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gruffydd

Buy-to-let Is Uk's Bubble; Northern Rock Its Needle

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http://investing.reuters.co.uk/news/articl...MN-BUYTOLET.xml

"The banks have been lending to amateur people who are investing on the basis that house prices will only ever rise," said Dominic White, an economist at ABN AMRO in London.

"The Northern Rock has been at the forefront of these aggressive lending standards and now you have reached a situation where you have cut them out of the market. That kind of tightening of lending standards will become self-fulfilling."

Edited by gruffydd

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thats ok though, cos we can bail them out with our hard earned taxes.

i mean, no one like to see a greedy btl and a greedy bank lose money or sleep.

please gordon - take my contributions to them. they fully deserve it.

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Three years is apparently long term for these tossers.

Where were the warnings before?

http://www.digitallook.com/news/312595/Bro...thern_Rock.html

House broker ABN Amro reiterated its “buy” recommendation on Northern Rock citing its solid platform for the medium to long-term, while Merrill Lynch also reiterated its “buy” advice.

Edited by OnlyMe

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

``There is clearly a regulatory failure, not just in the U.K. but around the world as well,'' Willem Buiter, a former Bank of England policy maker now at the London School of Economics, said in an interview. ``The fact that banks have such needs at the moment is because the banks have played the field with such reckless abandon in the past few years. The chickens are coming home to roost.''

;)

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``There is clearly a regulatory failure, not just in the U.K. but around the world as well,'' Willem Buiter, a former Bank of England policy maker now at the London School of Economics, said in an interview. ``The fact that banks have such needs at the moment is because the banks have played the field with such reckless abandon in the past few years. The chickens are coming home to roost.''

Should have kept the old bankers on, most have said the same thing.

In fact we'd have been better off digging up the dead ones, sticking the rates at historcal levels and leaving them forever more or pegged to the rise in money supply. The dead ones would be utterly unswayed by panic, political influence or the personal desire to micromanage the economy and keep everybody supplied in monetary happy pills.

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Three years is apparently long term for these tossers.

Where were the warnings before?

http://www.digitallook.com/news/312595/Bro...thern_Rock.html

House broker ABN Amro reiterated its “buy” recommendation on Northern Rock citing its solid platform for the medium to long-term, while Merrill Lynch also reiterated its “buy” advice.

:D

Still 3 years is a long time in investments. I wonder how much NR did go up in that time.

I remember being told what a great buy Polly Peck were because if you invested 1000 pounds in 1980 you would be a millionaire.

This struck me as fatuous even before they collapsed.

For a start, once my 1k had doubled I would have cashed in.

Also, 1000 pounds was a lot of money in 1980, who would have had access to that and more to the point who would have known? It's a bit like saying around the same time, that microsoft looks good.

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http://money.cnn.com/news/newsfeeds/articl...13-19699951.htm

The ratings agency affirmed the 'A-1' short-term rating and lowered Northern Rock's Tier 1 and upper Tier 2 perpetual subordinated instrument ratings to 'BB' from 'BBB+'.

S&P also lowered the Tier 2 dated subordinated debt rating to 'BBB' from 'A-'.

The ratings agency said it has incorporated the reasonable probability of a takeover into the ratings.

'Since it will be extremely difficult for Northern Rock to rebuild its franchise, we expect that it will effectively begin to wind down in an orderly manner if it is not acquired in the near future,' S&P credit analyst Richard Barnes said.

Northern Rock hedge fund going to take down the BTL's with them ?

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In fact we'd have been better off digging up the dead ones, sticking the rates at historcal levels and leaving them forever more or pegged to the rise in money supply. The dead ones would be utterly unswayed by panic, political influence or the personal desire to micromanage the economy and keep everybody supplied in monetary happy pills.

Now that is a plan. Brilliant. :lol:

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http://money.cnn.com/news/newsfeeds/articl...13-19699951.htm

Northern Rock hedge fund going to take down the BTL's with them ?

I'm know I'm being thick, but I thought the idea of a hedge fund was to be errr.. hedged.

I perhaps misunderstand what a hedge fund actually is though. NR just borrowed short, and lended long?

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I'm know I'm being thick, but I thought the idea of a hedge fund was to be errr.. hedged.

I perhaps misunderstand what a hedge fund actually is though. NR just borrowed short, and lended long?

Not hedged, leveraged up to the nuts.

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http://investing.reuters.co.uk/news/articl...MN-BUYTOLET.xml

"The banks have been lending to amateur people who are investing on the basis that house prices will only ever rise," said Dominic White, an economist at ABN AMRO in London.

"The Northern Rock has been at the forefront of these aggressive lending standards and now you have reached a situation where you have cut them out of the market. That kind of tightening of lending standards will become self-fulfilling."

Well there still pedling their gear , someone better give them a call to remind them their business model doesn't work any more ............

http://www.northernrock.co.uk/mortgages/landlords.asp

Edited by grey shark

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Well there still pedling their gear , someone better give them a call to remind them their business model doesn't work any more ............

http://www.northernrock.co.uk/mortgages/landlords.asp

I just tried their mortgage calculator...it would give me nearly 4 X earnings.

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I just tried their mortgage calculator...it would give me nearly 4 X earnings.

Yep, I can get 6x on their calculator. Right then, I'm off to put an offer in on those pokey new flats with paper-thin walls that they're building on the dodgy part of town. That can be my pension, donchya know.

Edited by Paddles

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