Friday, September 14, 2007
David Buik sums the Northern Rock crisis up nicely!
'Northern Rock Dug Its Own Grave'
Northern Rock's financial problems are due to its exposure to sub-prime lending - giving money to people with "pretty doubtful" credit ratings - finance house BGC International's David Buik told Sky. The City expert said the firm had "dug its own grave".
Posted by Webmaster @ 11:17 AM (2171 views)
5 thoughts on “David Buik sums the Northern Rock crisis up nicely!”
Add a comment
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
lvmreader says:
Hang on a second – the problem here stems from bad credit ratings applied to the CDO packages and general ABS (MBS, CDO, CLO, CBO) mullarkey.
We have a Credit Rating Agency Oligopoly and this needs to end. There is a great scandal here in the opposite sense to what Mike Milken was villified for.
The scandal here is to do with busted models being applied to bundles of loans to assess risk. The same applies for so-called creditworthy people. Anyone with a 6x multiple is not creditworthy to AAA+ levels. This all needs to be looked at again. We need a better way to assess risk and one where more than a handful of players are allowed to set risk for everyone.
confused76 says:
“giving money to people with “pretty doubtful” credit ratings” … and so inflating house prices. Forget the demand, the supply and the migrants! It is a good thing if NR goes under! They deserve that!
One thing for sure… Northern, Barclays, Kensington,etc: FORGET CITY BONUSES THIS YEAR!!
lvmreader says:
Senior Quant Analyst – Synthetic Credit Derivatives, £500,000 per year.
http://www.millarassociates.com/requirement.php?id=723
http://www.millarassociates.com/requirements.php?type=all&zone=11
Scott says:
The age of the celebrity lifestyle is over.
crash bandicoot says:
I’m with Ivmreader, it’s the valuing of subprime debt at AAA levels that started this. Do the rating agencies have any interest in selling CDO’s etc. Surely these things should be disclosed or there is a big potential for a conflict of interest.