"getting Lending Moving Again"

[DTMark]

In every single editorial piece on all the news channels and programs regarding the economy, the defacto introduction is always "everyone agrees we need to get lending moving again".

This infers that there is a backlog, a queue of people who want to borrow. And if only the gates which have been closed could be opened again, although not everything would be quite back to normal - after all, we don't want a return to the boom, do we (yes, if your initials are GB) - everything would get back on track.

I have not once seen any serious investigative attempt to qualify this.

Take the housing market for instance - why on earth would anybody want to borrow to buy property in this climate?

Or, take businesses looking to invest for the future. Is now a good time to borrow?

Or, people looking to buy a new car. Any takers at the moment with job uncertainty?

Of course this is chicken-and-egg; if we all bought cars and houses tomorrow great, it's all back on again.

But the "get lending flowing again" sounds like pushing on a string.

To me it sounds more like: Businesses who had borderline business models and as a result are having a very bad time, please don't declare bankruptcy right now. Instead, have a loan to keep you going (the taxpayer will pay), then go bankrupt some time after the next election if you would.

The genie seems to have popped out of the bottle and Government speak viz "if we don't act now, it'll be too late" rings rather hollow. Surely it's already too late?

Who wants to borrow in this climate and is the premise that lending is the key to recovery (AKA debt is wealth I guess) correct?

Edited January 21, 2009 by DTMark

[RDW]

Obviously, we, the sheeple are not far enough on the hook yet.

[laurejon]

The crux of the problem is that many good business's are having their credit line cut by the bank, this creates a domino effect that drags everyone else with it.

The banks are fools to themselves as they dont have the brains to establish what is a good bet anymore. Gone are the days when you sat in a bank meeting for a couple of hours sweating bullets as the Bank Manager looked over your books.

Todays Bank Managers might be good at doing a bit of singing and dancing on TV Commercials, but looking over company books would be well above their mental capacity.

Todays Bank Managers have most probably risen the ranks from Customer Services in a busy call centre, and think that day books are a novel or light reading you read on the commute home from work.

Edited January 21, 2009 by laurejon

[South Lorne]

The crux of the problem is that many good business's are having their credit line cut by the bank, this creates a domino effect that drags everyone else with it.

The banks are fools to themselves as they dont have the brains to establish what is a good bet anymore. Gone are the days when you sat in a bank meeting for a couple of hours sweating bullets as the Bank Manager looked over your books.

Todays Bank Managers might be good at doing a bit of singing and dancing on TV Commercials, but looking over company books would be well above their mental capacity.

Todays Bank Managers have most probably risen the ranks from Customer Services in a busy call centre, and think that day books are a novel or light reading you read on the commute home from work.

...you're right .....today's Bankers are just product salesmen....most don't have a clue about assessing risk, security and viability of business or personal balance sheets and worthiness, respectively ....they are unskilled ego hunters....and ..until this is changed back ...we're all doomed....

[eric pebble]

In every single editorial piece on all the news channels and programs regarding the economy, the defacto introduction is always "everyone agrees we need to get lending moving again".

Edit: "...EVERYONE AGREES WE NEED TO GET LENDING

LIAR LOANS

AGAIN....

[Quagmire]

As mentioned above I think the "get banks lending" line is valid in the context of business lending, companies are dependent on lending and there is nothing wrong with that.

In the context of consumer lending its complete nonsense. The appetite for more debt won't be there with the fear of job losses, the falling house market etc.

[Kegs]

To me it sounds more like: Businesses who had borderline business models and as a result are having a very bad time, please don't declare bankruptcy right now. Instead, have a loan to keep you going (the taxpayer will pay), then go bankrupt some time after the next election if you would.

I think youve hit the nail on the head. The government knows we are shafted and has just been buying time to try to win the next election. How can lending be the solution when it is the cause of the problem?

[Nelly]

I think youve hit the nail on the head. The government knows we are shafted and has just been buying time to try to win the next election. How can lending be the solution when it is the cause of the problem?

Why would they want to win the nexy election if its all going to f*ck?

Surely they'd rather lose it and point the finger at the new government!

They still blame things on the last tory government from over 11 years ago ffs

[Kegs]

The Labour government want to win another term because they are not through yet with turning Britain into a socialist, multicultural human rights Utopia.

They will stop at nothing to achieve this. Brown has shown this to be the case with carrying on with the huge levels of public spending when our country can no longer afford it.

And the other thing is that Brown and Co are so far up their own arses that they really do not believe any of this mess is their fault. Socialists are always blinded by their own self righteousness.

[Nelly]

Socialists are always blinded by their own self righteousness.

Very true indeed

[VeryMeanReversion]

In every single editorial piece on all the news channels and programs regarding the economy, the defacto introduction is always "everyone agrees we need to get lending moving again".

Lending to low risk individual companies and individuals that can do something profitable with the money and pay it back is a good thing and should be encouraged.

However, risk has been repriced to more accurately represent reality. Lending to high risk customers at low-risk prices has rightly stopped.

