Black Saturday?

[ianbeale]

Thought i would get this title in first

lease can you put your weekend press links here taht will have the sheeple spitting out their cornflakes

Its Pimms O'clock

Keep the faith

IB

[strbear]

You're too early - its Black Friday Night and I bagged that - come back at 00:01 and stake your claim!

SB

[Goldfinger]

What about different time zones?

[strbear]

What about different time zones?

Despite popular belief Ilkley is in the UK and in the 21st Century in case you were wondering

Regards

SB

[ianbeale]

You're too early - its Black Friday Night and I bagged that - come back at 00:01 and stake your claim!

SB

fair cop gov - please let this thread die gracefully as it was a false start

[strbear]

fair cop gov - please let this thread die gracefully as it was a false start

No I want everyone to know you're premature so I'm going to keep it at the top!

SB

[Guest Bart of Darkness]

I'm considering starting a Black Gatilsday thread. The trouble is, getting the timing right.

Lois Griffin: I saw that on a two-part report on Dateline Tuesday and Dateline Gatilsday.

Peter Griffin: What the hell is Gatilsday?

Lois Griffin: NBC invented a new day so they could add another Dateline.

[ianbeale]

No I want everyone to know you're premature so I'm going to keep it at the top!

SB

didnt you see me on eastenders tonight my sexual prowess is like a 24hr leman car (self certified)

[strbear]

well in 22 minutes you'll be on schedule and I'll gladly hand over the baton to you! looks like the world didn;t fall apart on my shift so its over to you

SB

[ianbeale]

sod that im off to bed

[19 year mortgage 8itch]

Hell yes, just picked this up on the telegraph site: http://www.telegraph.co.uk/money/main.jhtm...04/cndow104.xml

Investment bank Bear Stearns precipitated one of the worst market slumps of the year yesterday after admitting that the US credit markets were the worst it had seen in more than two decades.

The Dow closed 280 points lower at 13,182

The Dow Jones Industrial Average had been trading just a shade lower when chief financial offer Sam Molinaro compared the current crisis on Wall Street to the 1987 stock market collapse, the Asian debt crisis of the 1990s, the collapse of hedge fund Long Term Capital Management and the recent dotcom bubble.

"These times are pretty significant," he said on a call with investors. "I've been out here for 22 years, and this is as bad as I've seen it in the fixed-income markets."

His comments were a response to Standard & Poor's, which downgraded the rating on Bear Stearns debt to "negative" from "stable", suggesting it may lose its A+ rating. The investment bank is the manager of two hedge funds heavily invested in sub-prime loans that collapsed last month and S&P said its "profitability would be especially affected if there were an extended downturn in those markets."

The Dow immediately plummeted, closing 280 points lower at 13,182.

[eric pebble]

Hell yes, just picked this up on the telegraph site: http://www.telegraph.co.uk/money/main.jhtm...04/cndow104.xml

Very good blog by Evan Davies: I think he is spot on -- the BOE cut in interest rate in August 2005 was a terrible mistake. It sent out the WRONG message at a crucial point. I like this response below the blog: Really good stuff this!

http://www.bbc.co.uk/blogs/thereporters/ev...t_decision.html

[At 06:54 AM on 06 Jun 2007, Paul wrote:]

"I agree completely with your analysis. The problem appears to be that the MPC seems has no sense of urgency when house prices are going up at double-digit rates, but then panics as soon as prices slow or even fall a little. I personally did not agree with the rate reduction when it was made in 2005, for exactly the reasons you state - it sent a message to those that were over-extending themselves that the MPC would not allow house prices to fall.

The only way to quell the irrational exuberance is for the MPC to make absolutely clear that property is not a one way bet and can go down as well as up, and that if it does fall, the MPC may not be able to reduce rates to prop the market up again. Much of the buying, even at the present ridiculous prices, is driven by naive investors who believe it can go only one way, and helped by plenty of economists who insist that in the absense of a recession, mass unemployment or interest rates of 15%, there cannot be a crash.

To expose such a view as a fallacy, one need only look across the pond to the USA, where historically low rates and low unemployment is doing nothing to avert a collapse in house prices that looks like it could last years. And where the US economy goes, the UK is normally not more than a year or two behind..."

[DrBob]

Farm infected with foot-and-mouth

http://news.bbc.co.uk/2/hi/uk_news/england/6930684.stm

http://news.bbc.co.uk/2/hi/uk_news/england/6930684.stm' rel="external nofollow">

Last Updated: Saturday, 4 August 2007, 00:56 GMT 01:56 UK

Cattle at a farm in Surrey have been found to be infected with foot-and-mouth disease. Some 60 animals on the farm near Guildford have tested positive for the disease which wreaked havoc in 2001. A 3km protection zone has been put in place around the premises and a UK ban imposed on movement of all livestock.

