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Guest KingCharles1st

It Was Northern Rock

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Guest KingCharles1st

The official start of the crash will always be pinned on Northern Rock. As far as the media and the historians are concerned- this is the pivotal moment.

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unfortunatly your right. People do know it's not the case but NRK is so easy to remember they say "oh it was NRK" when challenged (this actually happened to me) they say oh yes yes you're right it was the US credit crunch. I don't bother to go into the lengthy lecture about easy credit swelling M4 and this is all the fault of the idiots that want it all NOW, rather than save and wait.

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It was down to greed, easy credit, banks that dint care who they lent to so long as they paid long enough for the debt to be parcelled up and sold on at massive profits.

It was down to idiots who thought rapidly rising house prices was a good thing. It was down to one upmanship and corruption; it was about lying on mortgage application and parading the new 4x4 in front of the neighbours....

It was down to rapid growth of money, the carry trade....

It was not down to the US subprime fall out and northern rock... yes they were up to it... but which major banks in the US and UK weren't?

rant over

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The official start of the crash will always be pinned on Northern Rock. As far as the media and the historians are concerned- this is the pivotal moment.

This could end up as a superstition like Actors calling MacBeth "The Scottish play".

All the VI's will be fearful of the memory and start referring to Northern Rock as "The Geordie Bank".

If anyone says the words "Northern Rock" the bankers and financiers will be chanting & tweaking each others noses just like in that Blackadder 3 episode:

"Hot potato. Orchestra stalls. Puck will make amends. Ohhh"

:lol::lol::lol:

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The official start of the crash will always be pinned on Northern Rock. As far as the media and the historians are concerned- this is the pivotal moment.

So you are saying that the crash has started – so if the BOE lower interest rates to keep the economy going and house prices rocket up again (Ireland model) and then crash years later – you are saying that people will say “it’s all northern rocks fault” –

Really shouldn’t you wait until the crash actually starts – best guess is that it would take 2 years for the crash to really start from this point – nobody would even remember NR that far away – the truth is that the crash will be blamed on investors (I.e. the BLT’ers)

this is the pillock moment

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Guest KingCharles1st
So you are saying that the crash has started – so if the BOE lower interest rates to keep the economy going and house prices rocket up again (Ireland model) and then crash years later – you are saying that people will say “it’s all northern rocks fault” –

Really shouldn’t you wait until the crash actually starts – best guess is that it would take 2 years for the crash to really start from this point – nobody would even remember NR that far away – the truth is that the crash will be blamed on investors (I.e. the BLT’ers)

this is the pillock moment

Ummmm... you are telling me the crash hasn't started.... o-k-.......

The crash has started in Earnest- its only the "don't need to sells who don't see this. however- there is a flip side. When I am seeing empty estate agents with less staff and the ones that are there with nothing to do .

Basically, M4 M3 M25 whatever- has little resting place with the average public, THEY will see the turning point as Northern Rock- god- it was drummed into them for a week by the media- usually it would take two weeks granted.

People can't swell to absorb any more debt...

Edited by KingCharles1st

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Ummmm... you are telling me the crash hasn't started.... o-k-.......

The crash has started in Earnest- its only the "don't need to sells who don't see this. however- there is a flip side. When I am seeing empty estate agents with less staff and the ones that are there with nothing to do .

Basically, M4 M3 M25 whatever- has little resting place with the average public, THEY will see the turning point as Northern Rock- god- it was drummed into them for a week by the media- usually it would take two weeks granted.

People can't swell to absorb any more debt...

we saw all the above 3 years ago when interest rates started to go up - prices actually dropped and HPI YOY nearly got to 0% - I believe at the moment HPI YOY is about 10% ish - hardly a HPC - we will need 6 months of negative HPI before YOY will start to go negative - this all seems very unlikely when interest rates are still very cheap - employment is good - economy still ticking along fine - when one of those changes maybe we will have a trigger - but NR is so unimportant in crash terms

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All the VI's will be fearful of the memory and start referring to Northern Rock as "The Geordie Bank".

I reckon it'll destroy confidence in financial institutions in the regions, London's the proper place to do stupid things with money.

