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ralphmalph

Gordon Brown To Reignite Hpi - 90billion Injections

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The Treasury is preparing a radical rescue plan for the housing market which may involve pumping billions of pounds into the stricken mortgage markets.

http://www.telegraph.co.uk/money/main.jhtm...7/cnplan127.xml

Ramifications?

Anyone still holding Sterling? Get rid!

Edit: Link repair. Thanks Durch!

Edited by dom

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That link's not working very well for me.

If any such plan comes to pass (which I doubt, given the cost) then it will be an outrage.

Taxing FTBers twice, once through tax, secondly through currency depreciation, to increase the price of their single largest expense!

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That link's not working very well for me.

If any such plan comes to pass (which I doubt, given the cost) then it will be an outrage.

Taxing FTBers twice, once through tax, secondly through currency depreciation, to increase the price of their single largest expense!

Nothing will be said as usual. Not enough people understand the monetary system to even have an opinion. That includes FTBs.

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Link doesn't work.

I'm not paying any more tax if they bail out the mortgage industry. I'll declare UDI. Who will join me in the struggle for an independent Democratic Republic of Islington?

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'One plan being studied by ministers includes an ambitious scheme that would effectively bail out the slumping new home loans market with an injection of £90 billion. The "Special Liquidity Scheme" under which lenders are able to "swap" existing mortgages with the Bank of England for government bonds, releasing cash, could be extended to new mortgages under the controversial proposals.'

Look, I do not pretend to be an academic...but could any HPCer possibly translate the above into anything other than total nonsense?

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From the article:

It will also ensure that the loans are only accepted with a major "haircut" and on such terms that they will only be at risk if house prices plunge by unprecedented and entirely unanticipated rates.

This is all you need to read to be sure that house prices are going to plunge by unprecedented and entirely unanticipated rates.

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The madness of King, George (in reverse order) continues.

Bail out the fat cats, get the public to pay and support Gordon's already lost election run up.

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It will also ensure that the loans are only accepted with a major "haircut" and on such terms that they will only be at risk if house prices plunge by unprecedented and entirely unanticipated rates.

And how the ****** is that supposed to result in a flood of new lending?

This would apply to new mortgages, right?

So which lender is going to want to issue a new mortgage for the enticing reward of swapping it for gilts at a major haircut?

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The madness of King, George (in reverse order) continues.

Bail out the fat cats, get the public to pay and support Gordon's already lost election run up.

Yeah, but their delusion is so great at present that they believe they won't have to raise taxes at all. They think they can simply borrow the money instead.

Should be fun watching long term interest rates if they actually try this crap. November 1932 redux.

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Should be fun watching long term interest rates if they actually try this crap. November 1932 redux.

That sounds like a generally more financially savvy version of what I was thinking.

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and there was I thinking Brown couldnt get much worse. What a fool I am.

If Brown does inject the mortgage system with more cash it wont work, all that will happen is that more and more debt is piled on to 'the hard working families' as he puts it.

He really clutching at straws now.

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'One plan being studied by ministers includes an ambitious scheme that would effectively bail out the slumping new home loans market with an injection of £90 billion. The "Special Liquidity Scheme" under which lenders are able to "swap" existing mortgages with the Bank of England for government bonds, releasing cash, could be extended to new mortgages under the controversial proposals.'

Look, I do not pretend to be an academic...but could any HPCer possibly translate the above into anything other than total nonsense?

Gov/BOE will swap mortgages for gilts or other AAA rated stuff.

i think the catch is that this trade is done on a temp basis, the gilts/bonds will have to be given back in return for the rubbish mortgages. this in theory will stop the losses with banks pushing them into the future. so whereas if a bank needs to write down 50bil today it goes bankrupt via this method it might be able to do it over 10 years and survive.

haven't read the article but if it is a permanent swap then expect hyperinflation in a few years.

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if i where him

pay off all mortgages under £500k taking that debt onto gov books to be paid for by a renters tax just to piss you all off ;)

oh, i would do this on the condition of being voted in for the next election.

Edited by cells

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and there was I thinking Brown couldnt get much worse. What a fool I am.

If Brown does inject the mortgage system with more cash it wont work, all that will happen is that more and more debt is piled on to 'the hard working families' as he puts it.

He really clutching at straws now.

He'll be clutching at Miliband's before long too.

Edited by mirage

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He'll be clutching at Miliband's before long too.

I'll never be able to look Drongo without thinking "reacharound" again. The pain just gets worse!

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Even if Brown were mad enough to give the banks the money, would they be mad enough to invest it in property? They can see the US situation still unravelling after all. How much of the 50 billion already given has found it's way into the mortgage market?

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The problem Gordon has is that he cant throw money at the problem and that is the only thing the socialist Ba$tard knows.

If he increases taxes he is fooked.

if he borrows more to fund things then mid/long term debt goes up (which means 5+ year mortgages go up) which means house prices & stocks go down more!

he could potentially cut wasteful spending but they don't call themselves socialists for nothing so this is unlikely.

There is NOTHING he can do, NOTHING.*

so now gordons #1 aim in life is to truly, ultimately, fook up the country in the hope that it will mean the conservatives cant pull us out of the poo enough to get re-elected.

*he could high-inflate but that would take longer than the 18-24months he has.

Edited by cells

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If they pile in more money, its the end, 20 years down the line this country is broke.

I just dont understand how they dont understand about global economic trade intergration, wages in this country can't cope are all levels now, taxes too high, rentals too high, homes too high. Seems labour et al have lost control like so many governments around the world, there dream of economic growth is flawed in so many ways.

If they go ahead with this then ill have no option but to buy more gold.

Can't they see that many more people can't afford homes, saving is out for many and when they retire the cost to this government is going to be huge.

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  • 399 Brexit, House prices and Summer 2020

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      • down 5% +
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