March 2009 Archive

Monday, March 30, 2009

Wonder when Britain will be downgraded?

The first of many I hope

Timesonline: FSA secures first jail term for insider dealing

Insider dealing solicitor caught out, surely there must be many city types who are very worried now.

Posted by tim miller @ 04:53 PM 2 Comments

What people are still buying in the recession

U.S. News via Yahoo: 10 Winners in the Recession

No 1 home gardening vegetable seeds. Others include Rsum Editing, condoms, At-Home Coffee Brews...

Posted by mountain goat @ 04:05 PM 0 Comments

Some good charts showing prices have to fall because of loan to incomes

Lovemoney: Why prices have further to fall

A good article confirming that loan to income ratios is what has brought property prices in real terms down 50% already. At peak according to HBOS/ Halifax loan to income ratios were just below 6x , the Council of Mortgage lenders have confirmed the average now is 3x's, prices are going to have to fall 50% because lending is not going to go back up as this article confirms. Property prices are not going to go back up to 2007 levels for two decades and then only in line with wages.

Posted by sybil13 @ 03:43 PM 8 Comments

Do you think they need a loan until the sale is complete??

BBC News: Government to sell nuclear assets

The government has announced that it is putting the commercial arm of the UK's Atomic Energy Agency, UKAEA Limited, up for sale.

Posted by watchman @ 03:38 PM 2 Comments

Big News - Hpc Cancelled!!!!

MSN: 19% leap in mortgage approvals

The feel good bulls are out the cage and fighting back - You have got to have rocks in your head to buy a house now. Unless you get a bargain!!

Posted by waitingfor hpc @ 03:14 PM 15 Comments

Your tax dollars at work

BBC: Council to offer 100% mortgages

Dundee City Council is set to become the first local authority in Scotland to offer 100% mortgages to tenants looking to buy their council home. The authority believes it will help first-time buyers get on the property ladder and boost the local economy. But critics accused the council of giving money to people who have already rejected by high street banks as too risky Dundee Council stated that several councils in England had already started offering mortgages or were considering it "with a view to getting the housing market moving again, stopping the crash in house prices and helping bring the economic recession to a swifter end".

Posted by little professor @ 02:47 PM 13 Comments

Does this sound like bad news?

FT: GM and Chrysler denied extra funds

The Obama administration refused on Sunday night to give fresh bail-out money to General Motors and Chrysler, telling the carmakers to come up with new plans or risk insolvency.

Posted by watchman @ 12:55 PM 3 Comments

A one per cent write down? It's a start, I suppose.

Metro: Bradford and Bingley writes off 500m in bad mortgages

Nationalised lender Bradford & Bingley said today that it was writing off more than 500 million in mortgage loans turned sour. B&B is taking the charge of 507.7 million to reflect estimated arrears at the end of 2008 and the impact of further house price falls ahead. The hit compares with a 22.5 million provision for the previous year. The firm said 4.6% of its 41 billion mortgage book was three months or more in arrears, or repossessed.

Posted by mark wadsworth @ 12:52 PM 4 Comments

Hidden on bbc website, spanish banks in the doodoo

Bbc: Spain bank bail-out hits shares

The Bank of Spain is to take over Caja Castilla la Mancha in the first bank bail-out in Spain since the global financial crisis began.

Posted by mark @ 11:08 AM 9 Comments

Lagging but relatively complete HP index down 2% for Feb; 16.5% YoY

Land Registry: House Price Index February 2009

The February data shows a continued decline in annual house price change, with a movement of -16.5 per cent. This is now the eighteenth month in a row in which the annual rate of house price change has fallen. The data shows a monthly change of -2.0 per cent, bringing the average property price in England and Wales down to 153,862. These price levels were last seen in September 2004. Sales volumes in England and Wales remain low in comparison to last year's levels. The average number of recorded property transactions per month was 38,830 between September and December 2008. In the same period the year before, sales volumes averaged 95,679.

Posted by 51ck-6-51x @ 10:42 AM 11 Comments

Feb: Home purchases up; Remortgaging down

Bank Of England: Lending to individuals: February 2009

The increase in net lending secured on dwellings (1.5 billion) was higher than the January increase and the previous six-month average. The number of loans approved for house purchase (37,937) was higher than in January and the previous six-month average. Approvals for remortgaging (32,633) and for other purposes (31,372) were lower than in January and the previous six-month averages. *** Home purchases back to the level of Jun 08 (peak was Sep '06 @ 126K)

Posted by 51ck-6-51x @ 10:35 AM 11 Comments

A timely warning

Independent: Simon Carr: How to save? Go deep into the red

Be responsible. Rebuild your balance sheet and pay off as much debt as you can. Be a sucker. Because when we look into the past, we can see how they're going to get out of this mess in the future. They're going to increase public debt massively, then they'll print money to service it and use inflation to run the debt down. So what we want is enormous debts ourselves that inflation will degrade over the next decade. That's how Alistair Darling is recommending we do it. True, he isn't putting it quite in those terms, but his meaning is perfectly clear to those of a sceptical bent.

Posted by quiet guy @ 07:48 AM 23 Comments

G20: Any chance of consensus?

The Times: Germans wreck global new deal

GORDON BROWNS carefully laid plans for a G20 deal on worldwide tax cuts have been scuppered by an eve-of-summit ambush by European leaders. Angela Merkel, the German chancellor, last night led the assault on the prime ministers global new deal for a $2 trillion-plus fiscal stimulus to end the recession. I will not let anyone tell me that we must spend more money, she said. Merkels criticism drew an angry response from Labour MPs. Denis MacShane, the former Europe minister, said: Who does Mrs Merkel think is going to buy Mercedes and BMWs if she . . . says putting demand into the economy is a bad thing? Another Labour MP said: One has to ask who had something to gain from the leak of the communiqu. This feels like a dirty trick.

Posted by devo @ 07:24 AM 6 Comments

Instruments of government policy

Wall Street Journal: New Task Seen for Fannie, Freddie

The regulator of Fannie Mae and Freddie Mac is considering giving the government-backed mortgage companies another role: helping to finance small mortgage banks. A spokeswoman for the regulator, the Federal Housing Finance Agency, said it is looking at ways that the two companies might help revive the market for so-called warehouse loans, which are loans made to mortgage banks. This possible role for Fannie and Freddie is the latest sign of how they are being used increasingly as instruments of government policy rather than corporations focused on shareholder returns.

Posted by devo @ 07:06 AM 0 Comments

Not all governments are as foolish as ours

Telegraph: Russia backs return to Gold Standard to solve financial crisis

Russia has become the first major country to call for a partial restoration of the Gold Standard to uphold discipline in the world financial system. Arkady Dvorkevich, the Kremlin's chief economic adviser, said Russia would favour the inclusion of gold bullion in the basket-weighting of a new world currency based on Special Drawing Rights issued by the International Monetary Fund. Chinese and Russian leaders both plan to open debate on an SDR-based reserve currency as an alternative to the US dollar at the G20 summit in London this week, although the world may not yet be ready for such a radical proposal. Mr Dvorkevich said it was "logical" that the new currency should include the rouble and the yuan, adding that "we could also think about more effective use of gold in this system".

Posted by drewster @ 03:21 AM 4 Comments

This is how the party ends

Wall Street Journal: Inflation Is Tempting for Indebted Nations

Barack Obama and Gordon Brown seek to lead the world into battle against the financial crisis, putting up trillions of dollars to revive their economies and bail out banks, posing a troubling question. As the countries' debt burdens mount to levels not seen in decades, they'll face a growing temptation to allow inflation to accelerate more than they typically would -- a move that would slash the value of their debts, as the prices of everything else rose. That could cause a lot of pain for all kinds of investors, from UK and US pensioners to large holders of US treasury debt such as China. "It would be epic, it would be terrible, but it's probably easier than outright defaulting," says Ken Rogoff, former head of the IMF.

Posted by little professor @ 01:26 AM 13 Comments

Hometrack: -0.3%MoM, -10.3% YoY

Reuters: House prices fall at record annual rate in March

Today's pointless EA survey of the day, courtesy of Hometrack, shows that house prices are down 'only' 10.3% YoY. Hometrack has persistently reported lower price falls than Haliwide and even the Land Registry. The more important Nationwide figures should be out later today

Posted by little professor @ 12:52 AM 4 Comments

Sunday, March 29, 2009

UK's Biggest Scammer set to Lose Knighthood

The Heral: Campaign to shred Sir Fred of knighthood gathers pace

But will he lose his multi million pound bonus with the UK's current Inverse Meritocracy Policy ?

Posted by timware @ 10:30 PM 0 Comments

David Smith's latest article is a bit meh

Times: Building on past mistakes

People may dispute whether these are genuine green shoots, but something is stirring in the mortgage numbers. The British Bankers Association reported that monthly mortgage approvals rose to 28,000 last month - down "only" 31% from last year. Let us suppose this is the beginning of a gradual recovery in demand. Will the supply be there? The main source of property to buy that is, homeowners putting their flats and houses on the market is also well down, with sellers taking the view they are unlikely to get a decent price. What about new housing? This year will see the lowest number of homes built since the second world war.

Posted by little professor @ 08:42 PM 1 Comments

Tesco to shortly offer current accounts with Mortgages to follow!

Wall Street Journal: Tesco To Open Bank Branches In 30 Stores By Year-End

Tesco plans to open 30 in-store Banks by the end of 2009 with TESCO current accounts being offered within the next 2 years followed by TESCO mortgages some time thereafter.

Posted by enuii @ 08:24 PM 4 Comments

More bad news for property 'investors'

Property Week: UK developers ready to take defaulting property investors to court

Developers in the UK are drawing up contingency plans to deal with an expected increase in real estate investors defaulting on payments for off plan properties including taking them to court. Developers are worried that investors who put down deposits on properties a year or more ago will either discover they can't find a mortgage to cover the balance, or will be prepared to lose their deposits rather than put themselves straight into negative equity. Builders are also looking at lobbying the Government to make up the shortfall for first time buyers.

Posted by little professor @ 06:19 PM 2 Comments

Pay at the END of 25 years

Mortgages News: Failed mortgage applications to attract charges

This article mentions that rare but crucial fact that all debts added to mortgage loans are only paid off at the END of the term. So you can find out the real price should this charge be paid now as long as you know the real interest rate (as in ignore inflation). If the real interest rate is 1%, then the equivalent you would have to pay the bank now is 28% more. For a real interest rate of 2%, that is 64% more. If you have a mortgage additional borrowing is very very expensive. (!) The banks are a bit sneaky here with charge for mortgage refusals...can you imagine if that catches on. Charging people who ask to buy something !

Posted by stillthinking @ 03:01 PM 1 Comments

Outrageous advice

The Independent: A little help from your friends: the door opens for first-time buyers

Yet another awful example of the press encouraging "the generation who know no better" to throw away their financial futures! They should be educating them, not shafting them!

Posted by wdbeast @ 12:33 PM 5 Comments

Brown Rumbled by New York Times

NY Times: Anglo-American Capitalism on Trial

This article picks up on Brown's sneaky tendency to praise America to the skies when in Washington and then turn around and tell us 'this all started in America' when he's back home. "Still, Mr. Brown may not have strengthened Washingtons confidence in him as a partner with his habit of tailoring his remarks to popular predilections on opposite sides of the Atlantic."

Posted by an bearin bui @ 12:31 PM 1 Comments

Yet another blow for pensions

Guardian: Pensions blow for those soon to retire

Quantitative easing has been "a disaster" for pensions because it has pushed up the price of gilts - so private pensions are about 10% lower. Lucky MP's are on final salary schemes.

Posted by cyril @ 11:22 AM 4 Comments

G20 - Stabalise the world or bust

Daily Telegraph: Only a united front at the London G20 can save the world from ruin

Another article from the Telegraphs economist Ambrose Evans Pritchard drawing analogies with how the world failed to act at the start of the Great Depression and what will happen if they fail to act now. It would be interesting to get some reasoned, non political argument as to what impact this event will have on UK house prices if one of the following three scenarios happen: a. An agreement is reached for coordinated action and reflation of all economies (deficit and surplus). Which we know could lead to worldwide inflation and house price losses will be less in actual terms than in real terms. b. The usual promises are made with no substance (as before). c.Blatant divisions emerge that cannot be healed: Thus becoming the turning point of real protectionism.

Posted by britishblue @ 11:13 AM 14 Comments

Monetary growth drives the housing bubble

UK bubble: Do you think there might be a connection?

A neat chart linking UK housing prices with the growth of the money supply. The relationship looks uncannily close.

Posted by inflationwatch @ 09:37 AM 7 Comments

Stock markets forwards and upwards

Investment Postcards: Investment Postcards from Cape Town: Words from the (investment) wise for the week that was (March 23 29, 2009)

Following Fed Chairman Ben Bernankes money printing announcement of last week, the action stayed on Capitol Hill with Treasury Secretary Timothy Geithner detailing his Public Private Investment Program (PPIP) as well the initial salvo on new rules of the game for the USs broken system of financial regulation. In reaction to the Obama administrations plan, global stock markets extended their gains and the US dollar reclaimed a stronger footing, but government bonds suffered from indigestion on issuance worries and the haven appeal of commodities waned. Read all about this and the implications for financial markets in the weekly Words from the Wise review.

Posted by prieur du plessis @ 09:33 AM 0 Comments

A lesson about trust

Washed It! blog: New Home Sales Fell 41% in February 2009

Interesting anti-MSM analysis of US market: "The parade of the mathematically innumerate business writers continue to misread data. The latest evidence? New Home Sales. After incorrectly reporting the Existing Home Sales, the mainstream media misread the Census department report of New Homes. No, New Home Sales data did not improve. In fact, they were not only not positive, they were actually horrific. The year over year number was a terrible down 41%. Sales from this same period a year ago have nearly been halved."

Posted by quiet guy @ 12:35 AM 1 Comments

Saturday, March 28, 2009

Public sector wages still playing catch up!

The Times: British pay falls first time in eight years.

Weekly pay for those working in the private sector declined by 3.4 per cent to 448, though public sector staff saw their wage increase by 3.4 per cent to 441 a week.

Posted by cheekie charlie @ 08:28 PM 4 Comments

South park take on the economy! It tickled me!

Southpark studios: They took 'er economy

The people of South Park talk about the dark economic times.

Posted by happy mondays @ 07:58 PM 4 Comments

Dunfermline Building Society on the Rocks

BBC: Forced sale of building society

Scotland's largest building society is to be put on the market by the government after it effectively collapsed. The building society's exposure to risky assets, loss more than 9m in its own IT business and the purchase of mortgage securities from two troubled American finance houses, GMAC and a subsidiary of Lehman Brothers have led to it's demise.

Posted by enuii @ 07:03 PM 0 Comments

Buyers pay much higher interest rates if insufficient downpayment

FT: Hidden charges hit UK home buyers

Buyers not able to make a downpayment of 25% are being charged interest rates ranging from 13-17 per cent on the amount they borrow above 75 per cent of houses value.

Posted by mountain goat @ 01:52 PM 6 Comments

King and the Brezhnev-era Apparatchik


Mr King's comments have put him on a collision course with prime minister Gordon Brown who last night insisted the Great Money Forest of Hampshire would soon be in bloom, promising a bumper harvest of ripe, crisp tenners.

Posted by sovietuk @ 12:40 PM 0 Comments

Oh, if only this were true...


I don't know what sort of stupid game they are playing. Is this part of some stupid plan to stampede people into buying now and/or taking out longer term fixed rate mortgages? Our government has spent the last two years desperately trying to prop up property prices by fair means or foul (and there's no reason to assume that the Tories will be any different) so allowing the 'totally independent' MPC to up interest rates just ain't going to happen. I suppose they might just flip back to using RPI instead of CPI inflation or something.

Posted by mark wadsworth @ 12:27 PM 12 Comments

Beckett will soon be saying if we are lucky the market might bottom at 50%

Daily Mirror: Property prices could fall further, according to Housing Minister Margaret Beckett

In the face of the Land Registry figures showing 23% falls since peak, and the Council of Mortgage lenders confirming average loan to income is now 3x's (50% drop from peak), the paper said: But the senior minister warned: "Any politician who said we have hit the bottom of the market would be insane. Everybody is saying things are very difficult."

Posted by sybil13 @ 11:23 AM 4 Comments

Buy to let deal son upswing - but at what price?

Financial Times: Buy to let deals on the upswing

Interesting article. Suggest serious investors are buying up to 150 1/2 bedroom new build flats at a time for up to 50% discount off 2007 prices. However,although this may feed through to official figures in terms of units sold it won't have any effect on the Nationwide and Halifax price indexes as these block purchase won't be paid with mortgage loans. Therefore in reality all three major indices are now under-reporting the drop in house prices, because the third, the Land Registry doesn't record repossessions. However, this may just have the effect of dragging out the reported falls over a number more years,, because if you are unlucky enough to have purchased a flat in 2007 in a block where they are selling for 50% discount no surveyor is going to value up when you come to sell.

Posted by britishblue @ 10:47 AM 9 Comments

Is the Crisis Good for America?

Time: The End of Excess

Do we start on the cusp of a new world? Or do we just go through 10 years of downtime only to have the whole cycle start again? The UK is like american but without the self confidence in its consumerism and without the dollar.

Posted by ketha @ 08:18 AM 0 Comments

The man who broke the Bank

The Times: George Soros, the man who broke the Bank, sees a global meltdown

This recession, he explains, is a once-in-a-lifetime event, particularly in Britain. This is a crisis unlike any other. Its a total collapse of the financial system with tremendous implications for everyday life. On previous occasions when you had a crisis that was threatening the system the authorities intervened and did whatever was necessary to protect the system. This time they failed.

Posted by devo @ 01:19 AM 1 Comments

Friday, March 27, 2009

Plan to add zero to all bank note denominations

Financial Times: New notes chime chorus of protest

Rest of the issue very interesting too

Posted by inflation is eating my savings @ 11:22 PM 3 Comments

Not 'may' but 'will'........

Times: George Soros: Britain may have to seek IMF rescue

We all know Gordon Brown - with the help of others - has effectively wrecked the UK economy and that the UK will definitely need to go cap in hand to the IMF.....

Posted by hpwatcher @ 11:07 PM 7 Comments

I'm starting to feel embarrassed for him now. Just kidding.

Timesonline: Chile leader to Brown - we saved in the good times

Gordon Brown was embarrassed for the second time in as many days on his tour of South America today as his Chilean host explained how the country was able to protect is economy because it had saved cash in case of a downturn.

Posted by flintster1994 @ 10:21 PM 4 Comments

And the wolves will dwell with the lamb

The Telegraph: Wall Street backs Barack Obama's toxic assets plan

Leading Wall Street bankers pledged to support President Barack Obama's plans to revive and restructure the financial sector as he attempted to smooth over a fraught fortnight in which members of the industry have become public enemy No 1. Jamie Dimon, chairman of JP Morgan, one of the first to arrive for the lunchtime meeting, said that "everyone in the room came from a point of doing what is right for the United States of America, not their company."

Posted by devo @ 09:23 PM 7 Comments

Geithner too afraid to bite the bullet; Depression develops apace

The Hill: Geithner unwilling to ban credit default swaps

Treasury Secretary Tim Geithner said that he likely will not ban one of the key financial instruments that led to the collapse of AIG and a number of other institutions. Geithner said it would be too difficult to distinguish under the law what is a legitimate business risk versus what constitutes a major gamble.

Posted by devo @ 08:52 PM 1 Comments

The historian knows best!

Telegraph: Mortgages top of Brown's new fiscal help plan

Gordon Brown is to push ahead with further stimulus measures to try and revive the economy, despite warnings from the Governor of the Bank of England.

Posted by flintster1994 @ 08:18 PM 7 Comments

Friday night posting - 'the chart'

Mises Blog: What goes on behind closed doors

Sorry but I couldn't resist this - a quick Friday night joke from Mises

Posted by quiet guy @ 07:54 PM 0 Comments

That should do it! Party's back on!

Telegraph: Europe fetches the monetary helicopters, at long last

Rejoice. After much pious posturing and criminal wastage of time the European Central Bank at last seems ready join the Anglo-Saxons, Japanese, Swiss, and Isrealis in printing money to fend off disaster.

Posted by flintster1994 @ 02:42 PM 4 Comments

This should scare the sh*te out of any recent buyers who bought on monthly affordability.

Telegraph: Interest rates could increase 'with vigour', warns chief economist

The Bank of England's chief economist has warned that policy-makers will hike interest rates back up with "vigour" when needed, to keep inflation in check.

Posted by flintster1994 @ 02:36 PM 15 Comments

At this rate the crash might only last another couple of years...

BBC News: House price decline accelerates

House prices are falling even faster than before in England and Wales, according to the Land Registry. Prices dropped by another 2% in February, pushing the annual rate of decline from 15.1% to 16.5%. It means the average property is now worth 153,862, down by 30,361 in the past year, which is back to the level last seen in September 2004. Prices have now fallen for 18 months in a row, dragged down by the impact of the recession and the mortgage drought. Don't bother going to the story - this is all it says.

Posted by timmy t @ 11:47 AM 4 Comments

We all knew this anyway!!!

Yahoo/sky news: UK Recession Deeper Than First Feared

putting the economy on track to contract by as much as 4% this year."

Posted by mark @ 11:44 AM 5 Comments

Still not enough......

Reuters: House prices fall 16.5 percent

LONDON (Reuters) - House prices in England and Wales fell 16.5 percent on the year in February, the Land Registry said on Friday.

Posted by mark @ 11:31 AM 19 Comments

Next they will blame the leaves, why not just be honest and say it is the depression

Yahoo: Easter and weather damage John Lewis sales

LONDON (ShareCast) - John Lewis blamed the fall of Easter last year and sunny weather for a big drop in sales at its department stores last week.

Posted by mark @ 11:27 AM 1 Comments

China and US to inflate their way out of the mess

Market Oracle: Investing in China and Dow 10,000

In short, the Euro region will get stuck with massive deflation as the U.S. and China try to inflate their way out of the global financial crisis, together

Posted by sold 2 rent 1 @ 11:10 AM 29 Comments

15 fold increase in the year to September 2009

Market Oracle: Fed Planning Inflationary Dollar Destroying 15-Fold Increase In US Monetary Base

This is a staggering devaluation of the US currency! It means that for every dollar in America in September 2008, the fed is going to create fourteen more of them!

Posted by sold 2 rent 1 @ 11:04 AM 14 Comments

UK GDP: 2008 +0.7%; 4Q -1.6%; 4Q YoY -2.0%

ONS: GDP Growth Economy contracts by 1.6% in Q4 2008

GDP contracted by 1.6 per cent in the fourth quarter of 2008, revised down from a contraction of 1.5 per cent. GDP in the fourth quarter of 2008 is now 2.0 per cent lower than the fourth quarter of 2007. For the year 2008 as a whole, GDP rose by 0.7 per cent, unrevised from the previous estimate and down from 3.0 per cent in the previous year. Output of the production industries fell 4.5 per cent compared with a fall of 1.8 per cent in the previous quarter, driven by the marked decline in manufacturing output. Construction output fell 4.9 per cent over the quarter, revised down from a fall of 1.1 per cent published in the previous estimate. This was due to survey data replacing a forecast. Output in the service industries fell 0.8 per cent in the fourth quarter, down from a fall of...

Posted by 51ck-6-51x @ 09:42 AM 1 Comments

Its someone else's fault.... Slur Gordon will be last man standing King Becomes Political Football in Deficit Spat With Brown

Bank of England Governor Mervyn King began testimony to lawmakers this week with a joke about football. As the week ends, he may have scored a goal for the opposition. Conservatives George Osborne and William Hague are seizing on Kings unprecedented warning that U.K. Prime Minister Gordon Brown doesnt have the room to drive up spending, while investors are using the remark to explain why a British bond auction failed for the first time in more than seven years. Kings rare commentary on fiscal policy is exposing him to the political spotlight he has sought to avoid since becoming central bank chief in 2003.

Posted by postle @ 08:02 AM 1 Comments

Roubini forcasts further 20% drop in the UK

International Business Times: Roubini on Home Buying its Better to Wait

Roubini advises US house buyers to wait before the buy a house as he sees another 20% drop in US house prices over the next 12-18 months. He argues that there has to be a significant improvement in the US economy before house prices stabilise. He questions why anyone would buy in this market instead of waiting as not only do they have to pay down a large deposit but this could get wiped out in the drop in prices.

Posted by britishblue @ 08:00 AM 13 Comments

BBC mentions tenants again

BBC: Tenants are 'recession victims'

"Campaigners are urging the government to help protect thousands of private tenants facing eviction as landlords increasingly fall into arrears." What's wrong with simply forcing the banks to honour the remainder of the tenant's contract. It's the only fair thing to do and it might actually make the banks think about thelending in the first place their lending criteria in the first place.

Posted by phdinbubbles @ 07:27 AM 7 Comments

Yes or no?

FT: Barclays stress test signals no new funds

The Financial Times has learnt that the Financial Services Authority will conclude its detailed trawl through the banks books in the next few days and it has indicated that Barclays does not need any fresh capital. However, there are some analysts who predict that Barclays might need a large dose of fresh capital to weather the downturn.

Posted by devo @ 07:12 AM 4 Comments

Thursday, March 26, 2009

The "royalty" again. Man do I have a bee in my bonnet tonight!

BBC News: PM and Palace 'discussed reform'

Gordon Brown and Buckingham Palace have discussed plans to change the rules of succession to the throne, including giving women equal rights.

Posted by flintster1994 @ 11:20 PM 5 Comments

Scary Gilts Issuance Graph

Burning Our Money: Gilt Strike

"Yesterday's failed auction of 40 year gilts underlined a few ghastly truths we may possibly have mentioned once or twice before. Let's start by asking whether you would be prepared to lend to the UK government? Right here and now. Today. In particular, would you lend the government money at a fixed interest rate of 4.25% for 40 years?" Now check the first graph. If this article is half correct then we are in big trouble.

Posted by quiet guy @ 10:23 PM 6 Comments

Youtube Hannan speech video blogged here first causes news sensation

Telegraph: For once, Gordon Brown had to sit and listen

Hannan video posted over 2 days ago on this newsblog becomes most watched video on youtube yesterday. In 24 hours, 380,000 people had watched a video before a word appeared on the BBC or in any newspaper. The days when political journalists got to decide what was news are over.

Posted by enuii @ 08:09 PM 21 Comments

Wow everyones a fraudster now SFO probes 56m alleged property fraud against AIB

The Serious Fraud Office is investigating a 56 million alleged property fraud against Allied Irish Banks (AIB) office in London. The alleged fraud concerns the purchase of a number of UK investment properties between 2003 and 2007 for which AIBs corporate banking department provided loans.

Posted by landedgentry @ 06:45 PM 0 Comments

More Cash Please Folks!

SKY: 'G20 Must Back 69bn Trade Rescue Fund'

Gordo says, "I'm going to ask the G20 summit next week to support a global expansion of trade finance of at least $100bn (69bn) to help revive trade in all parts of the world," he told a news conference after meeting Brazil's President

Posted by alan @ 06:17 PM 1 Comments

Annual Retail Sales Growth Slowest Since September 1995

ONS: Retail sales February 2009

Annual growth in total retail sales volume for February slowed, with falls between January and February in all sectors. The growth from February [2008] to February [2009] slowed to 0.4 per cent. There was a 1.9 per cent fall from January to February, where all sectors showed a fall in sales volumes. In the three months to February the seasonally adjusted index for the volume of retail sales increased 2.0 per cent over the previous three months. The three months to February compared with the same three months a year ago increased by 3.0 per cent. These increases are due to the strength in volume of retail sales in December and January.

Posted by 51ck-6-51x @ 04:11 PM 2 Comments

Warning that house prices may fall by 80%

Irish Times: News Article

Great bear bait from across the Irish sea.But then the Irish republic had the mother of all housing booms.....Ireland is a year longer into the housing crash, perhaps we can hope for such 80% reductions coming to the UK?

Posted by euopean-bear @ 02:49 PM 1 Comments

Prices are down in ireland


Irish house price falls accelerated in January. Average national house prices reduced by 1.4% in January of this year this compares to reductions in October (-0.8%), November (-0.5%) and December (-0.9%) last year according to the latest edition of the permanent tsb / ESRI House Price Index.

Posted by euopean-bear @ 02:43 PM 0 Comments

Economy shrank by 7.5% in the last three months of 2008

BBC: Record decline hits Irish economy

The construction industry, which has faced a housing market slump, suffered a 24% fall in output, the biggest fall on record.

Posted by alan @ 01:43 PM 0 Comments

Staines vs Draper on the Daily Politics

Staines vs Draper on the Daily Politics: Staines vs Draper on the Daily Politics

while we wait for iplayer Staines vs Draper on the Daily Politics

Posted by crown @ 01:24 PM 5 Comments

US T-bond market and the Armstrong turning point

Market Oracle: Eggertsson Theory, Armstrong, Timing and the Economic Confidence Model

Looking at the US T-bond market and the Armstrong turning point on 19 April.

Posted by sold 2 rent 1 @ 11:42 AM 7 Comments

Our old friend Kirsty in vintage form (clip from 0750 today)

BBC R4 Today Programme: Restrictions on second homes?

Kirsty defends her second and third homes, and her fantastic contribution to the local economy. Interests don't come much more vested than this...

Posted by sceneclub68 @ 11:24 AM 4 Comments

Stock Markets - keep an eye on confidence measures

Investment Postcards: Stock Markets - keep an eye on confidence measures

It is important that confidence be restored for the recent stock market gains to be more enduring. The relationship between stock prices and confidence measures is highlighted in this post.

Posted by prieur du plessis @ 10:47 AM 0 Comments

That's sweet music to my ears!

BBC: Tenants 'haggling' as rents fall

"The cost of renting a home has continued to fall as UK householders let out their homes in a bid to beat the recession. Two surveys suggest that there has been a surge in properties available to rent, pushing down costs for tenants... According to Globrix, the number of new rental properties coming onto the market rose from 98,841 in the final three months of 2008 to 155,499 in the first quarter of 2009 - 57% increase... The poll by said that in March the average property had been listed for 65 days before being filled by tenants, down five days on the previous month, but up 17 days compared with a year ago... But Zaza Patterson, lettings manager at Dreweatt Neate estate agents, said that some of the biggest reductions in rent have been four-bedroom homes"

Posted by mark wadsworth @ 10:32 AM 13 Comments

An earthquake in geo-finance?

Telegraph: US backing for world currency stuns markets

US Treasury Secretary Tim Geithner shocked global markets by revealing that Washington is "quite open" to Chinese proposals for the gradual development of a global reserve currency run by the International Monetary Fund.

