still managed to get most of their debts frozen. That took their total debt clearance to £100,000, leaving more than £20,000 outstanding. However, a legal bill of £100,000 left the Rankines back where they started."
Is tescos boss looking to be next PM???
Tesco (TSCO.L: Quote, Profile, Research), Britain's biggest retailer, has called for changes in the way business rates are calculated in Britain, saying the current system unfairly hits store groups and should be reformed to encourage investment. *******hmmm how unfair is tescos to suppliers and local corner shops??********
Helping you keep track
A raft of housing statistics were released today from the Royal Institute of Chartered Surveyors, the Council of Mortgage Lenders, and the Department of Communities and Local Government. The squeeze on mortgages was confirmed by data from mortgage lenders, while an industry survey showed that the number of sales hit a 30-year low. UK house prices in September were 5.1% lower than a year ago according to official government figures, making the average UK house price £208,583.
Government spin machine still humming smoothly
Will the bond market call a halt to the bailouts or does the fed print money?
A steep yield curve as there is at the moment usually signals a recovery but... "The steepening of the Treasury yield curve has been accompanied by an increase in the cost of insuring against default by the U.S. Treasury. It may come as a shock, but there are credit default swaps on the U.S. government and they have become more expensive -- in tandem with an increase in the spread between two- and 10-year notes. This link has been brought to light by Tim Backshall, the chief analyst of Credit Derivatives Research. The attraction of investors to the short end of the Treasury market is "juxtaposed with the massive oversupply and inflationary expectations of the longer end," he writes."
lack of available mortgages
Phew, and this is public sector - Postal levels down?
SHREVEPORT, LA (KSLA) - "We lost 2 billion dollars and like any other business we have to stay afloat." And to keep from sinking, the United States Postal Service is considering cutting thousands of jobs nationwide. Lavelle Pepper with the post office in Shreveport says they too are feeling the affects of the same disease hitting the country... a struggling economy. "We employ about 685,000 people. If we do layoffs it would include clerks, carriers, mail handlers across all crafts."
Who sets Libor? Only the banks themselves. Every morning, Monday to Friday, unless there's a bank holiday, just after 11o'clock, two people get together in the office of the British Bankers' Association. Sixteen leading banks (including Barclays, HBOS, HSBC, RBS and Lloyds TSB) send them the estimated interest rates at which their bank could borrow money 'were it to do so by asking for and then accepting interbank offers in reasonable market size just prior to 11.00'. The pair discards the bottom four and the top four, and then average out the remaining eight. That is that day's Libor.
Taylor Wimpey cuts 1000 jobs with no improvement in sight
Builder Taylor Wimpey today warned there was no end in sight to the crisis in the housing market as it axed a further 1000 staff. The firm said that while last week's dramatic cut in interest rates from 4.5 per cent to 3 per cent was welcome, 'there will not be a recovery in the UK housing market in the short term'. Business has gone from bad to worse since the collapse of Lehman Brothers in September sent financial markets and the banking system into meltdown. Mortgage lending in the third quarter of the year was down 70 per cent and has shown no sign of improvement. ******NOTICE THEY DON'T BLAME STUPID HIGH HOUSE PRICES, MAYBE THEY MIGHT BLAME LEAVES ON ROADS OR RAIN FOR LACK OF CUSTOM*****
screwing us again!!
daily mail: Banks INCREASE interest rates for credit and debit cardholders despite 50-year low in cost of borrowing
Banks have increased interest rates on tens of millions of debit and credit cardholders despite the cost of borrowing falling to a 50-year low. The average annual percentage rate for credit cards has risen from 17.2 to 17.6 per cent since May. It means financial institutions have failed to pass on a cut in interest rates to their customers since the Bank of England dropped its base rate from five to three per cent during the same period.
Students shown the door as parents fail to pay
Private schools are having to throw out increasing numbers of pupils as parents default on fees, according to a leading finance expert. The schools are facing a struggle to survive as pupil numbers fall, largely because increasingly cash-strapped families are finding it hard to pay the soaring cost of fees. The price of a private education has risen by 40 per cent in five years.
Yell plans 1,300 job cuts in £100m costs drive
Yell, publisher of the Yellow Pages, is planning to cut up to 1,300 jobs over the next ten months as it presses ahead with a plan to reduce costs by £100 million by the end of March 2010. The job losses, being pushed through by John Condron, chief executive of Yell, will be felt across all the group's divisions and will include cutting management jobs as well as slimming down the sales forces and reducing administrative positions. It marks the second major cost-cutting drive at Yell in little more than a year. During the 12 months to September, about 1,300 jobs were lost, which will have saved about £150 million during its current financial year. The job losses announced today will generate additional savings and demonstrate a clear deterioration in the economic climate.
Link To RICS Report PDF
Sellers accepting prices must drop
"New buyer inquiries improved to their least negative reading for 16 months..." That's a relief then.
This is why governments will never work!! Let the public run it all... no bailouts, no waste, etc
Olympic bosses have been accused of “unbelievably excessive” use of consultants after spending £40m on advisers. Official figures of Olympic Delivery Authority (ODA) expenditure show huge payments made to consultants since its formation three years ago.
Bank of China is the rival bidder said to be close to making an counter-offer for HBOS, the BBC has reported.The revelation follows news which emerged over the weekend that a foreign bank is considering making an offer for HBOS and is being advised by European American Capital (EAC), a London-based investment firm founded by Tim Goode - a former treasurer of RBS and ex-chief executive of treasury and capital markets at Halifax. European American Capital said it could not comment on the matter.
Nov. 11 (Bloomberg) -- General Motors Corp., burning cash as U.S. sales slide, is being pushed closer to bankruptcy as it waits to learn whether the auto industry will win a new round of government loans. The prospect of a forced liquidation raises the stakes for GM's quest for new federal borrowing after saying on Nov. 7 it may run out of operating cash as soon as year's end.The failure of GM in an event where the company stops production would cost 2.5 million jobs in the U.S. in the first year, according to a study by the Center for Automotive Research in Ann Arbor, Michigan.
Profits at Starbucks collapsed 97 per cent in the fourth quarter of the year after the ubiquitous coffee chain was forced to absorb the effect of weakening demand and the cost of closing stores earlier this year. As the group admitted to the earnings plunge, shares in the Seattle-based group sank 3 per cent in after hours trading to $9.91 each. Two years ago, the stock fetched $38.41.
Tatlor Wimpey 'pessimisitc' about recovery
Property Week: Taylor Wimpey extends debt negotiations but remains pessimistic on UK housing recovery
We remain of the view that there will not be a recovery in the UK housing market in the short term. We welcome the significant interest rate reduction announced last week, and are hopeful that if this is passed on to consumers, then it will help the market to return to stability more quickly. Increased mortgage availability and a return of customer confidence remain the key requirements for a sustained market recovery,’ it said.
Cable gets bearish
At a conference of London housing professionals on Friday (7 November) Mr Cable said the UK was dealing with ‘the bursting of the third major bubble in house prices since the Second World War’. ‘The bubble is now bursting and none of us can predict how far it will go,’ he told delegates. ‘But the work I saw last week, based on auctions and the rather elementary futures market in housing, suggests that we could be in for something really quite drastic, like a halving of prices from the peak.’
If you though crashing house prices and financial systems were bad, do not read this
According to a newly published global oil supply report to be presented by the Energy Watch Group at the Foreign Press Association in London, world oil production peaked in 2006. Production will start to decline at a rate of several percent per year.By 2020, and even more by 2030, global oil supply will be dramatically lower. This will create a supply gap which can hardly be closed by growing contributions from other fossil, nuclear or alternative energy sources in this time frame.
Abbey relaunch tracker products
mail Online: Banks will NOT pass on further interest rate cuts to hard-up customers... except for Abbey
Abbey is the first lender to relaunch its tracker deals after 33 providers withdrew their ranges following last week's surprise 1.5 per cent interest rate reduction. It is also reducing its two-year fixed rate mortgages by up to 1 per cent, giving a new rate of 4.49 per cent for someone with a 40 per cent deposit who pays a £995 arrangement fee, rising to 4.79 per cent for people with only a 25 per cent one. But the group has only one product available to people with less than a 25 per cent deposit, namely a five-year fixed rate mortgage.
Unsurprisingly, public trust in senior politicians has fallen in the last two years.
Committee chair Sir Christopher Kelly called the results "deeply disturbing". And he said a cause was that greater openness "meant people become aware of things which previously were carried on but they didn't know about".
Latest RICS survey out now
The number of homes changing hands hit a new record low in October but chartered surveyors are optimistic that business will pick up soon, figures have showed. Property sales fell to an average of just 10.9 per chartered surveyor estate agent during the three months to the end of October, down from 11.5 in September, and the lowest level recorded by the Royal Institution of Chartered Surveyors since its survey began in 1978. But surveyors feel more upbeat about the future, with 20% more expecting sales levels to improve during the coming three months, up from just 4% in September. RICS said this optimism was being driven by a trend for sellers to drop their asking price, but it added that it could also reflect expectations of a jump in repossessions.
The BBC business editor, Robert Peston, has admitted at an industry conference today that the media were to some extent "complicit in this canard" that house prices would continue to rise. Peston said that the media helped to create "a myth that somehow houses were a one-way bet and that debt never had to be repaid". "The BBC, newspapers and other broadcasters, in news and in features, were complicit in this canard that somehow house prices could only ever rise and that what you have to look at is the interest payments on your debt rather than the principle," Peston said.
The nightmare is only just beginning.
Circuit City Stores Inc, the No. 2 U.S. consumer electronics retailer, filed for bankruptcy on Monday just weeks before the start of the holiday shopping season, becoming the largest retailer to file for Chapter 11 since Kmart in 2002. Circuit City fell victim to tighter credit terms from vendors, a draining cash position and decreased consumer spending amid a deepening economic crisis.
GM to cut production, idle 5,500 hourly employees
General Motors Corp said on Monday it will cut production in North America due to declining demand through the first quarter of 2009. Highlights: * Says production cuts to result in idling of 5,500 hourly employees
Carnegie Taken Over by Swedish Government, to Be Sold
Sweden's largest publicly traded investment bank, was seized by the government and will be sold off in parts after accusations that it took ``exceptional risks'' with loans. Sweden's national debt office assumed control of Carnegie Investment Bank AB and Max Matthiessen Holding AB, the two units that make up Stockholm-based Carnegie. The divisions had been used as collateral for a 5 billion-krona ($640 million) loan made by Sweden to shore up Carnegie's funding last month.
Britain’s economy is more like a geriatric than the dynamic “Cool Britannia”
Gordon Brown persists in presenting Britain as simply a victim of the global financial crisis. Such an approach conveniently absolves him of any responsibility for the mess. But it is becoming clear that Britain’s position is particularly precarious. The idea of a uniform global crisis certainly does not square with the revised growth forecasts published by the International Monetary Fund last week. While Britain’s GDP is projected to fall 1.3% in 2009 that of China is expected to rise by 8.5%. Even Africa is expecting growth of 4.7%. Perhaps it is unfair to compare Britain with emerging economies. But the average GDP fall for advanced economies is forecast to be 0.3% next year. Britain is likely to be the worst performer next year with the exception of disaster areas such as Zimbabwe.
shoplifters were motivated by need rather than greed. unlike the banks then !
RETAILERS are suffering a shoplifting crimewave as the economic downturn continues to bite, according to new figures on supermarket theft. Supermarket Tesco caught more than 43,000 thieves in the first half of this year - an increase of 36 per cent on the same period in 2007. Essential items were the most common target, the figures revealed, suggesting that shoplifters were motivated by need rather than greed.
The China Syndrome
Monday, 10 November 2008 Bremner Bird and Fortune: Silly Money Part Two This week, in "The China Syndrome", the three satirists discussed the role of the former Communist country in the global economy. Unlike many countries, China has saved trillions of dollars in foreign reserves. As there are no social programmes, citizens must save around 50% of their money to survive. Families are only allowed one child, so they cannot rely on their income. Their economy has grown by 10% per year for the last 25 years, while a city the size of London is built every year. comment from http://brennybaby.blogspot.com/2008/11/bremner-bird-and-fortune-silly-money_10.html
140 jobs to go at two factories
Britain's biggest building society, the Nationwide, has slashed mortgage lending and says it expects house prices to continue to fall in 2009/10. Its comments came as it said underlying pre-tax profits for the six months to 30 September were down 18% to £322m. Its bad debts rose to £74m, up from £62m last year, as borrowers struggled with their repayments. Net residential mortgage lending was under a third of the total of the same period a year ago, it said. Nationwide said it expected the housing market to remain "subdued", with prices continuing to fall in 2009/10.
Well, that's what the bailout said they could do, what the surprise?!
The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral. Just remember that Obama voted for and campaigned hard to get the bailout in its current form. Congress could have taken a few weeks to improve the bill but were feared into passing it. Financial (t)errorism.
Wonder what it will look like in 2010?
LONDON (AP) -- "British lender Nationwide Building Society said Monday mortgage lending fell 72 percent in the first half of its financial year, as home buyers were deterred by a crashing property market and mortgage rates were boosted by the credit crunch." - Given that Nationwide should hold up better than some, we should be expecting house price to fall more than 72%?! - When you take volumes into account, this doesn't seem out of the picture. Effectively, houses that don't sell, have no price, no market, so, they should be taken into account to get a full picture. Effectively, the non-sales are a result of price fixing. Auction the lot, and you get the proper price.