The outbreak in 2001 led to between 6.5 million and 10 million animals being destroyed and cost as much as £8.5bn. Many farms and other rural businesses were ruined. National Farmers' Union President Peter Kendall said of the latest incident: "This is a matter of grave concern. We have an industry still depressed from low prices. We have to ensure this is a small isolated incident. We are working with the government to ensure the right steps are taken."

Yes, it definitely is a Black Saturday.

[Realistbear]

When they come to write about the events of 2007 we shall look back to this time and ask why oh why didn't we see it coming. Some of us will respond to that question by saying that we believed in an economic miracle that would allow us to live a life of wealth and happiness based on ever rising house prices which in turn gave us the ability to turn our homes into ATM machines to buy all the things we want without ever having to worry about "debt." In the miracle economy a new paradigm was created when Gordon Hamish Brown stood on the steps of No. 11 Downing street and declared the end of the bust side of the business cycle. The sheeple cheered and rushed to their local EAs to buy properties by the score. Affordability was a redundant term in the new paradigm, the banks were not worreid because the boom meant house prices would only ever go up.

Then came the great credit bust of 2007. The boom had petered out and the inevitable downside to the cycle had arrived. Gordon had lied to the people that there would be no more bust.

[Wad]

The only way to quell the irrational exuberance is for the MPC to make absolutely clear that property is not a one way bet and can go down as well as up, and that if it does fall, the MPC may not be able to reduce rates to prop the market up again. Much of the buying, even at the present ridiculous prices, is driven by naive investors who believe it can go only one way, and helped by plenty of economists who insist that in the absense of a recession, mass unemployment or interest rates of 15%, there cannot be a crash.

Good quote. I think that this arguement about whether or not Fed/BoE shoudl bail out the housing market is surfacing quite frequently among policy makers. It is a purely political one. The problem is that if no rescue is organised the slump could go too far. There is a point at whoch a rescue has to be organised if deflation sets in and mass defaults start to occur. There is a real danger here that central banks continue to hold rates too high for too long and then the downturn overshoots and turns into something really nasty.

Me and the wife have been discussing this a lot over the last 24 hours and we came to the conclusion that Bush has to release oil from the Strategic Petroleum Reserve (SPR) to get oil prices down. That is a purely political decision but could be done in coordination with an orderly reduction in interest rates by the Fed when the falling oil orices begins to tip inflation rate down. Releasing oil from the SPR also brings in cash to the Government and reduces its need to issue T Bills and that reduces the pressure on interest rates a little as well. The Fed could pressage an interest rate reduction by telling everyone what the plan is well before they put it nto action.

A coordinated response like this would not be seen as a bail out as it would come on the back of falling inflation.

That said I feel as bearish as I have ever done since 1987.

[brush2805]

Foot and Mouth doom and gloom has taken over.

[@contradevian]

Despite popular belief Ilkley is in the UK and in the 21st Century in case you were wondering

Regards

SB

23rd century house prices though

[Dosser]

Good quote. I think that this arguement about whether or not Fed/BoE shoudl bail out the housing market is surfacing quite frequently among policy makers.

I don't know if this point has been raised before: could Merv's admission that he would like to see housing included in the inflation measures, not be bear food as has been claimed? Rather Merv knows that housing is about to go flat and fall, thereby supporting actions to cut rates and further prop up the market and as unsustainable as it is in the long run stop a correction returning the market back to its long run equilibirum.

Hence Merv's actions are more bull than bear, and at the risk of sounding like a conspiracy fruitcake; satisfy the wants of Mr Brown and Co.?

[Guest Shedfish]

I don't know if this point has been raised before: could Merv's admission that he would like to see housing included in the inflation measures, not be bear food as has been claimed? Rather Merv knows that housing is about to go flat and fall, thereby supporting actions to cut rates and further prop up the market and as unsustainable as it is in the long run stop a correction returning the market back to its long run equilibirum.

Hence Merv's actions are more bull than bear, and at the risk of sounding like a conspiracy fruitcake; satisfy the wants of Mr Brown and Co.?

i think that's a distinct possibility

it's either that or the MPC have been asleep at the wheel

(both are equally likely)

[refusnik]

Hell yes, just picked this up on the telegraph site: http://www.telegraph.co.uk/money/main.jhtm...04/cndow104.xml

"This is only time in world history when people were able to buy houses with no money down."