Posted by peter_2008 @ 10:21 AM 16 Comments

Landmark building going under!

Times: Canary Wharf owner in danger of going bust

Morgan Stanley-backed consortium not looking very healthy. With commercial property prices predicted to fall 20% this year, I would say it's looking very grim.

Posted by tim miller @ 10:18 AM 0 Comments

Stimulation or not?

Times: Merv swerves curveball

Mervyn King warns we running out of cash and can't afford another fiscal stimulus. What's up? Merv, Alistair and GB not all singing from the same hymn sheet any more? One theory being talked about in Whitehall...

Posted by mountain goat @ 09:49 AM 1 Comments

A shift to local sourcing

Evening Standard: Sainsbury chiefs cheap veg pledge

I've been waiting for this to happen. A fall in the value of Sterling was bound to lead to an increase in the UK production of a wide variety of goods

Posted by flashman @ 09:07 AM 9 Comments

George Soros again profits from Financial Fools

Daily Mail: 'I'm having a very good crisis,' says Soros as hedge fund managers make billions off recession

A hedge fund manager who predicted the global credit crunch has said the financial crisis has been 'stimulating' and the culmination of his life's work. George Soros, who predicted the global financial crisis twice before, was one of the few people to anticipate and prepare for the current economic collapse. Mr Soros said his prediction meant he was better able to brace his Quantum investment fund against the gloabal storm. But other investors failed to take notice of his prediction and his decision to come out of retirement in 2007 to manage the fund made him $US2.9 billion.

Posted by postle @ 07:01 AM 0 Comments

Everything is not peachy

The Times: Queen invites Mervyn King, Bank of England Governor, to palace

In the midst of the economic crisis yesterday, when news about the nations finances dominated every news bulletin, the Queen did something she had never done before; she held an audience with the Governor of the Bank of England, at Buckingham Palace, for the first time since she came to the throne 57 years ago. For half an hour she and Mervyn King were in a room alone as they discussed the state of the economy. No one else was there: no advisers, no officials, no one to take notes of what was said. And no one not unless Mr King lets indiscretion get the better of him when he comes to write his memoirs will ever know what they said to each other.

Posted by quiet guy @ 01:09 AM 34 Comments

Wednesday, March 25, 2009

Brown is Blaming everybody except Himself....Cheeky Man

Daily Mail: Brown attacks 'avarice' of bankers as he puts big-spending Budget on hold

Gordon Brown attacked the behaviour of bankers today as he appeared to retreat from ordering a new giveaway Budget to stimulate the economy. Speaking in New York, the Prime Minister stressed that monetary policy and interest rates were just as important as tax cuts or higher spending. 'It is the combination of all these things that makes a difference,' he said. Mr Brown also criticised the 'avarice' of the financial sector and claimed bankers had acted outside the values everyday people try to uphold in their daily lives.

Posted by postle @ 08:39 PM 4 Comments

The Great dep Recession

Cnn: The Great Recession

Hembre said he is worried that the U.S. could be in a period of prolonged economic stagnation similar so the so-called lost-decade that Japan suffered starting in the 1990s. He said continued weakness in housing and high debt levels by households and governments could hold the economy back for some time. And some economists aren't completely ruling out another depression.

Posted by mark @ 07:39 PM 0 Comments

Yesterday's CPI numbers were bad; they are going to get worse

UK Bubble: Ten reasons why inflation will accelerate

"The prevailing reality is that the UK macroeconomic framework is a total mess. It is incoherent, irresponsible, and driven by short-term political expediency. Sooner or later, this toxic cocktail of confusion will feed into higher prices".

Posted by inflationwatch @ 05:20 PM 3 Comments

Resignation letter sent by an executive vice president of AIG FP

New York Times: Dear A.I.G., I Quit

DEAR Mr. Liddy, It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context: I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in or responsible for the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage. After 12 months of hard work dismantling the company during which A.I.G. reassured us many times we would be rewarded in March 2009...

Posted by 51ck-6-51x @ 04:31 PM 11 Comments

Currency is trashed, so buy a house!

Reuters: U.S. home sales climb at fastest pace in 10 months

"New orders for long-lasting U.S. made goods rose in February for the first time in seven months and new home sales rebounded, government reports showed on Wednesday, suggesting the economic downturn might be easing a bit". "Recent data, including retail sales and housing, have pointed to some signs of a slowdown in the pace of the economy's downturn. The U.S. economy slipped into recession in December 2007".

Posted by alan @ 04:07 PM 1 Comments

"What goes around"

Sky news: Sir Fred Attack: 'This Is Just The Start'

A group has claimed responsibility for attacking the home of former bank boss Sir Fred Goodwin and warned "this is just the beginning".

Posted by happy mondays @ 02:22 PM 26 Comments

Gilt auction fails

Debt management office (DMO): Gilt auction press release

For the first time for many years, a Gilt auction has failed to be fully covered. The sale of 1.75bn of 4.25% 2049 Gilts, though small compared to most auctions, was only 93% covered. Long dated gilt prices have fallen sharply today as a result. Is this the start of the flight from Gilts, and the rise of interest rates?

Posted by uncle tom @ 02:20 PM 5 Comments

Couldn't resist

The Spoof: Sir Fred Goodwin's Windows Smashed

** Entire article: ** The Edinburgh home of former Royal Bank of Scotland boss Sir Fred Goodwin has been damaged overnight. Windows of the house and Mercedes S600 car parked in the driveway were smashed. The police are appealing for witnesses or anyone who may know what happened. RBS Insurance Services said they were looking into a claim for the damage, but said they believed there was a 693000 excess on the policy.

Posted by 51ck-6-51x @ 02:08 PM 2 Comments

This has started to happen - like it or not !

Assetz: House Price Falls Show Early but Strong Signs of Softening

Examining UK house price data reveals a clear picture of the housing market has started to see signs of softening price falls.

Posted by foa4 @ 01:58 PM 10 Comments

One for the NWO-heads

FT Alphaville (again): Is a global super-currency on the cards?

It started out as a call from the likes of George Soros and Ted Truman. But the IMFs little known international accounting system of special drawing rights [SDRs] has now been propelled straight into the limelight thanks to both China and Russia. The Chinese and Russians are advocating the accounting system as a means towards a new global reserve currency. If inflation really is on its way on a large Volckerian scale, the dollar reserve system could be under serious pressure - from the point of view it would threaten Chinas and other surplus countries reserves to such a degree they would be forced to do something about it. Preparing a new alternative system based on SDRs therefore seems a logical contingency for them.

Posted by little professor @ 12:54 PM 22 Comments

Not as encouraging as the title suggests

FT Alphaville: Roubini sees ligjt at the end of the tunnel

Roubini thinks that the steps that have been taken thus far (and I know that many on hear abhor that any steps were taken at all) are not enough and unless US, Japan, China and EU pull together and take less reactive steps a full scale depression is on the cards. Incidentally great speech from Daniel Hannan.

Posted by bellwether @ 12:19 PM 5 Comments

Gilt auction today was not completely covered

FT Alphaville: Gilt auction failure begins

Wednesdays 1,750m auction of 4 per cent Treausury gilts dated 2049 failed, with a bid-to-cover ratio of 0.93. Thats the first UK conventional gilt auction failure since 1995 according to Dow Jones. So is this a sign of things to come? And is this why Bank of England governor Mervyn King was so concerned about further government spending on Tuesday?

Posted by mountain goat @ 12:09 PM 11 Comments

HSBC's3rd Strike

The Times: HSBC to cut 1,200 British jobs and close sites

HSBC is cutting 1,200 British jobs in the bank's third attempt at slashing its costs in the continuing financial services downturn. The redundancies, which are being announced to staff today, will affect all areas of the country, hitting staff in back office units that service HSBC's retail and small business customers. The layoffs announced today are in addition to 500 redundancies signalled in December and indicate the continuing pain being felt in the financial sector as high street banks struggle to bring costs down to match the reduced level of business activity. In September last year, HSBC took the axe to its global banking division with the loss 1,100 jobs worldwide, including 500 in the UK.

Posted by 51ck-6-51x @ 09:26 AM 0 Comments

Hit The Bottom? More Like Hit The Start Button

Telegraph: Housing market could have 'hit the bottom', mortgage figures suggest

I think either the Media is being controlled by someone with a large interest in housing or someone needs to be fired at the newspaper.............Harry Wallop House prices in most areas haven't even come down in price so by someone saysing they have hit the bottom they couldn' t be more wrong, it is another misleading article!

Posted by cman @ 08:33 AM 1 Comments

CPI really 4.6%?

Independent: Millions are caught in the inflation trap

The collapse in the value of the pound and a surprising rise in food prices has left inflation stubbornly high. CPI has risen from 3% to 3.2%. Indeed, had the Chancellor Alistair Darling not cut the rate of VAT from 17.5% to 15%, CPI would be standing at an uncomfortably high 4.6%, more than double the target of 2 per cent. The richest fifth of the population are enjoying the lowest rates of inflation, about minus 1 per cent; the items that have risen the most, such as food, represent only a fairly small proportion of their spending.Meanwhile the poorest fifth have seen their cost of living rise by nearly 6 per cent.

Posted by little professor @ 12:40 AM 8 Comments

Tuesday, March 24, 2009

Another one topples

Telegraph: Czech government forced from office

The Czech government has become the latest victim of the economic crisis after it was forced from office when it lost a confidence vote in the Prague parliament. His administration's collapse threatens to plunge Prague's EU presidency into chaos and will leave it rudderless ahead of the crucial G20 summit in London next week. Prime minister Mirek Topolanek's government is halfway through its six-month EU presidency. The latest government collapse, following the resignation this week of Hungary's prime minister, will increase concerns about growing political instability in eastern European countries which have been hit hard by the economic crisis.

Posted by little professor @ 11:27 PM 5 Comments

Stiglitz says 'No'

Telegraph: Geithner rescue package 'robbery of the American people'

The US government plan to free beleaguered banks of up to $1 trillion (690bn) of toxic assets will expose American taxpayers to too much risk, leading economist Joseph Stiglitz has cautioned. The Nobel Prize-winning economist, speaking a day after the Dow Jones Industrial Average rose by almost 7pc in support of the novel public-private partnership (PPIP), said that the plan is "very flawed" and "amounts to robbery of the American people." Professor Stiglitz on Tuesday led a list of well-known economists and high-profile industry figures who have said Treasury Secretary Tim Geithner's toxic asset plan may not be as successful as it first seems.

Posted by charlie brooker @ 11:03 PM 7 Comments

Perhaps justice WILL prevail in the end.

Reuters: Connecticut subpoenas AIG executives on bonuses

* 14 current and former AIG executives subpoenaed * Conn. top lawyer disputes Bernanke on state wage law * Blumenthal urges Fed chief to pursue lawsuit against AIG Connecticut authorities have subpoenaed 14 current and former executives of American International Group in an investigation over compensation and bonus practices. Connecticut's attorney general on Tuesday also disputed Federal Reserve Chairman Ben Bernanke's assertion that blocking AIG's controversial bonus payments would violate state law Blumenthal also criticized Bernanke for testifying in Congress that Connecticut's wage law posed a barrier to any lawsuit seeking to block AIG's bonus payments.

Posted by devo @ 09:52 PM 1 Comments

Trust, once destroyed, cannot so swiftly return

FT: Successful bank rescue still far away

Nobody can be confident that the US yet has a workable solution to its banking disaster. On the contrary, with the public enraged, Congress on the war-path, the president timid and a policy that depends on the governments ability to pour public money into undercapitalised institutions, the US is at an impasse. It is up to Barack Obama to find a way through. When he meets his group of 20 counterparts in London next week, he will be unable to state he has already done so. If this is not frightening, I do not know what is.

Posted by devo @ 08:58 PM 7 Comments

Daniel Hannan MEP slaps Gordon Brown

You Tube: Daniel Hannan MEP: The devalued Prime Minister of a devalued Government

Fantastic and devastating attack on Gordon Brown at the European Parliment.

Posted by hpwatcher @ 07:09 PM 39 Comments

Daniel Hannan

The Telegraph: Gordon Brown's toxic smirk betrays his guilt in bankrupting Britain

For anyone who has ever dreamed of being able to tell our rulers, to their faces, precisely what we think of them, Daniel Hannan's recently posted video of himself doing exactly that to Gordon Brown in the European Parliament is compulsive viewing. Unlike most experiences of watching our elected representatives confronting the occupying power that is New Labour, Hannan's speech leaves no opportunity for even the most hypercritical to claim "I could have done it better." None of us could.

Posted by devo @ 06:48 PM 2 Comments

How will the banks make money, going forward?

The Telegraph: UK mortgage lending at 1,200bn 'unmanageable', claims Cap Gemini banking report

Mortgage lending in the UK has reached "unmanageable" levels and must shrink as a proportion of national economic output if banks are to make home loans profitable again, a new report claims. According to the annual world retail banking report from Cap Gemini, Unicredit and EFMA, mortgage lending has "exceeded reasonable limits" with the volume of debt running at 86pc of GDP or about 1,200bn.

Posted by devo @ 06:34 PM 5 Comments

Making Up Your Own Reality - Private Equity Style

Reuters: Foxtons trading profitably, BC Partners says

Foxtons supposedly still profitable on tiny volumes whilst carrying 260m of debt. I really don't understand how that's possible. Of course, private equity can say what they like - it's private and not listed. "We do see a level of activity, particularly in prime London real estate -- we don't see prices falling there for example ... which is extraordinary," Sadly this VI has it wrong. He shouldn't care about trying to hold up prices, he should be trying to hold up volumes which will only happen if prices do fall

Posted by ontheotherhand @ 05:16 PM 3 Comments

(Britain cannot afford any further housing stimulus)

Guardian: Britain cannot afford any further fiscal stimulus, King warns

After a decade of mismanaging interest rates by ignoring the speculative boom in housing and then ignoring the subsequent rise in inflation from currency devaluation, you might be fooled into thinking that Mervyn King has Seen The Light with a statement like this. Unlikely. King refused to accept the Monetary Policy Committee's culpability in stoking the credit boom, and the primary function of the latest money printing exercise appears to be to buy government debt at a time when no-one else wants to touch it. And when you have a finger on the QE 'nuclear option' (which King has said they will continue to use), you don't actually need any other measures at all. As Hamlet says "My words fly up, my thoughts stay below. Words without thoughts, never to heaven go."

Posted by paul @ 04:53 PM 2 Comments


Bloomberg: U.K. Inflation Rate Unexpectedly Rose in February

Its a big surprise, said Stewart Robertson, an economist at Aviva Investors in London. Um, is it?!?

Posted by tyrellcorporation @ 11:04 AM 48 Comments

Does not compute!

BBC: Mortgage approvals signal change

If lending is increasing, but customer deposits have gone down slightly, where's all this extra money coming from? Oh ... I see.

Posted by mark wadsworth @ 10:55 AM 21 Comments

Gilts - don't buy them

MoneyWeek: Gilts - don't buy them

"Gilt prices have rallied strongly in recent weeks on confirmation of the Bank of England's decision to start quantitative easing. This process is a little too easy for my tastes. The UK Treasury issues bonds and the Bank of England buys them straight back. Problem solved! But there's only so much manipulation a market can bear."

Posted by damien @ 10:45 AM 0 Comments

The ETHICAL/Diverse economy is not far away

Market Oracle: Diverse Economy Comes After Communism and Capitalism

In 1991 communism failed. In 2008 capitalism failed us. In the space of 17 years, two great economic systems based upon very elaborate and self-convinced ideologies collapsed. Two great peoples, American and Russian, are stunned and wandering in a vacuous period of human history, in a great pause between ages. A third system is coming; it is not greedy capitalism, and it is not socialism or statism either. The next system is a diverse economy of diverse measures and performance goals, diverse social organization, diverse ownership, diverse firms, and a diverse market.

Posted by sold 2 rent 1 @ 10:18 AM 27 Comments

CPI: +3.2 YoY, RPI +0.0 YoY

ONS: Consumer price indices February 2009

In the year to February, the consumer prices index (CPI) rose by 3.2 per cent, up from 3.0 per cent in January. In the year to February, the all items retail prices index (RPI) was unchanged, that is, an annual rate of 0.0 per cent, down from 0.1 per cent in January. Over the same period, the all items RPI excluding mortgage interest payments index (RPIX) rose by 2.5 per cent, up from 2.4 per cent in January.

Posted by 51ck-6-51x @ 09:32 AM 73 Comments

Comedy Club chief reveals 50% off residential property sale

FT: Assetz reveals grand property endeavour

"People seem to realise the UK is pretty close to stabilising in the residential market and are trying to invest," he said. "Most housebuilders wont listen to individual investors - you might be able to buy two or three units and even get a good price, but we have the ability to get a lot more due to our relationships with the companies and our experience. "We can acquire assets that are already 40 per cent off, but as we can complete the purchase quickly, we can easily get another 10 per cent on top of that knocked off the price."

Posted by jack c @ 08:11 AM 8 Comments

Partial solution: Government can subsidise wages indefinitely

The Times: Pay cuts and freezes spread as inflation plunges to 50-year low

The industrialist Sir Anthony Bamford called yesterday for wage subsidies for manufacturers to support employment during the recession. Sir Anthony, chairman of the construction equipment manufacturer JCB, said that the Government should subsidise the wages of workers who have been put on reduced hours because of falling demand.

Posted by devo @ 07:15 AM 8 Comments

Where I live, the prices are going up......

BBC: Deflation risk as prices to fall

'The RPI measure of UK inflation is expected to be negative - a sign of falling prices- when data is released later on Tuesday. Economists expect the Retail Prices Index (RPI), which includes housing costs, to have declined for the first time in 49 years.'

Posted by hpwatcher @ 06:04 AM 10 Comments

One third of the expected repossessions will be of first time home buyers who bought in the last 12

Australian: 30,000 Australian homes could be repossessed by December

The forecasts are predicated on the unemployment rate - which is now 5.2 per cent - hitting 7.5 per cent by the end of the year. home owners should seek financial assistance early if they sense trouble ahead.

Posted by chris @ 05:15 AM 0 Comments

Place your bets

Guardian: Deflation returns to UK after nearly 50 years

Deflation is expected to officially return to Britain after an absence of nearly 50 years, when government data is released showing that the retail prices index has gone negative. RPI was just 0.1% year on year in January, and experts forecast February's figure will be -0.8%. CPI is expected to fall from 3% to 2.6%.

Posted by little professor @ 01:29 AM 6 Comments

Monday, March 23, 2009

Recording the Prices but Not the Cost

Mail: Ros wine and rotisserie chicken is added to the measure of inflation...

"In a world where families don't have the money to eat out or the time to cook a full meal, the supermarket rotisserie chicken has become a staple purchase.The Office of National Statistics (ONS) today added the shop-bought cooked chicken to the basket of goods used to calculate changes in the cost of living". However, families who are facing big increases in the cost of putting fresh food on the table may find such figures very hard to swallow.

Posted by alan @ 10:09 PM 4 Comments

A bailout in Gordon's back yard

This is Building society to get 60m bailout package

The Government is understood to be putting the finishing touches to a 60m rescue package for Dunfermline Building Society, Scotland's largest mutual ... The bailout will be hugely embarrassing for Prime Minister Gordon Brown, whose Kirkcaldy and Cowdenbeath constituency is near Dunfermline's headquarters, and for Chancellor Alistair Darling, an Edinburgh MP. Dunfermline's problems could not have come at a worse time for Darling as he is set next month to signal strong support for mutuals such as building societies in a White Paper on strengthening the financial system.

Posted by quiet guy @ 10:02 PM 3 Comments


Timesonline: Global stocks leap on shock rise in US house sales

A surprise 5.1 per cent rise in sales of US houses today sparked a global rally across stock markets in the UK, America and Europe, adding to optimism sparked by the Treasury's unveiling of plan to spend $1 trillion to boost lending. The National Association of Realtors said that existing home sales were up 5.1 per cent in February, beating expectations and marking the largest monthly jump since July 2003.

Posted by flintster1994 @ 04:07 PM 22 Comments

They still believe they're masters of the universe

Observer: Chips down for casino banks

One from yesterday's paper. "The crunch was not caused by greedy bankers - oh no, the real culprits are abstractions, like global macro-economic imbalances. The implication is that if you disagree, you must be thick. Despite everything, these failed financiers still think they are superior." Remind you of anyone?

Posted by letthemfall @ 03:02 PM 33 Comments

Words Fail Me.

THE MAIL: Couples mortgage went from 1500pcm to one pence!!!

This couple signed a two-year tracker deal at 1.01 per cent below the base rate when they bought their London home in 2007 for just over 400,000. They now pay 1 pence per month mortgate repayments. Reduced from 1500pcm.

Posted by dan @ 01:25 PM 1 Comments

By Timothy Geithner, U.S. Treasury secretary

Wall Street Journal: My Plan for Bad Bank Assets

The American economy and much of the world now face extraordinary challenges, and confronting these challenges will continue to require extraordinary actions The new Public-Private Investment Program will initially provide financing for $500 billion with the potential to expand up to $1 trillion over time, which is a substantial share of real-estate related assets originated before the recession that are now clogging our financial system. Over time, by providing a market for these assets that does not now exist, this program will help improve asset values, increase lending capacity by banks, and reduce uncertainty about the scale of losses on bank balance sheets.

Posted by devo @ 01:02 PM 2 Comments

Money For Nothing

Evening Standard: Couple with 1p a month mortgage

The building society today admitted that the couple should in fact be paying nothing on their mortgage but a computer glitch is forcing them to pay 1p a month. Computers at mortgage companies have been unable to process the zero interest. "That's why we're paying one pence," said Mr Cameron, an estate agent!

Posted by yoyo1 @ 12:54 PM 15 Comments

Is this where the UK will be in 2031?

Bloomberg: Japan Home Prices Slump to 24-Year Low as Recession Deepens

"Japanese residential land prices fell to a 24-year low as job losses and wage cuts discouraged homebuyers...Residential land prices fell 3.2 percent in 2008 to the lowest since 1984... ." Property is now an investment that can lose you money over a quarter of a century, even in an over-populated, overcrowded island.

Posted by ah-so @ 12:27 PM 1 Comments

The banality of evil

BusinessWeek: Wall Street's Economic Crimes Against Humanity

The financiers at AIG were awarded millions in bonuses because their contracts were based on the transactions they completed, not the consequences of those transactions. A 32-year-old mortgage broker told me: "I figured my job was to get the transaction doneWhatever came after the transactionthat was on him, not me." A long list of business executives have reaped sumptuous rewards even though they fractured the world's economy, destroyed trillions of dollars in value, and disfigured millions of lives.

Posted by devo @ 12:09 PM 10 Comments

Its inflation you should fear, not deflation

MoneyWeek: Its inflation you should fear, not deflation

House prices and the RPI may still be falling, but deflation isn't what we should be worrying about. An explanation of why the big danger could now be inflation.

Posted by damien @ 11:34 AM 39 Comments

Look at photo, this you will see all over UK soon.

Las vegas sun: Boaters World going out of business

When we thought it was time to get back into the second round of bankruptcies start..............Companies............. Boater's World to close its 129 stores around the country Beltsville, Md.-based Ritz filed for bankruptcy protection in February. It reported having about 800 camera and photo processing stores

Posted by mark @ 11:09 AM 0 Comments

The Swiss, a nation long famous for their devotion to banking secrecy

The Economic Voice: Entropy, Chaos and Power (Part 1)

It is proving increasingly challenging to write this column as the moment we sit down to analyse and comment on one set of events, five new events occur which add both colour and confusion to the picture. This is Disaster Capitalism, otherwise known as the Shock Doctrine, occurring in real time. We are being deliberately flooded with perpetually morphing variables amidst a sea of information that is at best sketchy and at worst plain lies. Amidst the confusion, the media and politicians pump just one or two "stories" so focusing the public mind exactly where they want it; this week it's AIG bonuses. Behind the smokescreen of this carefully orchestrated confusion the Managers are executing their plan to the letter. The fact is, the world is managed, it is not micro-managed but it

Posted by troy @ 10:55 AM 14 Comments

Lol - I am not even going to make a joke out of this serious issue

Yahoo: Italian porn star protests drooping savings

MILAN (AFP) An Italian porn actress stripped off in the Milan stock exchange on Tuesday in a protest at financiers she accused of mismanaging the country's savings, the market operator said.

Posted by mark @ 10:51 AM 5 Comments

Property rental prices drop as more homeowners turn landlord

Telegraph: Property rental prices drop as more homeowners turn landlord

"Research commissioned by the site to coincide with Gumtrees Q1 2009 Rental Index found almost a third of homeowners in the UK now rent out property to tenants, 57 per cent of whom have only done so in the past two years". In my view (as a long term renter) until rental yields become less attractive to home owners (not helped by current interest rates) this trend is going to continue artificially maintain house prices. We could either see a painful HP fall over a long period of time or depending or in an extreme case we could become more like parts of Europe where life-long renting is more common. I would urge any long-term renters to demand a rent reduction - I did and got 150/month taken off! I suspect my landlords are on a VR because they didnt bat an eyelid...

Posted by mda @ 10:48 AM 0 Comments

PP: Fed Planning 15-Fold Increase In US Monetary Base

The Economic Voice: The fed is planning moves that would more than double its balance-sheet assets by September to $4.5 trillion from $1.9 trillion

Whether expressing approval or concern over the feds intentions, most commentators fail to understand the real magnitude of the projected expansion of the US monetary base because they dont take into account the amount of dollars circulating abroad. in US monetary baseThis 15-Fold Increase will be impossible to reverse Next September, when the fed realizes it has gone too far and tries to reverse its balance sheet expansion, it will be unable to do so.

Posted by troy @ 10:42 AM 4 Comments

Crash Gordon will go this Way

Bloomberg: Hungary Seeks New Premier to Fight Economic Crisis

Hungarys ruling Socialists began hunting for a new premier to tackle the economic and financial crisis after Ferenc Gyurcsany said he will quit with the nation mired in its worst recession in at least 16 years. His successor, who will need opposition support, would be elected on April 14 by parliament, Gyurcsany, who heads a minority administration, said yesterday. Talks with rival parties are under way. The new Cabinet will have a year to repair Hungarys finances before the next scheduled elections. The new premier will face an unfathomably huge challenge, said Zoltan Lakner, a political analyst at Budapest-based Vision Consulting. The person, probably an economist, needs to have crisis management experience and possibly a fully fledged crisis management plan.

Posted by postle @ 10:30 AM 0 Comments

Astounding changes to global banking The decade for global banks

Drag the slider at the bottom of that chart from 1999 to 2009. In 1999: U.S. has 6 of the world's top 10 banks, including the first 2 and 5 of the top 7. China has none in the top 20. 2009: U.S. has just 3 of the top 10 with 5 being the top position. China has the top 3 (!!) and 4 of the top 10.

Posted by landedgentry @ 10:28 AM 2 Comments

No need for Estate Agents at all

Telegraph: House sellers resort to swapping their homes

Things getting really tough: "For a long time, home owners have saved money on their holidays by swapping their properties with other families for two weeks. Now, they are trying to swap their properties for good, frustrated that the moribund housing market has led to a stagnation in house sales." Bear porn on a Monday morning

Posted by growler @ 09:36 AM 3 Comments

YES! I agree with this, the US has for too long rules the world of paper money!!

MSN: China backs talks on dollar as reserve -Russian source

I like this idea - as the likes of the US & UK need to be told STOP PRINTING money and pay your debts!!

Posted by waitingfor hpc @ 09:30 AM 4 Comments

Sunday, March 22, 2009

The global economic crisis

Matt Taibbi: The Big Takeover

There is a reason it used to be a crime in the Confederate states to teach a slave to read: Literacy is power. In the age of the CDS and CDO, most of us are financial illiterates. By making an already too-complex economy even more complex, Wall Street has used the crisis to effect a historic, revolutionary change in our political system transforming a democracy into a two-tiered state, one with plugged-in financial bureaucrats above and clueless customers below.

Posted by devo @ 09:35 PM 10 Comments

The experts seems to agree prices have fallen 30% and possibly 50% by the end of the year

Telegraph: Do not pass go or expect house prices to rise soon

It would seem that nothing is going to stop property prices falling, no matter how much spin we get treated to every week, and even with the government still encouraging people with 50% loans to put down as a deposit via their Home Buying Scheme , mortgage lenders giving the other 50%.. Martin Weale, Director of the National Institute of Economic and Social Research said: "..... someone who bought a house in 2000 will have done quite well out of it - " Perhaps someone needs to tell the sellers ! I do feel it is only a matter of weeks now before we hear : "NOW IS THE BEST TIME TO SELL WHILST YOU MAY ONLY HAVE TO REDUCE 30% . SOON IT WILL BE 50% AND PRICES WILL NOT GO UP FOR A LONG LONG TIME AND THEN ONLY IN LINE WITH WAGES "

Posted by sybil13 @ 08:26 PM 50 Comments

Ever thought you can Let without actually Buying?

BBC: Illegal landlords subletting social housing

Experts estimate 5% of social housing properties in inner city areas could be being unlawfully sublet.

Posted by peter_2008 @ 03:23 PM 11 Comments

Whats wrong with hiring a van, much cheaper

Times: Thousand jobs in peril at Pickfords

BRITAINs biggest removals firm, Pickfords, could go through a controversial pre-pack administration, putting 1,100 jobs at risk. The business, rescued in April last year by Team Group, has brought in Deloitte, the accountancy firm, to advise on a restructuring as the firm struggles in the wake of the collapse in the housing market.

Posted by mark @ 02:01 PM 2 Comments

The Times Goes Bear on BTL

The Times: Unhappy returns

An unusually candid summing up of a landlords lot. Rent is not so much "dead money" now.

Posted by wdbeast @ 11:36 AM 7 Comments

G20 wake up call & don't forget to put your clocks forward

Guardian Police try to forestall 'innovative' G20 summit protesters

Police are facing two days of unprecedented protest by a collaboration of "innovative and clever" direct action groups during the G20 summit in London, a senior officer said yesterday.

Posted by happy mondays @ 11:30 AM 3 Comments

Normal service will not be resumed shortly

Times: Mortgage rates will be high for nine years

So mortgage rates will be higher and fresh lending will be dependent on savings deposits. Looks like the housing 'recovery' is permanently postponed!

