Tuesday, Aug 03, 2010
The good is bad and the bad is good or something like that!
Guardian: Northern Rock savings fall after government withdraws guarantee
I like the comment about how the bad bank made a proft. Well, look at the bse rate. You'd have to be really in the shtuck to default. It is all about what happens to the banks when rates rise.
Posted by brickormortis @ 09:53 AM (727 views) Add Comment
5 Comments
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1. refusetobuy said...
"Northern Rock plc is largely funded by retail deposits while Northern Rock (Asset Management) [the bad bank] is backed by a government loan"
Repossessions have been low so profits have been high.
Repossessions have been low because mortgage rate was low
Northern Rock (Asset Management) could afford a low mortgage rate because they had funding from the government.
No-one else will lend to them at this rate because the mortgage defaults are likely to be high.
The government are still taking the risk of the property market tumbling, but it won't show up in the P&L.
2. greenmind said...
Why is it inevitable that interest rates will rise. Can someone give me a good reason why 0.5% base rate cant be maintained over the 3 or 4 years?
3. Stevie Dee said...
Looking at this article and the results of banks at the moment generally in relation to the astrology. You'll find that you have pluto square jupiter transit exact at the moment. The problem i foresee, is firstly mars squaring pluto and opposing jupiter tomorrow, should see something interesting tomorrow financially, but the the big one is saturn moving into a square on pluto and opposing jupiter, with the moon in play as well, could be some really interesting stuff in about 30-40 days time. As there will be a full moon in aries. With another shock 7 days later as the moon creates a grand cross as it arrives in cancer. Let's see what happens!
4. greenmind said...
Stevie, just watchout for the moon entering uranus.
5. Stevie Dee said...
Ah the uranus joke. Well uranus is actually the planet of the unexpected it's at 0 degrees aries, it's in the mix too. So quite apt greenmind. Lol