Pension schemes in the red
Its latest snapshot of the finances of nearly 7,800 private sector schemes shows that in October their collective deficit stood at £97.3bn. That was worse than the £80.3bn deficit seen the month before. The international financial crisis has severely dented the schemes which a year ago had a surplus of £84.1bn. If schemes stay in deficit then employers will have to make good the shortfall by putting in extra recovery payments, typically within 10 years, to ensure the schemes become solvent again.
£ @ new low vs €
€1 = £0.8208 £1 ~ €1.21 The euro hit a record high against the pound on Monday, on expectations of further monetary easing by the Bank of England after a dramatic rate cut last week sent UK rates lower than those in the euro zone.
This Guy Is A Nutter!
I am amazed by the stupidity of this Labour Govt - yet they still get voted in. Brown should be fired in disgrace for what he has done to the Uk, yet he is still here ready to exact more damage. TAX CUTS funded by BORROWING?????? This just plain insane!
frying pan to fire to.........
Fannie Mae posted a record quarterly loss as new Chief Executive Officer Herbert Allison slashed the value of the mortgage-finance provider's assets by at least $21.4 billion and said it may need to tap federal funds next year. In its first report since being seized by the U.S. government last month, Washington-based Fannie Mae said its third-quarter net loss was $29 billion
this is a new one zero price target - this is 2008/9 depression stuff
General Motors Corp. was downgraded to ``sell'' at Deutsche Bank AG, which set a share-price estimate of zero, and was cut to ``underweight'' at Barclays Capital. GM fell 12 percent to $3.83 at 8:55 a.m. before regular New York Stock Exchange composite trading. The biggest U.S. automaker said Nov. 8 it may not have enough cash to keep operating this year and will be ``significantly short'' by the end of June unless the auto market improves or it adds capital. ``Even if GM succeeds in averting a bankruptcy, we believe that the company's future path is likely to be bankruptcy
Circuit City files for bankruptcy
Circuit City Stores Inc., the No. 2 electronics seller after Best Buy, filed for bankruptcy protection Monday, thus becoming the latest retailer hurt by a worsening economic downturn. According to the company's Chapter 11 filing with the U.S. bankruptcy court in Richmond, Va., Circuit City (CC, Fortune 500), which currently has 566 operating stores in the United States, will continue to do business and pay its workers while it restructures debt and its business operations.
Will the US soon be Bankrupt?
The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral
Fear of depression
Bank executives enjoy SECRET £300,000 champagne party
The Royal Bank of Scotland has blown £300,000 on a secret champagne junket for executives - less than a month after being given a £20billion handout by the taxpayer. Bankers and their partners enjoyed the lavish party to mark their 'success' after a year in which the collapse of the banking industry led to global financial meltdown. The supposedly stricken bank laid on the celebration amid extraordinary secrecy to try to prevent details reaching the public, even cancelling the original venue, a top hotel in Hampshire, and transferring the party 350 miles north to Edinburgh.
Car firm Pendragon stutters towards £30m loss
THE owner of the Stratstone and Evans Halshaw car dealerships warned today it expected to make losses of £30m this year. Nottinghamshire-based Pendragon also said it had made 2,500 jobs redundant over the past year – equivalent to 20% of its workforce – as it faces up to the impact of the economic downturn on the car market. It also expects that 75 of its dealerships will have closed between June 2007 and the end of this year, but it said the actions taken and the impact of recent interest rate cuts will lead to improved trading next year. Pendragon is heavily exposed to the domestic market, with all but a handful of its 300-plus dealerships based in the UK.
Hundreds of jobs lost at Greenberg Glass Emergency
MOST of the 300 people employed by the collapsed Greenberg Glass Emergency have lost their jobs, administrators say. The firm is part of the Liverpool-based Greenberg Glass Group although its main base is in Liverpool. The group’s other division - Greenberg Glass Contracts - was put into administration two weeks ago.
Fresh fears over Vauxhall jobs at Ellesmere Port
General Motors, which owns Vauxhall, employs about 3,700 workers at plants in Luton and Ellesmere Port, Cheshire, which produce about 215,000 vehicles a year. It needs at least £7bn to pay its bills each month, the Daily Mail reported.
this is pretty major...
Some 40,000 Deutsche Post (DPWGn.DE: Quote, Profile, Research) in the United States are at risk as the group steps up plans to turn round its loss-making DHL express delivery company there, a German newspaper report said on Sunday.
Porsche earned eight times as much from its VW option trades than from actually selling cars
Frankfurt: Porsche has fuelled the controversy over its stake building at rival Volkswagen by revealing it had earned eight times as much from its VW option trades than from actually selling cars. The company said it made 6.83 billion euros ($8.7 billion Dh31.93 billion) from trading in VW options, plus another 1 billion euros from the rising value of its Volkswagen stake, in the fiscal year that ended in July.
Ominous legal precedent
"Familes risk losing the homes after missing just two mortgage payments, following a High Court ruling. The judgement reinforced a law from 1925 which allows lenders to sell the homes of people in arrears independently without needing to obtain a court order." In this case, the lender GMAC also stated "it would not have appointed a receiver had the case involved a residential home loan, rather than a buy-to-let mortgage. However, the ruling does give GMAC, along with all other mortgage lenders, the right to do so with a residential loan if they so wished."
When will it be time to buy stocks and property again?
As consumers rein in their spending, companies are facing much tougher times, with bankruptcies soaring already. That’s bad news for stocks – but it could be even worse for the property market...
Housing slump to continue to 2010, survey warns
Construction Confederation chief executive Stephen Ratcliffe said: “It is clear that the dramatic downturn in the housing sector is now being followed by sharp falls in the commercial and industrial sectors. “This is made all the more painful because contractors are caught in a pincer movement between falling demand and rising costs. The inevitable result is lower margins.”
only 40%?? and the rest
The futures market has downgraded it expectations for house prices which now points to a fall in cash terms of more than 40% from the peak in August last year to the bottom of the market in 2011. According to Tradition Future HPI an average house measured by the Halifax index will drop from £201,081 in August 2007 to £114,347 in October 2011. In real terms that is a drop of more than half.
These bailouts are now taking the P**S
Cracks showed long before it all caved in
A triple blow came on Thursday: Halifax said house prices had tumbled by 15% in the year to October, while the Society of Motor Manufacturers said car sales were down 23%. And government data showed new housing construction orders had fallen by a third. The real economy is in trouble. Those Halifax figures were extraordinary in that they showed house prices had already fallen - in just a year - by more than they did in the housing bust of the early 1990s, in nominal terms at least.
This is even better than 'Palinfreude' - departing Bush-ites in deep doo-doo
An exiting army of Republican foot soldiers is faced with the prospect of selling its Washington-area homes in the worst housing bust since the Great Depression.
What to watch this week: US tries to sell its exploding debt
Longer-dated Treasuries were vulnerable as $55 billion of supply hits the market this week in the Treasury's quarterly refunding, significantly above the $18 billion refunding in November last year. The government's sale of new issues will kick off later in the day with new three-year notes, followed by new ten-year notes as well as re-opened 30-year bonds later in the week. "The immediate focus of the market has shifted from the depth of the economic slowdown to the bond auctions this week, as the market wants to see how supply will impact the market in the long run," says Ryuji Shimai, a market analyst at Shinko Securities in Tokyo.
“This is a total surprise for the market,” said a trader at brokerage Venture Finanzas. MADRID, Nov 10 - Santander has agreed to launch a €7.2bn ($9.24bn) rights issue, priced at a heavy discount to Friday’s closing price, and postpone a series of asset sales until market conditions improve.
Tax revenue on life support
The government has discovered that they might not get anything with vat at 17.5 so they are going to cut it. The article points out that this will stimulate foreign manufacturing not the UK as we import everything. However, they are to be applauded for admittedly being forced into "cut public spending and taxes" mode, although they aren't actually cutting any public spending and they intend to increase it. I am guessing that our noble leaders are looking at some pretty dire news which we don't have yet.
More money for AIG
The U.S. government reached a deal Sunday night to scrap its original $123 billion bailout of American International Group Inc. and replace it with a new $150 billion package.
Social housing shortage to be fixed by kicking people out of social housing to free up spaces (?). This is a good idea but depends on how many people fluked access to cheap social housing. Frank Dobson apparently became a cabinet minister while in subsidised public housing. I have personally felt it is a bit unfair that social housing once acquired, seems to be entirely unconnected with wealth. A more cynical explanation would be that they are trying to support the collapsing flat market by turfing out potential buyers. Anyway, I agree with this move. They might be too incompetent to actually achieve this of course, or it might take four or five years...
HSBC Holdings plc - Q3
Europe's biggest bank HSBC Holdings said its profit in the third quarter was ahead of a year earlier as growth in Asia helped offset almost $5 billion in bad debts on U.S. home loans and asset writedowns. ... HSBC and other banks have reclassified how some assets are accounted for under new rules. Without the reclassification HSBC said its third-quarter writedown would have been $835 million higher.
More rate cuts coming?
The Bank is expected to slash its growth estimates in its quarterly assessment of the economy on Wednesday, raising the prospect of still further interest rate cuts. In its August inflation report, the Bank had predicted modest economic growth of 0.5% next year and 2.25% in 2010. But conditions have deteriorated rapidly since then and the Bank is expected to make an abrupt U-turn. It is now likely to forecast a fall in output of 1% to 1.5% next year.
I wonder where abouts the estate agents are in the "handouts" queue?
Barack Obama, the US President-elect, has thrown his weight behind a plea to Henry Paulson, the Treasury Secretary, to use some of his $700 billion (£444 billion) bailout fund to rescue America's car companies. Nancy Pelosi, the Democrat Speaker of the House of Representatives, and Harry Reid, the Senate Majority Leader, are believed to have sent a letter to Mr Paulson asking him to offer a financial lifeline to General Motors, Ford and Chrysler.
"As America stands at its own dawn of hope, so let that hope be fulfilled through a pact with the wider world to lead and shape the 21st century as the century of a truly global society."
Gordon Brown blurts it out ...
Taken straight from the BBC article: "And if we learn from our experience of turning unity of purpose into unity of action, we can together seize this moment of change in our world to create a truly global society," Mr Brown will say, according to pre-released extracts of his speech. The UK, the US and Europe are key to establishing a new world order, he will argue.
The reality for Iceland
REYKJAVIK, Iceland — The collapse came so fast it seemed unreal, impossible. One woman here compared it to being hit by a train. Another said she felt as if she were watching it through a window. Another said, “It feels like you’ve been put in a prison, and you don’t know what you did wrong.” This country, as modern and sophisticated as it is geographically isolated, still seems to be in shock. But if the events of last month — the failure of Iceland’s banks; the plummeting of its currency; the first wave of layoffs; the loss of reputation abroad — felt like a bad dream, Iceland has now awakened to find that it is all coming true.
Things about to get very sticky indeed
A car dealer desperate to shift stock has stunned the motor industry with an extraordinary offer: buy one car - and get another one free. Car industry experts described the offer as "almost unbelievable" and said it was a sign that the car market was in crisis. Struggling consumers fearful for their jobs have been deciding to hold on to their existing vehicles. This week alone four big car dealerships called in the administrators, with the loss of more than 400 jobs. More are predicted to fail over the next few months. It won't be just cars.
The Dubai government on Sunday formed a high level committee to tackle the impact of the widening financial crisis on the emirate’s once booming property market.
The city centre crash is even worse
At an auction organised by Allsop last Monday, a flat in an upmarket area of Leeds that was bought for £400,000 in July 2007 sold for just £159,000. A reduction of 60pc. At the same auction a flat in the city centre of nearby Wakefield, bought for £189,000 on October 31 2007, sold for just £69,000. They were not the only bargains on offer. The auction was originally planned to run for two but was extended to four
Allan Watt explains the coming Bretton's Wood's system in the longer perspective.
Propaganda or real deflation?
Figures from the British Retail Consortium show that electrical goods and fashions are cheaper than they were a year ago, with further falls in the pipeline. So, you will be able to cover yourself with fake fiber from China, but no chance of a healthy organic meal. Seems like propaganda based on dud BOE inflation stats. Tho, I do wonder if Estate Agents will follow suit!
Obama Considering Jon Corzine, Another Former Goldman Sachs Chief Executive, For Treasury Secretary
Change can happen. Change we need. Yes, friends, change is having different former CEOs of Goldman Sachs serving as Treasury Secretary. Gov. Jon Corzine, a multimillionaire and former Wall Street chief executive, is being actively vetted by the Obama transition team as a possible candidate for Treasury secretary in the new administration, two New Jersey Democrats familiar with the process said early this morning.
Infaltion or Deflation? You decide.
As regular readers will know, for months - years! - I've banged on about the inflationary dangers of cutting interest rates too sharply. In August 2005, the Bank of England's Monetary Policy Committee lowered rates to 4.5 per cent, when CPI inflation was on its 2.0 per cent target - but definitely on the way up. Back then, I accused the Bank of treading "a perilous path", while risking "a further acceleration in the growth of credit". In December 2007, during the first wave of the sub-prime crisis, the Bank cut rates to 5.5 per cent, with the CPI already at 2.1 per cent. Even in those tranquil times, interbank rates still rose despite the MPC's rate cut - and I observed the Bank had "shot its bolt".
And these people are supposed to be experts?
LAND SECURITIES is expected to lay bare the full extent of the commercial-property bloodbath this week when it puts plans for a demerger on ice and unveils a shock 20% drop in the net value of its assets. A virtual shutdown in commercial-property lending has combined with falling occupier demand and a steep decline in rents to push values down sharply since the collapse of Lehman Brothers in September. Analysts were this weekend slashing forecasts for Land Securities’ half-year results to show a fall of more than 20% in its net asset value per share from £19.56 to between £15 and £16.