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lol just heard virgin might be attempting to buy NRK with a middle east consortium. When l think about the quality of Virgin Media l get the impression that Branson has become just another shonky bastid rather than any kind of moral business man once portrayed.

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lol just heard virgin might be attempting to buy NRK with a middle east consortium. When l think about the quality of Virgin Media l get the impression that Branson has become just another shonky bastid rather than any kind of moral business man once portrayed.

Lots of people are rumoured to be looking at buying NRK - but, it seems, once they see the accounts they loose interest pretty quickly. :-)

Anyone have an idea about the status of the interest from Cerberus?

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lol just heard virgin might be attempting to buy NRK with a middle east consortium. When l think about the quality of Virgin Media l get the impression that Branson has become just another shonky bastid rather than any kind of moral business man once portrayed.

helping by lending cheap money to the masses sounds like something virgin could be proud of - I don't really see what is wrong with that principle - just lending to people who can not afford it is the problem

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lol just heard virgin might be attempting to buy NRK with a middle east consortium. When l think about the quality of Virgin Media l get the impression that Branson has become just another shonky bastid rather than any kind of moral business man once portrayed.

003branson3SPL_468x702.jpg

Slight chafe there Ricky? :lol:

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It is also an easy way for Virgin Finance to get some free publicity whether they are really interested or not.

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we saw all the above 3 years ago when interest rates started to go up - prices actually dropped and HPI YOY nearly got to 0% - I believe at the moment HPI YOY is about 10% ish - hardly a HPC - we will need 6 months of negative HPI before YOY will start to go negative - this all seems very unlikely when interest rates are still very cheap - employment is good - economy still ticking along fine - when one of those changes maybe we will have a trigger - but NR is so unimportant in crash terms

Interest rates appear cheap except if you have a sub-prime which isn't governed by interest rates hikes/drops these can do what they want. Some sub-prime interest rate are 11%. Even if the BOE drop interest rates it doesn't mean the banks will now. Employment is good ????? just walk into any jobcentreplus at present and watch out for financial and building layoffs these are good parameters for Recession. Yes we were told the economy was in good shape during the last crash even when were in it, isn't there a banking crisis on at the moment both the UK and USA are not sure what effect this is going to have on the economy yet. And isn't our economy based on us spending in the High Street ?????

The interest rate 15% spin. Don't forget interest rates were historically high in the 80s with 8%-10% being classed as average interest rtaes though on 40K properties with 20k a year earnings not bad. Yes they peeked briefly at 15% but remember they dropped to 6% very quickly the lowest in decades and property still fell even sharply.

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helping by lending cheap money to the masses sounds like something virgin could be proud of - I don't really see what is wrong with that principle - just lending to people who can not afford it is the problem

Only a couple of weeks ago, I was offered £ 10000 up front on my credit card at 0% interest for a whole year by Virgin when I rang them up to cancel it.I was almost tempted to take it & stick it in a savings account ;)

I think the Rock's business model would sit nicely with that of Virgin's as both are based on irresponsible lending..

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Interest rates appear cheap except if you have a sub-prime which isn't governed by interest rates hikes/drops these can do what they want. Some sub-prime interest rate are 11%. Even if the BOE drop interest rates it doesn't mean the banks will now. Employment is good ????? just walk into any jobcentreplus at present and watch out for financial and building layoffs these are good parameters for Recession. Yes we were told the economy was in good shape during the last crash even when were in it, isn't there a banking crisis on at the moment both the UK and USA are not sure what effect this is going to have on the economy yet. And isn't our economy based on us spending in the High Street ?????

The interest rate 15% spin. Don't forget interest rates were historically high in the 80s with 8%-10% being classed as average interest rtaes though on 40K properties with 20k a year earnings not bad. Yes they peeked briefly at 15% but remember they dropped to 6% very quickly the lowest in decades and property still fell even sharply.

Beats me why you claim to be a bear if you actually believe what you write.

I'm in west Suffolk and there is no way on earth that annual HPI is remotely close to 10%. Interest rates may still be low by historical standards, but repayments most certainly are not - and that's what counts. Employment may be 'good' but wages are slowly falling in real terms, especially in the rural eastern counties where jobs in city finance are non-existant. Economy still ticking along fine - well I'm not so sure anymore.