Posted by paul @ 09:34 AM 0 Comments

Irwin Stelzer comments on money printing

Telegraph: Soon there may be nobody left to lend to America

"Anyone who thought Ben Bernanke and his Federal Reserve Board colleagues were out of ammunition received a rude, or pleasant, shock last week. Rude, if you worry that a few extra trillions sloshing around the economy might one day trigger a wave of inflation; pleasant, if you worry that the economy is sinking fast, and the Obama administration and Congress havent a clue what to do about it." ... "Chinese premier Wen Jiabao said he was a little bit worried that America might cheapen its currency and pay back the $1.2 trillion it owes in depreciated dollars. Now that the Fed has moved, he must be a lot worried."

Posted by quiet guy @ 08:53 AM 3 Comments

But they told me the crash would passover Scotland!

Scotland on Sunday: House price slump 'until 2013'

"Although Scotland is still expected to fare better than the rest of the UK, the report paints a gloomy picture for the immediate future of the property market north of the border." Article predicts a four year slump. I agree that prices will probably decline and then stagnate for a couple of years into 2013 but I think it unlikely that prices will 'recover' to peak levels by 2017.

Posted by missingteddybear @ 08:22 AM 0 Comments

Another deflation prediction

Telegraph: UK to remain in deflation trap until 2012, economists warn

"The forecast, by a team at BNP Paribas, states that prices in Britain will keep falling for at least another two-and-a-half years, as Britain suffers an apparently intractable bout of debt deflation." Other than the bursting of the housing ponzi scheme, I don't see much deflation around me - quite the opposite in fact. I don't believe the deflationary threats being given by our government but BNP Paribas should be relatively impartial. Are there any deflationists out there who would like to comment?

Posted by quiet guy @ 12:23 AM 23 Comments

Saturday, March 21, 2009

Georgia House of Representatives propose replacing dollar with gold and silver

Atlanta Business Chronicle: Georgians could pay future state taxes in gold

If a bill under review by the Georgia House becomes law, state residents might be paying 2010 taxes in gold... Now assigned to the House of Representatives Banks & Banking committee, HB 430, or the Constitutional Tender Act, would require the use of gold and silver coin for the repayment of debts to the state, notably all state taxes. It would also mandate that any bank conducting business with the state accept gold and silver coins as deposits... In effect, the bill seeks to revive the gold and silver standards for certain forms of state business, and Georgia would become the only state in the country to do so...Federal Reserve Accounting Unit Dollars, having no redeeming value in gold or silver coin, shall not be made a tender in payment of debts by the state, it states.

Posted by mountain goat @ 06:50 PM 4 Comments

Wasn't the rising student population going to save BTL?

BBC News: Student hardship pleas increase

There has been a big increase in the number of university students across the UK applying for emergency hardship funds. About 50% of students work during term time, using the money to pay for tuition, accommodation, food and socialising. "We have got a 25% increase in applications to the access to learning fund than this time last year and in the last month we have had an almost 50% increase in inquiries about extra funding." The problem is compounded by the lack of part-time jobs. Twice as many students are looking for term-time jobs than in previous years - far more than the number of jobs available. "For some students it's absolutely critical that they work during term time. It's the difference between them being able to complete their course or dropping out."

Posted by drewster @ 05:02 PM 5 Comments

A case for deliberately stoking inflation

Market Oracle: FSA to Regulate UK House Prices Lower

Wayalat comments on the FSA's proposed 3X rule then makes the case for deliberate inflation to destroy debt. "the mainstream press ran with a dubious report that UK house prices could fall by another 55%. This in my opinion is not going to happen, not in the soon to become apparent highly inflationary environment of quantitative inflation that many of the worlds economies are moving towards as they seek to print money in the form of monetizing their debt by buying government bonds and thus artificially lowering long interest rates by increasing the amount of currency in circulation by the hundreds of billions if not trillions."

Posted by quiet guy @ 04:09 PM 22 Comments

What do you do when you can't sell overpriced flats?

The Cumberland News: Carlisle apartments maybe turned into 109-bedroom hotel

Carlisle may soon have some of the most spacious city centre hotel rooms in the north.

Posted by aje141269 @ 04:05 PM 1 Comments

Sorry not GB. You wish!

BBC: 'Obstacle' PM to resign

"I hear that I am the obstacle to the co-operation required for changes, for a stable governing majority and the responsible behaviour of the opposition," he was quoted as saying on Saturday by Reuters news agency.

Posted by peter_2008 @ 02:23 PM 0 Comments

Nice to Know You

Property Week News: Nice Group In Administration

Nice Group , large buy-to-let investor in East London has been put into administration. There was a classic BBC program which followed the directors around London buying up houses and turning them into HMO's. Presumably the protagonists are now less smug.

Posted by jezzer187 @ 01:03 PM 1 Comments

Government borrowing 'to swell'

Bbc: The government has limited scope to implement its planned stimulus package as borrowing soars

The government has limited scope to implement its planned stimulus package as borrowing soars, according to a key economic think-tank.

Posted by zorbeh @ 12:28 PM 0 Comments

Estate Agents are Prolonging their Own Misery

Write About Property: Rightmove Index: Raised Asking Price Doing More Harm Than Good

The Rightmove index said that agents are elevating asking prices to get more instructions, which is doing no good and is prolonging the depression -- as is the lack of mortgages and unrealistic sellers.

Posted by problem pete @ 12:18 PM 0 Comments

The Case for FSA Regulation Sooner Rather than Later

Guardian: Forced to Go Cap in Hand?

Some banks are still lending up to five times peoples salaries, incredibly Northern Rock is named as one of the worst offenders.

Posted by problem pete @ 12:11 PM 0 Comments

Assuming the rally is bear market may be wrong and costly

Market Oracle: Stealth Bull Market

Decent argument that we have already hit market lows in stocks and if you want to pick up bargins now is the time. I'm generally more convinced by the perma bear arguments but this analysis makes some pretty good points.

Posted by bellwether @ 11:19 AM 3 Comments

There's only one way to find out... FIGHT!!!

Telegraph: Britain at risk of serious social unrest,

A leading British thinktank Friday warned of the "grave threat" of social unrest in response to the global recession over the next two years. The Economist Intelligence Unit (EIU), in a paper published Friday, rated the risk of upheaval that could "disrupt economies and topple governments" as "high or very high" in 95 countries. The paper, called Manning the Barricades, identified Britain as one of a group of "heavily indebted economies that experienced housing bubbles" and "are particularly vulnerable to deleveraging and asset price declines". ""The UK has been among the worst-hit developed countries by the global downturn and the majority of the population fears a deep and long recession Popular discontent and anger are likely to rise, and populist sentiments will strengthen. "

Posted by little professor @ 10:38 AM 21 Comments

First buyers sign up to HomeBuy Direct scheme

Property Related: First buyers sign up to HomeBuy Direct scheme

The first buyers have signed up to the governments latest HomeBuy initiative, which is intended to get first-time buyers back into the housing market. The 400 million programme gives buyers an equity loan worth up to 30 per cent of the value of the property to help with the purchase. It is jointly funded by the Government, through the Homes and Communities Agency, and the developer. Housing Minister Margaret Beckett met Sally Taylor, a 25 year old policewoman who is buying at Barratt Homes Equinox development in Cheltenham. Sally is buying a two-bedroom flat for 99,000 which would have cost 142,000 without the help of HomeBuy Direct.

Posted by yatesy @ 10:20 AM 0 Comments

'Nice bounce' - but beware the landing

MoneyWeek: 'Nice bounce' - but beware the landing

This year's renewed plunge in major indices has been followed by a rally that has seen the S&P 500 gain around 13% and the FTSE 100 8%. But the bear market has had more false bottoms than a conjurer's bag - will the latest rally be another one?

Posted by damien @ 09:28 AM 0 Comments

You can feed US$100 billion to a zombie-bank one night and it is gone by morning

ISN: There Is No Zombie Free Lunch

Now the true cost of feeding the zombies can be seen. The cost is that large parts of the world will not be able to finance necessary investments, and some developing countries will not be able to pay their growing food bill. So the poor will become even poorer. There is no free zombie lunch.

Posted by devo @ 12:00 AM 0 Comments

Friday, March 20, 2009

Goodbye Dubai - the Guardian paints a grim picture

Guardian: The dunes will reclaim the soaring folly of Dubai

When prices go up, buildings go up. When prices come down, buildings tend to stay up. Construction has ceased on half the unfinished towers that stretch out into the desert. Nothing can bail out a tower if there is nobody to live in it. The same goes for thousands of villas on the artificial islands in the world's most boring sea. They will stand empty in the heat. Most towers were built as investments. The value of those investments has fallen an estimated 60% in just six months. If their emptiness reaches a tipping point where there are no neighbours, no shops, no services and no social life, they will decay, like downtown Detroit. Their lifts and services, expensive to maintain, will collapse. Their colossal facades will shed glass. Sand will drift round their trunkless legs.

Posted by drewster @ 10:56 PM 7 Comments

The darker side of debt

Yahoo/ITN: Loan shark who raped debtor jailed

A loan shark who raped an impoverished customer and threatened to petrol-bomb another woman's house has been jailed for seven years. Paul Nicholson, 39, squeezed hundreds of thousands of pounds from working-class families. If repayments were overdue he demanded his money by threatening debtors with the baseball bat, machete and knuckle dusters he owned. Warrington Crown Court has heard that Nicholson, who lived in a 1 million house next to a golf course in Delamere, Cheshire, forced one woman who owed him money to perform a sex act. He told one debtor: "Your priority is to pay me, not feed your kids." The couple targeted more than 800 poor people across Widnes and Runcorn in Cheshire, charging up to 150 per cent interest on loans.

Posted by drewster @ 09:21 PM 2 Comments

So what ever left there are bad eggs...

BBC: Uncertainty over mortgage support

Support for a scheme for homeowners struggling to make mortgage repayments remains uncertain as a deadline for lenders to show their support passes. Some 50% of building societies will not take part in the Homeowner Mortgage Support Scheme, according to the head of one building society.

Posted by peter_2008 @ 09:00 PM 0 Comments

Deteriorating economic conditions

Washington Post: U.S. Federal Deficit Soars Past Previous Estimates

Deteriorating economic conditions will cause the federal deficit to soar past $1.8 trillion this year and leave the nation wallowing in a sea of red ink far deeper than the White House had previously estimated, congressional budget analysts said today

Posted by devo @ 08:22 PM 4 Comments

Nothern Rock still lending 4 1/2 times one salary

Guardian: Northern Rock: Still lending madly

The FSA sent a LOUD message this week to lenders that once prices fall they will regulate on 3x's income if lenders start to lend irrepsonsbily again, that is failing to keep prices keeping pace with wages. Today there was criticism of the Rock lending out over 1 billion irresponsibly after the government bail out, yet surely any politician / reporter or lender suggesting anyone should take a mortgage on a property that is not at least 40% below peak is IRRESPONSIBLE. As is suggesting to FTB's that loan to income ratios fixed at 3x's once prices have fallen in line with income is not THE BEST NEWS FOR FIRST TIME BUYERS. Why would anyone think that regulation and keeping prices in line with wages is not the best thing that can happen for any future buyers?

Posted by sybil13 @ 04:41 PM 4 Comments

Thats another article with 35% predictions

Your Mortgage: House Prices to fall another 14%

I really hope that FTB's are reading these articles TODAY and finally realising just how GOOD the FSA announcement this week was when Lord Turner said he will bring in regulation if has to after property prices have fallen in line with income and loan to income ratios of 3x's . to STOP prices going back up. First they have to fall, and they are falling despite all the spin, and more and more are saying they HAVE to. The FSA sent a LOUD message to lenders this week, return to sensible lending or I will force you. 3x's income and prices will to have to fall in line and go back to being prices that will not break the banks!

Posted by sybil13 @ 04:25 PM 0 Comments

More and more confirmation of 40% falls

Bloomberg: U.K. Homes Face Unprecedented Drop, Bernstein Says

March 20 (Bloomberg) -- U.K. house prices face an utterly unprecedented decline of 40 percent in nominal terms, as interest rate cuts fail to slow the momentum of decline, according to analysts at Sanford C. Bernstein in London. A 40 percent nominal house price fall is utterly unprecedented in the U.K., analysts led by Bruno Paulson wrote in an e-mailed note to investors today. Prices have already declined 20 percent, it said." end quote. How refreshing to have 40% drops due to loan to income ratios confirmed more and more eventually it will sink in that prices are coming down in line with incomes and as the FSA said earlier this week will stay at 3 x's income or lower to ensure they do not go up until they go up in line with wages

Posted by sybil13 @ 04:18 PM 3 Comments

Oh dear rent day and no money in the pot

Daily Mail: Shopkeepers hope for a boost in trade as rent day looms

Retailers on the edge could be forced out of business in the next few days if they can't afford to pay quarterly rent on Wednesday.

Posted by mark @ 03:23 PM 3 Comments

More gbailouts due then?

This is money: A&L dives 1.3bn into red as bad debts soar

Bad debts surged by 125% at Alliance & Leicester in 2008 as the bank, rescued last summer by the Abbey group, posted losses of 1.3bn

Posted by mark @ 03:20 PM 1 Comments

Markets are not efficient or rational

FT: Why the Turner report is a watershed for finance

Lord Turner is the UKs man for all seasons. A few years ago, he fixed pensions. Today, it is finance. Over the last 18 months, and with increasing intensity over the last six, the worlds financial system has gone through its greatest crisis for at least half a century, indeed arguably the greatest crisis in the history of finance capitalism. This is the reports starting point. It advances two explanations for this disaster: exceptional macroeconomic conditions particularly the emergence of excess savings in large parts of the world and reliance on the theory of efficient and rational markets.

Posted by mountain goat @ 01:07 PM 6 Comments

Don't get fooled by the stock market bounce

MoneyWeek: Don't get fooled by the stock market bounce

Stock markets are rallying, but now's not the time to pile back in. History and the corporate debt markets suggest that stocks could fall a lot further before they reach the bottom.

Posted by damien @ 12:03 PM 68 Comments

The Grand Illusion

ThisIsMoney: Brown 'ignored 2004 warning on crisis'

Another article implying GB is a bad economist, when he isn't an economist at all. His education was political history, and he obtained a political post as an alternative to leadership. Darling is a former lawyer. Not economists.

Posted by stillthinking @ 10:56 AM 10 Comments

What about SAVERS????

MSN: Its not all bad news for mortgages

The silent majority are being screwed by this government! Savers outnumber debtor 7 to 1. We should march on the streets. Pensioners can not afford to live and this is all the article can say!

Posted by waitingfor hpc @ 10:18 AM 3 Comments

What if it happens in the UK?

BBC: The central bank of crisis-hit Iceland has cut its interest rate to 17%

Sorry to spam the HPC site today - but here is what happens when you are well and truly cornered and need the IMF to help you out. Interest rates DOWN to only 17%. Handle QE with Care, Alistair Darling

Posted by growler @ 09:56 AM 2 Comments

Gloves are off

The Times: Solicitors to take on estate agents

Time to buy some popcorn. Solicitors accuse the agents of colluding to offer basically the same extortionate fees in an unregulated industry. And it took them this long to realise.... what hope do we have?

Posted by growler @ 08:43 AM 18 Comments

Pesto: Back to the nineteenth century?

BBC 'News': Back to the nineteenth century?

Pesto slates the whizzkids - predicts less inflation due to less credit..... One way would be to shrink our banks so that they could be funded wholly by domestic deposits and savings - but that would lead to such a severe contraction in the availability of credit as to impoverish us for some years.

Posted by mrb @ 08:18 AM 0 Comments

30% falls becoming mainstream

The Telegraph: 2m homeowners to fall into negative equity, FSA warns

Remember when even mentioning a crash was rubbished - let alone the "lunacy" of JDs -35% prediction? If only 30% is more like it. Bear porn. Enjoy

Posted by growler @ 07:29 AM 17 Comments

The exploited?

The Times: Tenants exploit oversupply to force down rent

Poor old RICS complaining on behalf of their tenants that people want fair value.... Of the declines, "many reporting a fall of up to 30 per cent in rents". Later in the report, the only voices bleating flawed facts are the Estate Agents: "The bottom end of the market is very lively indeed. Renters looking to negotiate on anything below 500 a week will get a bit of a shock". Folowed by the classic Estate Agent "in my area" misleading fiction of... "in some areas not much is coming in to replace them. Estate agents said that if this were to continue, demand could soon outstrip supply and rents could rise." Righ.I live in Gerrards Cross. One of the areas with the highest average house price. Check Rightmove "To Let" and see what there is sub 2000 pcm. Tons. Dreamers

Posted by growler @ 07:21 AM 10 Comments

And the rest

BBC: Rock faces 50% negative equity

"Negative equity will affect 50% of Northern Rock's mortgage loans if house prices fall by 10% this year. The figure is revealed in a report on the nationalisation of the bank written by the National Audit Office (NAO). The NAO says the bank continued with high-risk mortgage lending right up to its eventual nationalisation in February last year. "

Posted by phdinbubbles @ 12:17 AM 3 Comments

Report into Northern Crock fiasco published

Daily Mail: A criminal waste of public money

The nationalisation of Northern Rock has faded from the public eye. But a jaw-dropping report into its collapse by the National Audit Office reveals a disgraceful catalogue of waste, incompetence and the wholesale mismanagement of public money. We now discover that even after the Government had taken control, the failed lender handed over 1.8billion to home buyers borrowing up to 125 per cent of the value of their property. What was effectively taxpayers' cash was being given to buyers who were going straight into negative equity. This was a criminal use of public money and didn't do the borrowers any favours, as many have had homes repossessed.

Posted by little professor @ 12:05 AM 4 Comments

Thursday, March 19, 2009

Another building society on the ropes

Scotsman: Dunfermline Building Society in crisis with 26m loss

"One of Scotland's oldest building societies, the Dunfermline, is on the brink of unveiling a significant financial loss, exposing another of the country's great financial institutions to the threat of a takeover." ... "The Dunfermline was one of the last lenders to pull out of the 100-per-cent-plus loans market, while it also had a considerable exposure to buy-to-let loans and lending to commercial property borrowers."

Posted by quiet guy @ 08:54 PM 5 Comments

America's big bail-out could backfire

MoneyWeek: America's big bail-out could backfire

The US is following Britain's example of 'quantitative easing' by buying up $300bn of government bonds. It's an aggressive move, but it could just make things worse. Long-term interest rates will have to rise sharply. There's a real danger that could choke off any economic recovery before it really starts, as global borrowing costs are forced up. In short, QE II could backfire badly.

Posted by damien @ 06:03 PM 5 Comments

Guy who was appointed by the government to review mortgage market in 2004 promoted to a rate setter!

Timesonline: David Miles joins BOE rate-setting committee

The Bank of England has appointed David Miles to its rate-setting committee to replace arch-dove David Blanchflower. Professor Miles, who was appointed by the Government to carry out a review of the mortgage market in 2004, will become an external member of the Bank's nine-strong rate-setting committee in June.

Posted by flintster1994 @ 04:23 PM 7 Comments

Anyone know this scheme?

Contract journal: 200m Wakefield scheme in administration as Shepherd halts work

A spokeswoman told the Wakefield Express: "Trinity Walk is a victim of value erosion in the property sector. ***********ANOTHER NEWS ARTICLE ON SAME SITE WORTH READING************

Posted by mark @ 04:15 PM 2 Comments

Did inflation ever really disapear?

Bloomberg: Gold Jumps, Oil Tops $50 as Inflation Concern Spurs Commodities

March 19 (Bloomberg) -- Gold jumped the most since September and oil exceeded $50 a barrel for the first time in two months on speculation the Federal Reserves steps to spur growth will revive demand for commodities as a hedge against inflation.

Posted by flintster1994 @ 02:21 PM 37 Comments

No big deal. Crank up the presses!

BBC News: UK budget deficit widens further

The UK's deficit widened to 8.99bn in February, a record level for the month, official data has shown. This was eight times the figure seen a year earlier, as tax receipts fell 10% causing the government to borrow more. As unemployment has risen and firms have seen profits fall this has hit the money government collects in taxes.

Posted by flintster1994 @ 12:18 PM 5 Comments

Why rising unemployment is bad news for us all

MoneyWeek: Why rising unemployment is bad news for us all

"Britain's dole queues grew at the fastest pace since records began, taking the headline total to over two million for the first time in 12 years. That's terrible for those who've just lost their jobs of course. But bad news for everyone else too. It means less money being spent in the shops, more forced house sales and another surge in benefit costs. So that means even greater government borrowing, or even larger tax rises ahead. Or both..."

Posted by damien @ 11:30 AM 6 Comments

US printing $1 trillion - competitive devaluation to follow

NY Times: Fed to Buy $1 Trillion in Securities to Aid Economy

With its key interest rate already at zero, the Fed has turned to a tactic that amounts to creating money out of thin air. The Federal Reserve will pump an extra $1 trillion into the financial system by purchasing Treasury bonds and mortgage securities. The move is its biggest yet, almost doubling all of the Feds measures in the last year. Investors responded with surprise and enthusiasm, and the DOW jumped 91 points. But there were also clear indications that the Fed was taking risks that could dilute the value of the dollar and set the stage for future inflation. Gold prices rose $26.60 an ounce, hitting $942, a sign of declining confidence in the dollar. The dollar dropped sharply against the Euro and the yen.

Posted by little professor @ 10:59 AM 4 Comments

Falling off a cliff

Mortgage Strategy: Gross mortgage lending drops 60% year-on-year

Gross mortgage lending in February dropped 60% from the same time last year to 9.9bn, the lowest monthly lending figure since 2001. The Council of Mortgage Lenders says this decline is bigger than the 3% to 4% usually experienced between January and February...........

Posted by jack c @ 10:40 AM 0 Comments

Spring bounce, dead cat bounce or blatant ramping?

Metro: House sales up after record lows

From a largely fact-free article "The number of homes changing hands rose to its highest level for a year during February as a recent jump in buyer interest translated into increased sales, new research shows... The National Association of Estate Agents said ... the rise in transactions showed that the increase in buyer demand seen during January was beginning to generate more sales, as consumers believed there were "bargains to be had" in the property market. It added that with record low interest rates making savings accounts less attractive, growing numbers of people were were willing to make a long-term investment in bricks" Sorry, they're not investing in bricks and mortar, they're investing in inflated land values (cont. page 94).

Posted by mark wadsworth @ 10:37 AM 13 Comments

A brave new world caught in images... Scenes from the recession

Check out the bus - Prices wont last...

Posted by peeta @ 09:15 AM 0 Comments

Responsible lending should soon ensure FTB's will be able to get on the ladder

The Move Channel: FTB's Still Floundering

When will people realise that soon FTB's will be able to get on the ladder easily, easily that is if they ever thought they would be able to afford an average house at current prices because obviously those prices are going to have to fall with regulated mortgage lending here to stay. That is as long as FTB's don't think "I will have to rush out and buy now before regulation comes in and I wont be able to afford to buy" . How CRAZY is this, if they wait they will get at least 40% off or more, after all Lord Turner said if property prices start to inflate we will regulate at 3x's or even 2.5, if nobody could afford a property now at sensilbe lending then if Lord Turner did not expect prices to fall 40 - 50% why would he have said we will regulate at 3 or 2.5 if property prices rise?

Posted by sybil13 @ 08:44 AM 5 Comments

... because house prices are too high?

BBC News: Housing lists 'to set new record'

This was very briefly mentioned on BBC breakfast this morning, ONCE. Housing waiting lists in England will reach record levels by 2011, according to a body of housing associations. An extra 200,000 families over the next two years will push the total to a new high of around two million, the National Housing Federation said. It predicts that 80,000 will lack a home as a result of repossessions and unemployment, and the rest because of the shortage of social rented housing.

Posted by imminent_plunge @ 08:43 AM 4 Comments

I'm alright Jack! Gordon Brown's army of voters.

Timesonline: Public sector shielded as unemployment hits 2 million

A growing divide between a burgeoning public sector and struggling private sector emerged yesterday as figures showed that the number of people out of work rose above two millions in January the highest level since Labour came to power in 1997. The number of people signing on for unemployment benefits rose by 138,000 last month the fastest rate since 1971. Meanwhile, jobs and pay are still rising in the public sector. Official figures show that 30,000 jobs were created in the public sector last year, with 105,000 lost in the private sector.

Posted by flintster1994 @ 08:38 AM 29 Comments

Wednesday, March 18, 2009

Things must be bad for the lawyers to consider working a 4 day week London's Norton Rose Explores Reduced Work Hours as Layoff Preventative

Alan Jarvis, head of employment, pensions and benefits at Denton Wilde Sapte commented: "This is the first time in recent memory that a firm has introduced a four-day working week. There can be continuity issues for certain areas of work, both because of the nature of the work and the fact that clients are still working a five-day week. There are advantages but also difficulties." No bailouts here gov!

Posted by techieman @ 11:17 PM 2 Comments

The view from a first time buyer....

The motley fool: Has the Government gone insane?

''First-time buyers today face a genuine struggle to get on the housing ladder, even those who have not overstretched themselves and are looking to buy a modest starter home. I know, because I am one. And if these rules come in I will not be able to get a mortgage that I could easily afford.''

Posted by fun 4 now @ 11:04 PM 36 Comments

David Blanchflower fears that one in 10 Britons could be out of work by the end of this year

International Herald Tribune: Reports show more weakness in U.K. economy

A record number of Britons signed up for unemployment benefits last month, average pay shrank in January for the first time since at least 1991 and David Blanchflower a Bank of England policy maker said he feared things would only get worse. "The worry is that this is all going to get much worse and we need to do something about it;" - well what is it then?

Posted by enuii @ 11:00 PM 1 Comments

Fat Chance, Size Matters etc.

The Guardian: Fed to spend $1trillion on quantitative easing

No one knows whether these measures will work. Much depends on whether banks loan out the cash they raise from selling treasuries and whether households and businesses spend, rather than save, any extra borrowing," he said. "But the sheer size of the measures suggests that they will do some good, thus increasing the chances of a decent recovery next year. At the least, no one can say that the Fed isn't trying.

Posted by devo @ 10:49 PM 4 Comments

A sign of the times

The Guardian: Keep Calm and Carry On

The point is that people have been sold a lie since the 1970s. They were promised the earth and now they're worried about everything - their jobs, their homes, their bank, their money, their pension. This is saying, look, somebody out there knows what's going on, and it'll be all right.

Posted by devo @ 10:39 PM 1 Comments

The red herring of the millenium; deflation!

Telegraph: Petrol prices to rise again

Despite falling costs in the past few weeks motorists will be hit again by increases when the Government adds 2p to fuel duty from April 1. Between mid-February and mid-March the average UK price of petrol fell from 90.88p a litre to 90.56p, while The average cost of diesel went down from 100.79p a litre to 99.77p.

Posted by flintster1994 @ 09:42 PM 6 Comments

Mazda a bit like the UK??? Who will bail out the UK??

Japan Times Online: Mazda, unable to sell bonds, to seek government bailout

"We can't sell bonds right now," said Nobuyoshi Tochio, general manager of Mazda's financial services division. "The market isn't functioning. Conditions are really bad."

Posted by mark @ 08:30 PM 1 Comments

Falling house of cards..

Contract journal: Cornhill Construction in administration

Cornhill Construction has followed Cornhill Interiors and Cornhill Retail into administration.

Posted by mark @ 07:33 PM 4 Comments

Another rip off tax, how will this affect jobs?

Petrol prices: Duty rise set to bring fuel tax to 71% in 2 weeks

Fuel duty is set to rise by roughly 2 pence per litre on April 1st meaning that 66 pence of the average litre of fuel goes directly to the Treasury.

Posted by mark @ 07:31 PM 5 Comments

Restore Stability = Prop up

Bloomberg: Seeking Ways to Stabilize Housing Market, Beckett Says

The U.K. government is seeking new ways to prop up the housing market as a recession and a reduction in bank lending pushes down prices. We are always looking at what more we can do to restore stability to the housing market, Housing Minister Margaret Beckett will say today, according to a text of the remarks released by her office.

Posted by alan @ 07:21 PM 10 Comments

Wonder what the chinese will make of this?

Bloomberg: Fed to Buy $300 Billion of Longer-Term Treasuries

March 18 (Bloomberg) -- The Federal Reserve said it will buy $300 billion in Treasury securities and acquire more mortgage and agency debt in an effort to bolster housing and hasten the end of the recession.

Posted by flintster1994 @ 06:57 PM 0 Comments

Government confirms changes to Home Information Pack legislation

Property Related: Government confirms changes to Home Information Pack legislation

The Communities and Local Government (CLG) have confirmed that the proposed legislation which is due to come into play from 6th April 2009 will go ahead. The most controversial of which is the removal of first day marketing exemption. In total there are three key changes to HIPs you need to know about: 1. The temporary first day marketing exemption will be removed, which means that a HIP must be available on the first day a property is marketed 2. A Property Information Questionnaire, completed by the seller, must be included in the HIP, and 3. The end of the use of insurance to cover missing data in personal searches. These changes have important implications for industry practice in the marketing of residential properties for sale and the advice given to clients.

Posted by lee @ 05:27 PM 0 Comments

Deposit size triples, prices fall to 1/3 (?)

Times: Buyers face 15% deposits in mortgage shake-up

Buyers face 15% deposits in mortgage shake-up as the FSA clamps down on supersized offers, chairman announces proposals to mark end of reckless lending.

Posted by refusetobuy @ 04:14 PM 21 Comments

Unemployment soars above 2m

FT: Unemployment soars above 2m

Unemployment has soared to above 2m for the first time since Labour came to power in 1997, according to official figures published on Wednesday...

Posted by watchman @ 02:12 PM 2 Comments

Over one million BTL mortgages are in arrears!

BBC: Rental repossessions on the rise

"It's a sign of the times - tenants are facing eviction because their landlords can't pay the mortgage. In 1998 there were around 28,700 buy-to-let mortgages in arrears. In 2008 there were 1.15m, says the Council of Mortgage Lenders." Seeing as there are only two million or so rental properties in the UK, that is quite stupendous!

Posted by mark wadsworth @ 01:43 PM 12 Comments

The Turner Review

FSA: The Turner Review: A regulatory response to the global banking crisis

The Chancellor of the Exchequer asked me in October 2008 to review the causes of the current crisis, and to make recommendations on the changes in regulation and supervisory approach needed to create a more robust banking system for the future. This Review responds to that remit, focusing on the fundamental and long-term questions. It does not address the short-term challenge of macroeconomic management over the next few years, though it does comment on ways in which the transition path to new more stable arrangements must be managed in the light of that short-term challenge. And its focus is on banking and bank-like institutions, and not on other areas of the financial services industry.

