Ft : Warning On Market Risks As Prices Fall

[Golden Shower]

Sorry, I must have posting diarrhoea today.

Need subscription for this one, but I imagine the FT could be a good read today;

Market warning

A turbulent week in the financial markets ended on Friday with sharp falls in gold, oil and copper prices and warnings from central bankers and Wall Street strategists that investors are misreading the risks.

Paul Tucker, director of markets at the Bank of England, on Friday said the recent climate of ultra-low interest rates and low volatility might have prompted investors to become complacent about underlying risks in the financial market. In particular, an explosion in the use of structured financial products, such as credit derivatives, might have distorted market interest rates – and left investors mis-pricing risk, he said.

[OnlyMe]

When hedge funds wanted to build their derivative shit-house they knew they could rely on a supply of cheap materials from the central banks.

Don't forget credit and mortgage derivatives we are likely to hear a lot about these products. The first that some people will know about them will be when their pension has been stuffed and subsequently trashed by them.

Edited May 20, 2006 by OnlyMe

[laurejon]

Is he suggesting that a 2% mortgage is an ultra low intrest rate!!! He must be mad, my repayments are 3500pcm for an ex Council Studio Flat in Oldham and that is interest only

Interest Rates have got to come down, they are far too high and have been for several years.

We are living in a miracle economy, surely they could drop the rates whereby they pay us to borrow.

[Smurf1976]

Is he suggesting that a 2% mortgage is an ultra low intrest rate!!! He must be mad, my repayments are 3500pcm for an ex Council Studio Flat in Oldham and that is interest only

Interest Rates have got to come down, they are far too high and have been for several years.

We are living in a miracle economy, surely they could drop the rates whereby they pay us to borrow.