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okaycuckoo

Wondering About Barclays

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Always thought Barclays would go the same way as RBS because they had similar leverage (Deutsche too) - but their lips slipped off the government tit and the market gave them kudos for that.

Still not convinced.

Here's Martin Hutchinson's view on a possible split of investment and retail banking in the UK - overall he thinks investment banks will have to shrink anyway:

For Barclays, it would quickly become clear that the split merely emphasized the wrong road taken in the last decade. Having spent large amounts of money building up its BZW investment banking business after the 1986 "Big Bang" Barclays correctly decided in the late 1990s that the cultural clash between traders and retail bankers was too great, and in 1998 sold the majority of BZW to Credit Suisse First Boston, keeping only the (pretty well unsalable at that time) debt markets division. Barclays' strategy then became one of concentrating on retail banking and investment management, in which it became a formidable global force through its pioneering of Exchange Traded Funds. However in the 2000s, overambitious Barclays management made a series of mistakes, overbidding for ABN-Amro in 2006 at the peak of the market and buying the remnants of Lehman Brothers in late 2008, a move that both reintroduced the problem of integrating retail and investment banking and forced Barclays to sell its crown jewel, Barclays Global Investors, in June 2009. A retail banking/investment management combination is stable and benefits from considerable synergies; a retail banking/investment banking combination is much less attractive.

Diamond, Barclays' new chief executive, is basically a debt trader who got extremely lucky, the profits of Barclays' debt trading operation having benefited year after year from the over-expansive monetary policies run by the Fed since 1995, and the wide and immovable "gap" between short-term and long-term rates to which they led. Once U.S. monetary policy is finally corrected with the departure of Ben Bernanke, and the 1981-2010 bull market in U.S. government bonds comes to its well-merited end, life for debt traders will become much more difficult. Thus the investment banking side of Barclays is unlikely to be particularly profitable, and given over-aggressive trader management, exacerbated by the Lehman DNA, is likely to collapse again into gigantic losses at some point.

http://www.prudentbear.com/index.php/thebearslairview?art_id=10437

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

Me too. He who dares, etc...

She who didn't dare is now kicking herself.

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

I had a punt on RBS right in the depths at around 13p.

Made about 5 grand, but then doubled up and ended up losing about 5.5 grand.

If it's any consolation your barc might have gone the same way. It's human nature.

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

I remember the father in law trying to get me to buy barclays shares at the time. Wifey reminded me of what he said and I told here that there was no way I was buying shares in a bank who's shares had dropped from £7 to 50p. Thankfully I stopped short of calling him an idiot. :)

Still, he was saying in early 2008 that the recession was no big deal and wouldn't be as bad as the last one. I guess it is one all :)

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

Buying any bank around that time was a huge risk. Several of my collegues bought barclays shares because someone told someone they were a good buy. I refused saying it's madness and like a very expensive lottery ticket you'll probably lose but could make a lot if you're lucky.

They were lucky, so far as they've not yet sold. They are sitting on some big returns though.

If the same similar situation happened again I still wouldn't buy. Too big a risk.

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Buying any bank around that time was a huge risk. Several of my collegues bought barclays shares because someone told someone they were a good buy. I refused saying it's madness and like a very expensive lottery ticket you'll probably lose but could make a lot if you're lucky.

They were lucky, so far as they've not yet sold. They are sitting on some big returns though.

If the same similar situation happened again I still wouldn't buy. Too big a risk.

Barclays were very lucky in getting that Middle Eastern billionaire to stick loads of money in - bear in mind, by that point several Middle Eastern sovereign funds had lost serious money buying into other big banks.

What are their chances of him repeating the gesture in meltdown II or Barclays finding someone similar?

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Me too. He who dares, etc...

She who didn't dare is now kicking herself.

Surely you bought gold miners instead - much bigger return. Or how's about Avis - 100x return?

As Homer says: It's still good, just a little dirty.

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I think loads of us thought the same thing when RBS, HBOS and Barclays hit their lows:(insert thought bubble) "they look really cheap, but they might get nationalised and I might lose all my money."

By that time Northern Rock had been nationalised, and shareholders did indeed lose all their money. Government policy was the only thing dividing the deal of a lifetime from complete loss of your capital.

When playing with your own money, caution takes over and you don't gamble. However, if you're a trader and you only get paid a bonus for the upside and don't pay any penalty for the downside you'd be mad not to gamble.