Posted by 51ck-6-51x @ 12:40 PM 12 Comments

As every one knew

Times: Flats were built for a profit, not for living in

it appears flats are no use 4 social housing as they were not built for people.....just...for..err profit

Posted by fun 4 now @ 11:26 AM 8 Comments

...or the abnegation of responsibility

Guardian: The price of avoidance

"Like the credit boom, the tax-avoidance game represents the triumph of technical proficiency over social responsibility."

Posted by letthemfall @ 11:08 AM 12 Comments

How far do house prices have to fall?

MoneyWeek: How far do house prices have to fall?

If we want to see a sensible link between house prices and earnings, house prices will have to fall a lot further than they have already - but just how much further?

Posted by damien @ 10:59 AM 29 Comments

Group think at BOE

Bloomberg: Bank of England Votes Unanimously to Print Money After Rate Cut

I like these consensus' it always indicates the truth just like when you hear anyone trying to put the other side of the argument to global warming - 'but all the worlds leading scientist agree' - that's only because the y wouldn't be considered world leading if they didn't!

Posted by matt_the_hat @ 10:37 AM 3 Comments

Some good crash porn

The Motley Fool: Will house prices ever recover?

Bye..bye bulls..

Posted by teddy bear @ 10:35 AM 2 Comments

The treasury contradicts IMF's impartiality

Green shoots

Guardian: Unemployment surges through 2m

We a love the supply and demand arguments for high house prices - we have had it shoved down our necks for a decade - the cockerel is coming home to roost

Posted by matt_the_hat @ 10:31 AM 1 Comments

O Rly?

Guardian: Larry Elliott: The case for green shoots are stronger in the UK than the US

"If anything, the case for green shoots is easier to make in the UK. The latest report from the Royal Institution of Chartered Surveyors showed that people were starting to window shop for property even if they are not yet ready to commit themselves to take out a mortgage (if they can get one). Spending in the shops has held up well. Unless this really is the final collapse of capitalism, the stimulus package will eventually work. And it will work all the sooner if we occasionally remind ourselves that even after the darkest night the sun comes up in the morning." [Footnote: Larry Elliott co-wrote the 2007 book 'Fantasy Island' which accurately depicted Blair's Britain as a credit-junkie nation. I'm surprised to see him change his tune so soon.]

Posted by drewster @ 01:59 AM 11 Comments

There were only four occasions in the 49-year history of the index in which its growth rate was belo

REUTERS: Australia economy on brink of recession - index

SYDNEY, March 18 (Reuters) - Australia is on the brink of recession according to a private index of activity which has slumped to its worst reading in almost two decades.

Posted by chris @ 01:08 AM 0 Comments

An Australian leading economic index declined in January, stoking speculation the nation is in its f

Bloomberg: Australian Leading Index Falls to Recessionary Level

The index, a gauge of future economic growth, dropped 0.2 percent to 252.1 points from December, Westpac Banking Corp. and the Melbourne Institute said in Sydney today. The index shrank at an annualized 3.1 percent rate.

Posted by chris @ 01:07 AM 0 Comments

The peasants are revolting

The Times: Armed guards at AIG offices after death threats over bonuses

A wave of popular anger over the $165 million (118 million) in bonuses received by executives of American International Group (AIG) is threatening to engulf the insurance company and cause deep damage to President Obamas infant Administration. Armed guards have been stationed outside the Connecticut offices of AIG Financial Products (AIGFP), where death threats have been pouring in and some employees have resigned or have refused to turn up for work. Andrew Cuomo, New Yorks attorney-general, has used subpoenas to discover that the company paid bonuses of $1 million or more to 73 executives, who stayed at AIG to help it to unwind its $1,600 billion portfolio of credit default swaps.

Posted by devo @ 12:12 AM 11 Comments

Tuesday, March 17, 2009

Low cost mortgages returning to Market?

Ulster Bank: Ulster Bank Fixed Rate Mortgages

Ulster Bank are offering 2 year fix at 3.79% and 4.39% for a 5 year fix. Both 90% LTV, or alternitively 4.29% for a 95% ltv 2 year fix. better than the rest of the rbs group who are only offering sub-4% fixes on 25% deposit

Posted by 5lab @ 11:56 PM 0 Comments

We are truely uniquely placed

Times: UK recession will drag into 2010 as others recover, says IMF

Britains economy is set to keep shrinking well into next year, even after all or most of its leading competitors have begun to enjoy renewed growth, the International Monetary Fund will warn this week.

Posted by peter_2008 @ 11:29 PM 2 Comments

The BBC is roiling and squealing about mortgage plans

BBC 'News': New measures to control UK banks

Note the BBC gives the last word to the House Builders Federation. They don't even bother using quotes in the fourth from last paragraph, they just recycle HBF opinions as facts. The BBC news website editors must be seething as their buy-to-let empires crumble under the prospect of common sense returning to the property sector. To think of all the hard work they've put into ramping property - what a waste!

Posted by paul @ 11:13 PM 13 Comments

Finally a Reporter that makes some sense of course regulation is the ONLY way forward

City Wire: Morning Line: Rationing is a vital fix for the broken mortgage sector

Quote: Any regulatory cap on mortgage lending - perhaps to a maximum of three times income - would be suicidal, the newspaper declares on its front page this morning, quoting property experts in....... As it turns out pretty quickly, however - though not until youve bought the paper and turned to page 2 - these property experts include a former president of the National Association of Estate Agents (originator of the headline suicidal line) a gaggle of mortgage brokers, and a spokesman for the Council of Mortgage Lenders. With the greatest respect, none of these with the possible exception of the CML can be seriously considered to be property experts. Rather they are salesmen and media-friendly self-publicists, happy to provide a handy sound-bite at short notice.

Posted by sybil13 @ 09:35 PM 0 Comments

Green shoots in the US property market

CNN: Housing starts unexpectedly surge

Initial construction of U.S. homes unexpectedly surged in February, after falling for eight months, according to a government report released Tuesday.

Posted by flashman @ 08:31 PM 4 Comments

No green shoots here..

Las vegas sun: Sales of new homes tumble further in 2009

As bad as 2008 was for the new-home industry, 2009 is shaping up to be even worse.

Posted by mark @ 06:44 PM 2 Comments

A bit of background on Mr Cowley of 'The recession hits prime property' fame. Enjoy

The Times Online: Living: How to make a million (2003)

I was on the internet one weekend and said to my wife, Theres an interesting property here. We got in the car on Monday morning and drove over, arranging a mortgage on the phone on the way. What they saw was a beautiful old rectory near Loughborough, Leicestershire. As soon as the big wrought-iron gates opened, we wanted it, he says. It is a magnificent property standing in 30 acres.

Posted by just_sold_up @ 06:14 PM 0 Comments

But the other article posted today says prime property is rising in price ???

The Times Online: The recession hits prime property

"As the recession bites, distressed sales and repossessions are hitting the top end of the market" ------ As a counter to the article posted earlier about prime property rising I though we ought to see this

Posted by shining wit @ 04:13 PM 5 Comments

Why the dollar will get even stronger

MoneyWeek: Why the dollar will get even stronger from here

"Other countries which went on huge spending binges are now faced with huge debt burdens, crashed property markets and wrecked banking systems. Understandably, their currencies have plunged. Yet the US which faces all these problems has seen the dollar sail ever higher. Baffling as it may look, there is an explanation. The dollar is not like other currencies. Indeed, it's so exceptional that further gains are still perfectly possible while the crisis continues..."

Posted by damien @ 02:44 PM 2 Comments

Britain's credit card debt is 53bn

BBC News: Credit card debt crackdown plan

This upsets me more than any other debt. The credit card companies and banks have destroyed so many people even when interest rates were low.

Posted by wdbeast @ 02:26 PM 5 Comments

Barclays, the Caymans, Luxembourg...

Guardian: Barclays gags Guardian over tax

A Barclays whistleblower writes: "It is a commonly held view that no agency in the US or the UK has the resources or the commitment to challenge SCM. SCM has huge amounts of resources, the best minds rewarded by millions of pounds. Compare this with HMRC [Her Majesty's Revenue & Customs] recently advertising for a tax and accounting expert with the pay at 45,000." Shows how the banks can use their muscle against the public interest. Also an interesting comparison with public sector resources.

Posted by letthemfall @ 12:44 PM 10 Comments

Excellent bear porn

Metro: Homeowners rocked by 68% rise in repossessions

"The number of repossessed homes soared by 68% last year as the economic downturn left many people struggling to pay their mortgage, figures showed today. A total of 46,750 properties were repossessed by lenders during the year, up from 27,900 in 2007, City watchdog the Financial Services Authority said. There was also a steep jump in the number of people who fell behind with their mortgage repayments during the final quarter of the year." Assuming those three-times-salary rumours are correct, who on earth is going to buy them?

Posted by mark wadsworth @ 12:28 PM 3 Comments

Arrears growing

BBC: Mortgage arrears up 31% in 2008

"The number of mortgage accounts in arrears has shot up by 31% in the past year, according to figures from the Financial Services Authority (FSA)."

Posted by phdinbubbles @ 12:22 PM 2 Comments

Markets havent bottomed yet

MoneyWeek: Markets havent bottomed yet

"You expect City people (like any other salesperson) to talk their books. So most of the time you can take fund managers' comments on the market with a big heap of salt, particularly if they sound optimistic. But recently, increasing numbers of very respectable people with good track records have been arguing that shares are cheap."

Posted by damien @ 11:47 AM 2 Comments

Telegraph Comment Page

Telegraph: Don't let mandarins ration mortgages

"Tomorrow we will learn how Whitehall intends to run the housing market when Lord Turner delivers, at Gordon Brown's request, his ideas for reforming bank regulation."

Posted by phdinbubbles @ 11:39 AM 21 Comments

More than 1m jobs to go in UK

FT: More than 1m jobs to go in UK

More than a million British workers will lose their jobs over the next two years as the recession takes an unexpected turn, hitting the north and Midlands as badly as the south, a leading economic forecaster has warned.

Posted by need-a-crash @ 11:34 AM 0 Comments

Too Little Too Late - Go Now!

SKY: PM On Banking: 'I Should Have Been Tougher'

"Gordon Brown has conceded that tougher action to curb the financial markets should have been taken 10 years ago when he was still Chancellor". Wow!

Posted by alan @ 09:58 AM 8 Comments

Yes suicidal for your BTL portfolios maybe

Telegraph: 3x times lending will be suicidal say experts

The wording has changed since yesterday !

Posted by str 2007 @ 09:38 AM 77 Comments

Quick, QUICK, QUICK.. PLEASE BUY A HOUSE....Now is the best time, prices are going up again

MSN: Home prices rising at top of market

Yawn, yawn - do people actualy believe this drivle? I must admit that I am bored with the market and want something dramatic.. like a sudden drop in prices or another bank to go bust. Oe indeed Gordon the moron to do something else incredibly stupid (which is not hard for him)

Posted by waitingfor hpc @ 08:47 AM 10 Comments

Inside Track "BTL King" gets hit hard

Independent: Slump-hit millionaire seeks to renegotiate divorce settlement

Jim Moore can't expect many hearts to bleed when he complains he is down to his last 3m. Mr Moore, called the "Buy-to-let King" when his property investment empire was worth 135m, is going back to court try to reopen the divorce case which left him strapped for cash. He made his fortune launching Inside Track, a company offering seminars on the property market. He also launched a sister company, Instant Access Properties, which helps investors enter the buy-to-let market. When the property market slumped both companies went bust. The divorce, which was finalized last year, left his ex-wife with 16m in property, a deferred sum of 4.7m, and ongoing maintenance payments. Mr Moore claims the credit crunch has reduced his net worth to just 3m

Posted by little professor @ 08:44 AM 7 Comments

Deflation isn't happening......

Mail: Universities' plan to double student fees could leave millions in debt into their 50s

''Tuition fees could be more than doubled under a blueprint to be put forward by universities today. Some students would find themselves with debts of 50,000 they could be paying off into their 50s. Middle-income families would be worst hit, as they would just miss out on financial support from bursaries, grants or means-tested loans.''

Posted by hpwatcher @ 06:16 AM 8 Comments

Angry buyers finding their voice

BBC: Angry buyers finding their voice

The Ombudsman for Estate Agents has reported a "surprising" workload dealing with complaints despite the property market slump. While activity dropped by as much as 60% in 2008, Christopher Hamer said sales disputes dropped by just 3%.

Posted by peter_2008 @ 01:20 AM 1 Comments

Monday, March 16, 2009

Won't see the likes of this again in our lifetime!

Times: Borrowers offered 10 times salary

Since we are on the subject of the FSA proposal to limit mortgages to 3 times income - thought you'd like to see this article written two years ago. I especially like the bit where it says that a couple on average wages could borrow 245K!

Posted by sold my soul to the never never never @ 07:14 PM 8 Comments

Peston on AIG and Goldman sachs and more...

BBC - Robert peston blog: The Goldman infallibility myth

Peston on AIG and Goldman sachs and more...

Posted by roy @ 07:01 PM 1 Comments

Are you 'dismayed' at not being allowed to borrow 6x salary?

Telegraph: The FSA mortgage cap: how it affects you

Those looking to move home or take their first step on the housing ladder, may be dismayed to read reports suggesting that they will only be able to borrow up to three times their annual salaries, under strict new banking guidelines. As well as imposing a cap on the maximum amount banks can loan, the new rules are also expected to ban 100pc mortgage will be banned. Ray Boulger of the mortgage brokers John Charcol added: "It seems inevitable that this will have a negative impact on house prices particularly as the average house price is more than three time the average salary." According to the Halifax the average house price is 160,327, with the average income being 26,000. The following question and answers provide more detailed information:

Posted by little professor @ 06:48 PM 59 Comments

Mortgages Aren't Important If No One Wants to Buy Houses

Write About Property: UK Property Market: Throwing Money at the Problem not the Answer

Some people think throwing masses of money into the housing and mortgage markets are the solution to the problem. But in reality people won't be looking at buying houses in sufficient numbers for this to matter until the recession is turned around.

Posted by problem pete @ 05:53 PM 0 Comments

A glimpse of the future for the UK?

Guardian [video]: Zimbabwe - gold for bread

"The zimbabwe dollar is now worthless. Here in my village, people are trading in gold panned from the river. If you need soap, you need gold. If you need bread, you need gold. Gold traders are demanding 4 times the market rate from people too hungry and desperate to turn them down. I don't remember the last time I used Zimbabwe dollars - the shops here just don't accept them anymore. People who are too sick or old to dig for gold are dying of hunger. I have never seen my people in such a desperate situation. Zimbabwe once had the best educated children in Africa. Now they must spend their days panning just survive.

Posted by little professor @ 05:40 PM 5 Comments

BoE info on Markets

Bloomberg: U.K. Mortgage Bond Market May Stay Shut, BOE Told

"U.K. residential mortgage-backed bond markets may stay shut throughout the rest of this year as banks nurse losses from the financial crisis, according to the Bank of Englands contacts". The outstanding balance of British residential mortgage- backed securities was the worlds second-biggest as of the third quarter of 2008, totaling 407 billion euros ($528 billion). Thats still a 10th of equivalent outstanding U.S. securities.

Posted by alan @ 05:06 PM 0 Comments

Mortgages on offer in 2009 vs. 2007

FT Alphaville: Mortgage Bubbles

Chart showing how many deals were on offer (size of bubble) at what margin above base rate. Look at the retreat from 2007 where near 100% for tiny margins was the norm.

Posted by ontheotherhand @ 02:55 PM 0 Comments

Maybe we are all just pretending a recession?

Telegraph: Meet The New Faux Poor

Desperate to chime with the zeitgeist, artfully distressed millionaires and billionaires are competing against one another to show just how far their fortunes have been reduced.

Posted by peter_2008 @ 02:02 PM 5 Comments

Nothing like keeping the Blairs employed

Telegraph: Cherie Hired to Sue RBS

Cherie Blair is to act on behalf of British pension funds in a lawsuit seeking hundreds of millions of pounds in compensation from Sir Fred Goodwin and the Royal Bank of Scotland.

Posted by str 2007 @ 12:30 PM 6 Comments

But is this Single or Joint Incomes?

Telegraph: FSA to Cap Mortgage Borrowing

Homebuyers will be prevented from borrowing more than three times their annual salaries under new mortgage rules to be announced this week.

Posted by str 2007 @ 12:28 PM 57 Comments

New regulations won't prevent the next crash

MoneyWeek: New regulations won't prevent the next crash

The housing market is already doing a good job of correcting itself, so it's a bit late for the FSA to toughen up the rules now. And any new regulation it does bring in won't prevent more bubbles in the future.

Posted by damien @ 11:20 AM 6 Comments

Wrongmove's Latest Index Report

Reuters: March house asking prices down 9 pct year on year

Asking prices for houses in England and Wales were 9.0 percent lower than a year ago this month, slightly less than February's record 9.1 percent annual drop, property website Rightmove said on Monday. Average asking prices rose by 0.9 percent in March, less than the usual increase for the time of year, and new listings were 57 percent lower than last year at 79,000, Rightmove said. "Traditional spring impetus (is) limited as ... lending remains restricted as banks are only now facing up to declaration of toxic debt," the survey said. Rightmove said there seemed to be buyer interest in properties priced at around 25 percent below peak levels, and that sellers who initially overpriced their homes risked heavier losses later. *** Report not yet available at ightmo

Posted by 51ck-6-51x @ 07:53 AM 23 Comments

So much for high house prices.

Telegraph: Britain showing signs of heading towards 1930s-style depression, says Bank

The country is displaying early symptoms of being trapped in a so-called debt deflation trap where families find themselves pushed further and further into the red every month, according to a Bank report published today. The stark warning will cause serious concerns, since it was this combination of falling prices and soaring debt burdens that plagued the US in the 1930s. The Bank is using its Quarterly Bulletin to highlight the threat posed to the economy by deflation where prices fall each year rather than rise.

Posted by charlie brooker @ 06:51 AM 8 Comments

A record plunge in Chinese exports may be great news for the U.S. Treasury.

Bloomberg: China Needs Another $2 Trillion of Treasuries: William Pesek

Its simple mathematics. The U.S. economy is more than four times the size of Chinas. Growth in China is wildly lopsided toward exports, many of those goods packed on ships bound for America. So, if China wants to stay afloat, it should spend less money building roads, bridges and dams and more on U.S. debt. That would give the U.S. and its consumers the access to easy credit to reignite spending, much of it on Chinese-made goods.

Posted by big chris @ 06:28 AM 3 Comments

It was on the cards.

The Independent: 40,000 each: The personal cost of the downturn

The worst economic slowdown in three-quarters of a century has wiped 40,000 from the wealth of every adult in the United Kingdom, a national total of almost 2 trillion; that is 2,000bn, or 2,000,000,000,000. The research into the destructive effects of the recession by the accountant PricewaterhouseCoopers for The Independent shows that the fall in the value of property and shares owned by British households between July 2007 and February 2009 has reached the equivalent of 18 months-worth of national output a colossal destruction that will take many years to recover from and threatens the retirement plans of millions of Britons.

Posted by charlie brooker @ 12:13 AM 14 Comments

Calling Eric!!

The Independent: Our mortgage free-for-all opened the door to crime

The news that the City of London Police made nine arrests last week over an estimated 40m mortgage fraud came as no surprise. I won't comment on the case and all those arrested have now been released on bail but it tells a tale of the times we have just lived through. The housing market from around 2003 onwards was almost entirely supported by mortgage expansion. Len-ders and brokers were desperate to keep writing business and hitting their targets, so they would think of ever more sketchy ways to go about things. From "drive by" valuations to the notorious 125 per cent mortgage, it was a time of immense greed with the moral compass of the Wild West. And for fraudsters, there is no better "mark" than a greedy individual or company.

Posted by charlie brooker @ 12:04 AM 0 Comments

Sunday, March 15, 2009

50% fall from peak already

Land registry data: Surrey Prices

Look at house numbers 16 and 28. Both are 4 bed detached houses and were sold around 2005 for around 500K. 28 was sold 2 years later for 1.1M completing in Oct 2007, right at the peak. No. 16 has just been sold for a smidgen over it's 2005 value at 520K. Although each of these houses are individual and detached they are all basically on the same size plot. So whatever refub was completed on 28 it's still a 4 bed house in Surrey.

Posted by sc @ 11:40 PM 0 Comments

What is the current value of the toxic assets?

BusinessWeek: A Simple Guide to the Banking Crisis

Why is the banking crisis so hard to solve? We stood and watched while Hank Paulson and Ben Bernanke fumbled with their response in the fall. Now we are being treated to the distressing spectacle of Tim Geithner struggling as well to articulate a clear policy for dealing with zombie banks. How come these smart and powerful men cant get a handle on the problem? I want to lay out 5 simple propositions which will help you understand why the banking crisis is so intractable. Then I will explain what happens next.

Posted by devo @ 09:56 PM 1 Comments

I'm amazed this doesn't happen more often.

Telegraph: Rural revolt gathers pace as upmarket new homes vandalised

Protesters daubed "No More 2nd Homes", "Greed" and "Go Away" on buildings in a picturesque village where many of the properties are empty for large parts of the year. It comes amid growing concern in some parts of the countryside that wealthy city workers are pricing locals out of the housing market and turning communities into "ghost villages" by buying up homes that they visit rarely.

Posted by tyrellcorporation @ 09:47 PM 17 Comments

Truth can be more bizarre than fiction

Telegraph: Hunt for 11 million ruby as Wrekin Construction goes under

The mysterious ruby - called the Star of Zanzibar - was bought by Shropshire-based Wrekin Construction. On paper, it is the most expensive ruby on record. But officials from Ernst & Young, the administrators called in to handle Wrekin's affairs, are now understood to be trying to establish why the gem was bought, and indeed whether it exists at all.

Posted by peter_2008 @ 07:54 PM 4 Comments

Clever guy getting out before property market really crashes, although I would have sold it in 2006

Daily Mail: Middle England for sale

According to received wisdom, you would be mad to sell your house right now. In which case, this particular vendor must be stark staring bonkers, as he is selling a whole village including a farm, a manor house, a dozen cottages, an old rectory, a shop, a fully operational blacksmith's forge, a famous shoot and one of the prettiest cricket pitches in the land. And, with a price tag of 25million, will anyone be remotely interested? As it happens, many people are. And the vendor is not mad - not least as he has been dead for nearly 30 years.

Posted by mark @ 01:42 PM 2 Comments

David Smith fights back

Times: Could house prices really fall another 55%

It can be a good sign that you are approaching some sort of turning point when forecasts start to look bonkers. City firm Numis claimed this week that house prices could drop by another 55%. Hyperbole grabs headlines. I have to say I find it unconvincing. Even at current prices, interest in the market is increasing. RICS says numbers of new buyer inquiries rose in February for the fourth month in a row. At the same time, surveyors are reporting an upsurge in valuations as potential sellers look to put their homes on the market. Many decide not to proceed, though; as a result, many estate agents have a shortage of properties to sell. Buyers are keener, but face significant financial constraints. Sellers do not want to sell in a weak market. Spring is here, but it doesnt yet feel like it.

Posted by little professor @ 01:13 PM 17 Comments

Mass Unemployment

The guardian: Job centre crisis as ten bid for each vacancy

Startling new figures have revealed that on average there are 10 jobseekers for every vacancy advertised in the UK. In one area of the south-east, 60 workers are available for each job. This week, as unemployment is expected to burst through the 2 million barrier, The Observer can reveal that the spectre of mass unemployment is forcing the government to reinforce job centres, with civil servants diverted from child maintenance and disability claims.

Posted by sold out @ 11:20 AM 3 Comments

Rampant ramping

Independent: The Englishman's castle in ruins

Mr Pidgley, CEO of Berkeley, says that the housing market "is somewhere along the bottom" of its economic cycle, meaning prices shouldn't collapse much further. Paul Pedley of the Home Builders Federation says, "I have been in this industry for 30 years, and housing is now as affordable as I can ever remember. But we need confidence to come back into the market. Confidence will inevitably return, as housebuilding never really loses a customer. The need for new homes is gradually getting pent up, and when the market improves and that demand is finally released, there will be rampant house-price inflation."

Posted by little professor @ 08:14 AM 16 Comments

Finally Someone Speaking Of Even 4x's Income As Irresponsible Lending

Guardian: Watchdog to curb risky mortgages

Is this the week that the UK finally wakes up to the FACT that we cannot afford to support an inflated property bubble? Is this the week that the UK finally wakes up to the FACT that trying to do so broke the banks and led to the current crisis? Is this the week that the good people of the UK accept that ensuring that property prices stay in line with wages is not such a stupid idea? Is this the week that the UK finally realises that you can't blame the government for the banks going broke trying to support property prices that had been allowed to increase 190% in a decade (US prices only went up 75% and are down nearly 50%), whilst also believing now the government are being irresponsible not FORCING lenders to go back to irresponsible lending. Let's hope so.

Posted by sybil13 @ 07:48 AM 2 Comments

Yet Another Misinformed Article

Housing Rescume Must be the Foundation of UK Recovery: Guardian

When will we STOP hearing how the property market must be rescued? When will people finally realise that it WAS the inflated property market that has put the UK on the brink of bankruptcy? When will the UK WAKE up to the fact that they cannot criticise the government for allowing irresponsible lending and then believe the government should force the banks back to irresponsible lending practices in order to STOP property prices falling back in line with incomes. IS IT SUCH A STUPID IDEA THAT PROPERTY PRICES HAVE TO FALL IN LINE WITH INCOMES? Surely the STUPID idea is that they don't have to, and that lenders can lend money they haven't got leading to 190% increase in prices in 10 years. Loan to income ratios have to now be followed and prices have to fall, the article speaks of 35%

Posted by sybil13 @ 07:33 AM 3 Comments

The best showdown of the financial crisis so far (3x video clips)

The Daily Show: Jon Stewart interviews Jim Cramer

The feud between Jon Stewart (Daily Show) and Jim Cramer (Mad Money) finally came to a head last Thursday when Cramer agreed to be interviewed on The Daily Show. Stewart rips into Cramer mercilessly. Definitely worth a watch. Sample quotes: "I understand you want to make finance entertaining, but it's not a f***ing game." / "To pretend that this was some sort of crazy once-in-a-lifetime tsumani that nobody could have seen coming is disingenuous at best and criminal at worst." / "All the incentives of these companies were for short-term profit, and they burned the house down with our [pension savings] and walked away rich as hell." / "In what world is a 35-to-1 leveraged position sane?" / "When are we going to realise in this country that our wealth is work?"

Posted by drewster @ 03:26 AM 14 Comments


Daily Mail: New blow for Vorderman as she quits property firm hit by slump

TV star Carol Vorderman has become the latest victim of the credit crunch after a property company she fronted was forced to start winding down. The former Countdown presenter and her agent attended a crisis meeting with executives at Carol Vorderman Overseas Homes last week, telling them they were no longer willing to have her name and face associated with the firm. The firm is now being run down into dormancy, according to its director Terry OConnor.

Posted by little professor @ 12:02 AM 6 Comments

Saturday, March 14, 2009

Defending the indefensible.

Market Ticker: Reserve Banking

My screed on "Mark To Market" brought the tinfoil brigade out of the woodwork in spades, and one of their most common "attack points" is that "reserve banking is fraud." Simply put, "no its not." Let's prove it.

Posted by devo @ 08:10 PM 9 Comments

It's not our fault guv', its them accountants over their's fault

The New York Times: Bankers Say Rules Are the Problem

"They say the problem, in short, is not that the banks acted irresponsibly in creating financial instruments that blew up, or in making loans that could never be repaid. It is that someone is forcing them to fess up."......just a bunch of little boys and girls blaming everyone but themselves, and these are supposed to be professional, responsible adults, give me strength.

Posted by bystander @ 08:01 PM 1 Comments

Borrower and lender in a deadly embrace

Guardian: China 'worried' about safety of US assets

OK, not the usual HPC material but interesting, I suggest: '"We have lent a huge amount of money to the US. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried." In rare comments on another country's financial health, he added: "I'd like to take this opportunity here to implore the United States ... to honour its words, stay a credible nation and ensure the safety of Chinese assets."' Remember; when America seezes ...

Posted by quiet guy @ 06:15 PM 0 Comments

I keep thinking I've misread it. Have they mispoke it?

Snoreygraph: House prices fall 20% in towns over past 6 months

It can't be six months. There must be some mistake.

Posted by indirectapproach @ 03:46 PM 0 Comments

G20 Monetary Reform

Number 10: E-Petition

In a country like the UK, 95% of the national money supply is created out of thin air as debt by commercial banks and written into their customers' accounts as loans. The proverbial visitor from Mars and Adam Smith's "impartial spectator" would both see these arrangements as daft. The stability, efficiency and justice of national and international "financial architecture" would be greatly improved if the money on which they are founded was created debt-free by central monetary authorities serving the interest of everyone who uses it.

Posted by richard bunker @ 01:27 PM 0 Comments

One for the bulls....

Ft Weekend: Just keep thinking sweet thoughts

"Extreme volatility is confusing. I once assumed that the bear market had ended last November. But last month’s sell-off dragged prices much lower. It is easy to capitulate in scary times and close all positions. The opposite error is to ignore fresh facts and stubbornly hold on to obsolete views. Either approach can lead to painful trading errors. Confounding my confusion was last week’s surprise 6 per cent rally." - i shall keep my own counsel on this one.

Posted by techieman @ 01:24 PM 1 Comments

Brief analysis of where he thinks Crude is going

Weekend FT: Brent set to trickle down

No fundamentalist need apply.

Posted by techieman @ 01:20 PM 18 Comments

S and P 400ish 2011

Barrons: After Rally a 50% sell off

A good trend analysis. I like the fact the guy is apologetic about being so bearish suggesta no sensationalism I guess. The initial rally predicted would run through the G20 meet perhaps with the market temporarily buying into the BS that will emerge from this.

Posted by bellwether @ 01:13 PM 15 Comments

An alternative to Banks?

Renegade Economist: James Robertson - It's Our Money Anyway

Interesting.... will it ever be implemented? i wouldnt bank on it!

Posted by techieman @ 09:15 AM 7 Comments

The financial sector is holding the economy hostage

MarketWatch: Banks want G20 to set up pricey bad bank

The world's largest financial institutions urged the G20 financial leaders on Friday to endorse the "bad bank" approach to dealing with the credit crisis, an expensive model one expert likened to another ransom note. The request came in a letter to U.K. Prime Minister Gordon Brown from the Institute of International Finance, a trade group of the world's largest global banks. The IIF wants Brown and his G20 colleagues to push the Obama administration in the direction of setting up a bad bank. Under this approach, governments would buy toxic assets from banks at a price higher than the prevailing market rates. For the time being, private investors simply won't buy the assets at the prices that the banks want. As a result, banks have huge holes in their balance sheets.