There is cash in houses-from depression
CLEVELAND – A contractor who found $182,000 in Depression-era currency hidden in a bathroom wall has ended up with only a few thousand dollars, but he feels some vindication.
Blanchflower branches out as he forsees redundancy, calling everyone fat b*stards!
Obesity could be socially contagious, according to new research by two of Britain's leading economists. Professor David Blanchflower, who sits on the Bank of England's monetary policy committee, and Professor Andrew Oswald, an expert on the economics of wellbeing, claim that the nation's expanding waistline could be down to people subconsciously trying to 'keep up with the weight of the Joneses'.
John Prescott's attempt to follow Tony Blair in becoming a property magnate is lying in tatters as he falls victim to the housing crash. A two-bedroom Central London flat the former Deputy Prime Minister bought for £740,000 with a mortgage last September has fallen in value by £100,000, say analysts. It is likely to have dropped by more than £200,000 in the next 18 months. At 70, Mr Prescott is unusual in being burdened by two mortgages. His 8 bedroom Hull home, which has turrets at the front and back, is worth about £450,000.
More Sound Fundamentals
As investment banks, hedge funds and private equity firms – three of the principal drivers of the Square Mile's explosive growth of recent years – cut tens of thousands of jobs, the Centre for Economics and Business Research (CEBR) expects the Treasury to face an overall City-generated taxation "black hole" of more than £10bn.
Free Cheap Giveaway Money Worldwide Yet No Fix!!
China announced a 4 trillion yuan ($586 billion) stimulus plan to spur expansion in the world's fourth-largest economy, helping sustain global growth as the U.S., Europe and Japan teeter on the brink of recession. The funds, equivalent to almost a fifth of China's $3.3 trillion gross domestic product last year, will be used by the end of 2010, the Beijing-based State Council said today on its Web site. China will adopt a ``pro-active fiscal policy'' and pursue a ``moderately loose'' monetary policy, it said.
They let the cat out the bag here...
I don't think that an article warning of the consequences of international investors pulling out of the UK being published in Gulf News is particulary good news... Apparently without the global capital markets we are another Iceland as we already completely dependant on them to stay afloat. There seems to be an inherent contradiction here though, in that while arguing against deficit spending as a cause of confidence breakdown and fund withdrawal->Iceland, the author suggests monetary policy (slashing interest rates) is a better option ignoring the fact that lower interest rates will also cause funds to be pulled out of the UK, as they search for a better return elsewhere. Perhaps all we can do now is cross our fingers.
Have you ever heard of anything so funny?£365,000 for a flat in Dundee! Lol
The firm behind a multi-million pounds luxury housing development in Dundee has promised customers that the project will go ahead. Fears had been raised about the future of the 202 Riverside apartments after developers Duncarse shut their city office and phone calls were unanswered.
Business school suggests businesses must become more ethical to survive
How should boardrooms respond to the macro crisis? Is it just a case of recession-as-usual: budget-paring, personnel-slashing, and portfolio-trimming? Not a chance. The tactics of recession-as-usual are neither necessary nor sufficient for firms to weather the global economic superstorm - because it's no ordinary squall, but a once-in-a-lifetime gale ripping up the very foundations of the global economic order. eg. if Starbucks wants to grow in developing countries, it cannot just rely on a handful of new stores serving fatter-margined deluxe water to a new global bourgeoisie -- rather, to make growth sustainable, Starbucks must reinforce and support fair trade, responsible relationships, and account not just to count profits
Countrywide estate agents downgraded
"FEARS are mounting over the financial health of the UK’s biggest estate agency, Countrywide – owner of Mann , Bairstow Eves and John D Wood, the west London chain."
New! Transparent Banking! Buy Now!
This (HP) sucker's going down
The banks will not and cannot reduce IRs any further. "HIGH STREET banks have told Alistair Darling that they will not pass on any further interest rate cuts to consumers and businesses. " The VIs realise a short and very sudden HP correction followed then a return to business as usual with a return of comission revenue is the bext outcome for them. So all you property moguls, hold onto your hats, this sucker's going down as Dybya would say :)
Sudden consolidation raises questions about regulation, consumer impact
So then, the "crisis" caused by the derivatives created by these banks was used to consolidate their power, whilst the central banks who created the money that fueled the boom, via the Bretton's Wood break with gold during the 1970's, have gained control of the major banks via IMF/World Bank style conditions forced onto the large investment banks. This is a marriage of government and corporations, it is corporatism, or, corporate fascism. Given that we need regulation of money to maintain our wealth, our wealth does not appear safe in this circumstance.
Credit crunch? Meet the Nation Crunch.
If the Reserves are no longer growing but diminishing, this might indicate that the exporting countries are no longer buying and accumulating more US, British and European debt. If they are not accumulating more foreign currency bonds and debt, then the fiscal deficits of the US, the Brits and the European Union countries are no longer being funded – especially important to the US, which is running an immense fiscal deficit, what with the US Treasury going into debt like a drunken sailor on account of the need to bail-out all and sundry debtors. What do they do when this occurs? The only thing they can, buy their own treasury bonds, monetize the debt, causing huge inflation in an economic death throw.
Showdown (Grand Finale) approaching
High Street banks have told Alistair Darling that they will not pass on any further interest rate cuts to consumers and businesses. At an emergency meeting, bankers warned the chancellor that they were “not charities”. They said they could not afford further to reduce mortgage payments and interest rates to businesses if, as expected, the Bank of England continued to cut rates as the economy fell deeper into recession.
Even a broken clock is right twice a day
What is the value of typically the same housing bear market / crash forecast that is rolled out every few months? This article takes a look back at Capital Economics that has been grabbing the headlines of late of having forecast the UK housing market crash of 2008. However if you dig a little deeper the actual accuracy of Capital Economics housing market forecasts evaporates into thin air. It's not Capital Economics fault for being crap at forecasting UK house prices, but rather the mainstream media not having any clue what they are reporting on instead of churning out the same repetitive drivel labeled as financial journalism
Interesting article... might solve inflation too..
``In 2010, we will have enzymes commercially available and a process that will allow our customers to produce at around $2.50 per gallon,'' Novozymes Chief Executive Officer Steen Riisgaard said in a September interview in Copenhagen. *******Not in the UK, we will still get screwed on fuel******
Dublin's Early Christmas Lights Fail to Ease High Street Gloom
Christmas is coming early to Dublin this year as city officials try to dispel the gloom from the country's first recession in two decades.
Silver lining to houseprice falls
Inheritance bills can be cut if property left in a will falls in price after the date of death. With house prices down 14% in a year and share prices falling by 30%, estates valued a year ago can be worth far less when the tax has to be paid. The Revenue may be sympathetic and make some cut in the tax. Alternatively, the tax must be cut if the executors sell property within four years or shares within 12 months at a lower price than the valuation.
19 banks failed this year
Ignore the headline - somebody's been cribbing our own conclusion
"The latest forecast from Tradition Future HPI, which uses the futures market as a guide to where house prices are heading, is its grimmest to date. It predicts the average house price will fall to £114,347 by October 2011, a drop of 43% from the peak in August last year." Which is in line with the average 42% fall that we predicted in the fun online poll on this site.
Tracker mortgage news
For many households the benefits of yesterday's mortgage cuts could be modest. The 4.2 million homeowners on existing mortgage deals pegged to the base rate - about a third of the UK mortgage market - will be celebrating this weekend. Their mortgage repayments are guaranteed to drop on December 1.
The crash to end crashes
I've never seen so many bankers, lawyers, doctors and actors'' with valuable things to pawn
Beverly Loan is a pawnshop. Not just any pawnshop, but the kind that caters to people who hock Cartiers, Harley- Davidsons and Oscar statuettes when they need cash. They really need it now, Tabach-Bank said from a third-floor office, protected by bulletproof glass, off his showroom in the Bank of America building near Rodeo Drive. ``I've never seen so many bankers, lawyers, doctors and actors'' with valuable things to pawn, he said. He pointed to an 18-carat white gold bracelet with 69 diamonds ($2,900) and an 18-carat yellow gold Rolex Yachtmaster II (``a steal'' at $18,500). With credit drying up at regular lenders, ``in many cases now, we're not just the bank of last resort,'' Tabach-Bank said. ``We're the bank of only resort.'' also at TS
All you need is cash
"Homeowners are kidding themselves if they believe the banks are about to provide a bonanza of cheap mortgage deals on the back of lower base rates. Banks are not bust one minute and fountains of cheap money the next. It couldn't, and shouldn't, work like that."
Two More For The Grinder (yawn)
Regulators seized a $5.1 billion Houston bank chaired by mortgage bond pioneer Lewis Ranieri and a small bank in Los Angeles Friday, raising the number of failures this year to 19 and showing how even the most experienced financial executives are struggling to survive the current crisis.
Cheaper mortgages - but only for the few
"We endlessly hear, not least from Gordon Brown, about how there is massive “pent-up demand” for property in the UK. But this isn’t a concept that makes any sense in economic terms: demand isn’t demand unless it is backed by cash."
Around 30 lenders instantly withdrew their tracker mortgages after the 1.5% cut
Manipulation of interest rates is fixing of the price of money. On private markets, money is expensive because most institutions are bankrupt. So, government are artificially depressing the price of money to sustain low sterling prices. BUT, only the favored institutions can get enough money from the BOE to track base rates, so, this price fixing results in scarcity of money at base rate. And, don't think rates cannot go negative. Card issuers are beginning to charge for withdrawals, charge for accounts, charges plus 0% interest rates equal negative interest rates. Only banks with direct links to BOE liquidity can continue trading. Only those financiers allied to the British Establishment survive & then later purchase assets at pennies on the pound; scorched earth policy.
This will weaken the high street lenders - will it tip some over the edge?
Hundreds of thousands of savers have rushed to move their funds to the few remaining high-paying deposit accounts, after the dramatic Bank of England rate cut left the savings market in chaos.
It's Knuts to Phil and Kirsty
Don't get me wrong, Phil Spencer was as enjoyable to watch as his property price predictions were bonkers - but now the market has bitten back and Phil's company is shutting up shop in the North East. BTW has anyone asked David Cameron whether Kirsty is still advising the Tories about housing?
The goverments final roll of the dice to revive a bust housing market
The banks caved in to government pressure to reduce mortgage costs yesterday, but immediately sounded warnings that they would refuse to pass on any further interest rate cuts.
US Dollar to collapse as China and the world grinds to a halt
"I would like to point out that in the last great depression in the US in the 1930's, we did not have a combination of a currency crisis with the economic crisis. The USD, although it fell compared to gold, held up well. Deflation increased the value of anything called cash, including gold. This time, the outcome will be different. This time, the US faces an economic depression AND a currency crisis soon after." He recons 2-4 years time, I recon October 2009.
Capital Economics UK Housing Market Forecasts
What is the value of typically the same housing bear market / crash forecast that is rolled out every few months? This article takes a look back at Capital Economics that has been grabbing the headlines of late of having forecast the UK housing market crash of 2008. However if you dig a little deeper the actual accuracy of Capital Economics housing market forecasts evaporates into thin air.
The Bankruptcy Bubble
The number of individual insolvencies rose to 27,087 in England and Wales in the third quarter - an 8.8 per cent increase on the previous three months and 4.6 per cent more than during the same period a year earlier, according to the Insolvency Service. At the same time, the number of companies put into administration rose by more than 50 per cent year-on-year to 1,007 in the three months to the end of September. Financial experts warned the rise is just the beginning, with worse figures expected next year as the looming recession unfolds.
Vultures still at it
More than 20 buy-to-let property clubs are encouraging members to strike controversial sell-and-rent-back deals with desperate homeowners trying to avoid repossession. Desperate home-owners are made a discounted offer on their home with a contract that allows them to carry on renting it. However, they have been critcised for frequently offering only 60% of the value and the rental contracts are often not as secure as is claimed. Some of the property courses suggested that investors could extract more money from tenants by selling an option to buy their house back. Another company advised kicking tenants out after six months to lessen risks of rent defaults.
Just 48 shopping days to Christmas left, all days being shopping days now.
Except it's visibly not working this time, interest rate cut or no. If you wander into the stores, there may still be people there but they are behaving quite differently. They have an air of detachment, even disaffection. They pick items up, look them over, check the price, and then put them down. They often head back out of the store empty-handed, their urge to buy defeated by their wish to save money. That's the West End. The scene at Westfield is different.
UK Housing Market 15% Crash Forecast Fulfilled
The latest house price data by the Halifax shows that UK house prices have fallen by more than 16% from the peak of August 2007 and October 2008. The crash in both US and UK housing markets over the last 12 months was increasingly followed in September by the bankrupt banks collapsing one by one like a chain of dominos with governments rushing to their rescue during September and early october to the tune of unheard of amounts of tax payers money that now runs to collectively over $3 trillion. This first triggered near panic interest rate cuts in October of 0.5% which was yesterday followed by true panic cut of 1.5% which takes UK interests rates down to 50 year lows.
Banks and BSs have now capitulated, allegedly
Further to my earlier post "What's in it for Lloyds TSB?", the banks and BSs have staged a tactical retreat and cut SVRs. But no doubt they will make it more difficult for people to qualify for SVR, via lower maximum LTV or income-multiples. We'll see.
Will ford cut Jobs in the UK too?
House price crash cancelled (part 2)
"THE sensible response to the base rate reduction is to take your savings out of the banks and building societies and put it into property."