That's why traders made a killing, whilst retail investors by and large didn't risk their capital.

A govt decision to nationalise RBS, HBOS and to not provide SLS funds to Barclays would have meant loss of capital. Simple as that. At the time no one barring insiders had any idea what the outcome would be, so don't kick yourself.

It was a mad gamble at the time, and if the share prices crater again don't rely on the govt coming to your rescue if you decide to take a punt.

Edited by WageslaveX14

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Me too. He who dares, etc...

She who didn't dare is now kicking herself.

I know someone who had £10k in RBS (at 2007 prices) and when NR was going down snapped up a couple of grands worth of shares.

People don't ask him for advice about financial matter any more.

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I know someone who had £10k in RBS (at 2007 prices) and when NR was going down snapped up a couple of grands worth of shares.

People don't ask him for advice about financial matter any more.

Family? Hehe.

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Surely you bought gold miners instead - much bigger return. Or how's about Avis - 100x return?

As Homer says: It's still good, just a little dirty.

Gold miners (HUI) have done ****** all over the past 3 years. Better off sticking to the real stuff if you are into the shiny stuff. I had some gold miners 3 years ago and lost a bit. Kept an eye on them now and again and the prices are lower today than in much of 2007/2008. For most of the HUI anyway.

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I think loads of us thought the same thing when RBS, HBOS and Barclays hit their lows:(insert thought bubble) "they look really cheap, but they might get nationalised and I might lose all my money."

By that time Northern Rock had been nationalised, and shareholders did indeed lose all their money. Government policy was the only thing dividing the deal of a lifetime from complete loss of your capital.

When playing with your own money, caution takes over and you don't gamble. However, if you're a trader and you only get paid a bonus for the upside and don't pay any penalty for the downside you'd be mad not to gamble.

That's why traders made a killing, whilst retail investors by and large didn't risk their capital.

A govt decision to nationalise RBS, HBOS and to not provide SLS funds to Barclays would have meant loss of capital. Simple as that. At the time no one barring insiders had any idea what the outcome would be, so don't kick yourself.

It was a mad gamble at the time, and if the share prices crater again don't rely on the govt coming to your rescue if you decide to take a punt.

Well said.

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Surely you bought gold miners instead - much bigger return. Or how's about Avis - 100x return?

No, but we did whack some more in our 'cautious-ish ' funds while the markets were at rock bottom.

So it could be worse.

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Barclays buying Lehmans was not a mistake. They paid pittance for a huge global name that has opened up the American markets for them. They seem a pretty well run bank to me. They bought up Woolwich a few years back, just to get their mortgage book, but they aren't big players and a housing crash wouldn't hit them like it would many banks.

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

As soon as governments made it clear they would do anything to protect their banking masters, including promoting mark-to-fantasy, all banks popped. I held off buying shares hoping governments would do the right thing and let the reckless fall on their sword. Man, was I dissapointed. Our corrupt system bothers me much more than any speculative opportunities lost.

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I often think about Barclays.

I often think "Why didn't I buy a load of their shares at 50p a pop?"

I often then remember how precarious they, and indeed all banks, looked around that time.

Barclays is the UK bank  I would be most afraid to put money in. Let's face it they have rolled over a tonne of debt at stupidly high interest rates to Middle East Investors.

I suspect they could  be the next bailout - they got away from having to disclose everything  last time and so they could be insolvent and no one would know.

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Diamond, Barclays' new chief executive, is basically a debt trader who got extremely lucky, the profits of Barclays' debt trading operation having benefited year after year from the over-expansive monetary policies run by the Fed since 1995, and the wide and immovable "gap" between short-term and long-term rates to which they led.

http://www.prudentbear.com/index.php/thebearslairview?art_id=10437

He's basically saying Bob has got lucky for the past 15 years so ergo, it can't last. Well I'm happy to follow someone who has been lucky for 15 years as he sounds like a lucky sort of chap to me. Bob's vision and foresight have obviously had nothing to do with it.

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He's basically saying Bob has got lucky for the past 15 years so ergo, it can't last. Well I'm happy to follow someone who has been lucky for 15 years as he sounds like a lucky sort of chap to me. Bob's vision and foresight have obviously had nothing to do with it.

He's basically saying that investment bankers in general got lucky. He's also sure there won't be so many investment bankers around in future. Sounds reasonable to me, although I'm sure "Bob" would disagree!

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  • 140 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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