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Why Are The Banks Still Losing Money?

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Why are the banks still losing money? I really don’t understand at all!

They had shed-loads of our dosh chucked at them in the last crunch.

The spread in interest rate between their borrowing and lending has never been higher.

They are pushing everyone into debt and making exorbitant amount of money from their charges.

Mortgage borrowers are getting screwed.

Personal loan borrowers are getting screwed

Business over-draft users are getting screwed.

This all adds up to massive profits.

And we are losing our public services to pay for their greed.

So why are they going into the red again? Am I missing something here?

Should we not be out on the streets chucking bricks at them?

I really don’t understand.

Could someone enlighten me here?

 

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The banks had £1 but had promised £97

People asked for about £4 of that £97, meaning £3 had to be invted from thin air. Banks then had £0 but owed £94

Now some more people are asking for their money.

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Why are the banks still losing money? I really don’t understand at all!

They had shed-loads of our dosh chucked at them in the last crunch.

The spread in interest rate between their borrowing and lending has never been higher.

They are pushing everyone into debt and making exorbitant amount of money from their charges.

Mortgage borrowers are getting screwed.

Personal loan borrowers are getting screwed

Business over-draft users are getting screwed.

This all adds up to massive profits.

And we are losing our public services to pay for their greed.

So why are they going into the red again? Am I missing something here?

Should we not be out on the streets chucking bricks at them?

I really don’t understand.

Could someone enlighten me here?

Well, they do own the government and as such appear entitled to any income thereof.

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The distinction between solvency and liquidity is a moot one if you pump in so much liquidity that no insolvency takes place.

It comes at the cost of affordability for average people though to buy houses and fund their pensions.

...why buy into the housing ponzi at this stage and why 'invest' in a pension just now until there is reform ...?.... :rolleyes:

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Why are the banks still losing money? I really don’t understand at all!

Because people they leant the money too keep withdrawing the last of their overdraft limit and blowing it on bankrupcy proceedings.

I do often wonder why people aren't prosecuted for fraud for doing this. It's only a matter of time before the banks make an issue of it. If you take moeny from overdraft/credit card and use it to go bankrupt, you've borrowed money with no intention of paying it back.

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The banks had £1 but had promised £97

People asked for about £4 of that £97, meaning £3 had to be invted from thin air. Banks then had £0 but owed £94

Now some more people are asking for their money.

Which bank is that? Even the worse offender BoS had a Loan to deposit ratio of 140% (not where need 9700%)

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Which bank is that? Even the worse offender BoS had a Loan to deposit ratio of 140% (not where need 9700%)

The system as a whole.

Theres only really one bank, it just has a lot of different logos over the door.

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Which bank is that? Even the worse offender BoS had a Loan to deposit ratio of 140% (not where need 9700%)

I think he is probably talking about broad money (and has the figures slightly out - 3% cash reserves) - ie. the deposits which were created from the original extension of credit:

1. Person A puts 10 freshly printed £10 notes (£100) in the bank.

2. Person B borrows £97 from the bank and gives it to person C.

3. Person C puts it back in the bank.

Result: Narrow money = £100, broad money = £197.

Rinse and repeat until there are about 33 claims for every £1 of narrow money.

Ofc, broad money is just made up of chains of credit. It's the flow of money, not the money itself. Some people get very stressed about this, for some reason.

EDIT: P.S. This is probably more for the benefit of others, than yourself. I don't mean to sound like a pedant!

Edited by Traktion

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Ofc, broad money is just made up of chains of credit. It's the flow of money, not the money itself. Some people get very stressed about this, for some reason.

Probably because it looks very much like legal fraud.

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Why are the banks still losing money? I really don't understand at all!

They had shed-loads of our dosh chucked at them in the last crunch.

The spread in interest rate between their borrowing and lending has never been higher.

They are pushing everyone into debt and making exorbitant amount of money from their charges.

Mortgage borrowers are getting screwed.

Personal loan borrowers are getting screwed

Business over-draft users are getting screwed.

This all adds up to massive profits.

And we are losing our public services to pay for their greed.

So why are they going into the red again? Am I missing something here?

Should we not be out on the streets chucking bricks at them?

I really don't understand.

Could someone enlighten me here?

Because when everything crashed they were stuck in a buying frenzy of TOXIC CDO's which started exploding in their faces!

As the USA economy collapsed more and more of these toxic CDO's have become next to worthless and banks can't find any more mugs to pass them on to.

So they get hit by 10's/100's millions $£ of losses a year and have Billions more 'toxics' hidden (none of them have revealed the true amounts - coz no one would lend anything to them if they knew).

They are all bust (empty shells) & live in fear of each other finding out what they are sitting on, threaten host Govts that "they are too big to fail" and take it out parasitically on their 'host' country's taxpayers!

Edited by erranta

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So far, they have taken 1.2 Trillion POUNDS out of public spending/UK economy to cover THEIR losses from UK taxpayers alone.

They are demanding ANOTHER TRILLION POUNDS to keep themselves afloat over the next year!

Can you all comprehend this "City Compensation Cultcha" for wrong doing? I can't believe there isn't a general strike to force these blaGGards out!