Posted by devo @ 08:51 AM 5 Comments

How to sell your house knock of 30%

This Money: How to Sell Your Home in a Buyers Market

I know we have read it before but it is good to see it being repeated. IF YOU WANT TO SELL YOUR HOUSE YOU ARE GOING TO HAVE BE REALISTIC take the 2007 price and knock off 30% . RECOVERY is not round the corner and this week the press have said there could be 40% falls by the end of the year (last weekend Guardian / Observer etc + the Numis Report (Daily Mail / Telegraph etc) predicting possible 55% falls from here (that is 75% in total). Reducing your home 30% now still leaves your buyer possibly losing 20% as well. Therefore selling your house 30% off does not make it a BARGAIN property but a realistically priced one for now.Realistically priced soon will mean prices HAVING to fall in line with wages they have to lose 40 / 50 % of their value, the UK can't afford anything else

Posted by sybil13 @ 08:09 AM 0 Comments

Friday, March 13, 2009

Go Obama.....

The Guardian: Switzerland caves in to pressure and signs up to tax-evasion fight

With its fearful attitude to do everything possible not to be blacklisted, the government has once again allowed itself to be blackmailed ... With today's decision the government is sacrificing a centuries-old principle of protecting citizens," it claimed

Posted by braindeed @ 08:22 PM 29 Comments

The Spoof is out there.....

Daily Mash: Madoff Pleads Guilty to not being a Bank

Bernard missed a trick! If he had been a bit more on the ball, Instead of 150 years in clink, he would be retiring on a big fat pension like Fred the Shred.

Posted by auntie @ 06:17 PM 1 Comments

French workers do not go quietly when handed brown envelopes

Telegrath: French Sony workers held company chief executive hostage overnight

The head of Sony France was held hostage overnight by furious factory workers whilst in Clairoix, north of Paris, the head of German tyre giant Continental's plant was pummelled with raw eggs after unexpectedly announcing that 1,210 workers were to lose their jobs.

Posted by enuii @ 05:37 PM 6 Comments

"interest rates could rise rapidly to counter inflation"

Citywire: Sharp rate rises ahead, MPC member hints

A member of the Bank of England's Monetary Policy Committee has said interest rates could rise rapidly to counter inflation when the current downturn is dealt with. Delivering a speech last night discussing stability and monetary policy, Kate Barker said she was aware that having cut interest rates drastically to 0.5% and introduced quantitative easing to combat flagging growth and the risk of deflation sharp rises could be on the cards further down the line. She said: 'I recognise that at some point this stimulus may need to be unwound, possibly rapidly, to avoid an overshooting of inflation.'

Posted by jack c @ 04:28 PM 17 Comments

More banks around the globe bite the dust!

Bbc: Administration for Australia bank

Australia's second largest investment bank, Babcock & Brown, has gone into administration after it was unable to deal with its massive debt levels.

Posted by mark @ 04:00 PM 5 Comments

Will Britain go bankrupt?

MoneyWeek: Will Britain go bankrupt?

"Having been sellers of gilts for 10 years, British banks have bought a net 30bn-worth in the last three months the most since data started in 1997. While there's still some cash left in the banks' vaults, expect the government to grab what it can. It all means that sterling assets from houses to conventional gilts to stocks exposed mainly to the domestic economy will keep crumbling."

Posted by damien @ 03:24 PM 15 Comments

Gordon Brown says we should take exception to his bank bailouts

Crown Blog: Gordon Brown says we should take exception to his bank bailouts

peaking back in October Gordon Brown says that people would take exception 3 partial proposals for bank restructuring. There have now been 3 attempts by Gordon and his band of merry muppets to restructure the banks and we are no further forward. By restructuring the banks he means throwing our tax payer money at them and hoping that some will stick. Watch our great leader here

Posted by crown @ 02:55 PM 0 Comments

Outbreak of commonsense

BBC: Help 'at risk' tenants - Tories

The Conservatives are calling for more protection for tenants who face being evicted from their home with little notice if it is repossessed. Lenders are required to give tenants just 14 days' notice that their property might be repossessed. The Tories say this period should be extended and tenants should be more clearly informed about their situation. Ministers said tenants would soon be given seven weeks' notice and insisted they should be treated fairly.

Posted by mark wadsworth @ 01:15 PM 5 Comments

So what to do with your savings now, if you have any Are we forgetting savers as interest rates drop?

Another casualty in the housing crash are savers, what should you do with savings now interest rates are so low? Certainly not a good idea to have too much cash in one place.

Posted by kaz @ 11:36 AM 4 Comments

The date to buy in 2009

Telegraph: September 16, 2009: The perfect day to buy your next house

Far from considering a few months period this is THE date to buy. Interesting thought.

Posted by kaz @ 11:35 AM 19 Comments

Norway to move into UK commercial property next year

Telegraph: Norway to use oil billions to buy UK commercial property

In a way, the UK provides a saving facility to the world, a trend which looks to continue. Whether Norwegian, Chinese etc, if your nation wants to defer consumption and save, then use the UK, buy up gilts, guaranteed commercial debts, collapsed commercial property. At the same time, for the UK population to save becomes more and more impossible. On the plus side, this would seem to end with lots of jobs for UK workers as those savings are eventually spent, but of course we won't be able to keep what we produce. As far as gilts go, Norway seems a little reticent on their purchases of government debt....

Posted by stillthinking @ 11:11 AM 1 Comments

FT Index Falls Into Line

FT: House prices continue to slide

"House prices in England and Wales continued their slide in February, with prices now back to levels not seen since early 2006, according to the latest FT House Price Index." Funny - I remember a few months ago the people who compile the FT Index were suggesting how the Halifax/Nationwide figures may be innacurate and how their methods are much better. The reality is simply that they rely on Land Registry data which we all know is about 3 months out of date...

Posted by papabear @ 10:50 AM 1 Comments

Bridging loans: tread carefully

MoneyWeek: Bridging loans: tread carefully

The Bank of England's rate cuts have brought traditionally-expensive bridging loans down to levels where many people might be tempted. But it's not really a good idea to have two mortgages...

Posted by damien @ 10:50 AM 0 Comments

Gloves come off-beggar thy neighbour currency devaluations get serious

FT: The Swiss franc factor

The Swiss National Banks abrupt move on Thursday to intervene to push down the Swiss franc raised alarm bells...It was the first time a leading central bank has intervened in the forex markets since Japan sought to weaken the yen in 2004, as Peter Garnham, the FTs currencies correspondent, reported on Friday, and the move has fuelled speculation that countries are set to engage in a bout of competitive devaluation.... The problem is that not everyone can devalue at once - someone has to be left with an overvalued currency. [something must end higher, commodities and shares of debt-free companies is my guess]

Posted by mountain goat @ 10:17 AM 2 Comments

Never forget this

BBC: Blair joins JP Morgan

Tony Blair joins investment bank JP Morgan in January 2008, 6 months after ceding the role of Prime Minister.

Posted by stillthinking @ 10:01 AM 14 Comments

Wayne and Waynetta to run Bank of Essex

FT: Local councils set to provide business loans

Essex Council has revealed details of a proposed Bank of Essex, which will make finance available to local small businesses struggling to get finance through commercial banks. At the same time several local authorities are pressing for government support for a scheme which will allow them to help residents who are unable to get mortgage finance from banks. Essex Council said the proposed Bank of Essex would act as an intermediary to release European Investment Bank funds for local firms.

Posted by jack c @ 08:54 AM 2 Comments

Don't pull your punches there, Jeff!

Telegraph: Brown and Madoff separated by a single detail

What's the difference between Bernard Madoff and Gordon Brown? Answer: one has drained fortunes from gullible victims, plundering their income and savings to create an illusion of prosperity. The other is going to jail. Mr Madoff has thrown in the towel. His Ponzi scheme, whereby he needed to suck in ever greater quantities of other people's money in order to maintain a semblance of competence, collapsed under the weight of undeliverable expectations. Nobody knows for sure how much has gone missing, but Wall Street scribes are calling it a $65 billion fraud.

Posted by charlie brooker @ 06:47 AM 24 Comments

Reduced to a life of luxury.

BBC: Rich list hit by economic crisis

The financial crisis is taking its toll on the world's richest people, wiping 332 names off Forbes magazine's "rich list" of world billionaires. Just 793 people can now lay claim to a place on the list, but on average they have lost 23% of their wealth. The stock market collapse helped Microsoft founder Bill Gates regain the top spot, despite his wealth declining $18bn (13.06bn) to $40bn. He ousted investor Warren Buffet, whose fortune declined by $25bn to $37bn.

Posted by charlie brooker @ 04:13 AM 4 Comments

X5 maker suffers downturn. Please, no sniggering.

BBC: BMW's profits tumble nearly 90%

BMW's net profits tumbled nearly 90% to 330m euros ($423m; 306m) last year, as the global economy weakened and reduced demand for cars. Earnings were hit by 2.4bn euros of exceptional costs linked to bad debts, personnel costs and provisions to cover risks on used car markets. Separately, the European Investment Bank made a 400m euros loan to BMW as part of a wider industry package.

Posted by charlie brooker @ 04:10 AM 22 Comments

Thursday, March 12, 2009

Pot calls Kettle again

Guardian: Darling calls for tighter regulation of bank capital

Regulators should have the power to force banks to build up enough capital in the good times to withstand a downturn, British finance minister Alistair Darling said on Thursday. Perhaps the word 'bank' should be swapped to 'governement'.

Posted by enuii @ 09:51 PM 5 Comments

Looks like the 75bn will not last very long.

Reuters: Bank steps up pace of quantitative easing

The Bank of England stepped up its quantitative easing programme on Thursday, saying it would buy 5 billion pounds of gilts next week after investors eagerly offloaded 2 billion pounds worth on Wednesday, investors had wanted to sell more than 10 billion pounds of gilts to the Bank of England, five times what it was bidding to buy.

Posted by enuii @ 09:13 PM 5 Comments

Is it time for the unthinkable?

BBC Blog: Should the Bank of England buy shares?

Instead of buying bonds, city gurus are now advocating buying shares. What next, houses?

Posted by iblewitlasttime @ 08:58 PM 16 Comments

Greenspan keeps talking but no one listens

The mess that Greenspan made: Alan Greenspan still hasn't got a clue

While Greenspan tries to pass the buck, there are others ready to nail him with the facts.

Posted by inflationwatch @ 06:57 PM 0 Comments

Over-valued? New-build? Buy-To-Let? Mortgage Fraud? Who'd a thunk it? (How many more are there?)

East Anglian Daily Times: Ipswich flats in 40 million fraud probe

NINE people have been arrested on suspicion of a 40million mortgage swindle believed to involve an Ipswich waterfront development. The suspects are currently on bail after being quizzed by police following raids on their homes. The alleged fraud is said to be part of an investigation into crooked mortgage deals, which could ultimately be worth hundreds of millions of pounds.

Posted by phil robinson @ 06:16 PM 0 Comments

Why so few questions?

Telegraph: Gordon Brown broke Lloyds, and it should break him

The disaster of Lloyds-HBOS could cost us 130 bn. So how come it isn't a bigger deal, asks Iain Martin. The catastrophe at Lloyds-HBOS is the ultimate New Labour scandal. It has the lot: cronyism, back-scratching, destructive micromanaging by Gordon Brown and an unimaginably large loss of public money.

Posted by alan @ 05:08 PM 9 Comments

Are shares now yesterday's story?

MoneyWeek: Are shares now yesterday's story?

Those with stock market investments over the last 18 months have lost a packet. And the danger now is that small investors could abandon equities altogether. While individual stocks may be cheap, we still wouldn't buy that index tracker just yet.

Posted by damien @ 03:57 PM 11 Comments

Asking For Your Comments On Whether House Prices Have Another 55% To Fall

City Wire: Do UK House Prices have another 55% to fall ?

Can there really be any doubt that property prices are going to have to fall. Obviously the article in the Telegraph and Daily Mail today is sending reverberations throughout the media.

Posted by sybil13 @ 03:02 PM 0 Comments

It was NuLab spin anyway

Independent: Pound fails to help exports as demand for UK goods collapses

"The much-vaunted boost to UK trade from the devalued pound has yet to materialise, according to the latest official figures. Despite a 25 per cent slide in the value of sterling since mid-2007, the UK's trade deficit widened by more than expected in January as exports to non-European Union countries fell sharply. The deficit in goods and services grew to 3.6bn, from a shortfall of 3.2bn in December. The deficit in goods, at 7.7bn, is up by 500m on the previous month".

Posted by alan @ 02:56 PM 0 Comments

Alan Greenspan: We didn't start the fire

Wall Street Journal: The Fed Didn't Cause the Housing Bubble

By ALAN GREENSPAN. Some claim the "easy money" policies of the Federal Reserve produced the U.S. housing bubble that is at the core of today's financial mess. However it was not the overnight fed funds rate that was too low. Rather, it was the low rates on long term fixed rate mortgages, which became disconnected from the Fed's monetary policy in the early 2000s, as a result of a glut of savings from China and other emerging markets. Tightening monetary policy by the Fed could not have "prevented" the housing bubble. I prefer Milton Friedman's assessment of our performance, in 2006: "There is no other period of comparable length in which the Federal Reserve System has performed so well."

Posted by little professor @ 12:46 PM 14 Comments

Some things never change - Excellent piece on boom and bust from 1897

Option Armageddon Blog: Panics and Booms, a lesson from 1897

He even explains leverage, housing booms and hpc. "during the prosperous times the demand for goods and property increases and soon the demand exceeds supply, and then prices advance....When prices of property and goods during a period of business depression are falling, the loss does not come on the entire property, but only on that portion of it represented by the cash capital the man has invested in it. The debt never shrinks until the real investment is all gone."

Posted by mountain goat @ 12:42 PM 5 Comments

City insiders tell it like it is

BBC News: City Diaries

Excerpt: "Until the debate moves on to what caused the bubble in the first place, namely the paper money system itself, Brown and any other leader will be condemned to produce new booms and busts by printing more money and stacking up more debt, exactly the two things that got us into this mess in the first place. What makes us City folk despair is that politicians of all colours - Brown, Bush, Obama - just can't see this and so it goes on, the familiar pattern of needing to "do something", increasing debt further and laying the seeds of the next crisis when the new bubble pops."

Posted by sneaker @ 11:52 AM 1 Comments

Why printing money must lead to inflation

MoneyWeek: Why printing money must lead to inflation

Everyone's worried about deflation for the moment. But with the Bank of England now printing money, it's only a matter of time before inflation takes off.

Posted by damien @ 11:52 AM 0 Comments

Stubborn sellers making things worse Prices On Hold Despite Glacial Market

The mix-adjusted average Asking Price for homes on the market in England and Wales remains essentially unchanged: slight rise of 0.1% since February. Monthly average price falls observed in just 4 of 9 English regions, Wales and Scotland. Asking Prices across England and Wales have fallen 7.1% since March 08. The average Asking Price reduction in February was 19,840. Typical Time on Market rises to 173 days for unsold homes for sale.

Posted by tinecu @ 11:50 AM 2 Comments

Running from gilts

Spectator: How Brown plans to borrow more money than the market would ever let him

An extremely small chart showing that private UK and non-UK investors are getting out of UK gilts. Only the nationalised banks are buying them, and the BoE of course. It would seem that the government can maintain the nominal price of gilts and push the nominal yield down to zero, but they can't alter a falling real price and by implication a negative yield(overall). Over the last year European, American, Japanese et al, have made real losses holding UK debt. This is a devaluation in all but name. So, printing money does effect the value of that already existing....fancy that.

Posted by stillthinking @ 11:44 AM 3 Comments

What happened to my green shoots?

BBC News: Mortgage lending slump continues

Mortgage lending continued to fall in January, according to the Council of Mortgage Lenders. Just 23,400 mortgages were completed for all house buyers, a new record low, with only 8,900 first-time buyers able to take out home loans. The number of mortgages lent was down by 28% from December from last month, and 52% lower than a year ago. The CML said the recession and falling house prices were forcing lenders to ration their lending even more.

Posted by little professor @ 10:38 AM 9 Comments

Blast from the past (2006).

Guardian: There's no need to fear a house price bubble

"But even on this pessimistic case, there seems very little chance that prices could decline by 14%, as they did in 1991-92, when mortgage rates rose briefly to 15%. In that depressing period, mortgage interest payments absorbed 15% of household income, while today's low interest rates have kept that ratio down to only 9%" PREDICTION FAIL.

Posted by ictoa @ 09:49 AM 4 Comments

Telegraph Scare Mongering Another 55% House Price Fall

The Market Oracle: Telegraph Runs with Improbable UK House Price Crash Forecast of Another 55%

The mainstream press as illustrated by The Telegraph has run with a house price forecast by Numis Securities (NS) that states that UK house prices could fall by a further whopping 55%, that is a rather incredible forecast to make in light of the of 22% fall to date.

Posted by nadeem walayat @ 09:35 AM 4 Comments

Unintended effects?

Mail....yes again...: Bank 'prints' 2bn more cash - but has it all gone abroad?

''Much of the fresh money created by the Bank of England yesterday could have leaked abroad, a City expert has warned. Former Bank of England official Danny Gabay said the biggest participants in the unprecedented quantitative easing scheme were likely to have been foreign investors''

Posted by hpwatcher @ 09:26 AM 8 Comments

Every Day Now We Hear About 50% + Fall In Property Prices

This Money: House prices 'could drop another 55%'

Is the UK finally waking up to the FACT that nobody could afford to support the UK's inflated property bubble? That property prices are going to fall 50% or more. That mortgage regulation on loan to income ratios at around 3.25 one wage will ensure that prices are not going to rise again for a long time, and then only in line with wages. That RECOVERY means returning to how things were prior to the madness, not a return to the kind of irresponsible lending that broke the banks. It can only be good news that we hear every day someone now confirming what was once considered a radical view! Now it just appears to be obvious, property prices are falling and falling fast.

Posted by sybil13 @ 08:56 AM 9 Comments

Mildly interesting

BBC: Tenants offered rent-to-buy deal

What is noteworthy is that this chap managed to get such a good discount on a block of flats from Barratt's that even if he doesn't sell them at a a profit, he is still making what appears to be a 5% to 6% return on his investment, also the fact that he accepts prices might go down. Maybe he could have a chat with Greenbay?

Posted by mark wadsworth @ 07:42 AM 6 Comments never went away you fools,,,

FT: The return of inflation

''Rising inflation expectations, rather than deflation, is the new fear. Warren Buffett the man who said the US economy had fallen off a cliff believes inflation could return to 1970s levels. Jim Rogers the man who said the UK was finished expects much the same. Pimco, the bond fund, sees similar risks.''

Posted by hpwatcher @ 06:48 AM 14 Comments

Old folk are looking for housemates!

Mish's: Boomers' Future Went Down The Drain

Among the adjustments forced by the new circumstances, perhaps the cruelest twist for many boomers is the need to join younger generations in the [flatmate] queue. The housing crash has forced record numbers of late-middle age homeowners to take in [lodgers] or risk becoming [lodgers] themselves. Home-share organizations founded to assist the elderly are scrambling to meet the demands of newly bust boomers. In the last few months they have experienced explosive growth in interest by homeowners age 50-plus to find rooms and roommates. People in their 50s and 60s are losing their nest eggs and increasingly willing to give up their privacy in exchange for rents of $500, $600 a month. Is this so bad? Why wait for a retirement home to live with other people?

Posted by drewster @ 12:19 AM 6 Comments

First attempt deemed a qualified success

The Telegraph: Bank plan to 'print money' begins

Investors piled into gilts after the Bank of England officially launched quantitative easing, buying 2bn worth of UK government bonds at its first auction. In what economists deemed a success, the Bank received 10.5bn worth of offers for gilts - more than five times what it sought. However, doubts remain as to whether the money the Bank is creating has found its way to the pension funds and insurance groups the Bank is keenest to target.

Posted by wanderinman @ 12:13 AM 2 Comments

Wednesday, March 11, 2009

The dawn of the truth.......

Mail: House prices 'could drop another 55%' and leave Britain bankrupt

''House prices could slump by another 55 per cent, a respected City forecaster warns. It also predicts a deep recession lasting throughout next year and a 'very real probability' that Britain will go bankrupt''

Posted by hpwatcher @ 11:26 PM 29 Comments

A drop in Chinese exports and falling prices in Japan and Germany underscored the weakness of the gl

Cnbc: Economic Data Shows Recession Deepening

A drop in Chinese exports and falling prices in Japan and Germany underscored the weakness of the global economy Wednesday. Charles Dumas from Lombard Street Research, and Ken Wattret from BNP Paribas consider the outlook for the global economy.

Posted by chris @ 11:00 PM 0 Comments

House prices 'could fall by further 55 per cent'

Telegraph: House prices 'could fall by further 55 per cent'

House prices 'could fall by further 55 per cent' House prices may fall by a further 55 percent and there is a "very real probability" that Britain will be bankrupted, a leading investment bank has warned in a private note to clients.

Posted by pi88edoffoftunbridgewells @ 10:46 PM 0 Comments

Inflation lurking just off shore.. The big downturn is yet to come

Gamespot UK: Nintendo UK raises Wii wholesale price

Quantative easing, huge national debts, and the housing bubble have all contributeded to the destruction of the pound, this will lead to the a sharp rise in everything imported to the uk and therefore Inflation. If house prices are dropping with Mortgages at 1%, just think what will happen when we have interest rates of 12, 13,14,15%

Posted by neillark @ 09:12 PM 9 Comments

Black hole springs to mind.

Telegraph: Democrats draw up plan for second stimulus bill

Just weeks after Congress approved the largest rescue package in US history, Nancy Pelosi, the speaker of the House of Representatives, said "we have to keep the door open" to another stimulus. David Obey, the chairman of the appropriations committee, said he has instructed his staff to start drafting another stimulus proposal, though he emphasised no deadlines or timelines had been set.

Posted by flintster1994 @ 06:30 PM 0 Comments

Pesto answers his own question: No

BBC: Will QE work?

"And the device of authorising the Bank of England to buy up a huge proportion of these IOUs has apparently reduced the cost of all that borrowing to an astonishing degree. Which seems a bit bananas, since surely all we're talking about here is one arm of the state buying debt issued by another arm of the state. Surely if markets were rational and efficient, there would be no impact on gilt prices, or yields or interest rates at all. Isn't there a kind of Ricardian equivalence going on here, where nothing of economic substance has actually changed? It seems to me that this policy only works on the basis that markets are irrational and short-termist." Exactly what I have been saying for ages, so if I'm wrong, at least I'm not the only one.

Posted by mark wadsworth @ 04:38 PM 9 Comments

Cannery Row

FT: Britons take whatever work they can

The recession is forcing British workers back into tough low-paid jobs that have been the preserve of migrant labour since the expansion of the European Unions borders in 2004... Its just happened recently, she said. Its what Id call older, middle-aged people who have been in work for 10, 15, 20 years in one place and now with the climate as it is, they are made redundant and willing to take on anything. It is heart-breaking.

Posted by mountain goat @ 01:28 PM 20 Comments

Does gordon still expect that bounce in

Yahoo: Germany's Daimler idles 18,000 truck workers

auto group will lay off 18,000 workers at its German truck plants

Posted by mark @ 01:27 PM 1 Comments

Where is my grant to develop products, where is my bailout

Reuters: UK offers grant to Land Rover for new car

Gordon you and your government are criminals you are insane, you abuse the public and the taxpayers money you bailout zombie firms, give money away and sh$t on the public from a great height....

Posted by mark @ 12:20 PM 3 Comments

Morning Line: the mortgage fraud at the heart of the housing boom

Citywire: Morning Line: the mortgage fraud at the heart of the housing boom

"One of the key lies underpinning the UK house price boom was that it was really all about a fundamental shortage of housing stock in a country with a rapidly rising population....." Sure, and I'm Charlie the cabbage. But there was also another key factor in the housing boom, one much less remarked upon thus far, but one that is now belatedly starting to grab some headlines....and that factor is fraud." People forced to break the law in order to 'climb the ladder'. Yes, I'm sure they had guns held against their heads.

Posted by gaztops @ 11:50 AM 1 Comments

Stock markets: Relief rally or new bull?

Investment Postcards: Stock markets: Relief rally or new bull?

The surge in stock prices again raises the question: was yesterday THE bottom? This post discusses a number of indicators Prieur du Plessis will be monitoring closely in order to establish whether we are dealing with anything more than an oversold bounce.

Posted by prieur du plessis @ 11:49 AM 2 Comments

UK house prices will plummet

MoneyWeek: UK house prices will plummet: look at this scary chart

If you're thinking of getting back into the British housing market don't. Any recovery in confidence helped by low interest rates and money pumping will be short-lived, says Dominic Frisby. In the longer run, prices are headed nowhere but down.

Posted by damien @ 10:55 AM 17 Comments

Savills Savaged

BBC: Savills hit by property downturn

Property firm Savills has reported a loss of 7.7m for 2008 after the sector saw an "unprecedented" downturn. The firm warned that 2009 would be another challenging year with the lack of mortgages continuing to hit sales. The loss was due to a 45.4m impairment charge related to the effects of the global financial crisis. However, Savills said that the fall in property values, coupled with the weak pound, could make UK property attractive to overseas investors.

Posted by jack c @ 10:12 AM 7 Comments

Latest news on Residential Property Futures (p3)

SPREFS: House Prices Only 35% Higher by 2028?

The derivative market took the statistical blip that was the increase in the Halifax HBOS (err, Lloyds) HPI from Dec-08 to Jan-09 in its stride. Forward prices for one thru three years were little changed but average UK house price for five years hence fell 4,795 to 119,864. Basically the derivative market expects the average UK house price to 20% lower than current prices by 2010, 31% lower than current in 2012 (the low) and 28% lower than current five years.

Posted by mark ainsworth @ 09:26 AM 2 Comments

Stating the obvious!!

Daily Telegraph: Failed banks toxic debt 'generated by massive mortgage frauds'

Liar loans, fraudulent BTL loans, corrupt VI's, this has caused the current economic situation. 40 million gang uncovered. How many more people are involved in order to bankrupt the UK banks? The Serious Fraud Office are going to be busy for the foreseeable future

Posted by khime @ 08:34 AM 1 Comments

This will really bake your noodle:

BBC: China's exports in sharp decline

Chinese exports plunged by more than a quarter in February from a year ago as the world's third-largest economy was hit by a drop in demand for its goods. Exports dropped by 25.7% to $64.9bn (47.3bn) compared with the same month a year earlier, while imports fell by 24.1% to $60.1bn, figures showed. The country's trade surplus stood at $4.8bn in February, compared with $39.1bn the month before. The dramatic drop in exports came as a surprise to many analysts. "This is clearly worse than expected. We were looking for a rise of 1.2%," said Robert Subbaraman at Nomura International.

Posted by charlie brooker @ 07:58 AM 0 Comments


BBC: RBS makes 1.7bn mortgage promise

"The Royal Bank of Scotland is promising to pump 1.7bn worth of mortgages into the Scottish housing market over the course of the coming year. Finance Secretary John Swinney has welcomed the move. He claims the bank's action will help re-invigorate the property market north of the border. "

Posted by phdinbubbles @ 07:50 AM 17 Comments

Reality check

Times: Welcome to the inescapable era of no money

We know we're broke, shame the government doesn't and keeps spending money like there's no tomorrow. There is a tomorrow however, it's just we'll be begging for scraps.

Posted by martin n @ 05:49 AM 0 Comments

Tuesday, March 10, 2009

More BTL mortage fraud

The Times: Nine arrested over 40m buy-to-let mortgage fraud

Nine people were arrested this morning in raids by police investigating a suspected 40 million mortgage fraud. Officers from City of London Police fraud squad are searching six homes and three business premises in southern England. The alleged fraud involves the purchase of 500 properties between 2005 and 2007 and the operations of a now defunct firm Eastbourne Financial Services. Bradford & Bingley said it was aware of the arrests and confirmed that it had been co-operating with police for some time. Brian Dilley, partner at KPMG Forensic, said that he expected to see more such cases in the future: As house prices continue to fall, there will be more and more of these cases surfacing. Lenders are now proactively looking at their loan books to identify indicators of such frauds.

Posted by koala bear @ 08:35 PM 0 Comments

ITV property portfolio tracks the market down

ITV: ITV Property Portfolio

Interesting feature of tonights main ITV news - In conjunction with the Royal Institution of Chartered Surveyors, ITV News is tracking the true drama of the housing market. ITV's Property Portfolio will follow the changing market month by month. Click on the properties to watch a video.

Posted by jack c @ 07:51 PM 2 Comments

Media is told to make light of "Quantative Easing". Move along now. Nothing to see here.

Timesonline: Sign our petition to rename quantitative easing

What do you think of the phrase quantitative easing? If you are anything like us on Money Central, you probably think it is yet another example of impenetrable official jargon. That is why we read with such joy, Carl Maxims letter to The Times today.

Posted by flintster1994 @ 06:33 PM 2 Comments


Telegraph: Inflation will kill the gilt rally in the end

Telegraph warns of coming problems with gilts. That the government is printing for expenditure is out in the open. The conclusion from the author is to stick to inflation-linked, however, can the government cover inflation-linked debt? They can't cover those with printing during an inflationary spiral, possibly they can be creative with inflation measurements. The BoE must be congratulated on their attempts to induce inflationary expectations.

Posted by stillthinking @ 05:17 PM 2 Comments

Rent don't buy

Yahoo: 5 Reasons Renting Still Beats Buying

Why through your money away on a mortgage when you can pay rent. It always adds up to more house for less money.

Posted by inflationwatch @ 03:31 PM 9 Comments

Capital flight - UK style

Alice Cook: UK Foreign investors racing towards the exit

Since March last year, about $1.8 trillion has left the UK banking system; a drop of about 22 percent. In other words, investors are racing towards the exit.

Posted by inflationwatch @ 03:27 PM 0 Comments

Off topic, but one for the gold bugs.

Telegraph: IPhone users can now jump on the gold bandwagon

The software will allow iPhone users to trade in gold and silver, or transfer the money to other people or companies, according to GoldMoney, a Jersey-based company that will provide the service. GoldMoney said the mobile payment application means any individual or merchant could open up an account and then receive a payment in gold or silver bullion within minutes."

Posted by flintster1994 @ 03:14 PM 15 Comments

Crashing China!

Bloomberg: China Home Prices Fall by Record on Slowing Economy

Chinese home prices fell by a record last month, paced by a 15 percent plunge in the southern export hub of Shenzhen, where factories closed as growth in the worlds third-biggest economy slowed.

