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Hsbc Chairman Says Can't Deleverage Unless Interest Rate Up, Saving Up And Asset Price Down

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...depends on your point of view whether it is patronising.... :rolleyes:

Well, from my point of view it's patronsing :)

I'm absolutely no expert in these things, but I was always under the impression that there was a "systemic risk" when the banking crisis came up and that was why they introduced the SLS, etc. So although some banks really had their noses right in the trough (Northern Rock) and actually needed funds put into them there were a lot of others (Barclays, HSBc) not right in the thick of it but still enjoying the feeding frenzy. As soon as the banks stopped trusting each other they all would have gone down unless these extreme measures were taken. All these measures at the cost of tax payers. For these banks then to turn around and start making demands - even if they were one of the 'less bad' ones doesn't fit with my idea of natural justice. We just hauled them out of the fire and now they're asking for more...

Should we forget all this just to let it happen again?

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Well, from my point of view it's patronsing :)

I'm absolutely no expert in these things, but I was always under the impression that there was a "systemic risk" when the banking crisis came up and that was why they introduced the SLS, etc. So although some banks really had their noses right in the trough (Northern Rock) and actually needed funds put into them there were a lot of others (Barclays, HSBc) not right in the thick of it but still enjoying the feeding frenzy. As soon as the banks stopped trusting each other they all would have gone down unless these extreme measures were taken. All these measures at the cost of tax payers. For these banks then to turn around and start making demands - even if they were one of the 'less bad' ones doesn't fit with my idea of natural justice. We just hauled them out of the fire and now they're asking for more...

Should we forget all this just to let it happen again?

...HSBC are not asking for more ...they are asking the market to return to reality ...in other words IRs which respect the situation and not one which is hiding from the realisation of bad lending decisions ....then house prices can fall to a level before the funny money came into the equation ....the funny money which Gordo thought was his economic miracle....no point in delaying the agony ..... :rolleyes:

Edited by South Lorne

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EDIT: OFCOURSE SLS IS A BAILOUT! THERE IS A HUGE COST AND THE BENEFICIARY WAS THE BANKS.

In the absence of the SLS, would HSBC have needed it? Once it was set up, they would have been at a competitive disadvantage not to use it.

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Since the BOE report of low interest rates are not helping home owners ,it seems like they are preparing the ground for them to rise

where have you dredged that rubbish up from? IIRC the BoE said low rates may be masking latent distress, which is not the same thing at all as saying low rates are not helping over leveraged home owners.

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...HSBC are not asking for more ...they are asking the market to return to reality ...in other words IRs which respect the situation and not one which is hiding from the realisation of bad lending decisions ....then house prices can fall to a level before the funny money came into the equation ....the funny money which Gordo thought was his economic miracle....no point in delaying the agony ..... :rolleyes:

Sorry - i didn't make myself clear. I was referring to the discussion about banks holding countries to ransom in regards to where they pay their taxes. Saying that they will go elsewhere if governments to not kowtow to them. I cannot see a particularly good reason for fighting to keep them, as they have been a drain rather than a boon to us over the last decade. :D

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You mean the HSBC that bought one of the biggest sub prime 'predatory' lenders in the USA, the biggest provider of pay day cheques etc...just before the sub prime disaster blew up?

It seems HSBC were the best likely only because they have a large part of the business from Asia which was OK in the crunch, the same as Standard Chartered who were hardly touched, the same reason Santander were ok with a large Latin American exposure, i doubt either will fair as well in the next part if those markets are adversely affected

Edited by Tamara De Lempicka

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...all the Banks who were bailed out in the UK were British High Street Banks ....and the Gordo 'proper' regulation brought in through a series of Banking Acts from '97 ....didn't work ...basically because they didn't understand what they were doing ..... :rolleyes:

+1

It's not that they were or weren't registered here its the fact that as you point out they blindly followed the edges of the regulatory frame work as some kind of master business plan and then when the inevitable happened pleaded too big to fail. That is the way that the financial sector operate then unfortunately going forward our domestic retail banking must be regulated completely. Not to do so can only mean that we could face the same problems in the future. What strikes me as odd is the way that globally this industry seems to feel that any regulation is bad, would we be happy if the nuclear power industry lobbied for and managed to drop all forms of regulation, I wouldn't for one.

