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latvianmidget

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About latvianmidget

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  1. Busy day on this topic! Thanks to everyone giving explanations & guidance, will take best part of the weekend to read through this all so I think I can safely colour myself out of my depth! Hopefully it will all make sense going through it all later. Glass of wine all round!
  2. A very good point, and one raised here too: http://ftalphaville.ft.com/blog/2007/08/10...ket-volatility/ It is the lack of understanding within the market as to who is doing what that is the most concerning to my uneducated eyes, I just struggle to see how these things can't be anything but a potential bombshell in their current unregulated opaque guise. I do see what Noel et al are saying about the notional values and so forth, but their ubiquity just seems worrying.
  3. Whilst I must claim ignorance on the derivatives market is seems to me that they bear some similarity to people who come up with a perfect system for betting on roulette, with elaborate cross bets on Black & Red only to realise they haven't taken in to account the "0" when the Casino takes all their cash. For these derivatives to have any meaningful existence someone has to be winning and someone losing, even if it is restricted to the commissions being paid on the derivatives themselves. And there are some seriously rich bankers out there!
  4. Funny you should mention insurance: http://www.insurancetimes.co.uk/story.asp?...torycode=371961 "A rise in claims is expected against surveyors who are caught negligently or fraudulently inflating the value of homes, making insurers reconsider the amount of PI cover they offer to surveyors. A similar situation is emerging with solicitors, who also face rising claims. Mark Roddis, executive director for Lockton International and head of SME PI, said: “Specialist valuers and surveyors are having a lot more difficulty in placing cover in the current climate. The concern is a repeat of the early 1990s, when there was a downturn in the property market and an upturn in claims against surveyors."
  5. From the Guardian article linked to earlier: "The plan was to sell their existing home and move in - but after a chance approach by a company looking for a temporary rental, they decided to let out their old home. It became the base for a pyramid of properties bought by constantly remortgaging and using equity from rising property values to put down a deposit on yet another house. The business took off in 1996 when interest-only mortgages became available, replacing costly repayment loans. By the time interest rates fell below 4% in 2003 the Wilsons were buying a house on average every day." Now if that is still correct, and they are completely reliant on inflation of the resale values of the properties and have been making no capital repayments, karma is comin' a knocking! edit: spullin...
  6. as the thread is gently (!) decending into a flamewar I'll resist the urge to bite at that one! As a further point of discussion however perhaps it isn't just the theories (if indeed they are) that are subject to fashion but also importantly their portrayal in the media? munro makes a very very good post above regarding the dangers of just accepting a point of view from those with an agenda, which should apply to both sides of the debate. Me, I'll take Lord Lawson with a big old spoon of salt.
  7. Just to wade in & get rid of one oft wrongly quoted assertion (regarding the 70's being the era of global cooling predictions): http://environment.newscientist.com/channe...-change/dn11643 Interestingly the question of overpopluation doesn't seem to get much airtime as part of any Global Warming commentary, I seem to remember this being much more of an issue when I was younger, despite the fact the world population has increased significantly since the 70's http://en.wikipedia.org/wiki/World_population
  8. The Beeb report BTL as a bad thing or going pear shaped? Nahhh..... And if all those soon to be ghettoised "luxury flats" the flippers bought and now can't get rid of are "Prime" I really do shudder at the thought of how bad the sub-prime in the UK is!
  9. Don't know if anyone spotted this nugget in there; saw it first thing this morning and put it down to me not reading it properly: "The number of buy-to-let loans that were more than three months in arrears went up from 0.58% to 0.73% during 2007. But that was still a lower level of arrears than the 1.1% seen among all mortgage borrowers. And the repossession rate was just 0.1%, compared with the 0.23% rate seen for the whole market. "None of this is surprising, this is the most prime sort of lending," said Malcolm Harrison of the Association of Residential Letting Agents (ARLA).
  10. Alphaville have a fairly low key article on this: http://ftalphaville.ft.com/blog/2007/11/22...-a-serious-hit/
  11. Thank you for the welcome Black Tuesday & will take your advice! Thanks for re-posting the links Jimmy, it is a shame the story hasn't been pushed further in the news but at least it has some coverage. What was interesting with the article posted this morning was the concept of not just confusion over the deeds and as a result whether a claim for repossession could be valid but the concept that the properties may be counted on more than one balance sheet with no mention being made of anyone else having a right to recover against the property. Normally one would suspect cases like this to be isolated, but as per the Lloyds example they do happen and when they do it causes quite a bit of trouble! Add this to the opaque nature of the CDOs SIVs etc and as many have alluded to we have another front pushing in toward the frankly terrifying economic perfect storm some have predicted. (and I think posters such as cgnao have already written quite a bit about this!) Thank you for posting the stories relating to the source of the original article, I guess it's always good practice to know something about the interest behind an article, god knows there is enough cr@p out there already!
  12. It’s a bit early so not 100% but if I am reading the article right but it appears that they are suggesting a similar situation to that at Lloyds Of London in the 1980's with respect to uncertainty in liability. Ultimately they discovered that syndicates had provided indemnity on multiple occasions for the same risk due to the convoluted way risk was passed around and when certain claims came through the syndicate who thought they had limited their total liability had to pay again and again, in part leading to the more public names getting into trouble. The analogy here (again if I am reading this correctly) is that you may have multiple companies holding a charge against the property but due to the fact the registration of these claims hasn't been done correctly there is the possibility that all these charges are being rated as first charges or at 100% and so on. This in turn may be giving a misleading account of the value of the debt in the event of default. This could have yet further downgrading implications for the re-packaged mortgages (CDOs etc) possibly making them worth even less. The only problem being one would suspect it will take forensic accountants to figure out what the hell is going on with each one if possible to unwind at all! Oh and "My name is James & I am an ex lurker". Morning all!
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