Posted by alan @ 02:55 PM 1 Comments

How to drop house prices 90%

Wikipedia: Japanese Asset Bubble

Too much money. Too many bad debts. Zero interest rates. Quantitive easing. Easy innit.

Posted by indirectapproach @ 02:51 PM 3 Comments

20 UK postcodes most likely to claim for theft

The Times: The top 20 burglary hotspots

Doncaster and Bristol have been named as the UK's thieving hotspots in a study by, the financial comparison website. The study highlights the postcodes where the highest proportion of homes have made an insurance claim for a burglary in the past 12 months.

Posted by mountain goat @ 02:50 PM 1 Comments

Brown pushed for an apology

Yahoo news: Brown pushed for an apology

Gordon Brown has said he takes responsibility "for everything that's happened" in his time in office - but again declined to apologise for the economic crisis. Skip related content

Posted by happy mondays @ 02:12 PM 11 Comments

Blah Blah Blah! The puppet speaks!

BBC News: Worst crisis since 1930s says Fed

US Federal Reserve chief Ben Bernanke says the world is suffering from the worst financial crisis since the 1930s. Mr Bernanke argues that the roots of the current global economic downturn stem from global imbalances in trade and flows of capital in the late 1990s. In a speech to the Council on Foreign Relations, he argues that the US and its trading partners did not do enough to redress these imbalances. He also says future economic recovery depends on financial stability.

Posted by flintster1994 @ 02:02 PM 2 Comments

Playing chicken - is AIG the centre of the CDS debt insurance storm?

Bloomberg: AIG Told U.S. Failure May Cripple Banks, Money Funds

"AIG appealed for its fourth U.S. rescue by telling regulators the companys collapse could cripple money-market funds, force European banks to raise capital, cause competing life insurers to fail and wipe out the taxpayers stake in the firm...The Fed is asking for an open-ended check and is not going to get it, Senator Robert Menendez, a New Jersey Democrat, said last week in Congressional hearings." [It seems to me that the housing bubble financed by the larger credit bubble happened because of a belief that potential losses were insured by the CDS market. If that is the case then it looks like AIG really is at the heart of the storm. I think is too complex to solve so should be allowed to fall. However, politicians used to undeliverable promises will not change course now.]

Posted by mountain goat @ 01:31 PM 4 Comments

Expect this trickle to turn into a flood ...

Metro: Nine held in 40m mortgage fraud

The [police] spokesman said the operation centred on an ongoing investigation into a fraud affecting mortgages taken out on more than 500 properties in the south of England between 2005 and 2007. A police spokesman refused to comment on the specific allegations that the inquiry centred on. "We cannot comment on this particular case but cases such as this often involve allegations of over-valuing of properties by complicit professionals, such as solicitors and surveyors," he said.

Posted by mark wadsworth @ 01:29 PM 0 Comments

No Green Shoots Just A Profession In Denial

Guardian: Green shoots are symptomatic of a profession in denial

50% falls finally being spoken about , soon we will hear that the problem is not the current sensible levels of lending but hugely inflated house prices that must now fall in line with affordablity (FSA regulation loan to income ratios fixed around 3.25 one wage 2.5 two etc)? I do keep reading property is becoming more affordable but still has a long way to go, so why can't people see that property was NOT affordable and that has been the reason for irresponsible lending and billions of pounds worth of debt that will take us 30 years to pay off and smillions of people bankrupt. How can we EVER go back to how things have been the past decade? NOW IS A GOOD TIME TO SELL BEFORE YOUR PROPERTY IS WORTH 90% LESS THAN IT WAS IN 2007, each week more evidence that this is they way it is going

Posted by sybil13 @ 12:54 PM 0 Comments

Look after No 1

London Evening Standard: Ex-Lehman staff in line for Nomura cash bonanza

Lehman's senior management, led by Christian Meissner and William Vereker, negotiated guaranteed bonuses for themselves and the division's 400-strong staff when they brokered the sale of Lehman's European and Asian investment banking division to Nomura last September.

Posted by alan @ 12:47 PM 0 Comments

This site is mentioned

Guardian: The view: Which films show us our future?

post apocalpse visions....featuring mention of HPC

Posted by fun 4 now @ 12:36 PM 1 Comments

How about arrest anyone issued a mortgage post 2005?

BBC: Eight seized over mortgage frauds

Police have arrested seven men and a woman over suspected involvement in a massive mortgage fraud worth 40m.

Posted by peter_2008 @ 12:32 PM 4 Comments

Oh dear

Dailymail: Cattles in new profits warning as it breaches bank covenants

Its 550,000 customers tend to have unsecured loans averaging 2300 or hire purchase deals on second-hand cars averaging about 9800. At the end of last June, Cattles had outstanding loans to customers totalling some 2billion.

Posted by mark @ 11:53 AM 2 Comments

Signs of the Times

Reuters: Signs of the Times

odd articles about recession, i like the jam sandwich one what a scam...

Posted by mark @ 11:35 AM 2 Comments

A Japan-style slump may be on the cards

MoneyWeek: A Japan-style slump may be on the cards

There are striking parallels between what's happening to Western economies now and what Japan has been experiencing for years...

Posted by damien @ 11:11 AM 0 Comments

This applys to uk too

Cnn: Banks' future woes in one word: plastic

Troubled financials with a big credit card business should expect more losses as the economy continues to tank.

Posted by mark @ 10:57 AM 0 Comments

The Greatest Economic Transformation in the history of mankind

Contrahour: Martin Armstrong: The Collapse of Socialism

There have been plenty of articles asking whether Capitalism is now dead. The problem is the question already presumes an outcome and fails to realize that we are still in the middle of the greatest Economic Transformation in the history of mankind. We are in fact not seeing the collapse of capitalism, but are in the final stage of the death of Socialism

Posted by sold 2 rent 1 @ 10:34 AM 17 Comments

Link to RICS Report

RICS: RICS Housing Report Feb 2009

This is the source material that is being reported on this morning. I always find the EA's comments interesting, my favourite this month is; Market Harborough - Leicestershire Andrew Kilburn King West "Continuing uncertainty in economy will continue to have an impact on a housing market which could have otherwise shown some signs of recovery."

Posted by wdbeast @ 10:33 AM 1 Comments

More spin on that RICS press release

Metro: House sales sink to new low

Property sales sunk to a new low during February as potential buyers continued to struggle to get a mortgage, research shows. Inquiries from new buyers increased for the fourth month in a row during February, rising at their fastest pace since August 2006, according to the Royal Institution of Chartered Surveyors. But the up-surge in inquiries, failed to translate into transactions, with the average chartered surveyor estate agent agreeing just 9.5 sales during the three months to the end of February, down from 9.8 in November and the lowest level since the survey began in 1978.

Posted by mark wadsworth @ 10:04 AM 0 Comments

A realistic Times article

The Times: How homeowners can survive negative equity

Obviously not written by Anne Ashworth. The 26 year old from Bristol has already lost 60,000 compared to what he could have sold it for in 2007. (How many 25 year olds in Bristol earn 52,000 a year?) He hopes that prices will recover in two or three years. Since after the 1989 peak prices fell for 3.5 years then were flat for another three years, he could be waiting for a long time.

Posted by monty032 @ 09:58 AM 1 Comments

BBC report on latest housing "boom to bust"

BBC: Housing market 'still in a slump'

UK property sales between December and February remained at their lowest level in at least 31 years, the country's surveyors have reported. Nine homes were sold per surveyor in the three months, the lowest since the Royal Institution of Chartered Surveyors' (Rics) survey began in 1978. This was despite the four consecutive months of rising enquiries by new buyers as affordability improved. Meanwhile, house builders said construction may hit an 88-year low. "After years of boom, the housebuilding industry is lurching towards bust," said Ruth Davison, director of the National Housing Federation.

Posted by jack c @ 09:18 AM 5 Comments

February house prices fall faster

Reuters: RICS survey - the quickening of the fall

"The fall in house prices in England and Wales accelerated in February and average sales over the previous three months hit its lowest in more than 30 years, the Royal Institute of Chartered Surveyors said on Tuesday. The RICS monthly price balance fell to -78.3 from -76.6, though it remains above last September's record low of -84.5. Average sales completed per surveyor sank to 9.5 for the three months to February from 9.8 in the previous survey, the lowest since the RICS started the series in 1978." --- [Does that take into account the number of surveyors who have lost their jobs?] "A shortage of mortgage finance and growing worry about job security has put many Britons off buying a new home. Surveyors expected prices to continue to fall over the next three months."

Posted by drewster @ 02:19 AM 9 Comments

Monday, March 9, 2009

A major change in monetary arrangements

Independent: Stephen King: The policy to print money is right but we must be told how it works

"Dear Chancellor ... having a wonderful time although weather cloudy ... have come across this thing called a printing press ... looks great, but must be used carefully ... love Merv xx."

Posted by devo @ 10:51 PM 3 Comments

"The pain will shift to holders of bonds"

FT: Fresh pessimism sweeps over credit sector

Credit market indicators barometers of stress since the financial crisis began 18 months ago are once more flashing red. Heightened concern over the fate of US carmakers and worries about escalating losses at banks and financial institutions and at General Electric, the largest debt issuer in capital markets, are creating a grim mood. There has been a strong repricing of credit risk as there is a panic almost about the financial sector, Brian Yelvington, strategist at Creditsights, says.

Posted by devo @ 09:21 PM 0 Comments

Buffett's talks.

Timesonline: Buffett: crisis is an economic Pearl Harbor

Warren Buffett, the billionaire US investor, today described the America's battle with recession as an "economic Pearl Harbor." Mr Buffett said the meltdown, which has seen US unemployment hit a 25-year high, was an "important war which could be won." Japanese planes attacked the US Naval base at Pearl Harbor, Hawaii, on December 7,1941 in a surprise strike which drew the country into World War II. The US put aside "partisan stuff" then and should do so again, Mr Buffett said. "We knew if we stuck together and followed leadership we would prevail," he added.

Posted by flintster1994 @ 06:16 PM 17 Comments

The O2 is up for grabs

Property Related: The O2 is up for grabs

If you've got a spare bit of cash and fancy investing in a large bit of property then we've got just the bargain for you. The O2, formerly known as The Millennium Dome, is on the market for the bargain price of just 35m. This may sound expensive but is actually a very good deal for the arena. The dome plays host to some of the biggest music events in the country and it has just recently been announced that Michael Jackson will be performing several shows later this year.

Posted by lee @ 06:10 PM 3 Comments

Bear Market Race To The Bottom - 2nd Worst On Record

Gold Speculator: Bear Market Race To The Bottom - Week 73 - 2nd Worst On Record

An article by Mark Lundeen which super-imposes the current bear market with historical bear markets. This is a very informative article that visually and statistically puts into perspective what has happened and what we may possibly expect in the coming weeks.

Posted by calvin oh @ 05:40 PM 0 Comments

World Leaders

Guardian: IMF: Fifth of Britain's GDP spent so far on bailouts

Alistair Darling has already spent almost a fifth of Britain's GDP on bailing out its shattered banking system more than any other major economy, according to a grave assessment of the world financial crisis published today by the International Monetary Fund. With G20 finance ministers due to gather in Sussex next Friday for a two-day meeting before the London summit in April, the IMF has totted up the costs of financial bailouts so far. It calculates that the UK has spent as much as 19.8% of its GDP, topping the table of G20 countries

Posted by sold out @ 05:34 PM 4 Comments

Good blog

JKA on Economics: Blog

no comments. I just found a link to this blog on alice cook house bubble site. lots of stuff about the uk gov. financial exposure (no not good news). truly, there a plethora of economic blogs out there...

Posted by stillthinking @ 05:26 PM 0 Comments

Stating the obvious

Housefund: European housing market recovery dependent on funding

Another article stating the obvious then failing to state the obvious. Obviously mortgage markets depend on funding, but what is causing property prices to fall is a decade of irresponsible overlending which nobody can now afford. What is happening now with falling property prices and responsible lending (3.25 loan to income ratios / 60 % LTV to take into accout the needed property price falls) IS THE RECOVERY that people appear to believe will mean going back to 2007 lending levels. The recovery of the housing market is dependent on sensible regulated lending, 3.25 loan to income and 40 - 50 % property price falls, we could not afford the madness of the past decade, slowly the market is recovering this is it, a return to what we can afford. The press now confirm January was a blip!

Posted by sybil13 @ 04:22 PM 1 Comments

Time on market soars as penny drops

Western Morning News: Sellers urged to drop prices

STUBBORN homeowners have been urged to ditch unrealistic asking prices as homes throughout the Westcountry are sitting on the market for more than a year. The greatest market stagnation was witnessed in upmarket Topsham, near Exeter, and the harbourside community of Fowey on the south Cornwall coast, according to the property website On average, it took around 300 days between the hoisting up of a "for sale" sign to a sale being agreed in both the two communities.

Posted by tinecu @ 01:56 PM 0 Comments

What year will house prices return to? House Prices Fall to 2005 Levels

Land Registry figures released at the end of February show that house prices in the UK have fallen to the same levels they were at in March, 2005.

Posted by kaz @ 01:16 PM 36 Comments

Legal actions against poor advice gaining momentum

Times: If only we'd kept our cash under the mattress

We need more of this: successful action against poor advice. Now just waiting for a mortgage/estate agent case. It can't be long

Posted by growler @ 01:06 PM 21 Comments

The one critical reason to avoid the banking sector

MoneyWeek: The one critical reason to avoid the banking sector

The sorry tale of Lloyds' takeover of HBOS shows why you shouldn't touch the banking sector with a bargepole. John Stepek explains how financial institutions are being crippled, and economic recovery delayed, by government interference.

Posted by damien @ 11:17 AM 0 Comments

Martin Wolf: The Future of Capitalism

FT: Seeds of its own destruction

Another ideological god has failed. The assumptions that ruled policy and politics over three decades suddenly look as outdated as revolutionary socialism. It is impossible at such a turning point to know where we are going. In the chaotic 1970s, few guessed that the next epoch would see the taming of inflation, the unleashing of capitalism and the death of communism. What will happen now depends on choices unmade and shocks unknown. Yet the combination of a financial collapse with a huge recession, if not something worse, will surely change the world. The legitimacy of the market will weaken. The credibility of the US will be damaged. The authority of China will rise. Globalisation itself may founder. This is a time of upheaval. How did the world arrive here?

Posted by devo @ 10:34 AM 0 Comments

Can someone answer this question

Guardian: Bank shares tumble as investors give thumbs down to Lloyds deal

Why would anyone take out an insurance premium if paying the excess would bankrupt the company? - 25bn excess is multiples of Loyds value

Posted by matt_the_hat @ 10:22 AM 4 Comments

The great cycles man is back in action

Gold Speculator: Martin Armstrong: The Coming Great Depression

Since penning his first article in years last October, Martin Armstrong has written 6 more smaller articles from his prison cell. The documents are scanned in from his typewriter output and some scanning errors are are present. This one tries to give some kind of forecast of what could happen in the markets over the next 18 months.

Posted by sold 2 rent 1 @ 09:52 AM 5 Comments

Bovis said that the availability of mortgages for home purchase had fallen 70% during the year

BBC: Bovis Homes reports 78.7m loss

The housebuilder Bovis Homes has reported a pre-tax loss for 2008 of 78.7m, compared with a profit of 123.6m for 2007. It decided to write off 77.4m of the value of its assets such as land. It has also written off 10m of the benefits it had expected from the 2007 acquisition of Elite Homes. Bovis boss David Ritchie described it as "an unprecedented year", saying there had been, "the toughest trading environment for many years". He blamed the problems on "declining mortgage finance availability and poor economic conditions, allied with low consumer confidence".

Posted by troy @ 08:09 AM 3 Comments

Driven by sharp falls in consumer spending, investment and inventories.

Reuters via Yahoo: Economy to shrink by 2.8 percent this year

The economic downturn will be deeper than previously thought this year and the recovery will be muted, the British Chambers of Commerce said on Monday. {and from the silly figures dept!} And it revised down its growth forecast for 2010 to 0.8 percent from 1.1 percent in January. It also said it expects unemployment to hit 3.2 million in the second half of 2010, or just over 10 percent of the workforce, higher than its January forecast of 3.1 million

Posted by troy @ 06:18 AM 8 Comments

Overseas Seizures ? Is this really happening?

Bloomberg: AIG Told U.S. Failure Would Cripple Worlds Banks, Money Funds

March 9 (Bloomberg) -- American International Group Inc. appealed for its fourth U.S. rescue by telling regulators the companys collapse could cripple money-market funds, force European banks to raise capital, cause competing life insurers to fail and wipe out the taxpayers stake in the firm. AIG needed immediate help from the Federal Reserve and Treasury to prevent a catastrophic collapse that would be worse for markets than the demise last year of Lehman Brothers Holdings Inc., according to a 21-page draft AIG presentation dated Feb. 26, labeled as strictly confidential and circulated among federal and state regulators. What happens to AIG has the potential to trigger a cascading set of further failures which cannot be stopped except by extraordinary means

Posted by troy @ 06:10 AM 3 Comments

Japan's long slump defies faith in stocks as best investment

Bloomberg: Asian Stocks Fall as World Bank Fuels Economic Growth Concern

March 9 (Bloomberg) -- Asian stocks sank for a second day, led by banks and automakers, on concern corporate earnings will deteriorate further as the World Bank predicted the global economy to shrink for the first time since World War II. As they say in the investment business, past results are no predictor of future performance, and comparing countries and periods can be tricky. But the long-languid Japanese stock market offers a scary counterexample to the belief that over the long run, stocks are always the best investment. Kotak open to buying RBS' India assets 43 mins ago Print Story Indian private lender Kotak Mahindra Bank is open to acquiring Royal Bank of Scotland's India business if an opportunity arises, a senior executive said. sott

Posted by troy @ 06:02 AM 0 Comments

Jones was baffled. An Amex cardholder since 1989 and can't remember being late on a payment.

Microsoft National Broadcasting Company: Don't Leave Home; Your Credit Card is on Hold

That's exactly what happened to Cathy Jones, a businesswoman with three Amex charge cards. She got a call from Amex last week saying her cards were now on hold, while the company did a financial investigation to make sure she could pay her bills. Jones was baffled. She's been an Amex cardholder since 1989 and can't remember being late on a payment. So, to get some answers, Jones and I got on the phone, and called the customer service number on the back of her card. An Amex representative in New Delhi, India, said because of the bad economic times, American Express is now doing financial investigations of thousands of cardholders. The rep said Amex is insisting these customers fill out an IRS form 4506-T, authorizing the company to get their tax returns for the last three years.

Posted by troy @ 05:46 AM 1 Comments

Answer - LLoyds, Barclays, RBS, HSBC, but hang on a min?

Reuters vis SOTT: Question - Who got AIG's bailout billions?

NEW YORK (Reuters) - Where, oh where, did AIG's bailout billions go? That question may reverberate even louder through the halls of government in the week ahead now that a partial list of beneficiaries has been published. The newspaper reported that some of the banks paid by AIG since the insurer started getting taxpayer funds were: Goldman Sachs Group Inc, Deutsche Bank AG, Merrill Lynch, Societe Generale, Calyon, Barclays Plc, Rabobank, Danske, HSBC, Royal Bank of Scotland, Banco Santander, Morgan Stanley, Wachovia, Bank of America, and Lloyds Banking Group.

Posted by troy @ 05:38 AM 2 Comments

Ignore the dreadlines - China really is decoupling

Telegraph: China's stimulus package looks like it's stimulating

"Official data suggest that the 4 trillion yuan ($585bn) spending programme being pumped through the economy is already putting some juice back into China's industrial sector. New orders to the industrial sector rose in January, driven by heavy industry. Growth in bank loans has also shot up. Both look like early signs that the stimulus is stimulating. China can afford more later, if need be. The package so far will leave a fiscal deficit of under 3pc of GDP - high for China, but frugal by today's international standards. Premier Wen Jiabao has one goal - to keep Chinese living standards increasing. Spend the 4 trillion yuan well, and the rest of the economy will stimulate itself."

Posted by drewster @ 02:07 AM 0 Comments

Overvalued euro set to plunge ?within months'

Sunday, March 8, 2009

Is bank nationalisation needed?

BBC: Bank nationalisation not needed

Lord Mandelson has reiterated that the government has no plans to nationalise the banking sector. His comments come two days after the government increased its stake in Lloyd Banking Group to 65% from 43%.

Posted by devo @ 09:54 PM 7 Comments

Is Quantitative Easing the answer?

Telegraph: Quantitative easing is not the answer

My character has been questioned just because I've had the audacity to argue QE will provoke serious inflation, making a bad situation much worse. No matter that I have several centuries of policy evidence on my side to say nothing of the compelling logic of common sense. Printing money "is all about saving jobs" say my opponents. So if you're against QE, you're happy even gleeful to see decent people suffer the trauma of unemployment. That's how we've got into the current situation where history shows QE is nuts and almost the entire country thinks QE is nuts, but no mainstream politician has the guts to oppose it. The stage has, instead, been left clear for Gordon Brown to vandalise the UK economy.

Posted by devo @ 09:40 PM 4 Comments

"Ireland can afford to bail out all the banks"

Belfast Telegraph: JP Morgan backs 'remarkably strong' Ireland to pay debts

One of the biggest Wall Street banks has warned investors not to bet on Ireland defaulting on its debt, as its financial position remains "remarkably strong" despite the banking crisis and economic downturn. JP Morgan bond analysts pointed out in a note to clients this week, that many other eurozone countries "have significantly worse public sector debt to gross domestic product (GDP) ratios".

Posted by devo @ 08:43 PM 3 Comments

More doom and gloom...

Credit Morgan Stanley sees U.K. downturn worse than Great Depression

Graham Secker, a well-known equity analyst at Morgan Stanley who covers U.K. equities has warned that profits for U.K companies could drop by 60%, peak to trough. This would put make this downturn even worse than the 1930s. Read more: "Morgan Stanley sees U.K. downturn worse than Great Depression - Credit Writedowns" -

Posted by roy @ 07:33 PM 0 Comments

Speak up, don't be shy.

Reuters: Europe banks silent on reported AIG bailout gains

European banks declined to discuss a report that they were beneficiaries of the $173 billion bail-out of insurer AIG that has sparked political furor in the United States. Senators are outraged by the lack of details about where the bailout money has gone, likening AIG's underwriting of credit default swaps as gambling with somebody else's money.

Posted by devo @ 04:13 PM 3 Comments

BoE has a new mission

The Times: Easy does it as Bank promises option of last resort will work

"the Governor was emphatic in his interviews that the Banks new policy could not fail. Mr King said this was clear to him since, as a question of fact, there was no limit to the amount of new money that the Bank could create to pump into the economy in its drive to encourage consumer and business spending and to restore growth."

Posted by quiet guy @ 01:19 PM 18 Comments

Reassuring markets even the gold one is positive. No one wants to disrupt another market

Financial Times: Central banks look again at bullion sales pact

When Europes central banks told the gold market five years ago that they would renew their pact to cap their bullion sales, the sector breathed a sigh of relief. Today, gold prices are double their 2004 level and central bank sales far smaller, but the market is still hoping that the Central Bank Gold Agreement will be renewed again. The Bank of Englands unilateral announcement in early 1999 that it was selling part of its reserves helped gold prices sink to a 20-year low. They were trading at just above $250 an ounce by the summer of that year. After the pact to cap sales in September 1999, prices surged 30 per cent in two weeks, to more than $320 an ounce. On Thursday, spot gold in London was trading at $910 an ounce. ~~~~ despite the fall in house prices or . . . cont.

Posted by troy @ 12:18 PM 1 Comments

Stock markets gut wrenching!

Investment Postcards: Investment Postcards from Cape Town: Words from the (investment) wise for the week that was (Mar 2 8, 2009)

Down, down, deeper and down. So goes the chorus of a Status Quo song, but it is eerily starting to sound like the stock markets anthem. Another week and another plunge of equities on fears about the intensity of the global recession and renewed skepticism regarding the beleaguered financial sector. And, yet again, flight-to-safety trades such as the US dollar and government bonds took center stage. Read more about this, together with some thought-provoking news items and quotes from market commentators during the past week, in the weekly Words from the Wise review:

Posted by prieur du plessis @ 11:34 AM 2 Comments

A fall of another 20% this years seems reasonable says the Guardian

Guardian: Housing: if there's another 40% fall on the cards

I think we are going to see this more and more, finally people not speaking of "green shoots" but 40% falls . This would seem to go hand in hand with people speaking about loan to income ratios of 3.5 or less. I hope that finally we will see more articles like this one than ones that imply that house prices are EVER going to shoot back up. We now have to bring house prices in line with wages and sensible lending and start to address all the problems caused by irresponsible lending.

Posted by sybil13 @ 10:55 AM 4 Comments

Huge profits still yet to materialize

Mail: Grant and Anthea sell off 5m ski chalet

Back when the credit crunch started, the husband of TV presenter Anthea Turner dismissed rumours that his property company was in trouble. He boasted: I am sitting in our 5million chateau in Megve in the Alps. I will sue anyone who says that Imagine Homes is in financial difficulty. Yesterday it was revealed that the couple have been forced to put their Alpine bolt-hole up for sale. Worse still, anxious estate agents have suggested they lower their 5.5million asking price because of a lack of interest.

Posted by little professor @ 09:19 AM 10 Comments


Daily Mail: Tent city

Finally i have found a camping article :) at least summer is coming.

Posted by campin @ 04:54 AM 0 Comments

Apologise for the recession?

Daily Mail: Brown's credit crunch tantrum at 30,000ft

The full depth of Gordon Browns anger over suggestions that he should apologise for the recession was laid bare in extraordinary scenes on the Prime Ministers plane last week, 30,000 feet over the Atlantic. His anger boiled over in a series of outbursts during his trip to see US President Barack Obama. The Prime Minister stormed: You want me to go on television and apologise, but I am not going to do it. I have nothing to apologise for. It is not my fault. Get in the real world.

Posted by little professor @ 03:40 AM 15 Comments

Saturday, March 7, 2009

Mash mock QE


Later today the government will release details of a scheme where people can hand in their wallets and purses in exchange for a shiny, new wheelbarrow to carry their money around in.

Posted by tick tock @ 10:17 PM 0 Comments

The end's not in sight - so stay sceptical

MoneyWeek: The end's not in sight - so stay sceptical

Another bloodbath reduced most equity indices to new lows recently. But there is no good news anywhere, and recovering from the burst debt bubble is likely to take years.

Posted by damien @ 10:06 PM 0 Comments

The hatches are being battened down at Lloyds

Times: Lloyds primed for 1980s slump

Lloyds Banking Group with the government nod of approval is preparing to survive a 1980s-style U-shaped recession and government approved stress tests predict a worst case scenario of a 6% drop in GDP from Peak to Trough. Interestingly although the bank has been keen to avoid any state support, it has been under pressure from the Treasury and UK Financial Investments to sign up to the scheme.

Posted by enuii @ 09:42 PM 2 Comments

What's the worst kind of inflation? Now we've seen what happens when a house price-cum-credit bubble bursts, what's the worst kind of inflation?

This is highly subjective of course, but I'd be interested to know your views. One day, sooner or later, we have to get away from the idea that property ownership is a route to riches, being ultimately a zero-sum game.

Posted by mark wadsworth @ 04:49 PM 4 Comments

The usual VI cobblers tempered with a dose of realism from Ed Stansfield.

The Times: So when will house prices hit the bottom?

House prices still have further to fall but the recovery, when it comes, could be sharper and swifter than people expect, according to property "experts". The Money section invited a panel of economists and estate agents to our offices to discuss the outlook for house prices at a crossroads: while mortgage lending and house prices continue to fall, cash-rich investors are tentatively returning to the market in the hope that the trough is in sight.

Posted by will @ 03:30 PM 0 Comments

The USA auction House is really here!

REDC: All Homes Must be Sold

Sorry, didn't mean this to be an ad. but remember that news about REDC, the USA style mass auction house, coming to the UK? I thought it will take a while or maybe even causing riots, but they ARE actually here!

Posted by peter_2008 @ 02:25 PM 19 Comments

Why quantitative easing wont work

MoneyWeek: Why quantitative easing wont work

Now it has virtually nowhere left to go with interest rates, the Bank of England has started on the next phase of its great monetary experiment quantitative easing. John Stepek explains what it is and why it's a futile exercise.

Posted by damien @ 11:45 AM 13 Comments

Rewarding the reckless

Reuters: House approves mortgage bankruptcy overhaul

The policy measures are beginning to look more and more extreme. Isn't this simply forced wealth confiscation from creditors to debtors? I'm sure some African dictators would approve of these methods.

Posted by paul @ 11:38 AM 2 Comments

The Irresponsible Reporting And People's Utter Stupidity

WalesOnline: Cash may be stirring the market

I JUST CAN'T BELIEVE THIS ARTICLE referring to property in Wales and saying how amazing it is that people from all over the world are coming to Wales and buying up their property for 40% of the asking price!!! What is it with people? Apparently this is REALLY GOOD NEWS because it could show that the housing market is going to recover!!! ? Sadly as with all addictions there is a stage when we have to consider what RECOVERY means for the UK and recovery is what is happening with house prices falling and the FSA confirming that sensible regulated lending is here to stay. 3.5 loan to income or less and HUGE taxes on ANYONE investing in property, but as house prices are not going up for a long time investors will finally get the message soon

Posted by drayal @ 11:10 AM 2 Comments

Overlending followed by defaulting leaves the trend in house prices down down down

Guardian: Key to Recovery? US House Prices

When will THEY get it! The article says "it's easy to forget it was the "delinquency" rate among sub-prime mortgages in the US that started this crisis." NO LIKE THE UK IT WAS LENDING OVER 3x's PEOPLE'S INCOME that led to this crisis, allowing houses to be used for investment instead of simply homes that led to this crisis...encouraging world wide investment in spiraling house prices due to investment therefore no incentive to say STOP and return to sensible lending. We can't blame people defaulting on overpriced property for the problem WHO LENT THEM THE MONEY WHO ALLOWED HOUSE PRICE TO INFLATE IN THE UK 190% IN 10 YEARS? US property prices I believe only inflated 78% and their defaulters (not just subprime) broke the global banks, what will 5 million in the UK in negative equity do?

Posted by drayal @ 11:01 AM 3 Comments

Ex-lax for the economy.

BBC: We're in QE street now!