House price crash cancelled (part 1)
Peter Rollings, managing director of west and central London agent Marsh & Parsons was also optimistic. He said the huge fall in rates was "a pretty good reason to get back in the market". Mr Rollings said he had emailed all 3,780 buyers registered with the firm, urging them to make their move before prices start to go up again.
Apparently there is a housing shortage
Apparently there is a housing shortgage, and we need to build lots more houses, or house prices will shoot back up again. Where I live, there are between 6 and 300 homeless people, depending on who you ask, and around 1500 new build flats being constructed at the moment. Even if all the homeless people do get housed, and I doubt they will, who's going to buy the remaining places. Not to mention that there are a lot of empty places already.
US job losses much worse than thought; Payrolls fall 240,000
The U.S. unemployment rate jumped to a 14-year high of 6.5% in October as nearly a quarter million jobs were lost, the Labor Department reported Friday. U.S. nonfarm payrolls fell by 240,000 in October following a revised decline of 284,000 in September, which was the largest job loss in seven years. So far in 2008, a total of 1.18 million jobs have been lost, with 651,000 coming in just the past three months.
What's in it for Lloyds TSB?
Here is how the standard variable rates (SVRs) of the UK's largest banks and building societies compare. Halifax - 6.50%. Abbey - 6.94%, dropping to 5.44% on December 1. Nationwide - 6.19%. Britannia Building Society - 6.30%. RBS - 6.69%. Cheltenham & Gloucester (Lloyd's TSB) - 6.50%, dropping to 5% on December 1. Woolwich (Barclays) - 6.64%. First Direct (HSBC) - 5.50%. Apart from HSBC and Abbey who are playing their own game, Lloyds TSB are the only ones to meekly drop their rates as commanded. Is it possible that this is part of the quid pro quo for the gummint nodding through the HBOS take-over? In the long run, mortgage interst rates = savings interest rates plus one or two per cent. Who is going to put their savings with Lloyds TSB for 1.5% or 2% less than they can get at Barclays ?
Is Britain heading for a 0% base rate?
Yesterday's huge interest rate cut signals a long and painful recession for the UK. We've seen something similar before - in Japan, where rates fell to 0%. That resulted in nearly two decades of stagnation. Could Britain be in for the same?
The real reason for the bailouts
Have you ever heard of naything so stupid. Independant banks which 4 weeks ago admitted being bankcrupt are now being orderd to lend money with NO profit margins in a housing market that is dropping ... FAST. I just hope that they do not listen and why should they - we are surposed to be a democratic capitalist country not a socialist dictatorship! Everyday I get up and wonder where you can go in the world for a sane normal life.
Your money IS guaranteed but good luck getting it back
Is this the first signs of reinbursement taking months to go through, I tought it would be a matter of days.... delays, delays..... I think the ability to get your hands on your money when YOU want it will make a farce of this compensation scheme. Is NS&I the only safe place except under the matress? (pays about the same)
Soars like an eagle..lol
The number of people declared insolvent in England and Wales rose by nearly 9% in the third quarter of the year. A total of 27,087 people were made insolvent during the three months to the end of September. That is 8.8% more than in the second quarter of 2008 and 4.6% more than during the same three months of 2007.
Properties lose £30k from value
The average home lost £4,000 in value in the past month – £923 a week. Prices are falling far faster than in the early 1990s, when the crash was relatively steady, spread over nearly three years. Economists say house prices have not fallen as sharply as the current 15 per cent a year since at least 1931. Some 45,000 homes are expected to be repossessed this year, but this number is expected to rise, forcing prices still lower and pushing thousands into negative equity.
Consumer spending represents two-thirds of the nation’s economic activity
Naomi Klein - passes on such an enormous debt burden to the next administration
Not only does it transfer billions of dollars of public wealth into the hands of politically connected corporations (a Bush specialty), but it passes on such an enormous debt burden to the next administration that it will make real investments in green infrastructure and universal health care close to impossible. To understand the meaning of the U.S. election results, it is worth looking back to the moment when everything changed for the Obama campaign. It was, without question, the moment when the economic crisis hit Wall Street. Up to that point, things weren't looking all that good for Barack Obama. The Democratic National Convention barely delivered a bump, while the appointment of Sarah Palin seemed to have shifted the momentum decisively over to John McCain.
The numbers just keep on increasing
The number of individuals in England and Wales no longer able to meet debt obligations rose 8.8 percent from the second quarter to 27,087, the government Insolvency Service said today on its Web site. Company liquidations increased 10.5 percent.
Coming to UK NOW....
Taylor Wimpey to meet holders of its £450m Eurobond debt
The house builders had spread the message that the holders were untraceable, which in turn led to the possibility that they were wanting to take a hard line and push the group into administration or receivership.
Galliford Try makes £50m write-down on housing landbank
Galliford Try will write down £50m for its half-year results to 31 December 2008 because of the dwindling value of its landbank. The construction and house building group said it decided to review the value of the land on its balance sheet because of the continuing deterioration in the housing market.
The property rot will eat away Chancellor Alistair Darling's £37billion rescue package.
British banks may need to raise billions more in fresh capital to see them through the gathering economic crisis, a leading City analyst has warned. In a bleak prognosis for the UK banking industry, Jonathan Pierce of Credit Suisse said Britain's main High Street lenders are 'staring into the abyss'. The economy is 'getting worse, faster than we thought', with spiralling losses from soured loans threatening to erode the newly replenished cash buffers of Britain's biggest domestic banks, said Pierce. Coming on a day that the Bank of England hit the panic button with an unprecedented one-and-half-point interest rate cut, Pierce's warning cemented fears that lenders will suffer for a long time to come.
When in doubt, blame the banks
Nov. 7 (Bloomberg) -- The age of free money may be at hand.
As major central banks slash interest rates with unexpected speed, benchmark borrowing costs are now below core inflation for the first time since the early 1980s, and policy makers are signaling they will go deeper. Yesterday's cuts by the Bank of England and European Central Bank, which came with the Federal Reserve and Bank of Japan on the cusp of zero rates, are a bid to shock life back into their recessionary economies and strained money markets. It may be an uphill battle as consumers and businesses show greater interest in saving than spending, and banks hoard capital rather than lend it. ``It's the race to zero,'' said Stewart Robertson, an economist at Aviva Investors Ltd. in London, which manages about $230 billion. ``There's no obstacle to more rate cuts.''
Queen asks why nobody noticed the problems sooner.
She does not read this site I guess, then she would know lots of us did!
Still being too optimistic
When will the house price crash end and how far will prices fall? Should buyers grab a bargain now, or wait another year, or even longer. Times Money asked five experts for their predictions on how far prices will fall before they reach rock bottom. Martin Ellis (Halifax): -10% Jonathan Davis (Housepricecrash.co.uk): -35% Yolande Barnes (Savills): -10% Nick Bate (Merril Lynch): -10% Nicholas Leeming (Propertyfinder.co.uk): -10%
The axe looms at the Times
If Rupert Murdoch is having a cull, surely Anatole Kaletsky/David Smith/Ann Ashworth and other assorted numpties at the Times must be expecting their P45s. If he doesnt have these permabulls (who have made the business and economics sectors of his premier newspaper a laughing stock) in his gun sights, then the old crocodile surely must have lost the plot.
The Australian economy will grow 1.8% in fiscal 2009, according to the IMF, as a $10.4 billion
age: Investors should sell Australia's currency against the US dollar because it may lose 29% as it slumps toward a record amid a global recession, Morgan Stanley said.
The International Monetary Fund yesterday predicted that global growth will slow to 2.2% next year amid the first simultaneous recession in the US, Japan and euro region in the post-World War II era. A growth rate of 3% or less is "equivalent to a global recession,'' the IMF said as recently as April.
Facing up to reality
Those were the days eh??
Will we ever see the like of these again? - Definitely if GB has anything to do with it.
Who Knew, Who Decided and When?
"The Bank of England slashed interest rates by 1.5 percentage points to 3 per cent in a wholly-unexpected move" Stand back and consider. Unexpected to GB and AD??????????????? Was it decided days ago? Is a decision like this tenable without approval?
More Duckin' and Divin'
The most comprehensive report on unregulated credit-default swaps didn't disclose bets in the section of the more than $47 trillion market that helped destroy American International Group Inc., once the world's biggest insurer. MBIA and Ambac, previously the world's two biggest bond insurers, lost their top AAA ratings earlier this year because of potential losses on credit swaps sold to guarantee CDOs backed by home loans. Moody's Investors Service cut New York-based Ambac's bond insurance rating four levels yesterday to Baa1, three steps above junk, because of potential losses on the derivatives.
How many hours do you need to pay your hideously large mortgage? Part 2
CINCINNATI—According to a report released Monday by the U.S. Department of Labor, skyrocketing consumer prices coupled with stagnant wages have forced many Americans to work a fourth shift in another dimension in order to make ends meet. The extra-dimensional shift, which occurs on a time axis at right angles to that of normal reality, allows American workers to supplement their incomes, while still maintaining the morning, afternoon, and overnight shifts they need in order to stave off bankruptcy. "The maximum 24 hours of possible work time offered by our plane of existence is simply not enough to provide a living wage in the current economic climate," Labor Secretary Elaine Chao wrote in a letter introducing the report.
Cost-cutting TfL axes seven infrastructure projects
Seven major infrastructure projects will be cut as Transport for London (TfL) tries to save £2.4bn to pump back into the Tube. Construction of a new Thames Gateway Bridge, extensions to Croydon’s Tramlink and the mythical Oxford Street tram will all go in favour of increasing capacity on the tube by 30%. Unveiling TfL’s 10 year business plan, London mayor Boris Johnson said the projects, all of which are still in design stages, were not being “scrapped” but “let go” because they lacked funding for completion. “I have not nicked, axed or whacked any scheme,” he said. “I just won’t continue to waste our money, and taxpayer’s money, on consultants and planners [working]… on schemes [that are] either impractical or that simply do not have enough funding.
Banks now refusing construction companies any new loans
Contractors say that while lending banks are honouring existing loan agreements, no fresh lending is available.
Steel giant plans to cut 400 jobs
Corus has announced plans to cut 400 jobs from its distribution business. The proposed job losses include 95 at the steel giant's plant at Shotton, Deeside and 50 in south Wales. Another 100 jobs will go at eight sites in the West Midlands and 50 in two locations in Leeds.
A day in an EA
A frontline dispatch reveals how smug, pushy agents have been brought low by the credit crunch. 'It's tough making these calls, but your house is worth only what someone is prepared to pay. And we need to get to a point where we're receiving offers.' an EA says.
Thank God!!! We are partially saved!
Will you be collared by your tracker?
The Bank of England's shock decision to cut interest rates to 3pc will be welcome news to borrowers with tracker mortgages. But some of these loans have a sting in the tail: they stop tracking the base rate once it falls to a certain level.
Buy an overpriced house and some blokes sob story (oh and get stuck with some bird too).
Sterling Still Holding
"The massive cut by the BoE may ultimately prove positive for the pound, as currency markets begin to factor in the simulative effects of lower U.K. rates," said Boris Schlossberg, director of currency research at Global Forex Trading in New York. Still, the potential for a continued rise in risk aversion amid unsettled financial conditions is likely to leave the euro and the pound under pressure against the dollar, said strategists at Commerzbank.
Foreclosures are Terminated
"The single most powerful action our state can take to shore up its economy is to help Californians stay in their homes," Schwarzenegger said. "Curtailing foreclosures will stop the downward spiral of home prices, free up needed cash for homeowners, help save jobs and make an immediate positive impact on our economy." - should have stuck to acting Arnie..
Off topic - All silent on this election front
Voters are going to the polls in Glenrothes to choose a new MP. Labour is defending a majority of 10,664 in the Fife constituency which was made vacant by the death of John MacDougall in August. The polls opened at 0700 GMT and will close at 2200 GMT. The result should be known by the early hours of Friday. The turnout at the last election in 2005 was 56.1%. The seat borders Prime Minister Gordon Brown's Kirkcaldy and Cowdenbeath constituency.
Barretts pull out of school land purchase
A controversial deal to sell 15 former school sites across Northampton to housing developer Barratt has collapsed. Northamptonshire County Council announced that it planned to sell the former school sites to the developer for a rumored £90m in 2007 Barratt had plans to build about 1,500 houses across the 15 sites.
Royal Worcester in administration
Administrators Pricewaterhouse Coopers (PWC) said it resulted from the firm's failure to sell its Stoke-on-Trent site and the current economic downturn. The company, which dates back to 1751, employs 388 people in the UK at sites in Stoke, Lymdale and Worcester.
Pity this headline wasn't in the Red top press
House prices have plummeted 15% over the past twelve months and are now falling at their fastest rate for over 25 years. The Halifax’s latest house price index shows the Average UK home has lost more than £30,000 in value since peaking in summer 2007. Average house prices fell to £168,176 last month, down 2.2% since September and a 14.9% fall since October 2007, when the average stood at £197,698. Prices have fallen £31,436, almost 16%, since the peak of £199,612 in August 2007.
In further response to previous post
In response to the previous post ...
so they are going to pass cuts on then????
Two major lenders today pulled their tracker mortgage ranges, just hours before the Bank of England is expected to announce an interest rate cut. Nationalised bank Northern Rock and Lloyds TSB both said they were withdrawing the deals, which automatically move up and down in line with the Bank of England base rate, from the close of business today for repricing. The move comes after a number of other lenders increased their tracker rates in recent days.
CBI: Lend lend. BANK: Shan't
An anglosaxon tidal analogy
Will the Bank of England's rate cut help your wallet?