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He also called for a return to the "fundamentals" of banking and warned central bank support for lenders would have to continue unless interest rates rose. "Western banks, in Europe in particular, are over-geared. How they deleverage that gearing, which is being financed by the ECB and the Bank of England, how that can be unwound is hard to see unless the savings rate increases or asset values decrease, with the consequent provisions for losses.

ah, here we are - I wondered when the banks would start squeeling about this. The reality is that zirp does hurt banks, more specifically, it hurts their oversized profits. Where's my violin?

What HSBC actually want is a nice steep yield curve, after slewing off assets (who is going to buy them though except the CBs) then have a nice wee crash once they have moved their assets into safer territory and leave the taxpayer holding all the rubbish. Then they are going to take the savings from the west and plow them into inflating a massive bubble in the BRICs and keep on making hay.

The fact is we don't need the banks to export carry trade money into the BRICS and the banks know it and are shitting themselves.

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You mean the HSBC that bought one of the biggest sub prime 'predatory' lenders in the USA, the biggest provider of pay day cheques etc...just before the sub prime disaster blew up?

yep

best is a relative term

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I think that could certainly be true - and shows the potential benefit of having a banking portfolio diversified across the world that allows them to play the global imbalances to remain liquid - i.e. use Eastern savings to maintain Western solvency where all other routes to Western solvency is closed off in the face of a run in international markets.

However, I would caution against thinking that because you have not heard a lot about HSBC in the news, that they are totally clean. Same with Barclays - I mean at the height of the crisis when they 'sold' themself to the middle easterners - that money was actually lent to the middle easterners by Barclays...that can't be right either. Indeed Anglo have been roundly condemned for carrying out a similar operation. Just that with one thing and another, Barclays managed to get away with it as sterling devalued, asset prices rebounded and they were given oodles of liquidity. Irish banks did not get the same help - indeed our devaluation will have caused their banks to have taken a huge hit straight away for Sterling denominated commercial property loans.

In fact the one that I really kept expecting to hear about (and still do) was Fidelity. However they are a very private company and you won't have heard a dicky bird about anything. But what have they held and have they been betting on their own account. It's all smoke and mirrors often enough, and if you can get away with it, you might just be lucky enough to nurse yourself back to health before being rumbled (like Barc?).

Interesting now in the context of the Wikileaks report by the US Treasury chap who lunched with Merv and reported to Paulson that Merv wanted to recap the UK and Western banks using surplus country capital. It seems likely that Varley had already discussed this with Merv I'd have thought.

With the exception of RBS its no suprise really that the larger commercial lenders are still standing and it's their competition (in certain markets) which has disappeared. i.e. mainly the former building societies. In any event, pretty much all 'banks' north of the City have been 'taken down'. Last man standing takes the spoils. I doubt very much this just 'happened' that way.

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....no is the straight answer..... :rolleyes:

http://business.time...icle5545532.ece

Too simplistic! The biGGer picture is >>>

While HSBC has not taken any direct state aid, it has benefited from the billions of pounds of taxpayers' cash that has been pumped into the banking system to keep it from collapse, and the cheap money supplied by the Bank of England.

Remember how all these 'clever' bankers are locked into one another - DOVE-TAILED into Mass failure if even one or two go under!

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You mean the HSBC that bought one of the biggest sub prime 'predatory' lenders in the USA, the biggest provider of pay day cheques etc...just before the sub prime disaster blew up?

Shush - they were just expanding their 'interests' (p.t.pun)

Wunder if any HSBC senior management bonuses were withdrawn or heads rolled over that one?

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Bankster says govt. must allow us to carry on looting or we'll move to Hong Kong 'cause we're 'special'.

No you're not. You're criminal looters. F*ck off and see if Hong Kong taxpayers bail you out next time you fail.

HSBC did not get a bailout.

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where have you dredged that rubbish up from? IIRC the BoE said low rates may be masking latent distress, which is not the same thing at all as saying low rates are not helping over leveraged home owners.

Low rates have been an enormous benefit for mortgagors, on balance. But my feeling is that BTLers are the ones who have really made out like bandits.

At the moment self-employed/construction/transport workers are getting stuffed with fuel and food price rises, so the benefit is being eaten away. This was predicted, and I'm just beginning to see the reality of distressed borrowers running out of road. This is at the same time as the reduction in the SMI rate is feeding through on account statements. For now, it's marginal, but the mortgage survivors among the unemployed and the most vulnerable of the employed are slowly giving up the ghost.

I really don't see a way out of this for the dumbest big banks. HSBC is probably not one of them. They were the first to write down US mortgage securities in May 2008, so maybe it's worth heeding what they say.

Whatever, I just hope Barclays is ultimately exposed. Hehe.

