Monday, September 24, 2007

Northern Rock gained market share in part by taking risks

Northern Rock May Point to U.K. Crunch

The immediate danger for depositors of British mortgage lender Northern Rock may have passed, but the company's troubles highlight a greater threat ahead: the broader impact of the global credit crunch on the United Kingdom's housing market and the world's fifth-largest economy.

Posted by ash4781 @ 09:07 PM (762 views)
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4 thoughts on “Northern Rock gained market share in part by taking risks

  • “If U.K. home prices do keep falling, many homeowners may find themselves not only feeling poorer, but owing more on mortgages than their homes are worth. In that case, the U.K. economy — and the policy makers who oversee it — will face a much greater challenge than the liquidity troubles of one bank.”

    Gordon will fight the utmost to prevent a crash, rates will go down. Pound down 20% vs Euro and Dollar is a pretty safe bet at this point.

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  • “Pound down 20% vs Euro”

    Agreed.

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  • Dollar is way cheap at this point. US is exporting unemployment big time. not sustainable.

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  • ‘negative equity’, that’s a blast from the past… I think the China effect on the west’s inflation is definitely wearing off (Marks and Spencer is a prime example of this). GB has been grooming Africa as the next China (slave labor for the west) but I think his timing is off… He has failed to convince the rest of the G8 to follow through on their promises of ‘aid’, which would have gone a long way to getting the African nations up to speed as an area of economic development. A lot of you may think I am nuts for thinking this, but believe me it isn’t that far fetched… A vast percentage of the natural resources used in the manufacturing industry in China actually originate in Africa, the cost of these basic materials has gone through the roof, therefore leading to (in part) inflation in China and around the world. Of course one of the main drivers of inflation in China is caused by their own success. People are demanding more money so they can buy ‘stuff’ and for housing, cars etc. Also, their diets are changing and they are no longer content with a bowl of rice a day, they want McDonalds. The drought in Australia is yet to have an affect on inflation in China, but that will also add to the strain.

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