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House Price Crash Forum


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Everything posted by RandomBear

  1. I think it's pretty awesome. Those sofas ARE awful though.
  2. No offense taken, I'll respond and say that honestly we will never see eye to eye. I will always see whay happened over the last 2 years as unfortunate but necessary. You seem to see a higher evil in it somehow. There is little way to reconcile those views. I will reiterate however that I agree with what you are doing generally and that I am surprised that with the numbers you are talking about the banks are not more willing to be negotiable. It may be worth you trying to get through to someone more senior as there may well be something they can do. Good luck either way.
  3. "what do you do within a bank, because you don't seem to understand the difference between QE and the SLS" As I say, the effect on the monetary base will be sterilised, almost certainly within a year, so I really haven't thought about it. The idea of the policy was to be inflationary - I suspect that even so, the economy has deflated mildly over the past 12 months, mainly in invisible ways i.e. asset price depreciation in illiquid/underwater property.
  4. Basically what they will do is either reverse repos on the bonds that they've bought (where they borrow money using the bonds as security) or they will issue extra t-bills to basically drain the excess liquidity from the market. They will want to get the liquidity out of the market at some stage, probably after the first few rate hikes.
  5. True. The recovery rate set for Lehman CDS was 10%. So close enough to everything really.
  6. Ha, ah we're talking about the SLS, that's today's bugbear of choice due to being on the front of the public press today, I guess. OK. I don't really have a strong view on the SLS to be honest, or the CGS for that. There you go throwing mud again though, it's so constructive. As I said, I'm a QE-sceptic. The impact will be sterilised within 12 months though and inflation expectations appear to be staying well bounded so I'm fairly relaxed, I just don't think it actually helped much. Many people will argue that the effect on the risk free yield curve was incredibly stimulative though.
  7. I agree to be honest. Although if the yield is supposedly 2% all that means is that the price is totally wrong one way or another.
  8. Interesting. Guernsey might be different. All other liabilities will be grandfathered to maturity as the I understand it, but I may be wrong. Thanks for the cheap digs, they are a rather flagrant attempt to cover the fact that you have no idea what you are talking about. I'm through responding to you. Banks don't fund at the base rate. That's what you are missing. I wrote a whole section on this. I can assure you that the Dudley BS's funding rate has gone from about 6% to about 4%, in fact I'd be surprised if it has dropped that much. That's why their SVR has hardly come down. Their real funding rate hasn't. And the Dudley BS is hardly some sort of gigantic subprime victim, is it?
  9. No, there would be an incentive to do some research. Which people would do anyway if they had a clue. Just because you seem to think you would be better off taking currency risk doesn't mean it's automatically true.
  10. You are of course entitled to do anything you want but I can assure you that your money would have been guaranteed til Maturity. It's the FSCS btw. Rates are 0.5% because when you have the biggest recession since the Great Depression, cutting interest rates hard and fast is what you do. Do you really think that there would be no difference if interest rates had been left at 5%? The jobless count would be catastrophic. And where are these "bumper margins" that everyone loves to talk about? Go do some research, they don't exist. Hrmm. if you mean 200bio clues, then I'm guessing QE. And yes, you are right, QE did effectively help out the banks a lot, but at what cost? It isn't just a gift, although I would expect the cost of it on a mark-to-market basis to eventually top £30bio, I must confess (not that the press seems aware of this). I'm a QE-sceptic myself though, so you are preaching to the wrong person I'm afraid.
  11. And there we differ. A part, or even whole-funded government backed guarantee is the same as a bailout, in my mind at least, since it provides moral hazard that shouldn't be there.
  12. The search light is good. Tighter, not necessarily greater, regulation, would be a good thing. It's a pity that most countries seem to be dodging the responsibility to actually shine that spotlight and just want to tax people more, without asking how best or why.