Barring a last minute attack of caution, it looks like the Bank of England will move today out of the realm of interest rate cutting and into a strategy known as Quantitative Easing. Having spectactularly failed to predict the credit crunch, I can at least claim to have predicted this, for in early October I said on Newsnight: "If the bank bailout does not work the only thing left is to cut taxes and print money". And so it has come to pass (though more on taxes below). The essential point about QE is that the bank invents new money and uses it to flood the banking system with cash: it's a bit like putting a power hose down a blocked drain. Eventually the water pressure moves the blockage.

Posted by charlie brooker @ 09:40 AM 2 Comments

Will banks pay people for having mortgages Will interest rates reach zero percent?

With interest rates being cut at such a speed over the past few months it begs the question Will we see interest rates reach zero perecent?

Posted by kaz @ 07:42 AM 0 Comments

Mr Brown is now trying to create a bond bubble

Telegraph: It took exceptional brilliance not to see a crash coming

It has been decided that what we face is a crisis of capitalism, when actually it is a crisis of the regulation of capitalism. The consequence of this misdiagnosis will be that the Government will recover control over our wallets, our jobs, our industries and our lives in ways which you have to be almost 50 years old to remember. Being 52, I do remember, and I quail.

Posted by devo @ 01:49 AM 16 Comments

QE in real terms

The Daily Telegraph: Retirement plans of millions of Britons at risk after Bank of England prints money

In a mere 24 hours the size of the pension deficits facing some of Britains biggest companies has jumped by around 100 billion to a record 390 billion - the equivalent of over 150,000 for every member of a final salary scheme. The increase is a direct result of the Banks announcement this week to create 150 billion and pour it directly into the financial system, experts said.

Posted by devo @ 01:20 AM 7 Comments

Desperate attempt to keep the plates spinning

Washington Post: U.S. to Invite The Wealthy To Invest in The Bailout

The government is seeking to resuscitate the nation's crippled financial system by forging an alliance with the very outfits that most benefited from the bonanza preceding the collapse of the credit markets: hedge funds and private-equity firms. The initiative to revive the consumer lending business, outlined by officials this week, offers these wealthy investors a new chance to make sizable profits -- but, thanks to the government, without the risk.

Posted by devo @ 12:40 AM 8 Comments

Friday, March 6, 2009

Sneaking in on a Friday evening

BBC: Government 260bn Lloyds asset deal agreed

Lloyds Banking Group has agreed a deal with the Treasury that will see the government insure 260bn of the bank's loans, the BBC has learned. Under the agreement, the government will increase its stake in Lloyds to around 60% from the current 43%. Reports said Lloyds had been reluctant to give the government a majority stake. Last week RBS announced it would use the asset protection scheme to ask the government to insure 325bn worth of so-called toxic assets.

Posted by little professor @ 11:20 PM 6 Comments

It will all end in tears

Financial Times: 0% rates beckon on mortgages and savings

Tens of thousands of borrowers will be paying nothing for their mortgage once this weeks base rate cut takes effect, widening the gulf in costs between homeowners with fixed and tracker loans.

Posted by enuii @ 10:40 PM 3 Comments

Loan To Income Ratios Down To 4 X's And Falling

Lovemoney com: House Prices will carry on falling

Last week the FSA spoke about mortgage regulation and loan to income being a better way to ensure there is never a repeat of the past 10 years. This week on the blogs there was a thread about income multiples with Northern Rock loans being set at 3.5 max. The basis of this article is THAT THERE IS NO RUSH TO GO AND prices will NEVER be allowed to BOOM again. They have a long way to fall in line with income and then the kind of rise we saw in the past 10 years could take up to 40 years to get back in line with wages. THE MORE WE HEAR ABOUT LOAN TO INCOME THE BETTER because it irrefutably confirms that house prices are going down down down because the UK cannot afford to support an inflated house price market

Posted by kathryn layard @ 10:16 PM 4 Comments

Nor is there a reasonable or relevant reason to disclose such information to the general public

Bloomberg: Bank of America Says Bonus Disclosure Will Harm It

Bank of America Corp. will suffer "grave and irreparable harm" if Merrill Lynch & Co. employees paid $3.6 billion in bonuses just before the firm's acquisition by the bank are publicly identified, its lawyers said. Bank of America today filed documents in state court in Manhattan to intervene in a case brought by New York Attorney General Andrew Cuomo to compel former Merrill Chief Executive Officer John Thain to testify about the bonus recipients. "Neither the individual names nor the job titles bear any reasonable or relevant relationship" to Cuomo's investigation, the firms argued in the documents. "Nor is there a reasonable or relevant reason to disclose such information to the general public."

Posted by troy @ 07:07 PM 3 Comments

Anyone got a spare trillion dollars?

Reuters: U.S. to invite wealthy to invest in bailout

The U.S. government plans to invite wealthy investors to invest in the bailout of the crippled financial system, The Washington Post reported on Friday. The investors would be invited to buy up recently issued, highly rated securities that finance consumer lending -- without the risk of massive losses, the report said. The idea is to entice the investors to put their huge cash piles to work to stimulate the financial system, the Post said. The program, which could involve the government lending nearly $1 trillion to these investors, exceeds the size of every other federal effort to address the financial crisis so far, the newspaper said.

Posted by 51ck-6-51x @ 04:41 PM 11 Comments

Axe Looms For 1,000 Catalogue Firm Staff

Yahoo: Axe Looms For 1,000 Catalogue Firm Staff

More than 1,000 jobs could be lost at catalogue and home shopping giant Freemans Grattan Holdings, the firm has confirmed.

Posted by mark @ 04:40 PM 0 Comments

The tottering giant

UK Bubble: UK banking sector - 5.3 times GDP

Another great Alice chart, which tracks total assets of the UK banking system since the early 1990s. "Back in 1991, UK banks had assets totalling ₤1.2 trillion. In the intervening 18 years, the sector has grown by 501 percent. It has averaged a growth rate of almost 2.5 percent a quarter, which is around 10 percent a year."

Posted by inflationwatch @ 04:13 PM 0 Comments

Britain's 500bn bail-out

MoneyWeek: Britain's 500bn bail-out

An analysis of the Government's underwriting of the toxic assets of Royal Bank of Scotland and Lloyds. Is it really a good deal for the taxpayer? The new boss of RBS, Stephen Hester, has admitted that the bank could be relying on taxpayer support for at least five years.

Posted by damien @ 03:11 PM 2 Comments

Gordon Brown addresses Congress - mashup

CROWN BLOG: Gordon Brown addresses Congress - mashup

Gordon Brown addresses Congress - mashup

Posted by crown @ 02:21 PM 0 Comments

Bloomberg's headline is good enough for me...

Bloomberg: BOEs King 'Groping in the Dark' as U.K. Prints Money

Bank of England Governor Mervyn King, criticized for his initial response to the credit crisis, is now embarking on one of the biggest risks in British economic history. The central bank yesterday won authority to print as much as 150 billion pounds ($212 billion) and pump it into an economy facing its worst recession since World War II, after cutting interest rates close to zero. With markets clogged and economic activity shriveling, King cant be sure the gamble will work. Were groping in the dark, said Willem Buiter, a former Bank of England policy maker and now a professor at the London School of Economics. Ultimately, well know it works if the economy turns around, and that we wont know for a couple of years.

Posted by 51ck-6-51x @ 02:10 PM 2 Comments

U.S. Non-Farm-Payroll: -651,000

U.S. Department of Labor, Bureau of Labor Statistics: THE EMPLOYMENT SITUATION: FEBRUARY 2009

Nonfarm payroll employment continued to fall sharply in February (-651,000), and the unemployment rate rose from 7.6 to 8.1 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Payroll employment has declined by 2.6 million in the past 4 months. In February, job losses were large and widespread across nearly all major industry sectors.

Posted by 51ck-6-51x @ 01:38 PM 5 Comments

Manufacturers' profits sink 94% as exports tank

Japantimes: Manufacturers' profits sink 94% as exports tank

falling at the fastest pace on record

Posted by mark @ 01:38 PM 0 Comments

The median price of a home sold in Detroit in December was $7,500

Chicago Tribune: Detroit's outlook falls along with home prices

DETROIT It may be tough to get financing for a new car these days, but in Detroit you can buy a house with a credit card. The median price of a home sold in Detroit in December was $7,500, according to Realcomp, a listing service. Not $75,000. Remove a zeroit's seven thousand five hundred dollars, substantially less than the lowest-price car on the new-car market. Among the many dispiriting numbers that bleakly depict the decrepitude of this onetime industrial behemoth, the steep slide of housing values helps define the daunting challenge to anyone who wants to lead this shrinking, poverty-pocked city of about 800,000 people.

Posted by troy @ 12:59 PM 7 Comments

More nasty surprises for stock markets are coming

MoneyWeek: More nasty surprises for stock markets are coming

So here we go. Into the great unknown. The Bank of England has switched the printing presses on. This is supposed to help the economy. So that'll be why stock markets around the world continued to plunge yesterday...

Posted by damien @ 11:16 AM 11 Comments

Is this the best place to put your money?

The Telegraph: New 'safe' bed allows savers to safely store their cash under the mattress

I kid you not - I had to check the date to make sure that it wasn't the 1st April! Robbie Feather, managing director of Feather & Black said: Confidence in banks has hit an all-time low and fears of a recession crime wave have been raised by the Home Secretary. As a result people genuinely seem concerned about the safety of their money. Our new Safe bed began as a slightly tongue-in-cheek idea but we are now confident that it will appeal to home owners who want to store their money or valuable belongings in a safe place."

Posted by sold my soul to the never never never @ 10:19 AM 5 Comments

News for the great unwashed

The Sun: Bank slashes rate...and flashes cash

HISTORY will be made next Wednesday as the Bank of England starts to magic up cash. For three months, almost 1billion a day will be pumped into the economy. This is unprecedented in the UK. It has not been seen anywhere in the West since the Great Depression of the early 1930s. The worry is whether it works. The banks that got us into this mess must get us out by passing on the new money. It is the Bank of Englands last card. Cross your fingers and hope.

Posted by little professor @ 08:16 AM 35 Comments

Gargantuan derivatives market weighs on all other issues

MarketWatch: The $700 trillion elephant

There's a $700 trillion elephant in the room and it's time we found out how much it really weighs on the economy. Derivative contracts total about three-quarters of a quadrillion dollars in "notional" amounts, according to the Bank for International Settlements. These contracts are tallied in notional values because no one really can say how much they are worth. But valuing them correctly is exactly what we should be doing because these comprise the viral disease that has infected the financial markets and the economies of the world.

Posted by devo @ 07:40 AM 16 Comments

Securing international co-operation to help the world's battered economy

ITN via Yahoo: Brown to outline global bank deal plans

Prime Minister Gordon Brown is preparing to outline plans for securing international agreement on bankers' pay and bonuses Mr Brown wants executive pay in the financial sector to form part of the "global new deal" he is keen to secure. The Prime Minister will tell the Scottish Labour conference of the progress he has made in securing international co-operation to help the world's battered economy. ~~ Brown says U.S. should lead world out of recession ~~ Brown calls for global interest rate cuts ~~ Brown defends handling of financial crisis ~~ Brown to Congress: Europe is your friend ~~

Posted by troy @ 07:35 AM 0 Comments

Good morning! And welcome to black Friday...

Reuters: Nikkei falls 3.1 pct as bank woes, GM hit confidence - Fri Mar 6, 2009 2:59am GMT

''TOKYO, March 6 (Reuters) - Tokyo's Nikkei average slid 3.1 percent on Friday on broad selling after General Motors warned of possible bankruptcy and as concerns intensified about the fragile health of the global financial sector.'' I could well be crying wolf, but I think today will prove particularly interesting....

Posted by hpwatcher @ 05:31 AM 0 Comments

One possible bad-case scenario (warning: contains x-rated bear porn)

The Oil Drum: An Adverse Scenario

Skip past the oil stuff at the top, down to the financial bit:- "With all of the debt defaults, some sort of debt jubilee may be necessary. The problem with a debt jubilee is that there would be many too many claimants for many of the world's assets. The debts that are cancelled are likely to cross country borders, making for international disputes. Furthermore, countries may want to retaliate for a loss of one of their overseas investments by grabbing a business located in its own country that has overseas owners. In not very long, relationships among countries are likely to deteriorate, and international trade will be at much lower levels than in the past. War may even break out."

Posted by drewster @ 12:21 AM 2 Comments

Thursday, March 5, 2009

The Last Word - It's Up from Now On

SKY: Bank Governor: New Money Will Beat Recession

"Bank Of England Governor Mervyn King has said interest rates will fall no further - and promised that 75bn of newly "printed" money would trigger recovery". Hurrah, the cavalry at last!

Posted by alan @ 11:51 PM 4 Comments

Are you prepared for the worst?

FT Columnists: Big risks for the insurer of last resort

The UK government looks increasingly like a python that has swallowed a hippopotamus. In acting as insurer of last resort to the British-based banking system, it is taking on huge risks on behalf of taxpayers. If this turned out to be a global depression, with huge losses for British-based banks, fiscal solvency might even come into question. Can this make sense? I doubt it.

Posted by quiet guy @ 11:40 PM 3 Comments

CNBC's Rick Santelli is angry that those loser homeowners are going to get bailed out.

The Daily Show: CNBC Gives Financial Advice

witty (wt) adj. wittier, wittiest 1. Possessing or demonstrating wit in speech or writing; very clever and humorous. 2. Characterized by or having the nature of wit; funny or jocular: a witty saying. 3. Quick to discern and express amusing insights or relationships. 4. Entertainingly and strikingly clever or original in concept, design, or performance: a witty sculpture; witty choreography.

Posted by debtfree @ 09:16 PM 5 Comments

"There is a high probability that the collapse of the United States will occur by 2010,"

Fox News No Less: Russian Scholar Says U.S. Will Collapse Next Year

MOSCOW If you're inclined to believe Igor Panarin, and the Kremlin wouldn't mind if you did, then President Barack Obama will order martial law this year, the U.S. will split into six rump-states before 2011, and Russia and China will become the backbones of a new world order. Panarin might be easy to ignore but for the fact that he is a dean at the Foreign Ministry's school for future diplomats and a regular on Russia's state-guided TV channels. And his predictions fit into the anti-American story line of the Kremlin leadership. "There is a high probability that the collapse of the United States will occur by 2010," Panarin told dozens of students, professors and diplomats Tuesday at the Diplomatic Academy a lecture the ministry pointedly invited The Associated Press

Posted by troy @ 09:13 PM 0 Comments

America and much of the world has entered "The Greatest Depression."

Kingston NY News: The Greatest Depression Under Way

The global financial system, built on endless supplies of cheap money, rampant speculation, fraud, greed, and delusion is terminally ill and will not be coaxed into remission by stimulus packages nor restored to health by government buyouts and bailouts. We are trend forecasters, not certified financial advisors legally empowered to provide such advice. Although gold prices declined today some $15 to $925 per ounce, we forecast that gold will be one of the few life saving investments that will continue to increase in value, reaching $2,000 per ounce and beyond.

Posted by troy @ 08:41 PM 2 Comments

DUCKS? Are the Chinese still buying our bonds?

Bruce Krasting Economics: Geithner ducks a big question

Geithner ducks a big question Mr. Geithner was on the hot seat again today. He did his best to sell a bad budget. The closing tape speaks for itself. One of the Congressmen asked a hard question. Mr. Geithner can we sell the bonds necessary to fund this deficit? Are the Chinese still buying our bonds? Mr. Geithner responded with a full three minutes of non-answers to those questions. At the end of three minutes the Congressman repeated his questions.

Posted by troy @ 08:36 PM 2 Comments

America has been doing something like this for several months.

Sorry Bloomberg Again: Bank of England Cuts Rates, Starts Asset Purchases (Update7)

Were moving into a new world in the U.K. from interest- rate adjustment to quantitative easing, said Charles Goodhart, a former member of the central banks Monetary Policy Committee. Its a great deal more uncertain how things will be done. This month what the MPC says is going to be much more important than what they do. Alistair Darling told broadcasters. America has been doing something like this for several months. You will see countries all over the world taking action to make sure there is enough money in the economy. The Bank of England has now reduced the key rate 4.5 percentage points since October ~~~ Credit markets in the U.K. are still frozen in spite of the Bank of Englands actions ~~ red lights flashing yet? how about the alarm bells? hear them now?

Posted by troy @ 07:27 PM 1 Comments

You can finally buy Citigroup shares at the dollar store,

Bloomberg: Citigroup Stock Below $1 as Investor Faith Erodes (Update1)

March 5 (Bloomberg) -- Citigroup Inc., once the worlds biggest bank by market value, dropped below $1 in New York trading for the first time as investors lose confidence the shares can recover after more than $37.5 billion in losses and a government rescue. Citigroup fell to $1.03 at 12:32 p.m. on the New York Stock Exchange after reaching 97 cents earlier today, marking an 85 percent decline this year and giving the New York-based company a market value of $5.5 billion. At its peak in late 2006, Citigroup stock was worth $55.70, for a market value of $277.2 billion. NYSE Euronext, which owns the New York Stock Exchange ?????????, has suspended until June 30 a rule that delisted companies trading below $1 after six months.

Posted by troy @ 07:15 PM 2 Comments

11% of mortgages are troubled

Cnn: 11% of mortgages are troubled

looks like a second fan full of SH$T is about to hit us all...

Posted by mark @ 06:41 PM 2 Comments

So, the market didn't like QE?

Reuter: FTSE tumbles 3.2 pct on financials; Aviva slumps

Britain's leading share index ended down 3.2 percent on Thursday, shrugging off the Bank of England's interest rate cut, as Aviva (AV.L) led financials lower on concerns over the insurer's capital strength. The FTSE 100 .FTSE closed 116.01 points lower at 3,529.86, after gaining 3.8 percent on Wednesday to snap a three-session losing streak. The UK benchmark is down more than 20 percent so far this year after sliding more than 31 percent last year.

Posted by peter_2008 @ 05:59 PM 4 Comments

It's not over

Spectator: House prices have a lot further to fall

If you own property, look away now because what follows is ugly reading. Margaret Beckett's 'green shoots' were illusory, and the 2.0% upswing in house prices that Halifax recorded for January has been more than offset with a 2.3% fall in Feb. So far prices are down 20 percent from their peak, and it wont get any better. It may well be the 2020s before anyone who bought in the last few years will recover their capital.

Posted by little professor @ 05:30 PM 17 Comments

An Article from First Rung that urges FTB to offer 35% off 2007 Prices

First Rung: UK House Prices continue to fall at an alarming pace

This article says that prices have fallen 20% from their 2007 peak 17% last year and says it is even more important that FTB get 2010 prices this year therefore they should offer 15% off asking price which I assume should be 20% off the 2007 price , which is a 35% fall.

Posted by drayal @ 03:50 PM 0 Comments

ECB cuts its key interest rate to 1.5% from 2.0%

BBC: Euro rates hit record low of 1.5%

The European Central Bank (ECB) has cut its key interest rate to 1.5% from 2.0%, the lowest since it started setting euro rates in January 1999. It followed a cut in UK rates by the Bank of England. US and Japanese rates are already effectively zero. A cut had been expected at the March meeting since ECB president Jean-Claude Trichet had described it as a key "rendezvous" for ECB rate-setters. Attention now turns to what other ways the ECB may try to boost the economy.

Posted by jack c @ 01:14 PM 7 Comments

Will this mean toyota start reducing UK staff now

Japantimes: Toyota U.S. sales dip record 40%

"They are in full-blown crisis right now," said John Casesa, a partner at consulting firm Casesa Shapiro Group LLC in New York. "They're tearing up their business plan."

Posted by mark @ 12:56 PM 2 Comments

Hmmmm sell shares now...

Contract Journal: Taylor Wimpey delays results

having so far failed to conclude negotiations with backers over its 1.6bn debt.

Posted by mark @ 12:52 PM 0 Comments

Bleep stupid bleep stupid bleeep why did i bleep bleep bleep borrow money from that bleeping bank

Dailymail: Gordon Ramsay's kitchen nightmare after restaurant group runs into trouble over loans

Gordon Ramsay Holdings (GRH) admitted the breach in a note with its accounts - filed six months late - and is in talks to renegotiate its loan. The company controls Ramsay's 11 restaurants including Claridge's and the chef's eponymous restaurant on the Royal Hospital Road, Maze in Grosvenor Square and Ramsay's pub in Narrow Street in London's East End.

Posted by mark @ 12:46 PM 5 Comments

At long last, get rid of this money pit

Cnn: GM warns it may be forced into bankruptcy

General Motors has substantial doubt about its ability to continue as a going concern if it fails to stem its losses and generate cash, and it may be forced to file for bankruptcy, the automaker said on Thursday.

Posted by mark @ 12:29 PM 2 Comments

BoE cut as epected, plus details of asset purchase programme

Bank of England: Bank of England Reduces Bank Rate by 0.5 Percentage Points to 0.5% and Announces 75 Billion Asset Purchase Programme

he Bank of Englands Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 0.5 percentage points to 0.5%, and to undertake a programme of asset purchases of 75 billion financed by the issuance of central bank reserves. World activity continued to weaken, reflecting both depressed confidence and the persistent problems in international credit markets. In the United Kingdom, output dropped sharply in the fourth quarter of 2008. That reflected lower consumer spending, a further fall in business investment and a rapid run-down in stocks, in part offset by stronger net exports as the past depreciation of sterling began to take effect. Business surveys continue to point to a similar rate of contraction in the early part of this year.

Posted by 51ck-6-51x @ 12:02 PM 24 Comments

UK Interest rates reduced once again - 0.5% cut

BBC: UK interest rates lowered to 0.5%

The Bank of England has cut interest rates to 0.5% - a fresh all-time low - as it continues efforts to try to revive the struggling economy. Interest rates have now been reduced six times since October, and the latest half a percentage point cut from January's 0.1% had been expected. Business groups have attacked the recent cuts, saying they have done little to encourage banks to lend more. Others argue that they are unfairly hurting the returns of savers.

Posted by jack c @ 12:01 PM 1 Comments

A rocky ride for the euro this year

MoneyWeek: It will be a rocky ride for the euro this year

All over the world, people in all walks of life are paying for the mistakes of the banks which destabilised the global economy. The recession is growing. And the pain will be felt first in the Eurozone.

Posted by damien @ 11:56 AM 0 Comments

Excellent explanation for why depression will stick with us

Guardian: Bank of England ready to pump money into UK economy

The Guardian's political commentators are living in cloud-cuckoo-land but their economic pieces are much better, particularly when certain bloggers pipe up: GolemXIV is always good, as is ChrisWoods here. It's easy to sum up why present policies will fail and why house prices will continue to fall (dramatically). Quantitative easing merely causes insolvent banks to hoard new money - they will NOT lend it out. There will be no effective increase in the money supply. HOWEVER, the bond and forex markets will, at some point, take fright at the possibility of inflation and at the fact UK plc is a busted flush. Inability to fund the public sector in the gilt auctions will require massive interest rate rises to sell the bonds. Hello Japanese-style depression.

Posted by alphabetzoo @ 10:18 AM 28 Comments

Someone Claiming To Be Me Has Been Saying Its All Your Fault, Brown Tells America


GORDON Brown yesterday told America that someone has been going around blaming them for the global economic collapse and using his name.

Posted by crown @ 10:18 AM 4 Comments

China - better days ahead?

Investment Postcards: China - better days ahead?

Chinas improved PMI numbers, together with the additional stimulus package, probably mark a trough in the GDP growth cycle. Will Chinas command economy come to the rescue of the Western world? Time will tell, but there are rays of light, not least of which is a bullish-looking Chinese stock market.

Posted by prieur du plessis @ 10:00 AM 1 Comments

-2.3% Halifax February

Halifax: House Price Index - February

Commenting, Martin Ellis, housing economist, said: "The average UK house price declined by 2.3% in February. This monthly decrease more than offset January's 2.0% increase. Prices in the three months to February compared to the previous quarter, which provides a better indicator of the underlying trend, were 3.6% lower. Whilst market activity remains at very low levels, there are some tentative signs that activity may be beginning to stabilise. The house price to earnings ratio a key measure of housing affordability has fallen to its lowest level for six years."

Posted by phdinbubbles @ 09:12 AM 27 Comments

Nothing we do for banks is for banks. It's all for the benefit of the people

CounterPunch: Blowing Up the Economy

"Nothing we do for banks is for banks. It's all for the benefit of the people that depend on banks -- the businesses, the families, the students -- that require credit in order to do things that are important to their future." --Treasury Secretary Timothy Geithner, PBS Jim Lehrer News Hour This isn't a normal recession. In a normal recession aggregate demand declines, economic activity slows, and GDP shrinks. While those things are taking place now, the reasons are quite different. The present slump wasn't brought on by a downturn in the business cycle or a mismatch in supply and demand. It was caused by a meltdown in the credit system's central core.

Posted by troy @ 09:07 AM 4 Comments

Were working hard to get them out of paid employment as quickly as we can.

Newsbiscuit: Government slashes waiting times for unemployment

There was some rare good news for the Government today as it published figures showing that the number of people waiting for jobless opportunities has reduced significantly since the start of the economic downturn. Waiting times for unemployment have also fallen in what the Government is describing as a real turnaround in performance against a key economic measure. The queue for the dole queue is now substantially shorter than this time last year, and the position compared to three years ago has been completely transformed, said Work and Pensions Secretary James Purnell today. We accept there are still people on waiting lists, but were working hard to get them out of paid employment as quickly as we can.

Posted by troy @ 08:21 AM 5 Comments

I wonder what Blanchflower will be insisting on next?

BBC News: UK interest rates to fall further

''The Bank of England is expected to cut interest rates to a fresh all-time low and start increasing the money supply in an attempt to revive the economy.'' The next move should be to get rid of BOE....

Posted by hpwatcher @ 07:10 AM 12 Comments

Wednesday, March 4, 2009

Cluttons' House Price Predictions Cluttons' House Price Predictions

House price predictions from a property investment firm House prices will fall by nine per cent this year and by 1.5 per cent next year, with a peak-to-trough decline of 24 per cent, according to the latest Cluttons' residential market forecast. In Central London, they predict that prices will fall by 11.0 per cent this year but will see a marginal growth of one per cent in 2010, putting the peak-to-trough decline at 29 per cent.

Posted by niclab2001 @ 10:34 PM 0 Comments

One theory on why the Dollar has remained resilliant.

Telegraph: Europes banks face a $2 trillion dollar shortage

The BIS said European and British banks have relied on an unstable source of funding, borrowing in their local currencies to finance long positions in US dollars. Much of this has to be rolled over in short-term debt markets. The currency mismatch has become a potential risk for banks as the dollar continues to climb against the euro and Swiss franc, and especially sterling and Swedens krona.

Posted by flintster1994 @ 09:27 PM 6 Comments

Eastern Europe Goes Bust

The Market Oracle: Subprime Eastern Europe to Bankrupt Western European Banks

Eastern europe threatens default on $2 trillion of debt bringing European banking sector liabilities to $23 trillion.

Posted by nadeem walayat @ 08:18 PM 0 Comments

Rents on the way down just like house prices

The Telegraph: BTL-Rental properties flood the market

8% rise in the amount of rental properties advertised in one month alone. Rents dropping-supply outstrips demand !!

Posted by johnnyp @ 08:14 PM 6 Comments

This will happen on a massive scale soon.

Telegraph: First-time buyers come home to roost

BOOMERANG CHILDREN! For Clarissa Young, a highly qualified, articulate 36-year-old from Ascot in Berkshire, waking up each morning in a bunk bed in her parents' spare room is not where she envisaged being at this stage in life, when most of her friends are married with their own children in bunk beds. "To make matters more laughable, when my 32-year-old brother Jared came home over Christmas, he had to sleep in the top bunk, so there we both were, feeling we'd regressed back to childhood," says Clarissa, who finds herself one of the "boomerang generation'': people in their 20s or even 30s who, usually thwarted by lack of mortgages, precarious careers or the rising cost of living, move back home with their parents.

Posted by flintster1994 @ 07:37 PM 9 Comments

$27 trillion is not enough

Bloomberg: Credit-Swap Market Is Too Small for Clearinghouse, Duffie Says

Regulatory efforts to guarantee credit-default swaps with a clearinghouse may be hampered by a shrinking market and a limited number of participants, according to Stanford University finance professor Darrell Duffie. A plan lead by Intercontinental Exchange Inc. has the backing of eight major dealers including JPMorgan Chase & Co. and UBS AG. At the same time, the outstanding notional value of credit-default swaps has shrunk 56 percent since 2007 to $27 trillion. The small number of banks and dwindling market may make clearing unworkable, Duffie said in an interview yesterday. It turns out the numbers dont justify the way its proposed, Duffie said. The numbers just dont add up.

Posted by 51ck-6-51x @ 05:59 PM 0 Comments

Didn't someone say there is no sub-prime lending in the UK?

BBC: Problems mount at sub-prime firm

UK sub-prime lender Cattles says there has been a failure of internal accounting controls at the firm and it is suspending three senior managers. The firm currently has a market value of 15m, but borrowing of 2.4 billion.

Posted by peter_2008 @ 03:37 PM 5 Comments

Tony Gets a Bonus

London Evening Standard: Bonanza for City in firms 21 billion chase for cash

"The City is reaping hundreds of millions of pounds from a bonanza of bailouts for Britain's top companies and demanding higher fees than ever before. The Square Mile, led by JPMorgan Cazenove, has charged fees close to 700 million in return for holding the hands of 11 major companies which have raised 21 billion of new money in just the first two months of 2009, the busiest flood of rights issues in years".

Posted by alan @ 02:52 PM 2 Comments

Maybe too much

Reuters: Bank of England set to boost money supply as rates near zero

This article suggests that the amount of QE will be 100 billion. To put that in perspective, there are 20 million workers in the UK, everybody else is either a dependant or a state dependant. Thats 5000 per worker. I hope this is just talk to move the market, because that seems a bit too much for my liking. Maybe the intention is to trickle feed the money a bit at a time.

Posted by stillthinking @ 02:43 PM 16 Comments

U.S. NEquity & Foreclosure Update

Bloomberg: More Than 8.3 Million U.S. Mortgages Are Underwater

>8.3m U.S. mortgage holders owed more on their loans in Q4 08 than their property was worth as the recession cut home values by $2.4 trillion last year, First American CoreLogic said. An additional 2.2m borrowers will be underwater if home prices decline another 5%, First American, a Santa Ana, California-based seller of mortgage and economic data, said in a report today. Households with negative equity or near it account for 1/4 of all mortgage holders. Prices in 20 U.S. cities fell 18.5% in December from a year earlier, the fastest drop on record, according to the S&P/Case-Shiller index. U.S. foreclosure filings exceeded 250,000 for the 10th straight month in January, RealtyTrac Inc. reported. An average of 230,000 borrowers a month slid to negative equity in Q4 08, First American said.