"Unless you can get a post-tax savings rate of above 5.2% - which will become harder after today's cut - then you are effectively being punished for saving. So, we might be bailing out the banks. But who's there to bail us out?"
ow does it go confused - mwah ha haaaa
It seems not even TV property gurus are immune from the credit crunch as Phil Spencer, star of Channel 4's Location, Location, Location, has been forced to scale down his business empire because of the housing slump. Less than 12 months after it's glitzy launch, the founder of property search company Garrington has had to close his office in Knutsford, Cheshire.
Company profits will fall further – and so will share prices
Factory output is down and the services sector is shrinking fast: the UK's recession is already in full swing. And a interest-rate cuts won't make any difference - the only way from here is down.
Useful list of job cuts
UK interest rates slashed to 3%
Win a London Pad
Due to the global credit crunch a UK based developer has launched the biggest property competition of all time. In association with Great Ormond Street Hospital (a children's hospital) MIA Developments Ltd is giving away a block of apartment in Central London valued at £8.25 million.
"cataclysmic crash" "cataclysmic crash" "cataclysmic crash"
Equities are set for a four- to five-month rally before a "cataclysmic crash" next year, Alex Allen, chief investment officer at fund of hedge funds boutique Eddington Capital Management, said. "At the edges where markets are liquid we've been willing to call the bottom. We're bullish on equities for the next four to five months and then we expect to see the final cataclysmic downleg," Allen said. "Equities will go to at least 50 percent below where they are now. It's going to be as bad as 1929," he said. "Equity markets are extremely expensive."
0% zero, nil, nothing....
The U.K.'s economy will probably be the worst performer in the G-7 next year, with the European Commission forecasting a contraction of 1 percent. The euro-region will grow 0.1 percent, the U.S. will contract 0.5 percent and Japan will shrink 0.4 percent, the Nov. 3 predictions show.
Administration, Administration, Administration
It seems not even TV property gurus are immune from the credit crunch as Phil Spencer, star of Channel 4's Location, Location, Location, has been forced to scale down his business empire because of the housing slump. Less than 12 months after it's glitzy launch, the founder of property search company Garrington has had to close his office in Knutsford, Cheshire.
UK? or USA?
Citigroup Inc. and Goldman Sachs Group Inc., faced with a weakening economy and the prospect of mounting losses, began firing workers as part of the firms' plans to cut more than 12,000 jobs, people with knowledge of the matter said. Goldman, which converted last month from the biggest U.S. securities firm into a commercial bank, yesterday began telling about 3,200 employees, or 10 percent of its workforce, they were out of a job, according to one of the people who declined to be identified because the decisions were confidential.
It will affect about 3,600 workers across three shifts on the Oxford site.
Mini production is to be cut back and the factory closed for a month over Christmas, as the car industry reports falling sales in the UK. Workers at the BMW-owned factories in Oxford and Swindon have been told the two-week Christmas shutdown is to be extended to four weeks this year.
Rate cuts seem to be baked in now
"UK house prices have fallen 15pc over the past 12 months according to figures from UK's biggest mortgage lender, Halifax, putting further pressure on the Bank of England to cut interest rates today." Article includes an interview with Proffessor Willem Buiter, a founding member of the MPC, who says that the base rates should be cut by 1.5% and expects rates to bottom out at about 2%.
Things must be really tough in NI for people to owe this much!
we need a job losses map, anyone??
UK 1% Interest Rate Cut
A cut of 1% would imply that the Government is fully in charge of setting interest rates and dictates behind the scenes the amount to cut interest rates by at each MPC meeting, therefore the Banks monthly meetings are a facade that purely exist for publicity purposes.
Nail in coffin for Manchester Airport??
UK airline BMI is to stop long-haul flights from Manchester Airport, putting up to 140 jobs at risk. Services to Chicago will end in January 2009, with flights to Las Vegas, Antigua and Barbados after Easter. The firm, which last week revealed it was being taken over by German airline Lufthansa, said the routes were not profitable enough. It comes less than two weeks after British Airways flew its last long-haul flight from the airport.
Expect some major job losses
Sales of new cars have fallen at the sharpest rate in almost 18 years, new figures from the Society of Motor Manufacturers show. There were just 128,352 new registrations in October 2008 - down 23.5% on October 2007. That is the worst figure since June 1991 when sales slumped by more than 31%.
104,034 investment banking jobs need to go, apparently, including ALL of UBS!!!
Merrill Lynch Layoffs required to maintain compensation ratio: 58,195 Credit Suisse (investment bank only) Layoffs required to maintain compensation ratio: 16,161 Deutsche Bank Layoffs required to maintain compensation ratio: 5,130 UBS Layoffs required to maintain compensation ratio: Everyone JPMorgan (investment bank only) Layoffs required to maintain compensation ratio: 5,647 Morgan Stanley No additional layoffs required Goldman Sachs No additional layoffs required
A 45% fall in construction reservations results in a 15% cut in jobs.
THE construction sector suffered new blows yesterday as one major player announced it was to axe about 750 workers and another revealed a 45 per cent drop in reservations. Builder Rok said in a trading statement that it was set to cut its 5,000-strong workforce by 15 per cent as a result of the "rapid" impact of the property downturn. It issued a profit warning for the current financial year. Meanwhile Redrow, the housebuilder with a sizeable regional arm in Scotland, admitted it was selling an average of just 38 properties a week across the UK.
Rising delinquencies in B&B's mouldering book of buy-to-let mortgages
Arrears on B&B's buy-to-let loans - the ones contained in the bank's largest securitisation vehicle - are rising sharply. They have to perform a difficult balancing act - encouraging the banks to offer competitively priced loans to home owners and small businesses with one hand, whilst trying "to protect and create value" for the taxpayer-shareholder with the other.
You can tell that the MPC are going to make a decision ...
The number of cranes adorning the London skyline has fallen by a fifth in just six months
Developments have fallen by more than half in a year, from 46 this time last year to just 17 in the past six months. But a report today warns that London is still facing a massive oversupply of empty office space in the next few years.
Another 2.2% off.
Deflation is the red herring: Get ready for inflation
President Obama's election also has historical parallels with the mid 1970's and the election of Jimmy Carter in 1976. Back then America and much of the western world was confronted with deep stagflation which saw gold surge from $35/oz to over $200/oz in 1974. Then gold fell sharply by some 50% - from $200/oz to $100/oz in 1976. This should put the recent fall in the gold price into perspective. After Carter's election in 1976, gold resumed its bull market and surged from $100/oz in 1976 to over $850/oz in January 1980. Similar price increases may be seen in the gold market in the coming years and gold's inflation adjusted high of some $2,400/oz
Halifax House Price Index For October -2.2%
The Council of Mortgage Lenders on a collision course with the Government.
Lenders warned homeowners last night that they should not expect cheaper mortgage repayments even if the Bank of England cuts interest rates today. Alistair Darling has said that banks receiving £37 billion of government funds should maintain lending at 2007 levels. However, the CML effectively gave the green light to its members to disregard the Chancellor's request, saying that it did not make commercial sense to insist or expect that lenders automatically would pass on cuts in Bank rate to borrowers. Melanie Bien, director of Savills Private Finance, the mortgage broker, said: “The Government has been calling on lenders to pass on the cut in interest rates to new borrowers. It seems the Government doesn't have very much influence over the Rock.”
How many hours do you need to pay your hideously large mortgage?
Mail Online: Thousands of workers face overtime ban after MEPs block Britain's opt-out of Europe's 48-hour week
Lord Mandelson said amongst other interesting things at the bottom of the article: 'To loose the ability to opt out will mean workers cannot boost their earning potential when some are already struggling with high food and energy prices.'
If all the economists in the world were laid end-to-end they still couldn't reach a conclusion.
Prof Garicano said: "She was asking me if these things were so large how come everyone missed it."
The next domino to fall
GMAC Financial Services has reported an increased loss for the third quarter and warned that its mortgage business, Rescap, may struggle to survive. The firm reported a loss of $2.52bn (£1.56bn), against a $1.6bn deficit a year ago, with Rescap losing $1.91bn. "Absent economic support from GMAC, substantial doubt exists regarding ResCap's ability to continue as a going concern," GMAC said.
One for the conspiracy nuts
I normally hate this sort of thing clogging up the blog, but this was too good to pass up. Consider it my early Christmas present to malct and p4ac. Distinguished statesman and commentator Gore Vidal appears on BBC's election coverage and calls the Republican party a 'Mayan Sect,' while hinting at a NWO-style assassinationa attempt on Obama, and saying he "knows too much". Worth watching for the comedy value alone. Maybe you guys were right all along :O
UK capital not immune from house price crash
London house prices are on target to fall by 17 per cent by the end of the year, after a further 0.9 per cent drop in October.House prices in the capital have already fallen by more than 15 per cent since the start of the year, with the latest decline of 0.9 per cent taking the average price of a London house to £245,036. According to the latest Haart London Index, further falls in house prices by the end of the year are unlikely to exceed more than 2 per cent, as house sellers have become more realistic about their asking prices.On average, vendors are now achieving 95.5 per cent of their asking price, Haart found.
Location, Location, Location, - Not !
Phil Spencer clearly has flawed judgement - not such a property expert after all ! He is closing his Knutsford office due to a fall in demand for his services - it's been open less than twelve months. However Mr Spencer predicts that house prices will stabalise towards the end of 2009 !
Paragon latest - "buy-to-let sector is being driven by professional landlords"
The number of first-time landlords entering the buy-to-let market has fallen to its lowest level since 2001, reveals a survey from Paragon Mortgages. Paragon polled a panel of 200 mortgage brokers as part of its biannual Financial Adviser Confidence Tracking index. It found that in the three months to the end of September first-time landlords accounted for 10.6% of business, compared to the 18.3% recorded at the same time last year. Brokers reported that 55% of their buy-to-let business was for remortgages, with 30% of business coming from landlords looking to expand their portfolios. John Heron, managing director of Paragon, says the results indicate that growth in the buy-to-let sector is being driven by professional landlords.
Government-owned lender defies Government
Northern Rock, the Government-owned lender, has announced that it is pulling all its tracker deals for homeowners and landlords and is expected to increase rates when it relaunches the mortgages later this week. It follows a move by Abbey earlier today to increase interest rates on tracker deals by up to 0.5 percentage points.
Barack Obama may be the first person in history to start striking coins in his image before taking p
Barack Obama may be the first person in history to start striking coins in his image before taking power. Wed, 09/24/2008 - 2:05am | posted by United Liberty Staff No need to vote in November- the die has already been cast and you can soon buy the commemorative gold coin to prove it. A UK company has started producing gold, silver and platinum coins featuring the profile of Senator Obama and the words, “President of the United States”. The Democrat Party must feel pretty sure about the election’s outcome as they’ve already ordered several to hand out to the party faithful in a few weeks. The coins wil also be produced for public consumption should there prove to be substantial demand.
Slow sales and tight credit are killing small companies unable to weather the downturn.
Flogging a dead horse
Mortgage lenders have been urged by MPs and business secretary Lord Mandelson to pass on any Bank of England interest rate cuts to borrowers....Lord Mandelson said the public would be “surprised” if mortgage rates did not fall after further cuts in the base rate. "surprised" Ha Ha Ha!
Will they cut more soon?
A Devon-based building company is cutting 750 jobs across the UK as part of cost-cutting plans after a sharp slump in business. Exeter-based Rok said projects worth more than £150m had been shelved or cancelled by public and private clients following the economic downturn. The downturn's "speed and severity" prompted the 15% cut of its 5,000 staff, mainly in white-collar roles.
MSPs campaign over HBOS takeover
Three MSPs have launched a campaign to put the £12.2bn HBOS takeover on hold to ensure other options are explored. Lib Dem leader Tavish Scott, the SNP's Alex Neil and the Independent MSP Margo MacDonald said HBOS directors were not acting in shareholders' interests.
ha ha ha ha ha ha ha ha ha ha ha ha ha
Potential purchasers of David McLean Homes have been scared off any deal over fears the business has too many unsold flats on its books.
Anyone put a deposit down for a piper home? tough luck!
House builder Piper Construction Midlands has ceased trading, resulting in the loss of 30 jobs. The 50-year-old firm built residential properties under the name Piper Homes.
Typical of the UK systems, business and Governments
Christopher Law, the division's former managing director, was charged with three separate offences relating to a three-year period between 1 January 2004 and 26 February 2007. He is alleged to have exaggerated sales in accounts filed to the parent company Alfred McAlpine, which was taken over by Carillion late last year.
500 jobs at risk
Obama's new homes
Another Buy-To-Let Landlord?
The court heard he sent coded messages to an Iranian military attache in Kabul telling him "I am at your service". He was also £25,000 in debt and had four mortgages on flats in Brighton. Bang goes his Army pension & his flats too.
No “Change” Is On The Horizon
Here finishes my coverage of the US Election. Ron Paul points out that Obama will not cut spending, government will get bigger and more intrusive, foreign policy will remain the same and unpopular bailouts will continue. He sums up my opinions, which I fear will become self evident as true over the following 6 months. I fear that the economy will now enter a state of flux and danger.
Is capitulation setting in?
I noticed this for a 1980's built flat on a leafy road near where I live, not one of those flats thrown up in the City Centre in the past few years which have crashed. What caught my attention was "REDUCED BY £45,000 (39%)". Still not cheap mind you. The bottom end of my Rightmove search had a few "BRIDGFORDS "SALE" flats. Anyone else noticed asking prices crashing like this? BRIDGFORDS "SALE" WAS £115,000 NOW OFFERS OVER 70,000 REDUCED BY £45,000 (39%) Situated in a popular purpose built development ...