Let's make them all lords and reward them further - as pEErs of the realm to look up to! :rolleyes:

Edited by erranta

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Probably because it looks very much like legal fraud.

Care to expand on this - which part do you think is legal fraud?

There is a legal ambiguity as to who 'owns' the money and what they are allowed to do with it. This could be considered fraud and is easily solved by defining the terms in contract - 1. 'keep my money safe at a cost' or 2. 'loan it out to others for interest'.

If people choose 2, then they know what is going on and should appreciate the risks of doing this. There is a bill going through parliament to define the terms when you open the account, which I think would make things much clearer.

EDIT: BTW, if your concern is with the chains of credit, full reserve banking* would have exactly the same problem. Are you saying this is fraud too? If so, you would essentially be saying any banking is fraud. That's fair enough, but I'd like to hear your views on this.

* Assuming there are timed savings accounts, where 'your' money is loaned out to others for a time period.

Edited by Traktion

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Care to expand on this - which part do you think is legal fraud?

There is a legal ambiguity as to who 'owns' the money and what they are allowed to do with it. This could be considered fraud and is easily solved by defining the terms in contract - 1. 'keep my money safe at a cost' or 2. 'loan it out to others for interest'.

If people choose 2, then they know what is going on and should appreciate the risks of doing this. There is a bill going through parliament to define the terms when you open the account, which I think would make things much clearer.

EDIT: BTW, if your concern is with the chains of credit, full reserve banking* would have exactly the same problem. Are you saying this is fraud too? If so, you would essentially be saying any banking is fraud. That's fair enough, but I'd like to hear your views on this.

* Assuming there are timed savings accounts, where 'your' money is loaned out to others for a time period.

He means it's fraud that the courts don't prosecute, I think.

And it is.

You've also missed where the fraud occurs - it's in spending money you have borrowed (and the accepting of what is already yours as a new item ofc.) You can't give away what isn't yours.

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Thanks everyone.

That makes it really really clear..........rolleyes.gif

I thought there was a good reason why they all deserved their bonuses.

Now, who posted recently about the best place i the World to live?

I'm packing my bags. This is going to get very very nasty indeed.blink.gif

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Thanks everyone.

That makes it really really clear..........rolleyes.gif

I thought there was a good reason why they all deserved their bonuses.

Now, who posted recently about the best place i the World to live?

I'm packing my bags. This is going to get very very nasty indeed.blink.gif

It wasn't really clear was it. They've done a good job in engineering something that when asked about.......people are having difficulty in explaining.

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He means it's fraud that the courts don't prosecute, I think.

And it is.

You've also missed where the fraud occurs - it's in spending money you have borrowed (and the accepting of what is already yours as a new item ofc.) You can't give away what isn't yours.

That's the same with full reserve banking, with timed savings. It's the same with any banking.

I know you think the whole lot is fraud, which is fair enough. However, those who think that changing from fractional to full reserve banking will change this are mistaken.

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Because people they leant the money too keep withdrawing the last of their overdraft limit and blowing it on bankrupcy proceedings.

I do often wonder why people aren't prosecuted for fraud for doing this. It's only a matter of time before the banks make an issue of it. If you take moeny from overdraft/credit card and use it to go bankrupt, you've borrowed money with no intention of paying it back.

But that's not how it's done...

...you pay the bankruptcy fees out of your wages or benefits and use your overdraft/credit card to buy food for your family. No-one is ever going to be prosecuted for buying food on their credit card - even if they know they can't pay it back!

;)

Edited by Mr Yogi

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Why are the banks still losing money? I really don’t understand at all!

They had shed-loads of our dosh chucked at them in the last crunch.

The spread in interest rate between their borrowing and lending has never been higher.

They are pushing everyone into debt and making exorbitant amount of money from their charges.

Mortgage borrowers are getting screwed.

Personal loan borrowers are getting screwed

Business over-draft users are getting screwed.

This all adds up to massive profits.

And we are losing our public services to pay for their greed.

So why are they going into the red again? Am I missing something here?

Should we not be out on the streets chucking bricks at them?

I really don’t understand.

Could someone enlighten me here?

 

In short - defaults or the threat of defaults.

If the bank has to repossess a property worth less than the loan, they are in trouble. Currently, we lots of overvalued houses and lots of unemployed people. They extended too much credit during the boom and are struggling to cope with the bust.

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That's the same with full reserve banking, with timed savings. It's the same with any banking.

I know you think the whole lot is fraud, which is fair enough. However, those who think that changing from fractional to full reserve banking will change this are mistaken.

I don't think it is fraud.

It IS fraud.

All banking is fraud.

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I don't think it is fraud.

It IS fraud.

All banking is fraud.

True.

By any normal standards, all banks are permenantly insolvent. If any other business carried on trading while insolvent they would have to answer to the Serious Fraud Office.

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I don't think it is fraud.

It IS fraud.

All banking is fraud.

I know your views on this - I wanted show to others what your solution is: A world with no banks of any type.

You're about the only person I have seen calling for this on here. I have seen no economists of any type calling for this. I'd be interested if you started a thread, defining and defending this position, tbh. It's certainly radical.

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  • 261 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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