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...don't think Hong Kong would entertain the Banks who failed and are still supported by the taxpayers ....that is a myth....for the others who pay us taxes ...well it will be their business choice ...it's a free world ..... :rolleyes:

Bankster says govt. must allow us to carry on looting or we'll move to Hong Kong 'cause we're 'special'.

No you're not. You're criminal looters. F*ck off and see if Hong Kong taxpayers bail you out next time you fail.

HK no longer welcomes FILTH bankers, they look for people like me but not me (I have a conscience anyway) in that they want people who can speak all 5 varieties of Chinese fluently along with English.

Also HK doesn't bail out anybody, when Lehman went bust lots of people lost their money, the government told them to go spin on it. They also happen to have strict limits on lending interest can't be more than 70% for instance. A biggie is that PRC law superceeds HK law as of 1999 when HK law based on British law is dominant, but PRC law at any time can step in and replace HK law. Which means like in PRC China, bankers who commit fraud tend to be executed after 10-20 years working in a labour camp.

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Have hsbc taken uk govt money?

Erm HSBC is special, because although seen as an international bank, it has the powers of a central bank. Bank notes in HK have HSBC logos on them Along with standard chartered bank. SO they lose some money? They have the power to print some more and also the ability to hide the location of this printed money and feed it into wherever it is needed.

Its quite funny how HMRC UK asks HK banks for info, the banks there laugh and throw the letters away.

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Sorry - i didn't make myself clear. I was referring to the discussion about banks holding countries to ransom in regards to where they pay their taxes. Saying that they will go elsewhere if governments to not kowtow to them. I cannot see a particularly good reason for fighting to keep them, as they have been a drain rather than a boon to us over the last decade. :D

.....true ...as stated before they have freedom of choice.....it's a global market .... :rolleyes:

Edited by South Lorne

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HK no longer welcomes FILTH bankers, they look for people like me but not me (I have a conscience anyway) in that they want people who can speak all 5 varieties of Chinese fluently along with English.

...if you are in demand there ...why are you not going for the opportunity..... :rolleyes:

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HK no longer welcomes FILTH bankers, they look for people like me but not me (I have a conscience anyway) in that they want people who can speak all 5 varieties of Chinese fluently along with English.

Also HK doesn't bail out anybody, when Lehman went bust lots of people lost their money, the government told them to go spin on it. They also happen to have strict limits on lending interest can't be more than 70% for instance. A biggie is that PRC law superceeds HK law as of 1999 when HK law based on British law is dominant, but PRC law at any time can step in and replace HK law. Which means like in PRC China, bankers who commit fraud tend to be executed after 10-20 years working in a labour camp.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=156508&view=findpost&p=2830097

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Too simplistic! The biGGer picture is >>>

Remember how all these 'clever' bankers are locked into one another - DOVE-TAILED into Mass failure if even one or two go under!

...considering they never asked for any in the first place and stated they could not see a situation in which they would ask in the future this is within that context.... :rolleyes:

http://www.housepricecrash.co.uk/forum/index.php?showtopic=156508&view=findpost&p=2830188

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...if you are in demand there ...why are you not going for the opportunity..... :rolleyes:

Because you only live once, 16 hour days day in day our for only 250% of my current salary simply isn't worth the price. I learned through 6 years of attempting to climb the slippery pole, that I lost my 20s to careerism. When life is more important.

Patrick a mate of mine went to work for Standard Chartered bank in much the same way. It's funny because he makes more but spends so much more that essentially he is broke week in week out. Bit like the brick layers I knew in Plymouth, £800-£1200 a week was pretty normal, but the job was so mind numbing they would go on weekend long benders and spend most of it. You see the bankers in LKF in HK? THey'll spend £100 on a pint of beer purely because it is £100 a pint of beer to show people how rich they are.

Edited by ken_ichikawa

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Because you only live once, 16 hour days day in day our for only 250% of my current salary simply isn't worth the price. I learned through 6 years of attempting to climb the slippery pole, that I lost my 20s to careerism. When life is more important.

Patrick a mate of mine went to work for Standard Chartered bank in much the same way. It's funny because he makes more but spends so much more that essentially he is broke week in week out. Bit like the brick layers I knew in Plymouth, £800-£1200 a week was pretty normal, but the job was so mind numbing they would go on weekend long benders and spend most of it. You see the bankers in LKF in HK? THey'll spend £100 on a pint of beer purely because it is £100 a pint of beer to show people how rich they are.

...good answer ...it's all about personal choices.....

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