ENJOY the best analysis of US and UK facts, history and fun in 50 minutes!
I’ve always hoped that comedians would take on the issue… And you can be sure that Bremner, Bird and Fortune did an excellent job of mixing significant and relevant cuttings. ENJOY the best analysis of US and UK facts, history and fun in 50 minutes! If only it wasn’t as tragic as it is given the thousands and millions of victims in an hour of video… An interview with Rory Bremner is published here by the Telegraph.
Interest Rate Cuts To The Rescue
This is like sending Danger Mouse to fight Blade! Inflations has not gone away and as we cut IR's the pound falls in value and imported inflation goes up! This is not the magic bullet that people think. Also look at the poll 65% of peole say cut rates to stop recession. If only it was that easy. I put one job in the job centre and got 50 applicants in 6 hours!!!!!! Not been like that for years!!!!
A few rich people, many of them aristocrats, own 69 per cent of the land in Britain. As a result, house prices are so high, millions can't afford to buy a home. The NS launches a campaign to end this feudal system. Maybe Kirsty Allsop should read this !!!
Relief for Third World Countries
Daily Mail: Credit crunch hits the gap year as cash-strapped parents refuse to fund 'rite of passage' trips
The gap-year trip is the latest victim of the credit crunch, new university entrance figures suggest. In recent years the long trip abroad has been a rite of passage for an increasing number of school leavers, who take a year off before starting their degree courses.
Manufacturing jobs plummet
Britain's manufacturing sector shrank last month at the fastest rate since records began almost 17 years ago as levels of output, new orders and employment registered unprecedented declines. The figures compounded fears that Britain has entered its first recession since the early 1990s and boosted expectations the Bank of England could cut interest rates next week.
Building jobs plummet
Britain's construction sector shrank last month at its fastest pace since records began more than a decade ago after falling house prices and tight credit took their toll, a survey showed on Tuesday. The Chartered Institute of Purchasing and Supply/Markit construction index fell to 35.1 from 38.8 in September. That was the eighth consecutive month the index has been below 50, the level which marks contraction, and the lowest since the series began in 1997.
Half of first-time buyers put down deposits of £67,000 - with help from their parents
"First-time buyers who get financial help from their parents are putting down an average deposit of £67,000 in London - £15,000 more than their average salaries according to figures released today. The Council of Mortgage Lenders said those who do not receive any parental help in the capital put down £19,000, despite earning an average of £57,000 a year."
White collar jobs plummet
Recruiters reported a record fall in job appointments and the first drop in wages for five years in October, industry group the Recruitment and Employment Confederation said in a survey published with accountants KPMG on Wednesday. Demand for staff shrank sharply and both permanent and temporary staff appointments were at their weakest level since the start of the survey in October 1997. (Headline as seen it City AM)
General Motors is on verge of collaspse
does this mean Saab, Vauxhall etc... will go or will they get a bailout?
Let's keep to the point: Prices are Collapsing
Knight Frank have issued a report saying ... "Since the peak of the market in March this year, prices have fallen by 13.4%, with the six monthly decline in prices (May to October) showing what can only be described as a dramatic collapse, a fall of 12.4%." As they say though, prices rose most steeply around those parts too. So are falling most steeply. Probably because the epicentre of this boom 'n bust is The City. As JU would say, expect much bigger falls.
Keynes on steroids. Yet more money printing for special interests.
“We will need a new international agreement. The financial system must have common sources, which implies a multiplicity of world financial centres and reserve currencies. We need to form a new risk-management system,which would be based on new techniques, not the principles that the Bretton Woods agreement was based on,” Medvedev said. (It won't solve diddly squat, and will serve to destroy the global economy)
Funding Drought Slams Chinese Plans as Banks Shun Plea to Lend
Wang Yi, who employs 300 people making children's raincoats on China's east coast, is worried his company won't survive the next year as exports dry up. The apparel manufacturer, which supplies European supermarket chains Tesco Plc and Aldi Group, needs a 600,000 yuan ($88,000) loan by Jan. 31 to stay afloat. China's state-owned banks rejected his previous applications. ``There's no point trying them again,'' says Wang, 40, standing in his two-story factory in Pinghu, about 90 kilometers (56 miles) southwest of Shanghai, where one floor is half empty. ``They prefer big customers.''
Threat of more job cuts as credit crunch contagion spreads to commercial work
The recession in construction is looking increasingly desperate as the giant commercial sector appears to be heading for a nasty fall.
Stewart Milne plans more redundancies, upto 117 jobs could go
Aberdeen-based house builder Stewart Milne Group will axe another 44 staff; just months after announcing 300 employees would go from across the UK. The company said the 44 jobs would be lost after a 30-day consultation period and that another 73 jobs are under threat.
Fall in eurozone retail sales
“This is especially challenging for an aging population or those with memory deficits to cope with.”
Notice how you’re being encouraged to use credit for small purchases now, and there;s no requirement to sign anything? It’s the new money. Observe the past century’s de-evolution of money away from an objective standard of value: gold (holds its own value) -> fiat paper (where the state taxes the populace through inflation) -> credit (where you are directly taxed by the central credit-issuing agencies). Next, banks will be securitizing people’s credit card debt and selling that through derivative transactions, if they aren’t already. Anything to consolidate the world financial system. So what we need isn’t a new cryptographic pin chip, what we need is real money again. Ellen Roseman, Toronto Star November 2, 2008
This cannot be good
Farmers are borrowing money at record levels as higher dairy prices and better harvests encourage them to buy land and new machinery. However, analysts also said that volatility in grain prices and rising fuel and fertilizer prices had increased overdraft borrowing. Figures from the Bank of England showed that lending to the farming industry stood at £10.6bn in the third quarter. Lloyds TSB said that the figure was an all-time high.
We made a mistake as a society in promoting homeownership as a universal achievable goal.
one example :- No commentator could explain why banks have all run out of capital at the same time, while making obscene profits. My explanation is simple. There have been no profits, obscene or otherwise. The banks were paying out phantom profits in the belief that their capital accounts were in good shape. They weren’t. The banks were unaware that the falling interest rate structure has been making inroads on their capital. Since all banks have been working with microscopic capital ratios as a result of 28 years of capital erosion, the failure of one single bank would trigger the ‘domino-effect’ on the rest. A.E. Fekete
'Sad blow' as contractor jobs go
Hearts bleeding thereof
I thought a tracker was just that - it tracks BoE base rates....or am I just 'stupid'?
Firstrung: 30 of the UK's mortgage lenders yet to inform customers whether last month's base rate cut will be passed on
Analysis by moneysupermarket.com has revealed a deafening silence in the mortgage world, as 30 of the UK's mortgage lenders have yet to inform their customers whether they will be passing on last month's surprise base rate cut and by how much.***I bet that if interest rates were to start to creep up again (though no likely at the present time}....a nano second afterwards the lenders would follow suit!
Recession is here
Manufacturing output decreased by 1.3 per cent in the third quarter of 2008 compared with the second quarter of 2008. Output decreased in 11 out of the 13 sub-sectors and increased in two sub-sectors. Factory production fell for a seventh month in September, the worst streak for almost three decades, adding to evidence the economy is in its first recession since 1991...
US Housing - The Biggest Speculative Manias of All Time
Comparing Tulip and South Sea bubbles to US housing
UK Banks to follow?
Ambrose talking up the US again
America's corporate giants have regained their place as the world's most valuable companies, reflecting a profound shift in the global power structure as the deep strengths of the US economy reassert themselves.
Forget those Depression rescue plans and focus on his vision for a more fulfilling life
Obama's fundraising revolutionized the way presidential campaigns are financed
Nov. 5 (Bloomberg) -- Barack Obama obliterated every political fundraising and spending record in U.S. history. The Illinois senator harvested more campaign cash than anyone before him, using both the Internet and traditional high-roller dinners to bring in more than $650 million from some 3 million donors for his presidential campaign. The 2004 Democratic presidential nominee, John Kerry, raised less than half that amount, as did George W. Bush and Al Gore combined in 2000.
Anyone surprised by this?
The Federation of Small Businesses said yesterday that there had been no improvement whatsover in bank lending since political pressure on the banks to maintain lending, led by the Prime Minister and the Chancellor, began to build last month.
Bears and Goldbugs speak
Bullionvault: Gold Jumps on US Election-Day as Investors Worry About "Huge Amount" of Money Going to Banking Rescues
The gold investing community seem to think that Obama will continue the bailout. No surprise, given that Leader of the House, Nancy Pelosi (Democrat) supported the bailout and blocked impeachment of Bush. I expect to see an expansion of Bush's Policies. I expect further inflation and dollar depreciation, dragging us down as we compete further. The EU is already raising tariffs on imports in a trade war in response to a weak US Dollar. We'll get further price controls, including on housing, prolonging the inevitable housepricecrash with the financial hair of the dog treatment.
Great way to avoid accountability!
The housing meltdown has prompted some unusual questions for state and county elections officials. Some Californians who have recently lost their homes to foreclosure aren't sure where to vote next week. California Secretary of State Debra Bowen says those who have moved to temporary housing can still cast ballots.
Gold up 5%, dollar down, stocks up. What election implications for the economy?!
What Impact? I see more intervention, Obama gained 4x more money from Wall Street than McCain, so, I see no end to the bailouts and think that intervention and price fixing will delay the crash, and extend the housepricecrash, making it more severe in the long run. So, instead of being able to buy a reasonably priced property now, we will need to wait another 10yrs, Japan style. We may see welfare for poor home owners, but, no policy to ensure cheap prices, to ensure that poor people can actually afford without crazy multiples. I'm just looking for the few good Congressmen/Senators and a boost for third parties. Hopefully peeps can add to this thread to contribute their thoughts. planning4acrash
Don't expect any BoE interest rate cuts to be passed on....
Of the various factors which determine mortgage pricing the starting point is the cost of funds to the lender. Other factors include the availability of funds (which has been a problem all year), how competitive the lender wants to be, competitor pricing and how risky the lender considers a particular type of mortgage.
Way off topic unless you expect the kids to sort this mess out
One in ten GCSE pupils did not know that a rechargeable battery could be used more than once Among the questions proposed was one that asked if a nurse should stay clear of X-rays 'to avoid melting her mobile phone'. Mr Gove said: 'It's not as though these questions are rigorous tests of scientific knowledge. One exam board asks if we look at the stars through telescopes or microscopes.' He added: 'There is a desperate need to assert the importance of rigour and excellence in education if we are to avert further decline, but almost every step the Government takes is in the opposite direction.' Nick Seaton of the Campaign for Real Education said: 'It's a national scandal. When you get laughably easy questions like this which may help politicians to reach targets but mean cont.
Financially troubled plants are being abandoned by the boss, leaving behind unpaid workers and debts
Reporting from Shaoxing, China -- First, Tao Shoulong burned his company's financial books. He then sold his private golf club memberships and disposed of his Mercedes S-600 sedan. And then he was gone. And just like that, China's biggest textile dye operation -- with four factories, a campus the size of 31 football fields, 4,000 workers and debts of at least $200 million -- was history.
"If in Venezuela, something similar should occur I will not give you bankers even one cent
CARACAS, Nov 3 (Reuters) - Socialist President Hugo Chavez vowed to seize any Venezuelan bank that fails due to the world financial crisis, criticizing the United States and other rich nations for spending to save banks rather than on the poor. "If here in Venezuela, God forbid, something similar should occur, or even appears set to occur, have no doubt I will not give you bankers even one cent," Chavez said late on Sunday at a political rally. "I will take your bank away from you. ... I will expropriate your banks."
Adding to AIG’s woes is the brain drain as talented executives rush to the exits.
Claiming to be solvent in September, AIG has been spending nearly $123 billion of the emergency Federal Reserve lending made available in September and October to keep the firm from going under. The money was part of a total of $143 billion in loan money given by the federal government to assuage fears that AIG was so large and intertwined with the financial community that its failure would have a disastrous domino effect. Burning so much money so fast has raised suspicions that AIG had already incurred billions of dollars in losses when the federal government extended it the $85 billion emergency line of credit. According to media accounts, AIG has not provided details of how it has spent the money.
My house is worth a fortune
Stumbled over this one. All part of the sticking asking price syndrome.
Bankers wave fingers to Brown
Lloyds TSB tried to minimise the likely impact of state ownership by casting doubt on the government’s ability to exert significant influence over the bank’s management.
The Worlds Oldest Profession hit by recession
Signs of the economic free fall have cropped up in many of Nevada's 25 or so legal brothels. The Mustang Ranch, for example, has a steady stream of customers, but the number of women vying for work has soared. Even a 74-year-old applied. This summer, the Shady Lady gave $50 gas cards to those who spent $300. The Moonlite Bunny Ranch offered extras to customers paying with their economic stimulus checks.
Mandys' warning to Bankers
Lord Mandelson upped the stakes in a row with UK banks this morning by warning that they face a customer backlash if they do not pass on interest rate cuts to customers. Britain's Business Secretary fired the latest salvo after an awkward 24 hours in the Gulf, which saw a senior HSBC banker travelling with the Prime Minister being attacked by No. 10 for saying that customers would not benefit fully from rate cuts.
Pushing a piece of string
Wherein Abbey announce that they have no intention of reducing mortgage rates by preempting a possible BoE rate cut on Thursday by raising its tracker rates for new borrowers by 0.5% from today. All these people who believe that cutting BoE rates is 'the answer' are going to have to learn that a) it isn't and b) it doesn't have any effect on actual mortgage rates anyway.