Take the housing market for instance - why on earth would anybody want to borrow to buy property in this climate?

I would take on a mortgage if I could get the right house at what I consider to be the right price (obviously well below current asking prices). Government protection is now in place if I lose my job, I can also pay for expensive unemployement insurance if necessary.

VMR.

[interestrateripoff]

What the media is really saying is we need to get DEBT increasing again.

Where the fook are the Uni academics? I mean I can't recall one single article where any major Professor has laid into Brown/Labour for this mess which has made it into the media.

This country has no academic in the same class as Roubini, no one has been prepared to put there head on the block and say anything remotely controversial which would make them stand out of the herd.

Lending cannot be started again because the system has failed, yet no one in the media is prepared to admit it.

[KingBingo]

To me it sounds more like: Businesses who had borderline business models and as a result are having a very bad time, please don't declare bankruptcy right now. Instead, have a loan to keep you going (the taxpayer will pay), then go bankrupt some time after the next election if you would.

NAIL ON HEAD !

[babesagainstmachines]

The banks are fools to themselves as they dont have the brains to establish what is a good bet anymore.

History suggest that they never were. Where do you think booms and busts comes from?

[Bloo Loo]

funny thing, its the banks themselves that are the most desperate for lending....our banks in particular as they are nett borrowers and what they dont get, they need to build up as capital, while at the same time their "cashlike" assets are devaluing daily.

while only companies that require leverage to function stand in the queue for refreshment....oh of course, small traders are getting their overdrafts slashed, but this happened in GC1 so was entirely expected.

[debtlessmanc]

What the media is really saying is we need to get DEBT increasing again.

Where the fook are the Uni academics? I mean I can't recall one single article where any major Professor has laid into Brown/Labour for this mess which has made it into the media.

This country has no academic in the same class as Roubini, no one has been prepared to put there head on the block and say anything remotely controversial which would make them stand out of the herd.

Lending cannot be started again because the system has failed, yet no one in the media is prepared to admit it.

History shows that this country doesn't listen to academics, it would rather learn the hard way. Academics working in the energy generation/distribution field have been screaming that the country has been running out of power and that we needed to start building nuclear power stations ten years ago. Sheeple+Govt didn't like the message and so ignored it until probably too late, my colleagues now tell me that we are likely to start having rolling power cuts in 5 or so years time.

[unclefester]

What the media is really saying is we need to get DEBT increasing again.

Where the fook are the Uni academics? I mean I can't recall one single article where any major Professor has laid into Brown/Labour for this mess which has made it into the media.

This country has no academic in the same class as Roubini, no one has been prepared to put there head on the block and say anything remotely controversial which would make them stand out of the herd.

Lending cannot be started again because the system has failed, yet no one in the media is prepared to admit it.

Nobody likes hill walking anymore

[Stars]

...you're right .....today's Bankers are just product salesmen....most don't have a clue about assessing risk, security and viability of business or personal balance sheets and worthiness, respectively ....they are unskilled ego hunters....and ..until this is changed back ...we're all doomed....

During the boom banking effectively became part of the real estate market, banking was about real estate

Mostly, real estate is not like the productive portion of the economy. It doesn't require the same considerations. You don't need any expertise to play monopoly; real estate will cream the surpluses of the economy no expertise required, that is, until the economy collapses

[eric pebble]

During the boom banking effectively became part of the real estate market, banking was about real estate

Mostly, real estate is not like the productive portion of the economy. It doesn't require the same considerations. You don't need any expertise to play monopoly; real estate will cream the surpluses of the economy no expertise required, that is, until the economy collapses

Yup - it is that simple - and that cynical....

[steve99]

The Labour government want to win another term because they are not through yet with turning Britain into a socialist, multicultural human rights Utopia.

They will stop at nothing to achieve this. Brown has shown this to be the case with carrying on with the huge levels of public spending when our country can no longer afford it.

And the other thing is that Brown and Co are so far up their own arses that they really do not believe any of this mess is their fault. Socialists are always blinded by their own self righteousness.

If for a minute, they were socialists, we would have had a massive building boom of social housing, thus keeping prices down for the buyers and cheap rental housing everyone that wanted it, free dentistry would have been reintroduced, the rail network would have been renationalised and we would have much cheaper fares, instead we have the most expensive. No, we have had a right wing agenda as was discussed and organised via a group of right-wing think tanks in the USA back in the 70's, implemented intialy by Ronnie Reagan and mimiked in the UK via the Tory party. This agenda was based on getting everyone into perma-debt, thus fullfilling the needs of the rich and powerful to have a majority of the population in a form of servitude for ever more.

The labour party is complicit and guilty on account of not dismantling what had been a tory agenda, whether by stupidity or design, I dont know. As for being up ones ar*ses, I dont see any difference with the worlds conservative parties either, take the USA for eg, right wing government for 8 years and I dont think Ive ever seen so much self righeouness since Hitlers regime folded.

We have not by any measure had a Socialist party.

[eric pebble]

We have not by any measure had a Socialist party.

Moneylenders Socialist League?