Jump to content
House Price Crash Forum
Sign in to follow this  
sambino

Bear Stearns Takeover Threatens Uk Investors And Homeowners

Recommended Posts

http://business.timesonline.co.uk/tol/busi...icle3568037.ece

Consumers in the UK are being warned to brace themselves for more bad news following the cut-price take-over of the US investment bank Bear Stearns.

America's fifth-largest bank has been sold to rival JP Morgan Chase at a knockdown price of $2 a share, valuing it at $236m (£117m). Last week it was worth $140bn.

The bank has become the biggest casualty of the global credit crunch, sparking fears that the crisis is far from over.

Share prices around the world plummeted today on the news and the dollar fell to a fresh low, while gold and oil prices shot up. Oil spiked overnight to more than $111 a barrel, while gold shot up $23 to $1022.70 an ounce.

The news also hit Asian markets, with Hong Kong's Hang Seng down 5 per cent and Japan's Nikkei 225 index off 3.7 per cent.

Jason Hollands of F&C investments said: “Investors are wondering how much more of this there will be. Most are too nervous to say if they have reached the bottom. Whenever they think they’ve passed the worst effects of the credit crunch, something like this happens.”

F&C predicts a poor ISA season for independent financial advisors.

Share prices have already factored in some of the impact of the credit crunch resulting in some good value deals.

London's biggest fallers were the major banks feared to be most heavily exposed to the credit crunch.

Halifax Bank of Scotland plunged more than 11 per cent, followed by Royal Bank of Scotland which was down 7 per cent. Alliance & Leicester and Barclays also fell 6 per cent and 5 per cent respectively.

Just two companies, British Energy and Royal Dutch Shell, remained in positive territory.

The fall of Bear Stearns is also likely to impact on the UK mortgage market. As banks find it harder to raise money, it is likely that higher rates of interest will be imposed on loans.

However, savers could benefit as banks will want to attract their deposits to fund the rest of their business.

Mr Hollands says it will be increasingly difficult for first time buyers and those coming to the end of a fixed term deal. “Those who stretched themselves a couple of years ago, may not be able to remortgage as banks tighten their lending criteria,” he said.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 297 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.