Staying ahead of the game
J.P. Morgan Chase & Co. launched an ambitious plan Friday to modify the terms of $70 billion in mortgages for borrowers who are behind on their payments or soon could be. The move by the New York bank will cover as many as 400,000 borrowers. They'll be moved into loans carrying lower interest rates, smaller principal amounts or other more-affordable terms.
Was this one of the biggest speculative manias of all time?
One of the greatest blunders of our time is made by those who blindly assume home prices are so low they couldn't possibly go any lower....The end of the decline in home prices will come only when there are no new economic forces driving them down.
endgame in the credit crisis a bloody stand-off between investors and governments?
"On the surface nothing remarkable is happening –the 30 year US Treasury bond yield recently hit an all-time low of 3.88%, as investors sought a safe haven during equity market turbulence. Yet while nominal bond yields have declined, the credit risk component of US Treasuries has risen by 25 times in little over a year...This has perplexed, and even amused, some market observers...Any "default" would at least be through the time-tested mechanism of inflation and currency devaluation, according to this view. On the other hand a longer-term examination of debt markets reminds us that, throughout human history, regular default is more the rule than the exception...particularly in times of severe economic duress." - Isn't that what we have now? or at least coming soon, October 2009 is my guess
Snouts in the trough (November 2008 - part 1)
Lloyds TSB has confirmed reports that HBOS' chief executive Andy Hornby has been employed as a consultant at Lloyds TSB on a rumoured £60,000 a month. He will be employed for six months at the firm. A spokeswoman for Lloyds TSB says: “It is true - Andy Hornby has been employed for six months consultancy services, but it’s not a fixed contract. “He has been involved for 10 years with HBOS and he’s got huge wealth of experience to draw upon.” But the move has sparked outrage in Scotland with SNP MP Alex Neil arguing that the deal "stinks to high heavens". He says: "How can HBOS shareholders be sure that Hornby will try to get them the best deal in the takeover talks if he is getting paid such a huge sweetener by Lloyds TSB?"
We're still a long way from the bottom
With house prices falling, US consumers are turning to their credit cards to make ends meet. But as bad debts soar and banks tighten up on loans, they are running out of options. And that’s bad news for the rest of the world - we could see the first global recession since the second World War.
Let's play the blame game
The current banking crisis has its roots in banking system reforms introduced by Gordon Brown in his days as Chancellor, a report claimed today.
A bit rich coming from the property porn channel
No longer be able to use your property as a cash cow?
Very worrying turn of events!
Politicians using tax-payers money to blackmail private companies. Expect Brown to do the same v. soon. 'The French state has threatened to seize control of the country's banks and fire top staff unless they do their part to stabilise the economy by stepping up lending to companies in need.'
Something here for everyone
Washington's bailing out banks. There are trillions of dollars of new debt. Lobbyists for auto companies, hedge funds, insurers, foreign banks, even states want more bailout cash. Bankers keep getting big bonuses, but it's peanuts for homeowners? Stop! Do you want to survive? Refocus!
We don't actually expect many bonuses to be paid at all in the banking sector next year
The level of savings will be there. Indeed, one would expect that, in the next year or two, the domestic economy will be saving more as a fraction of GDP than it has in recent years. So I've no doubt that the savings pool is there."
Snub for Prime Minister during tour of Gulf
Oh The Immorality of Modern (online) Times
Yet another folksy fable about hard up home makers feeling the pinch: Watch out, if you look for a last minute discount the seller might be so annoyed they'll refuse to sell to you! Or even worse, they'll tell the neighbours what you did!!!
Is this the start of hyper-inflation in the USA?
I have never seen anything like this. The adjusted monetary base over the last eight weeks has risen at 341% per annum. The increase in the monetary base is $300 billion.
Abbey/Nationwide raise their tracker mortgage rates prior to expected Base Rate drop
Abbey and Nationwide have raised their tracker mortgages on the eve of an imminent Base Rate drop. Nationwide revealed a maximum 0.4 per cent hike in trackers on Friday, and now Abbey has followed suit with a 0.5 per cent. Lenders attracted criticism last month after they put up trackers for new borrowers straight after the Bank of England lowered Base Rate. They have now repeated the strategy just before Monetary Policy Committee could reveal a very probable Base Rate drop by as much as 1 per cent, according to some economists. Abbey says this move is a “response to competitor moves”, and means its 85 per cent tracker has been removed, and its 60 and 75 per cent tracker is now 0.5 per cent higher.
How many private sector workers have sacrificed a pension for an overpriced house?
Daily Mail: Brown's £17,000 tax raid on EVERY private pension... as value of cushy public sector schemes soars to £1trillion
Some interesting numbers here, 'the average private sector worker retires with a pension worth about £1,700 a year, the average public sector worker will retire with a pension worth £17,091 a year.' Not forgetting that while Private sector workers pay £14billion a year into their own retirement funds they also contribute around £21billion via taxation for the pensions of retired public sector workers.
a debate on the global financial meltdown to position the world organization squarely at the center
Home / News / Local / N.H. UN calls for sweeping new "Bretton Woods" system October 30, 2008 Email| Print| Single Page| Yahoo! Buzz| ShareThisText size – + UNITED NATIONS—Diplomats and economists are pressing for new global financial rules, seeking an update of the World War II-era system created at New Hampshire's Bretton Woods. Nobel Prize-winning economist Joseph E. Stiglitz of Columbia University told the U.N. General Assembly that "this is a global crisis and it requires a global response." U.N. General Assembly President Miguel d'Escoto Brockmann convened a debate on the global financial meltdown to position the world organization squarely at the center of a possible fix. Development economist and former U.N. official Sakiko Fukuda-Parr of the New School said that
A saver who tried to transfer £24,000 from the UK arm of an Icelandic bank four weeks ago has finally received his money. Rhys Livsey, 29, from Cardiff, withdrew the cash from Kaupthing Edge a day before it was taken over by ING Direct after a financial crisis in Iceland. Mr Livsey had been told his money "had been held up".
Expect a load of cheap Citreons...lol
New car sales in Spain and France fell in October as consumers tightened their belts in preparation for a prolonged economic slowdown. Sales of new cars in Spain fell 40% compared to the same month last year, while sales in France fell 7.3%, the national carmakers' associations said. Year-to-date sales in Spain are now down almost a quarter. The financial crisis across Europe also means consumers are finding it more difficult to fund large purchases.
From Renting2 via Gardneniadotnet
A number of financial experts now fear that the federal government's $143 billion attempt to rescue troubled insurance giant American International Group may not work, and some argue that company shareholders and taxpayers would have been better served by a bankruptcy filing. "What we see now are a lot of games by the government to keep these institutions going with a lot of cash," she said. "This is to fill holes in companies' balance sheets, and they're trying to hold at bay the charges that our financial system is insolvent."
The numbers are steadily going up..
Three million homeowners, or more than a fifth of households, could end up in the trap of negative equity, with mortgage debts larger than the value of their property, as house prices continue to plunge, new City estimates show.
A Few last words
More from the "I told you so lot" he doesnt even mention govt intervention( the Basel regs... An old man at the end of a long cycle says "Here it comes, a Brave New World order. Houses for free and play the music on Mtv, That aint working , thats the way to do it , buy to let and your cheques are free.. So shall ism now or later?
First Google video of the first show
Silly Money (part one) - Bremner, Bird and Fortune
Slimmed down market will have less on offer....
Scarborough Building Society today announced it would merge with larger rival Skipton after falling victim to the economic downturn.
But I thought we were well placed to avoid the worst of the
"According to European Union economic forecasts, Gordon Brown will be presiding over one of Europe's highest rates of public debt by 2010 at the same as Britain's economy shrinks. Commission figures published on Monday will make grim reading for the Prime Minister, once praised as a "prudent" role model for other high-spending European governments. They include the prediction that British unemployment will jump to 7.1 per cent in 2009, up 25 per cent on the forecast of 5.7 per cent in 2008. Britain's economy is expected to contract by at least one per cent next year, the worst rate since 1991, while the euro zone and European rivals such as France and Germany avoid recession." With the rest of the article talking about more downsides, even more reason to wait a long, long time to buy
Thousands of US banks set to apply for government cash
Banks are considering taking government investments under the Troubled Asset Relief Program, or TARP, because not participating in the program may be seen by the markets as a sign of weakness, according to the report.
Ways to Slow Foreclosures
Up to 500,000 people may people might use this scheme to delay half of their monthly repayments for 2 years. Why only 2 years? How about 10 or 20? Come to think of it, why not just lump the debt on their children and grandchildren?
forcing it to axe 1,400 jobs.
Automobiles & Parts in the doldrums, a week after the engineer warned on full-year profits. The firm, which relies on the automotive sector for two-thirds of its revenues, said annual profit will plunge 20% this year, forcing it to axe 1,400 jobs.
You think we are at the bottom? Forget about it!
Don’t underestimate the potential depth, speed and duration of the decline. As the debts are unraveled, the economy comes unglued and the deceptions are uncovered, home prices could continue to plunge much further.
David Smith: We should have listened to Blanchflower
Economists do not often get to say “I was right all along” but maverick monetary policy committee member Danny Blanchflower is able to do so, no doubt to the intense irritation of Mervyn King and the other MPC members. Blanchflower, who spends half his time in the US, has long pushed the view that Britain’s economy was heading the way of America’s. He consistently argued the MPC was wrong to get hung up on a rise in inflation generated by global energy and food prices, and that it was also wrong to fret about the risks of a wage-price spiral. Such risks, in his view, were negligible. He is the MPC’s superdove, voting to cut rates at all 10 MPC meetings this year. And he has been proved right.
London House prices in record drop
Prime residential prices in central London fell by 3.9% in October, the fastest rate of decline on record, Knight Frank’s latest market report has found. Since the peak of the market in March this year, prices have fallen by 13.4%. And the six monthly decline in price – from May to October - was 12.4%.
As Predicted Here, It Just Gets Worse
In August, the Government converted £3bn of its loan to Northern Rock into equity to bolster its core tier 1 capital ratio, which had slipped to the dangerously low level of 2.9pc. The Government may have to inject "£2bn pounds to £3bn more," into Northern Rock, a source close to the Government has told The Daily Telegraph.
The rebound is a bad sign for markets
London prices down 3.9% MoM in October
The price of prime London homes - those selling for more than £1m and located in the swankiest areas, such as Mayfair and Belgravia - fell by about £5,000 a day in October, proving that even luxury housing is not immune to the credit crunch. The Knight Frank index showed that prices in London fell by an average of 3.9% in October - the fastest since the survey began in 1976. "The top end of the market appeared resilient and it was thought that the global rich were immune" from the recession, said Liam Bailey, head of residential research at property agents Knight Frank. "Now it appears that nothing is immune."
Comedy club has new act for November 2008
The shortage in new homes is predicted to drive up prices over the longer term, according to New Homes Mortgage Helpline.The new homes mortgage specialist claims that prices for new builds will rocket as the supply and demand imbalance worsens. The number of new home starts has fallen 50 per cent over the last year, according to figures from NHBC for October. Nic Spaull, managing director of New Homes Mortgage Helpline, said: "New homes are a safe option compared to the second hand homes market, as the economic crisis has resulted in the number of new homes built this year falling a long way short of the government's targets.
2002 levels and counting!
Mr Pryor is pessimistic about the market's prospects. "Forget what the figures from Halifax and Nationwide are saying," he added. "Like the official Land Registry figures for July, these are all out of date. This market is falling fast, with many homes now worth over 20pc less than they were at the peak of the market. "We can expect values for many homes to fall further, perhaps to 2002 levels. This means that for some they will have fallen by 50pc – 5.7m people have bought since then and those who borrowed more than 90pc of the property value will be in negative equity."
Where builders making more from land appreciation, and now the truth is out?
House builders’ landbank write-downs, already standing at a figure £2bn, could jump as high as £13bn if the woes of the housing market are faced head-on, according to City analysts.
no kidding, a child could tell you that!!!
The European Commission said the region's economy probably entered a recession this year and will barely grow in 2009, increasing pressure on political leaders to work out a plan to combat the financial crisis at summits this month. Economic growth in the euro area will slump to 0.1 percent next year, the worst performance since 1993, the Brussels-based commission said in a report today. It lowered its forecast for this year to 1.2 percent from 1.5 percent in April.
Off message, but all has an impact on market sentiment...
With rising bills and lower disposable incomes, nearly 1 in 4 (24%) Brits are still paying off credit costs from last Christmas. With the UK set to sink further into recession, the latest figures indicate a rise of 29% on last year's post-Christmas financial hangovers....
the scheme was credited with preventing a catastrophic collapse of the banking system
Nov 3 2008 The heads of the financial authorities are being grilled by MPs over their handling of the banking crisis. Chancellor Alistair Darling, Bank of England Governor Mervyn King and the Financial Services Authority chairman Lord Turner of Ecchinswell are giving evidence to the Commons treasury committee. The session, in a committee room in Portcullis House, opposite the Houses of Parliament, will mark the first stage of the committee's inquiry into the dramatic events of recent weeks.
The Prime Minister visits Ras Laffan, which could supply up to 20% of Britain's future gas needs
Published Date: 03 November 2008 Gordon Brown is viewing huge gas plants in Qatar as his tour of the Gulf continues. The Prime Minister is to visit Ras Laffan, which could supply up to 20% of Britain's gas needs in the future. On Sunday, Mr Brown claimed victory in his bid to persuade Middle East countries to help bail out economies struggling amid the global downturn. He has said he wants to boost the IMF reserve by hundreds of billions of dollars - much of it from the Gulf's trillion dollar windfall from soaring oil prices.