Granted, the HPC hasn't truly got going yet, but the tanker has now turned and is starting to move in the opposite direction.

I claim to be a bear - but a long term bear - 3 years ago I STR'ed but realized I had made a mistake - 6 months ago I bought a house again - well within my means - I have a mortgage of £25000 - so that I can afford the bad times when they come.

There are going to be places that have lower HPI - but the crash won't start until people see HPI negative and the panic starts - so my definition of crash starting would be panic selling - like the lines of people outside NR

Borrowing is cheap - while HPI is positive you can not make a better investment - you borrow and pay back at 6% - inflation is running at 2-4% (although some here will say 10%) - so if HPI is positive at 10% that means that the bank is paying you 4% to have a mortgage - if HPI was to go negative - inflation will soon make the borrowed money seem a lot smaller than it seems now (sorry I know this is very rough - just don't have the time to type it all out correctly or accurately- hopefully you can see my point)

I personally bought just before the last crash - yes I lost money - waiting would have been better - but not for to long - end of the day my bad investment trebled in 15 years - still don't know if that's a bad investment -just could have made a better investment

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Only a couple of weeks ago, I was offered £ 10000 up front on my credit card at 0% interest for a whole year by Virgin when I rang them up to cancel it.I was almost tempted to take it & stick it in a savings account ;)

I think the Rock's business model would sit nicely with that of Virgin's as both are based on irresponsible lending..

if you had some balls you would have bought £10000 in NR shares last week - and made a mint - my brother has been investing free from cards for years - if I had no money to lose I would get as many cards as possible - a huge mortgage and risk it all - you can ether win big or lose very small - good odds -

basically it's not irresponsible if you can afford it

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Please can you tell me what happened on 09/08/07?

I never was that good at history, and I don't keep a diary. :-)

A few hedge funds collapsed, and suddenly everyone got wary about the bad debt in all those securities that were being traded (i.e. sub prime).

Then the whole merry-go-round stopped, dead. The credit crunch had then started.

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The dominoes are all lined up

Your 2 year introductory rates comes to end

Your repayments go up

You slap it on your credit card

Your company downsizes due to the downturn but your mortgage is still being paid by Payment Protection Plan

Give it a few months...

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if you had some balls you would have bought £10000 in NR shares last week - and made a mint - my brother has been investing free from cards for years - if I had no money to lose I would get as many cards as possible - a huge mortgage and risk it all - you can ether win big or lose very small - good odds -

basically it's not irresponsible if you can afford it

Its easy to be wise in hindsight but no one in their right mind would have gone & bought 10000 worth of NR shares last week (infact I`m gobsmacked people are still buying it). I suppose I could have put it in savings but the current eco climate has made me really debt averse..

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A few hedge funds collapsed, and suddenly everyone got wary about the bad debt in all those securities that were being traded (i.e. sub prime).

Then the whole merry-go-round stopped, dead. The credit crunch had then started.

OK, so this is what kicked off the credit crunch in the US - the Bear Stearns thing?

What I am unclear about is how this directly affects the UK - I understand that it makes Commercial Paper and Asset Backed Securities (such as securitized mortgage debt) very difficult to value - and hence upsets the stability of hedge funds internationally... I understand that this is significant because fund managers have been investing in debts using leverage (in order to ensure their fund performs) and that this has kept the risk of defaults and bad debt hidden for quite some time... but, has this problem actually emerged yet in the UK? I'm not suggesting it isn't an accident waiting for a date to happen, but is it possible that the collapse of hedge funds in Sterling markets could be delayed indefinitely?

NRK seems to be far more relevant in the UK - I can only imagine that this will lead to tighter control of lending - which, in turn will affect sentiment with respect to the property market.

How credible is it to suggest that a meaningful proportion of hedge fund activity will cease in the UK? How precarious are the positions of hedge funds who hold Sterling debt as an asset? Which are the most at-risk funds? Is the problem in Britain all tied up in pension funds - hence allowing problems to be buried for a considerable time before anyone is forced to admit to problems?

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