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House of Lords

Bye Bye Northern Rock

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Rams in Australia can't find secondary financing...oh dear for any companies who work the same way...anywhere!

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Aug. 16 (Bloomberg) -- Australia's Rams Home Loans Group Ltd. failed to refinance A$6.17 billion ($5 billion) of short-term U.S. loans forcing the lender to seek emergency funding.

The Sydney-based company slumped as much as 59 percent on the Australian Stock Exchange. The shares fell to 81 cents at 2:10 p.m. in Sydney, compared with A$2.50 paid by investors before the stock listed on July 27. Rams has lost two-thirds of its market value this week.

Rams's announcement helped trigger a 3.4 fall in Australia's benchmark stock index as investors fretted over a deepening credit crunch on widening losses linked to U.S. subprime loans. Countrywide Financial Corp., the biggest U.S. mortgage issuer, yesterday dropped the most since the 1987 stock-market crash after Merrill Lynch & Co. raised the possibility of bankruptcy.

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Rams in Australia can't find secondary financing...oh dear for any companies who work the same way...anywhere!

I have no idea what he title has to do with your post, but I'm going to chuckle about that all the way to work.

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I have no idea what he title has to do with your post, but I'm going to chuckle about that all the way to work.

I felt the need for some airport gags (undoubtedly in the top 10 funniest things ever)

http://www.geek-to-go.com/Airport.html

Edit: obviously for the benefit of all those NR employees that will need some cheering up

Edited by House of Lords

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I'd say Northern Rock is fooked. (See, I speak Northern!)

Most lenders have been batching up mortgages into CDOs and selling them to hedge funds, thus allowing them to lend far more than they have in deposits. NR has done this, but also raises a lot of the money it lends out for 25 years as 3 month loans at the LIBOR rate. During the course of a 25 yr mortgage NR will be re-financing it 100 times! If they ever can't get the money, or it costs them more than the rate they are charging then it's game over. Unfortunately for them short term money is getting rather expensive. Rock, hard place, etc.

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I shed an inward tear everytime I hear of another UK manufacter closing and think of all the skills and knowlege lost. Future wealth and prosperity evaporating perhaps never to return to our country.

A debt retailer like NR going out of business only affects its employees and investors, it makes no difference to our future national prosperity. How difficult is it to buy money wholesale and sell it retail?

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Look, even "triple chin" Declan mentioned that "the likes of Northern Rock", are in trouble, in BBC Breakfast this morning.

they are cooked.

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I get a panic attack every time I click on to the discussions forum with titles like that.On e reason I have paired my exposure to Northern Rock on my bond maturity instructions to the FSA limit of 35K .I will still have to sweat out that chaps transfer until the actual maturity date of 1 September.The American Home Loans bankruptcy has cast a shadow over every building society/recent demutualisation.It's bloody ridiculous if their number 10 high street lender can fold on negative HPI of less than 10%.

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Can I do a cgnao and claim I called it first before any of yous lot noticed? :lol:

Good call, House of Lords. One of the best things about this website is the volume of obscure bits of information posted by people who know what to look out for. It would be next to impossible for one individual to collect all this info. Thanks to you, H o L and to all those who trawl through various sources and post salient info for the rest of us to share.

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Good call, House of Lords. One of the best things about this website is the volume of obscure bits of information posted by people who know what to look out for. It would be next to impossible for one individual to collect all this info. Thanks to you, H o L and to all those who trawl through various sources and post salient info for the rest of us to share.

That's all well and good but I did I do anything about it to short them? Grrr :(

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