  13. If you are genuinely in the position where you have 100s of thousands with them I am surprised that they won't negotiate at all. I suspect you don't though. I was a little surprised at how easily HSBC took it when I moved about 150k to Barclays as well as my salary every month, but when I tried to have a rant they really didn't care. Retail banking is a numbers game and there doesn't seem to be much interest in playing to the smaller guys. Like I said too many people get angry rather than understanding. Rates are 0.5% because we are in a recession. Your savings rates are well above that. You should be happy, since if interest rates had not been cut, you would have lost your job. How is the government stealing your money exactly?
  14. I do work for a bank, part of the reason I seem to spend my entire life here explaining how things actually work to people who have a lot of anger but not a lot of understanding. I can make cheap jibes too if you like, but I was trying to get by without that necessity. What's different about accounts with 50k-200k in and ones with 1k in? Without a bailout they are all toast and I bet the guy with 1k in it notices it as much as most of the 200k guys...
  15. Look, I'm speculating as well. But I don't think you can just get a haircut on a mortgage if it's been securitised which a lot of them had been so it would have been much harder. I suspect you are right and we have only deferred judgement day (hence my Bear status despite my unashamed Banker Apologist status...) but I still find it hard to criticise the actions already taken. Moral hazard was already present, we just made it (a lot) worse.
  16. Sure, but see my point above your post. That is still a bailout. If there was no bailout at all the 35k thing or moving deposits, whatever, would have counted for nothing. B&B savers would have been burned through to take the loss on the asset base.
  17. No. The over 35k thing is a bailout. You guys. Honestly. You can't reject part of a bailout but like the bit that saves your £35k. That's a bailout too. Without any bailout you lose everything.
  18. OK. So let's charge 10% on mortgages. Let's see how that works too. It's a bank account not a bloody charity or an equity investment. If you want to get inflation, buy RPI linked bonds. If you want to get HPI, buy a house, if you want <insert non-capital guaranteed returns here> then invest in whatever you bloody want. That's not what a bank account is. Bank accounts are for the return OF your money not the return ON your money.
  19. Perhaps. See my other comment in the other thread for what I think the logical conclusion would have been. Plus, you wouldn't have got your money back - what makes you think you can just get it "from another source"? That's the fallacy of the whole thing, if you get your money from the Gov't you have had a bailout. If you get it back at all you have had a bailout. Truly free markets mean no bailouts i.e. you lose your money and get noTV. I
  20. OK. Let's play this through to its logical conclusion. RBS and HBOS start turning down requests to withdraw cash. At this point everyone with savings in those 2 banks is in big trouble. I think that's about 40% of savers, but OK, let's assume that we get through this ok. The cash is still there notionally but inaccessible. Now they have to start selling assets at pretty much any price to get cash. This crystallises losses at the absolute low of the cycles, of far more than RBS lost last year. In fact, it blows through the deposits that were sitting there inaccessible. You just wiped out 40% of the UK's savings base. And the best bit is, you didn't actually help any borrowers (by cancelling their mortgages) since most of the UK mortgages on those books are securitised already. All you did was give a load of free money to the overseas banks who use US -backed money to buy up assets at firesale prices. The banks are in default, and that in turn has a spiralling effect on other UK banks. International banks refuse to give any credit to UK banks at all, since RBS and Lloyds HBOS have just gone bust. People start queuing outside the other banks for their cash. Cash access is once again suspended. The asset sale starts, and once again, the mortgages are unaffected as they are largely securitised and held outside the UK. Savers lose out. So, overall, you just destroyed £600bio in savings and gave it to the US while destroying the only industry the UK actually excels in.
  21. While we're on the topic, they really need to stop handing out interest only mortgages. These things are so toxic.
  22. If he hadn't been bailed, you lost your money. ergo you were bailed. And you are right, nobody learnt anything. Which is why blanket guarantees on all bank deposits were imbecilic. But the political mind dictated that no retail saver could lose their money since there was a bailout occuring above them.
  23. You are right, but the whole UK would be bust. I am scared (like you) that we have only postponed our day of reckoning for later, but I am still glad we did.
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