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Nothern Rock: A L L Deposits Now 100% Guaranteed

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

Oct. 9 (Bloomberg) -- Northern Rock Plc, the U.K. mortgage lender bailed out last month by the Bank of England, said the government will now guarantee all customer deposits until financial markets become less volatile.

Previous guarantees on deposits arranged jointly by the Bank of England, the U.K. Treasury and Financial Services Authority have been extended to customers who deposited money after Sept. 19, the Newcastle, England-based bank said in a statement today.

That's it. I go short Sterling as much as I legally can.

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They've also now probably shot themselves in the foot as far as finding a buyer for NR is concerned. Anyone interested in buying won't take long to conclude if that Darling feels the need to guarantee a 100% bailout, NR could not stay afloat otherwise.

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Last Trade: 210.00 p

Trade Time: 9:49AM

Change: 37.50 (21.74%)

Prev Close: 172.50

Open: 178.00

Bid: 209.00

Ask: 209.75

1y Target Est: 440.36p

The dead cat's been on the Viagra?

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Guest DissipatedYouthIsValuable
Last Trade: 210.00 p

Trade Time: 9:49AM

Change: 37.50 (21.74%)

Prev Close: 172.50

Open: 178.00

Bid: 209.00

Ask: 209.75

1y Target Est: 440.36p

The dead cat's been on the Viagra?

Cialis. Far too long a duration of action and far to many rebounds to be viagra.

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What has caused Darling to extend this guarantee to new depositors all of a sudden?

Is he expecting something to happen which, if it were not extended, would cause new depositors (I'm amazed there have been any) to want their cash out?

He is manipulating the share price upwards using taxpayer guarantees for some reason. Very suspect imo.

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Would love to know who's buying NR at the moment. The guarantee seems to me a like a prelude to packing it in, or an imminent breakup with the loan book sold on, and the rest of it dismantled. After all, Drongo doesn't need to keep it going until after an Autumn election now.

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Yep, I think it was NR, or another bank going belly up that was the real reason for cancelling the snap election...

The poll results were a real gift in giving Brown an 'out' that excuses him from what is to come. He could honestly say that he wasn't scared of facing Cameron in a snap election while crossing his fingers behind his back that no journalist asked whether the continuing financial crisis might be the real reason he was 'bottling' it.

These people are so teflon coated it amazes me.

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I read that NR are paying 50 million for the privilege.

Seems like a small price. I reckon all the other dodgy banks would happily pay 50 million to insure their 40bn (insert correct figure here) deposits. :angry:

Edit: didgy should be dodgy

Edited by bobthe~

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I would love to see NR hiking rates to attract more deposits now that they're 100% insured. The ultimate thing would be all other banks getting a run since NR would then offer the highest 100% guaranteed IR in the UK. :lol:

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What has caused Darling to extend this guarantee to new depositors all of a sudden?

Is he expecting something to happen which, if it were not extended, would cause new depositors (I'm amazed there have been any) to want their cash out?

He is manipulating the share price upwards using taxpayer guarantees for some reason. Very suspect imo.

I'd give dollars to doughnuts that the BoE is giving hand outs to the other high street banks via NR.

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They've also now probably shot themselves in the foot as far as finding a buyer for NR is concerned. Anyone interested in buying won't take long to conclude if that Darling feels the need to guarantee a 100% bailout, NR could not stay afloat otherwise.

havent they just had a rumour of a backing offer from america's city bank for 20 billion ?

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government will now guarantee all customer deposits until financial markets become less volatile

Clear cut then...who decides when the markets become less volatile, will they give me suffienct warning so I can then withdraw my funds from the Northern Rock...ideally I'd like seven days notice!

How many more U-turns? Clutching at straws or what?

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Wonder how much of a bank run there will be on HBOS after people read this:

http://money.uk.msn.com/investing/articles...umentid=6351303

The FSA has for years allowed banks and other financial institutions to amalgamate their various subsidiaries for the purposes of the compensation scheme. In the case of HBOS, for example, the public company that owns Halifax, Bank of Scotland, Birmingham Midshires and underwrites the AA's savings products, this means that there is only one compensation scheme limit per saver with all those companies.

In other words, if you had £35,000 in an account with each of the above banks and building societies (some £140,000) you will only have £35,000 guaranteed 100%.

Yet the FSA does not even require companies to make it clear they are part of a larger group for compensation purposes. And it hasn't made this restriction on compensation clear to savers

Bloody hell, this should be repeatedly shouted from every tree top in the land!

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Bloody hell, this should be repeatedly shouted from every tree top in the land!

Jeezus fin h chirst on a bike. The tone on here is that the government isn't doing enough?

HAVE YOU PEOPLE NO IDEA what is going to happen to the value of sterling when the government finally has to 'make good' on all these outrageous promises?

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If the govt guarantees the value of the money in NR, essentially making risk-free deposits, wouldn't the value of sterling rise as the world and his wife ploughed their money into it? ....Or am I missing something subtle?

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HAVE YOU PEOPLE NO IDEA what is going to happen to the value of sterling when the government finally has to 'make good' on all these outrageous promises?

Yes. It will be ADIOS MUCHACHOS time for Sterling.

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Jeezus fin h chirst on a bike. The tone on here is that the government isn't doing enough?

HAVE YOU PEOPLE NO IDEA what is going to happen to the value of sterling when the government finally has to 'make good' on all these outrageous promises?

You will be on your knees begging for Sterling to be replaced by the Euro. The elected officials will be hailed as saviours for making the switch to "protect" british citizens from the nasty Forex speculators.

Mission accomplished.

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Interesting anecdote to add to the mixing pot - my mother in law was talking to someone on the phone at Northern Rock HQ. She asked how many people who had taken their money out had reinvested in NR (you can get these questions under the radar when you're 84). The answer was only a quarter.

Perhaps this is a factor in the decision to extend the 100% guarantee to new investments - the previous guarantee didn't bring back enough cash?

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