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Togo Joe

Bradford & Bingley Boast

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B&B have boasted that they have secured funding into the sunset and are therefore immune to the systemic failure of the credit markets.

Maybe rain, maybe so. It doesn't matter. Why ? Because the downfall of Northern Rock (NR) was due to systemic failure whereas prolonged systemic failure will turn into real losses. NR's loans haven't gone wrong, only the financing structures. Although some of the systemic failure (reluctance to lend) is due to an assessment that some loans will go wrong, they haven't yet. So the real stuff has still to hit the fan - when the loans themselves go wrong. NR's loans would have gone wrong and so will B&B's. And so will many others. B&B may survive systemic failure, though I doubt it, they won't survive real losses.

There is no such thing as sub-prime lending. There is a reason, why, historically, it has always been conducted by ten-foot gorillas wielding baseball bats.

The democracy of unlimited credit is about as bonkers as democracy in .... (ADD COUNTRY OF CHOICE)

Togo Joe

The man who lost his YoYo

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