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A.steve

Weekend Ft

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I don't usually venture to read old-media, but this weekend I did... "FT Weekend edition" and two ideas stood out:

Front page story:

Potential for coordinated action by the Fed,ECB and BoE to buy up mortgage backed securities en-masse. The Fed are for it; the ECB are against it - and the BoE... well, that's very ambiguous. Mervyn King is alleged to be for it, but against central bank interventions which would favour "any particular asset class". This all seems very odd, to me... it seems obvious that if you accept mortgages at the central bank - then you support houses to the exclusion of other assets. I mean, the central bank can't lend against share certificates - can they? I suspect that this article is coloured by the authors' wishes... it seems to be over-optimistic (if optimism correlates with larger economic numbers.)

http://www.ft.com/cms/s/a233faa2-f789-11dc...com%2Fhome%2Fuk

Page 2:

Amazing story about the FSA... allegedly, when polled, 30% of the staff said that they intended to resign/leave. Things really are bad at the FSA... I wonder what is next to come out of the woodwork.

http://www.ft.com/cms/s/97b11682-f7b1-11dc...dse%3D%26dsz%3D

(I apologise if you have to register to read... Dead tree has its advantages sometimes.)

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This buying up of the MBS shite that the markets simply don't want defies belief and IMHO is the most dangerous and scandalous element of this crisis. If 'IT' can't function in the markets then why buy it? :blink: It's a new twist on being the bank of last resort, it's quite simply the BoE/Treasury acting as a bucket shop to bury all the toxic loan waste. Repulsive behaviour

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This buying up of the MBS shite that the markets simply don't want defies belief and IMHO is the most dangerous and scandalous element of this crisis. If 'IT' can't function in the markets then why buy it? :blink: It's a new twist on being the bank of last resort, it's quite simply the BoE/Treasury acting as a bucket shop to bury all the toxic loan waste. Repulsive behaviour

My instinct is similar.

I can believe that the Fed want to do this - I understand that their crisis is more advanced than ours, and I further guess that state side confidence in mortgage lending will under-shoot fair-valuation. I can see this being a big economic problem in a country where people aspire to commission new houses rather than buy existing ones.

I can understand why the ECB wants nothing to do with it... most Euro countries don't have the same economic dependency on mortgage money.

I can't even grasp what the BoE position is... if one looks at the article itself, the position is self-contradictory. Then, again, while the BoE loudly proclaims "no bailout" it has already lent against asset-backed securities as well as credit card debt... I strongly suspect that we've been desperately too little information to make any informed analysis.

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I can believe that the Fed want to do this

In the old days, heavy industry was the controling height of the economy.

as long as goverment held onto heavy industry they where secure. so they thought

after WW2, a shif happened. Goverments no longer needed to hold onto heavy industry.

there was a new controling height. one far more powerfull than the old heavy industries

and that was, the currency itself. Banks!

while the goverment has control of the currency (central bank) and control of money supply (commercial banks via law and the central bank) they have ultimate power.

without this controling height, goverments can not fund unjust wars, they can not funnel moeny into their friends large companies, they can not buy things we dont want or need.

so they will NOT let the currency, or the banks drop unless they absolutly have too

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In the old days, heavy industry was the controling height of the economy.

as long as goverment held onto heavy industry they where secure. so they thought

after WW2, a shif happened. Goverments no longer needed to hold onto heavy industry.

there was a new controling height. one far more powerfull than the old heavy industries

and that was, the currency itself. Banks!

while the goverment has control of the currency (central bank) and control of money supply (commercial banks via law and the central bank) they have ultimate power.

without this controling height, goverments can not fund unjust wars, they can not funnel moeny into their friends large companies, they can not buy things we dont want or need.

so they will NOT let the currency, or the banks drop unless they absolutly have too

The banks have thrived on consumers as the relatively 'new units of production' - debt slaves. They (the consumers) are for the forseeable future of no use as they are maxed out, as is the system. The system itself cannot bail itself out, only monetary and fiscal juggling by central banks and governments can stem the tide. What is appaling IMHO is that even now no questions are being asked in the mainstream media re. where this is headed. Already a clever form of misdirection has taken place whereby joe public appears to believe that 'they' are doing the right thing in order to 'save us', when in reality joe public will be smashed by these events for decades to come. He'll plod on, shrug shoulders, pay bills, moan about prices meanwhile the masters of the downfall will lose perhaps 25-35% of their nominal wealth: "Heh, I was once worth 150mil now only 100mil, trebles all round on my Sunseeker Manhattan" :angry:

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  • 294 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%



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