Takeover partner Lloyds TSB warned of a sharp fall in profits
Takeover partner Lloyds TSB warned of a sharp fall in profits Britain's biggest home lender HBOS raised its hit from the value of risky assets and bad loans to over £5bn pounds on Monday and its takeover partner Lloyds TSB warned of a sharp fall in profits. The banks said the takeover of HBOS by Lloyds TSB remained on track, however, and Lloyds said it expects to resume dividend payments next year after repaying preference shares taken by the UK government.
Anyone got access to the full version?
A growing number of economists are forecasting large interest-rate cuts as the Bank of England's monetary policy committee and the European Central Bank's governing council meet this week to consider the issue. The ECB and Bank of England last month participated in a synchronised rate cut along with the US Federal Reserve, the Bank of Canada and the Swedish Riksbank, clipping interest rates by half a point.
" ...Would anyone like to guess what the word behind the Prime Minister's head is in this photo?"
On October 17th Gordon Brown was quoted on www.number10.gov.uk "The UK must reduce its dependency on oil as an energy source and move to nuclear and renewables, the PM has said. [...] Gordon Brown said the Government's strategy was to move to a low carbon economy and escape the "dictatorship of oil"." And here he is on Sunday, November 2: "The Saudis and other countries in the Gulf States are very important, they are the countries with great revenues and oil wealth. What starts with negotiations in Saudi and elsewhere can end with great benefits for families in Britain."
And if British TV doesn’t have much in the way of considered political an
“I’m obsessed with Robert Peston,” says Bremner. “Even when I read my children stories at night I find myself drifting into his voice.” He adopts a strident wail, stressed in Peston-ishly eccentric places. “And ROUND the COR-ner of the CUUU-cumber frame came Mr Mac-GREG-or with a GIANT, one TRIIIILLION POUND bail-out…” Still, most MPs would probably rather be thought dull than be lampooned. Last year, Bremner called up Margaret Beckett, pretending to be Gordon Brown – and she fell for it. Bremner wasn’t allowed to broadcast the resultant tape, so he hasn’t attempted a similar ruse this time, he says. Then a thought strikes him. “I might ring up Robert Peston and give him a ‘bum steer’,” he says.
For those who missed it
Bremner, Bird and Fortune offer a satirical look at the global financial system in all its astonishing sophistication and stupidity.
A parody on Gordon Brown's own Downfall
40 - 50% drops forecast!
Scottish banking on the turn
Two of the banks which are to receive more than £30bn of taxpayers' money will this week announce billions of pounds in asset writedowns and warn the City that full-year profits are likely to be lower than previously expected.
Does anyone care about this now the global economy has stopped?
This is a serious attempt to reduce bunker [fuel] costs and polluting emissions. The kite will be used whenever it is possible on the voyage, and we are convinced it will revolutionise cargo shipping. We would consider fitting them to all our ships," said Christine Bornkessel, a spokeswoman for the Bremen-based Beluga shipping line, which has 52 merchant vessels. Well, the question is, now people have stopped
Implications for the High Street?
'This market has left most players paralysed with almost incomprehensible numbers talked for tonnage - and the list of ships ballasting, spot or swinging at anchor growing,' comments the Baltic. 'Cargoes were scarce and with credit still tight, stockpiles at Chinese ports, falling steel prices and the ongoing price dispute between Vale and the Chinese bringing activity to a virtual standstill.
Not much relief for home owners in prospect then!
Economists in the Square Mile are predicting that the committee, led by the Governor of the Bank of England, Mervyn King, could slash the cost of borrowing in the UK by as much as 1 per cent. This follows the lead taken by America's Federal Reserve Bank, which chopped its rate by 0.5 per cent last week. But the chances of mortgage borrowers feeling the full benefit of any cut are slim. "Even fewer lenders than last time will pass on any rate cut that is made this week," said Darren Cook of the financial information group Moneyfacts. "They won't be able to pass on any of the base rate cuts until money market Libor rates [the interest banks charge each other] decline."
Ursa minor - a little Bear Stearns?
ONE of Europe’s largest hedge funds, GLG, is sending a letter to investors this weekend saying it is to launch a “liquidity review” of its funds. It is also going to stop investors making withdrawals from its $1.5 billion (£930m) Market Neutral fund for six months. The review will decide the best way to preserve capital in GLG’s 40 funds.
71 second video
see also three short vids on UK house price crash here http://uk.youtube.com/user/THEUKCRASH - beware some humour involved. plus links to other hpc issue videos
Demand getting squeezed out
Nearly half of borrowers remortgaging next year could be locked out of the best deals by falling house prices. As many as 49% of homeowners who have taken out a loan since the start of 2007 have borrowed more than 75% of the value of their property, Financial Services Authority data revealed last week.
Rents fall. Landlords surprised.
The engineer of the British economic miracle explains his strategy: "Gordon Brown is set to call on wealthy oil states in the Gulf to invest more money in Britain. The prime minister will tell a meeting of businessmen in the Saudi Arabian capital Riyadh that such investment is vital to create and secure UK jobs."
The news serfs
Many people in the UK are finding the recession and credit crunch means they have to make cutbacks, whether on meals out or on necessities such as food and energy bills. However, for some people paying for the basics is impossible unless they go into debt.
Barack Obama - After the foreclosure crisis, he warned, “the credit cards are next in line.”
While campaigning in Edinburg, Texas, in February, Barack Obama met with students at the University of Texas-Pan American. “Just be careful about those credit cards, all right? Don’t eat out as much,” he said. After the foreclosure crisis, he warned, “the credit cards are next in line.” While many eyes are focusing on the housing meltdown and its hugely negative effect on an economy clearly moving into recession, few are paying attention to the next bubble expected to burst: credit cards. Combined with the subprime losses, such a credit card nightmare has the potential, experts say, of bringing down the entire financial system and global economy.
Well, Who'd Have Thought That?
"A report by the Centre for Policy Studies (CPS) to be published on Tuesday will claim the responsibility for the banking crisis lies largely with the Labour Government's decision to remove responsibility for banking oversight from the Bank of England." .................. "Mr Flight said: "The responsibility for the probability of a UK banking crisis can be laid largely at the current Government's door. The roots are in mistaken monetary and economic policies and in regulatory failure."
Increasingly desperate ramping - it's tragic, really
It is a rare shaft of sunlight amid widespread economic gloom. Housing experts say falling prices have led to a range of bargains on the market for first-time buyers while the Government's bank bailout is starting to make it easier to get a mortgage. Experts say there is little to be gained by waiting for property prices to drop any further because the delay between starting the process and closing the deal could mean anyone who waits finds prices have started to go back up.
Anne "angry" Ashworth demands substantial rate cutsby the MPC
She demands cuts on three occassions throughout the article - does she not understand that Banks will pass on cuts when they feel like it, not because the MPC lower their base rates, and also by tryin to protect hers and others like her short term gains she is willing to see sterling devalued, savings made redundant and inflation go through the roof. Once this madnes of slashing rates has passed, the MPC will be forced to raise rates much higher than before to control inflation. IMHO
When is a done deal not a done deal?
British ministers will hold talks with a leading Scottish businessman over a possible rival bid for mortgage lender HBOS, which has been hit hard by the subprime crisis, the government confirmed Saturday. ( also see http://news.bbc.co.uk/1/hi/business/7703908.stm )
They'll go to these lengths to keep on trousering the loot
New London Skyscrapers and Recession
As the Chrysler and Empire State Buildings raced each other to become the tallest in the world, the 1929 crash saw the economy collapse around them. The World Trade Center towers were completed in the dire stagflation of the mid-1970s which saw New York bankrupt, crime-ridden and at its lowest ebb. The passing of the high-rise baton to Asia with the completion of the Petronas Towers saw the collapse of the Asian markets in 1997. Super skyscrapers appear to be bad news for the economy.
Interesting look into the medium future for currencies and international trade. Appreciate doesn't relate directly to property but I guess what everyone on this site has in common might be the desire to use insight toward improving on their wealth. As I've mentioned before the future for sterling looks bleak.
The Assimilation Continues
Freedom Bank, based in Bradenton, Fla., became the 17th bank to fail this year.
Long article.....but worth a read if you're having a slow Saturday....
In reality, a country's troubles unwind so fast that the IMF will not have time to decide options
The IMF's new scheme to help emerging economies weather financial trumoil...Under the “short-term liquidity facility” (SLF), approved on Wednesday October 29th, qualifying countries will be eligible for a loan at short notice of up to 500% of their IMF quota, the maximum amount a country is obliged to provide to the IMF.
FLASHBACK - The Chancellor compared the situation to a dose of food poisoning
The Chancellor compared the situation to a dose of food poisoning, where "some aspects of it just have to work their way through the system". ,,,,,,,,,,,,, and this was less than six months ago! ,,,,,,,, Chancellor Alistair Darling said the Bank of England is to make an announcement on plans for a multi-billion cash boost secured on the mortgage assets of high street lenders. ,,,,,,, "But the idea behind it is that it will open up the market and it will begin the process of opening up the mortgage market which will help householders." ,,,,, We are trying to unbung that situation so that the Bank will be making money available to the British banking system.
Icelandic Central Bank approached the Bank of England in March
Nov 1 2008 The Government is facing calls for an investigation following claims that the UK authorities knew as early as April that the Icelandic banking system was in trouble - six months before its catastrophic collapse. Channel 4 News reported that the Icelandic Central Bank approached the Bank of England in March for assistance to support its currency as confidence in its heavily-indebted banking began to ebb away. The following month, Bank of England Governor Mervyn King was said to have asked the International Monetary Fund for an assessment as well as commissioning separate studies of Iceland's banks and its economy. According to the programme, he subsequently turned down the Icelandic request for help
Can't See it Happening Here
JP Morgan Chase, America's largest bank by market value, is taking action to help a further 400,000 families struggling with their mortgages. In a major step to alleviate problems in the US housing market, the bank plans to modify the terms on $110bn (£69bn) of mortgages.
house prices have a lot further to fall
The average price of a house in Britain is £30,000 less than it was a year ago, Nationwide said yesterday, with prices tumbling in the year to October at their sharpest rate since 1952.
High Street Halloween
One For The Deflationists
Any Hugh Hendry fans or uber-deflationists might enjoy the latest Commodity Watch Radio . High Hendry gives his take on things while Francis Claessens tells us what the super rich have been doing with their money. http://commoditywatch.podbean.com/2008/11/01/hugh-hendry-of-eclectica-and-dr-francis-claessens-of-peers/
What happened to the shortage of supply?
More than 100,000 homes are lying empty in Scotland, a report reveals today. Figures compiled by the Bank of Scotland show 101,019 properties are currently vacant - 4.1% of all houses across the country. The Bank of Scotland called on the Government to reduce VAT on renovating vacant properties to make them more attractive to investors, while homeless charity Shelter said Scotland faced a "housing crisis" and demanded more empty homes be brought back in to general use.
I've seen that graph somewhere before ;-)
Mainstream media begins to join the dots on house prices: "You can see that real prices are now approaching the trend line. Indeed, at the current rate of decline, prices will soon fall below trend. The interesting question is what happens next. Look at last time: prices fell well below trend and stayed there for years, declining by about 40% in real terms from peak to trough. It took until the second quarter of 2002 to get back to the peak achieved in the third quarter of 1989 - almost 13 years."
18% of all properties with a mortgage were in a negative equity position as of the end of September
• Over 7.5 million mortgages or 18% of all properties with a mortgage were in a negative equity position as of the end of September 2008. There are an additional 2.1 million mortgages that are approaching negative equity. These are defined as mortgages within 5% of being in a negative equity position. Negative-equity and near-negative equity mortgages combined account for over 23% of all properties with a mortgage.• anyonr got figures for the UK?
'arry and Saaaandra's neighbours hit by the crunch
It boasts the world's fourth most expensive postcode and an array of famous residents. But it seems even Sandbanks is not immune to the credit crunch. Two £1million-plus properties on the exclusive peninsula have been repossessed in recent weeks. A five-bedroom home in the Dorset enclave, nestled between Poole Harbour and Bournemouth, is on the market because its owners were unable to afford their £6,000-a-month repayments after their investment business took a downturn.
Not such a good prospect after all
Some people rushed into a new career and seemed as if they may have had their fingers burnt a little. The HCR spoke about was planned to be in the Home Information Pack though was dropped.
Struggling Taxpayers fund city bonuses
Thousands of staff at Royal Bank of Scotland, which is being bailed out with £20 billion of taxpayer's money, will be paid bonuses this year despite government assurances that City pay would be curbed. The disclosure has been condemned by Vince Cable, Liberal Democrat Treasury spokesman. He said: "The government said they would attach strict conditions on bonuses and it is very clear they are doing nothing of the kind. "The banks are just making complete monkeys of them."
Lionel Shriver sings from the HPC hymnsheet
More worried about empty shop shelves than Greek Debt, but, hey hoe.
The Baltic Dry Index measuring rates for coal, iron ore, and grains, and other dry goods plummeted below 1000 yesterday, down 92pc since peaking in June. The daily rental rates for Capesize big ships have dropped $234,000 to $7,340 in weeks, leaving operators stuck with heavy losses on long leases. Empty ships are now crowding Singapore and other global ports. "It is extremely serious, " said Jeremy Penn, president of the Baltic Exchange. "Freight rates have never fallen this steeply before. It is telling us that world trade in raw materials has slowed dramatically. Shippers are having genuine difficulty obtaining letters of credit from banks," he said. - The rest of the article goes to say that Greece will fall flat because it controls most freight, along with, you guessed it, London!