Posted by 51ck-6-51x @ 02:41 PM 1 Comments

Stock markets are about to rebound sharply

MoneyWeek: Stock markets are about to rebound sharply

"...a rally, if it comes, could be short, sharp, sweet and very painful if you're on the other side of the market. But remember, this isn't the bottom it will only be a trade-able bounce in an ongoing economic disaster..."

Posted by damien @ 02:25 PM 1 Comments

Food inflation 17%, official food inflation 9%

The Times: Food prices surge 9% despite inflation fall

Shop price inflation rose last month because of the increasing cost of meat, fresh produce and tinned goods, with overall prices up at an annual rate of 9 per cent, from 7.5 per cent in January. The cost of fresh food was 10.4 per cent higher in February than the same month last year. But the cost of ambient goods, such as tinned food or ready meals was also pushed higher as the cost of imported food rose because of the weak pound. The cost of an average basket of 24 staple items in the supermarket was 17 per cent higher last month than in February 2007, a separate survey by mysupermarket, the price comparison website, showed recently. The cost of an average basket of 24 staple items in the supermarket was 17 per cent higher last month than in February 2007, a separate survey by mysu

Posted by koala bear @ 12:57 PM 2 Comments

More of the same

BBC: Canada Cuts Rates to Record Low

"Canada's central bank has cut its key interest rate from 1% to 0.5%, a record low, as it tries to stem the effects of the global economic downturn. Canada has been hurt by the recession in the US, its biggest export market, and the decline in commodity prices".

Posted by alan @ 12:07 PM 6 Comments

'British jobs for British workers' - the truth

BBC News: Minister 'appalled' by stats body

The Office of National Statistics chose to publish data with the main conclusion being that 1 in 9 workers in Britain were born abroad. The ONS chose to publish this at the height of the Lyndsey Oil Refinery dispute, which was quickly followed by the controversy of Olympics jobs being automatically handed to overseas workers, without even been advertised locally. Employment opportunities were the main reason cited by ministers for wanting to host the Olympics in the first place.

Posted by imminent_plunge @ 11:55 AM 2 Comments

Forget The Great Depression - That Was A Sunday School Picnic

Theinternationalforecaster: Europe is 1348 all over again

Great article comparing the collapse of the Lombard System in 1348 with the collapse of the European Central Bank and the euro zone. Not for the faint hearted.

Posted by sold 2 rent 1 @ 11:47 AM 26 Comments

Deluded Nutter Tries to Convince US It Was Nothing To Do With Him

BBC News: 'Seize moment' Brown to urge US

Gordon Brown will urge the US to "seize the moment" to "make the future work for us" when he addresses a joint session of the US Congress. More like a "Seizure Lament". I cannot believe this man is our Prime Minister, he's got more front than Harrods. The sad thing is I think he actually believes that whats going on in our country is everyone elses fault, but after watching bloomberg last night I think we can rest assured that he wont be able to convince the yanks of anything other than he is a bumbling fool. Last night I saw Amercan TV presenters trying not to laugh out loud at this man, who is going to convince the world that "greater financial regulation is need", whilst they showed TV footage from a couple of years ago of him saying, what was needed was "light touch regulation"

Posted by mr cobblepot @ 10:03 AM 4 Comments

Commodities confirm the global slump

MoneyWeek: How commodities confirm the worst

If anyone had any lingering doubts about the seriousness of the global economy's collapse, recent moves in the commodities markets should firmly dispel them.

Posted by damien @ 09:43 AM 4 Comments

Inflation just round the corner?

Telegraph: Apple ups price of Mac computers, as exchange rate bites

The Mac Mini, the company's entry level computer, for instance has gone up in price to 499, compared with 399 before. The 20 inch iMac now costs 949; the old price was 789. The company said currency fluctuations, with pound falling in value, has forced up its cost. The American computer company, which has won an army of fans with its sleek designs, makes most of its computers in Taiwan.

Posted by flintster1994 @ 09:20 AM 20 Comments

Green Shots!

BBC: Job vacancies fall at record rate

Vacancies at UK employment agencies are declining at their fastest rate on record, a survey has indicated.

Posted by peter_2008 @ 09:05 AM 4 Comments

Why Didn't We Think of That?

BBC: Japan Clears Cash Hand-out Bill

"Japan's parliament has passed legislation to give a cash hand-out to every resident in attempt to boost the recession-hit economy. Most people will get at least 12,000 yen ($121; 86) under the $20bn plan". Easy peasy...just give everyone 25,000 to clear mortgage arrears, buy a car, take a holiday...What could go wrong?

Posted by alan @ 09:03 AM 8 Comments

Ukraine pain

FT: Ukraine risks unrest as ills worsen

Olexander Pavlenko, a young computer programmer, is one of tens of thousands of Ukrainians who cannot get their money out of the bank. He stood in line in Kiev at Nadra Bank and Ukrprombank, two big troubled banks, planning to withdraw more than $10,000 (7,950, 7,125). But like many others, he was told the cash was not available.

Posted by sold out @ 06:58 AM 8 Comments

Spot the trend

Telegraph: US banks may need more bail-outs, says Ben Bernanke

Stock markets across the world suffered a second day of turbulence as the Chairman of the Federal Reserve warned that the US Government may have to pour even more cash into the twin bail-outs of its financial and economic systems.

Posted by quiet guy @ 02:07 AM 1 Comments

Fruits of failure

Guardian: Former Northern Rock chief gets 800,000 payout as repossessions soar

"Northern Rock revealed yesterday that it was forced to pay disgraced former chief executive Adam Applegarth more than 800,000 last year in pay and pension top-ups following his departure from the bank after he failed to find another job. Applegarth was paid 731,000 after he quit the bank in November 2007 following a deal that awarded him a year's pay until he found another job. The Newcastle-based bank also had to stump up an extra 108,000 to fund Applegarth's guaranteed 305,000-a-year pension which pays out from the age of 60." Funny how bankers seem to be so careful with their personal financial arrangements.

Posted by quiet guy @ 01:58 AM 6 Comments

Tuesday, March 3, 2009

Office of National Statistics under fire for publishing 'sinister' figures on immigration

Mail: The immigration minister revealed that he had tried to prevent the organisation publishing the data and accused it of 'playing politics'.

It revealed that the number of foreign workers increased by 175,000 to 2.4million last year while the number of British fell by 234,000 to 27million.Labour sources suggested the timing of the release was a political act designed to embarrass Gordon Brown over his controversial 'British jobs for British workers' slogan.

Posted by chris @ 11:13 PM 0 Comments

It has to be effective It's our last chance.

Reuters: Q+A - What does quantitative easing mean?

WILL IT BE EFFECTIVE? The policy was pursued by Japan at the start of this decade with little success. Still, analysts reckon it will provide a helpful boost to UK activity, although it is difficult to say at this point how quickly it will feed through to the wider economy and how much money will need to be created to have the desired effect of stimulating growth and preventing deflation.

Posted by devo @ 10:51 PM 32 Comments

Start of a Domino Effect?

Times: GM Europe will run out of cash 'within weeks'

"General Motors European operations will run out of cash within weeks unless they get government support, the US carmaker warned today, saying that a collapse would put up to 300,000 jobs at risk". "The company is in talks with the governments of Germany, the UK, Spain, and Belgium". Vauxhall could be sacrificed - what will happen to all the unsold cars and unpaid mortgages?

Posted by alan @ 10:19 PM 2 Comments

Now We All Own Mezzanine CDO

Paul Wilmott's Blog: The Mother Of All CDOs

What's that recent deal that the UK Treasury has just done with RBS? It looks scarily familiar...something to do with $325 billion of toxic assets (no doubt including a few CDOs and CDO^2s) and divvying up different levels of risk? The balance sheet of RBS is 2.3 trillion. In return for 6.5 billion in some dodgy non-voting shares the UK Treasury is going to be insuring some of that 2.3 trillion. The first 19.5 billion is RBS's responsibility, after that the taxpayer takes care of 90% of the rest of the $325 billion. Sound familiar? Yes, the UK Treasury has just got itself the mezzanine tranche of a CDO!

Posted by 51ck-6-51x @ 05:58 PM 9 Comments

Our Dear And Esteemed Leader refuses to show any weakness

Telegraph: Gordon Brown refuses to apologise over recession despite plea by Alistair Darling

So his cabinet admits Brown got it wrong, Darling admits Brown got it wrong. Brown admits nothing.

Posted by paul @ 05:39 PM 13 Comments

Maths never a VI strong point

Daily Telegraph: Interest rate cuts: How much can you save

An article showing how lucky martgage payers can save up to 9,000 on a 200,000 mortgage due to the low interest rate. Wow wee. Since houses have fallen 20% from peak already, a 300,000 house will have lost you around 60,000 to date. Given that most people say another 15% is on the way (I say another 20-25%) then now is a good a time as any to get out before you lose another iro 35,000. So with a total loss of around 85,000 (allowing for "saved" interest), what kind of advice are banks giving when they tell their customers to "take advantage of the lower rates" that isn't in their own interest?

Posted by growler @ 02:05 PM 16 Comments

The techies understand.

Wired: Recipe for Disaster: The Formula That Killed Wall Street

For five years, Li's formula, known as a Gaussian copula function, looked like an unambiguously positive breakthrough, a piece of financial technology that allowed hugely complex risks to be modeled with more ease and accuracy than ever before. With his brilliant spark of mathematical legerdemain, Li made it possible for traders to sell vast quantities of new securities, expanding financial markets to unimaginable levels. *** This was definitely a catalyst to the crisis as it allowed "simple modelling of CDOs" ***

Posted by 51ck-6-51x @ 01:48 PM 28 Comments

Markets will fall further - but some stocks look cheap

MoneyWeek: Markets will fall further - but some stocks look cheap

The stock market slide is by no means over. But the market jitters are dragging down the good stocks along with the bad. So are there any blue-chips left that would make a good home for your savings?

Posted by damien @ 01:44 PM 2 Comments

Daimler Taps Bond Buyers as $9 Billion of Debt Maturities Loom

Bloomberg: Daimler Taps Bond Buyers as $9 Billion of Debt Maturities Loom

Moodys Investors Service ranks Daimlers debt at A3, its fourth-lowest investment-grade rating.

Posted by mark @ 01:18 PM 0 Comments

Let em close...don't bailout more companies with our money

Yahoo: Vauxhall May Have To Close Without Bail-Out

why should we bailout companies only to be charged high prices from the same companies in the future plus higher taxes..

Posted by mark @ 01:04 PM 3 Comments

More spin on same press release

Metro: Northern Rock repossessions soar

"... the overall rise during 2008 is due to Northern Rock being left with riskier customers as the bank drove higher-quality borrowers elsewhere to pay off its huge Bank of England loans. The plans to shrink the business saw its overall residential mortgage book fall 27% to 66.7 billion, but arrears jumped sharply. A total of 17,264 of its borrowers are three months or more in arrears - nearly five times as many as a year earlier. The bank's infamous Together mortgage - which lent up to 125% of the value of a home before being pulled in February 2008 - now accounts for 29% of its mortgage book, up from 24% a year ago." A prize to the first person who chants the mantra "Crowded island, pent up demand, long term investment, immigration pressures, soft landing, buy on the dips".

Posted by mark wadsworth @ 12:38 PM 0 Comments

We made mistakes, but we are capable of so many more

Telegraph: Alistair Darling: We made mistakes on the economy

"It is the first significant admission of responsibility from a senior government figure for the current economic crisis, partly blamed on ministers allowing the financial markets to run out of control for much of the past decade."

Posted by mountain goat @ 12:18 PM 4 Comments

The next big crisis - proving who owns what for bundles securitized mortgages

Bloomberg: US banks lose to deadbeat homeowners

Joe Lents hasn't made a payment on his $1.5 million mortgage since 2002. That's when Washington Mutual first tried to foreclose on his home. The lender failed to prove that it owned Lents's mortgage note and dropped attempts to take his house. Subsequent efforts to foreclose have stalled because no one has been able to produce the paperwork. Judges in at least five states have stopped foreclosure proceedings because the banks that pool mortgages into securities and the companies that collect monthly payments haven't been able to prove they own the mortgages. More than $2.1 trillion of mortgages have been bundled into securities by banks.

Posted by little professor @ 11:44 AM 10 Comments

Welcome to Britain

Dailymail: Polish workers forced to live in 'shanty town' in wood after job prospects dry up

But for one group of Polish migrants, the dream has turned sour, as work has dried up in the credit crunch.

Posted by mark @ 11:12 AM 5 Comments

Brown has called for a "global New Deal"

Cnn: Financial crisis to dominate Obama, Brown talks

didnt they use the words "new deal" in something before? I am sure it was an advert for job seekers, which clearly never worked.. I am surprised he has mentioned being "prudent" too.. what a D&CK

Posted by mark @ 10:30 AM 1 Comments

Army on standby to be deployed on British Streets


The double-whammy of the worst economic crisis in living memory and a motley crew of political extremists determined to stir up civil disorder has led to the extraordinary step of the Army being put on standby.

Posted by sold 2 rent 1 @ 10:21 AM 28 Comments

No More Investment In Property

FT Adviser: Concerns mount over investors sitting in cash

Property is no longer a viable investment! Are we FINALLY getting the message ? We are not awaiting a RECOVERY there will be no more BIG rushes on property and First Time Buyers ARE NOT BEING LEFT BEHIND but moving towards a time of sensible lending and affordability. What good news to see that investors ARE NO LONGER INTERESTED IN PROPERTY. Sensible lending has returned, 85% LTV and no more than 3.25 loan to wages and this is not just a short term solution but a way of trying to reduce the 190% increase in property prices fueled by irresponsible lending. It will take the UK 30 years to pay back the debt incurred in just a few short years and 5 million people + will be stuck in negative equity, but FINALLY the investors can see at least that property is no longer a good investment.

Posted by kathryn layard @ 09:53 AM 4 Comments

This is a dead parrot

BBC News: Northern Rock makes record 1.4bn loss

Nationalised bank Northern Rock has confirmed that it made a loss of 1.4bn in 2008, but says it is making "good progress" against its objectives. It also said home repossessions jumped by 63% last year, while mortgage arrears soared by 80%. The bank said that 17,264 mortgage accounts were now in arrears, up from 3,492 at the end of 2007. Almost 3% of its mortgage book is now in arrears, well above the industry average. Northern Rock said today that it was developing mortgage rescue solutions to limit repossessions and has pledged not to take possession of a property until at least six months after a customer has fallen into arrears. It has repaid 18bn of the 27bn loan it received from the government last year. This policy will now be reversed and Rock will be growing its lending.

Posted by little professor @ 09:07 AM 9 Comments

NuLabor says thanks to savers

Times: Bank of England set to pump cash into economy to avoid deflation

"The Bank of England is set this week to begin printing money in a ground-breaking move that will mark its most forceful action yet to curb the slump in the economy. The Banks Monetary Policy Committee is expected to act on Thursday, as soon as it is given a final green light from Alistair Darling to begin the so-called quantitative easing." In fairness, I accept that this might be the least worst option avavilable to the government now.

Posted by quiet guy @ 08:31 AM 23 Comments

How long does the average saver need to put by 35K?

MoneyWeek: Average house price falls 35,500 in a year

"House prices in London have fallen by 35,300 on average in the past 12 months, new figures show today. Property values slumped by at least 2,500 last month alone, according to price monitor Hometrack." Assuming that we don't have a currency collapse first, how far will prices drop in the next twleve months?

Posted by quiet guy @ 08:01 AM 2 Comments

Dow 800?

Business Week: Stocks: After Dow 7,000, What Next?

The blue chip average's fall below 7,000and the S&P 500's struggle to stay above 700show the market is in "uncharted territory" The 7,000 level for the Dow Jones industrial average is a nice round number, but it definitely wasn't a support level. On Mar. 2, the Dow blasted through 7,000, dropping almost 300 points, or 4.24%, to 6,763.29

Posted by devo @ 07:23 AM 1 Comments

Monday, March 2, 2009

Roger Bootle article

The Daily Telegraph: QE is a useful tool for the Bank as it tries to fix the economic plumbing

For something with such an obscure name, this policy has already caused an extraordinary amount of controversy. I can imagine that they will soon be arguing about quantitative easing down the Dog and Duck. So what are we to believe? Is it a case of Zimbabwe here we come? The key to recovery is sustaining bank lending at a higher level and that will take more than just drowning the system in cash.

Posted by devo @ 07:15 PM 22 Comments

Downing Street website spoof

Crown Blog: Downing Street website spoof

Click image to enlarge

Posted by crown @ 06:16 PM 0 Comments

So much for deflation, pt 2

International Herald Tribune: Eurozone inflation rises unexpectedly

After the US reported a rise in inflation last week, now the Eurozone reveals that inflation (CPI) rose unexpectedly to 1.2% in February, from 1.1% in Jan. Economists had expected the CPI to have dropped to 1.0%. I guess slashing interest rates and printing money isn't the best way to avoid inflation after all.Deflationistas have been left feeling... deflated.

Posted by little professor @ 06:09 PM 6 Comments

Anyone want to guess when will FTSE hit 3500?

BBC: Stocks rattled by financial fears

Stock markets have fallen worldwide, rattled by fears that turmoil in the financial sector is far from over. On Wall Street, the US Dow Jones index fell below 7,000 points for the first time since October 1997. In the UK, the FTSE 100 index briefly hit a six-year low. Markets elsewhere in Europe also fell sharply.

Posted by peter_2008 @ 05:03 PM 20 Comments

Breaking news.

BBC News: Mosaic firms into administration

A string of High Street brands owned by retail group Mosaic have gone into administration, but have then been sold to new owners. Oasis, Karen Millen, Warehouse and Coast have been restructured and bought by a management group - Aurora Fashions - which includes Mosaic bosses. The restructuring has saved 8,700 jobs in these businesses, says Deloitte.

Posted by flintster1994 @ 05:02 PM 0 Comments

The Global New Deal takes shape

The Times: Suspicion and self-interest behind the European Union rift

t should have been the moment when the whole of Europe pulled in the same direction to rebuild the worlds financial system. Instead, a gathering of EU leaders yesterday before next months G20 summit was marked by suspicion and self-interest, with the economic crisis exposing deep faultlines on how best to respond to the downturn.

Posted by devo @ 04:40 PM 0 Comments

Government scheme is weeks from being rolled out !

The FT: 10bn loan guarantee scheme hit by delays

"The governments flagship 10bn business lending guarantee scheme, due to come into force on Monday, is weeks behind schedule. The delay will fuel business and union concerns about the pace of government measures to combat the recession. The 10bn scheme was the centrepiece of a package of measures, branded real help for business, unveiled by business secretary Lord Mandelson on January 14. The scheme is designed to support up to 20bn of existing short-term bank lending to medium-sized companies, freeing up capital for new corporate loans. "

Posted by shining wit @ 03:50 PM 0 Comments

The stock market slide isn't over yet

MoneyWeek: The stock market slide isn't over yet

Recent moves in the stock markets show beyond doubt that we are experiencing a bear market of historic proportions. So how far do we have left to go?

Posted by damien @ 03:48 PM 0 Comments

No sign of recovery here

The FT: Net lending to individuals halves in January

"Lending by banks and building societies to households totalled 1.1bn in the first month of the year less than half the average for the last six months according to new data from the Bank of England. Net lending to individuals, a measure of consumer purchasing activity, fell in January to 1.1bn, roughly half the level of December and the average for the previous six months."

Posted by shining wit @ 03:48 PM 0 Comments

Losing $11million an hour.

FT: AIG loses $99bn in 2008

AIG is to money as black holes are to light: sucky. Its net loss for 2008 is a massive $99.3bn. The US government has announced it is to give another $30bn to the insurer, which is deemed to big to fail.Shares in AIG rose 10% in early morning trading.

Posted by little professor @ 02:37 PM 3 Comments

Federal Deficit to go from 0.45 trillion in 2007 to 2.5 trillion in 2009

Market Oracle: Obama Says Short U.S. Treasuries

Bank bailouts, homeowner bailouts, auto industry bailouts, and now massive stimulus packages; the Federal Government spending list goes on and on. The Federal Deficit for this fiscal year is projected by Goldman Sachs to be as high as $2.5 trillion. That's 5.5 times the fiscal 2007 Federal Deficit and 1.5 times Gross U.S. Savings. A $2.5 trillion deficit will create quite a waterfall on this graph, don't you think

Posted by sold 2 rent 1 @ 02:29 PM 6 Comments

Soros sees no bottom for world financial collapse

Market Oracle: Global Recession Deepens as No End to Financial Collapse

Renowned investor George Soros said on Friday the world financial system has effectively disintegrated, adding that there is yet no prospect of a near-term resolution to the crisis

Posted by sold 2 rent 1 @ 02:06 PM 25 Comments

Membacakan ini . . . . (read this)

BBC: Islamic banks 'better in crisis'

Indonesian President Susilo Bambang Yudhoyono has called on Islamic banks to take a leadership role in the global economy, amid the financial crisis. He was speaking at the opening of the World Islamic Economic Forum in the Indonesian capital, Jakarta. The forum has brought together political and business leaders from 38 countries to discuss the global economic slowdown.

Posted by charlie brooker @ 01:36 PM 3 Comments

More of our money and for what?????

Dailymail: Taxpayer to the rescue: Multi-billion pound bail-out as PFI funding dries up

Taxpayers are to be forced to bail out a 21.5 billion programme for new hospitals, schools and roads as private funding collapses in the recession.

Posted by mark @ 01:01 PM 8 Comments

Wait for 2 or 3 trillion it will come

Contract Journal: 1 trillion wiped off the value of UK homes

If the Nationwide figures are any reflection of the true value of houses in the UK then we have just witness about 1 trillion wiped off the value of the nation's housing stock in the same time it has taken for the full lunacy of the ABN Amro deal to be realised.

Posted by mark @ 12:30 PM 14 Comments

Call bottom now before it's too late!

BBC: Mortgage approvals levelling out

That's it we' re done here... thankfully the article also points out that amounts lent have halved...

Posted by old_traveller @ 12:18 PM 1 Comments

A convenient diversion

This is Never mind Sir Fred's pension, how is Gordon going to save us now?

"American investor Warren Buffet says you should look for intelligence, energy and integrity in the people you employ but the most important is integrity, because without it a smart person will use their intelligence and energy to fleece you."

Posted by plato @ 12:07 PM 1 Comments

Don't buy into the HSBC rights issue

MoneyWeek: Don't buy into the HSBC rights issue

HSBC is going cap in hand to shareholders to raise 12.5bn. But even though it's the healthiest bank in the FTSE 100, that's still no reason to take up the rights issue, writes John Stepek.

Posted by damien @ 10:47 AM 3 Comments


Metro: FTSE in six-year low after 12.5bn HSBC plea

Looks like HSBC isn't as strong as they've been making out! "...the firm also bore the scars of a tumultuous year for the banking sector in the severe blow to its profits, and lowered its dividend payouts. Matt Buckland, a dealer at CMC Markets, said: "What is perhaps most worrying is the fact that HSBC was seen as better placed than most of its peers and essentially any hope that confidence was returning to equities has been quashed once again." ..."

Posted by si @ 10:41 AM 0 Comments


Reuters: AIG failure would be disastrous for global markets

While putting more taxpayer money at risk is unlikely to be palatable in the current economic environment, analysts said the U.S. government had little choice. Without government intervention, AIG's expected losses would prompt credit ratings downgrades -- triggering even more debilitating losses for the insurer, and its trading partners. "The government really does not have the option of letting AIG totally blow up," said Robert Haines, senior insurance analyst at CreditSights, AIG's foray into the roughly $28.5 trillion credit default swap market left it heavily exposed to losses on toxic mortgage assets that it had guaranteed against default.

Posted by devo @ 10:05 AM 4 Comments

Mortgage lending plunges NINETY PER CENT

Metro: Mortgage lending plunges 60%

Mortgage lending dived by more than 60% during January to just one 10th of its level 12 months ago, figures showed today. Net mortgage lending, which strips out redemptions and repayments, was 690 million during the month, down from 1.79 billion in December, according to the Bank of England. It was the second lowest monthly total recorded by the Bank began since it began to keep statistics in this format in April 1993, and represented a steep dive from the 6.91 billion lent in January last year.

Posted by mark wadsworth @ 10:01 AM 7 Comments

S&P Analyse MBSs

Financial Times: Late mortgage payments hit record levels

Standard & Poors examined the performance of loans bundled into bonds or notes. The data showed that non-conforming or subprime mortgages hit a record delinquency rate, those late by 90 days+, in Q4 2008, rising to 28.6 per cent of all such loans outstanding. S&P noted that the stock of repossessed homes stood at 3.5 per cent, up from 2.8 per cent at the end of the Q3 and 1.6 per cent in the first three months of 2008. Charge-offs rose to almost 6.9 per cent in December, the highest level since August 2007. Rising delinquency rates could make banks even more reluctant to lend. An estimated 70-80 % of all UK subprime mortgages have been packaged, and the data give a comprehensive overview of those loans.

Posted by 51ck-6-51x @ 08:07 AM 3 Comments

I thought we were to manufacture our way out of recession!

BBC Website: Factory downturn 'accelerating'

Looks like the plunge in Sterling caused by Gordon's stupid interest rate cuts was in vain. Despite the fall in Sterling the downturn in factory output in the UK is accelerating. Time to put rates and Sterling back up. As most of our service industry in reliant on imported physical goods, I suggest this Sterling weakness is doing more harm than good.

Posted by mikelivingstone @ 07:29 AM 2 Comments

Hometrack: -0.8%MoM, -10%YoY

Times: Suddenly there are signs of life in the housing market

The average sale price is now 88% of original asking price, according to the latest survey from Hometrack. This reinforces the message coming from all parts of the property market that househunters are demanding bargains amid forecasts of further price subsidence. However, Hometrack's numbers do present evidence of signs of life in a previously becalmed market, with new buyer registrations rising by 17% and agreed sales up by 36%. A few agents are reporting multiple bids for some properties, with correctly priced homes going under offer relatively quickly.

Posted by little professor @ 12:56 AM 28 Comments

Though not this week before we get excited.

Reuters via Yahoo: Bank deputy says rates may rise

Official UK interest rates will need to rise before any economic recovery is felt on the ground to stave off the risks of an inflationary surge, former Bank of England Deputy Governor John Gieve said. "We've got to hold on to the fact that inflation will be kept low," Gieve said in an interview with the Sunday Times. "That will require some very difficult decisions because it will require the Bank to start raising rates before it is obvious on the street that the economy is getting better."

Posted by wanderinman @ 12:31 AM 1 Comments

Sunday, March 1, 2009

Endgame for savers

Telegraph: Bank of England poised for rate cut

The Bank of England is set to bring interest rates down to an effective zero-level within days and to sound the starting pistol on quantitative easing, pumping extra cash into the economy. The Government is putting the finishing touches to a letter to the Bank endorsing its proposal to embark on this radical policy. The Bank's governor, Mervyn King, will be granted approval by the Treasury within days to create up to 150bn in new money in the coming months to buy up everything from corporate bonds to government debt. It will pave the way for the Bank's Monetary Policy Committee effectively to "start the presses" at its interest rate setting meeting this Thursday.

Posted by quiet guy @ 10:52 PM 7 Comments

Brown seeks 'new deal' with Obama

BBC NEWS: Brown seeks 'new deal' with Obama

Gordon Brown has vowed to forge a "global new deal" with Barack Obama when he meets the new US president for talks in Washington this week.

Posted by unplugged @ 10:33 PM 4 Comments

Buck McRogers can't heat his house

TimesOnline: Scotland's retirement age may rise above 70

In a failed attempt to jump on the pensions bandwagon the Times rolled out this dramatic piece about a Scottish pension crisis in 2056. I am guessing that a panic now about something in -47 years- isn't really necessary. Interesting to see the pension crisis "meme" spread.

Posted by stillthinking @ 09:43 PM 1 Comments

Bigger, brasher

Guardian: The Americans are coming!

Get ready for a US-style repossession revolution on the streets of Britain. A controversial American property auction company that specialises in selling off repossessed homes at rock-bottom prices is preparing to open for business here, in a bid to cash in on the UK's credit crunch. Real Estate Disposition Corporation claims to be America's largest real estate auction company, and is well-known in the US for holding blockbuster "foreclosure auctions" where, amid much razzmatazz, hundreds of homebuyers and investors compete to buy repossessed properties at prices often far below their most recent valuations. Now Britain is set to get a taste of its "pile 'em high, sell 'em cheap" sales tactics.

Posted by little professor @ 09:41 PM 1 Comments

Pension threat

Guardian: Move to halve Goodwin's 16m pension

Just saw an interview on the television about the legislation that would required to claw back Goodwin's pension. Although speculative, the main idea seemed to be to alter the legal obligation to follow agreed terms by the trustees/administrator of occupational pension schemes. Given that the amount of Goodwins pension nationally is negligible, I don't see that the introduction of such legislation can be in anything other than a disaster for anybody in a private sector occupational pension. Needless to say, as profit is meaningless in the state sector defined contribution schemes would continue unaffected.

Posted by stillthinking @ 05:54 PM 14 Comments

Harrison and Hudson have common sense...

The Renegade Economist: Six Minutes with The Renegade Economist

Weekly conversation and questions to The Renegade Economist. This week Hudson and Harrison talk about what is actually going on in the US and here....

Posted by neo-serf @ 05:19 PM 0 Comments

Rosie Millard buys a house

Times: Honey, I blew the budget

HPC's second favourite property pornstar buys a 1.1m 'wreck' at auction, with the intent of doing it up for a profit. But before she can start work, she'll need to sell her own home first, for 1.45m

Posted by little professor @ 01:43 PM 19 Comments

Power transfers from East to West

Market Oracle: Why China's Economy is Booming

How could China explode higher when the world is in its worst financial crisis since the Great Depression? What about the tens of thousands of factories closing in China and the millions of Chinese losing their jobs that we're hearing about? Read the article to find out why China is booming

Posted by sold 2 rent 1 @ 01:11 PM 12 Comments

Board - Holed Below the Water Line?

Independent: Whistleblower to present new HBOS evidence

Paul Moore, the HBOS whistleblower, has presented new evidence to the Treasury Select Committee supporting his claims that the reckless sales-culture and product mis-selling ultimately led to the bank's collapse. The committee has also received Mr Moore's rebuttal of the KPMG report, which he claims is "imbalanced" and failed to consider key facts. The select committee is now expected to hold a new session investigating Mr Moore's testimony.

Posted by alan @ 01:10 PM 0 Comments

Commentary on the regime

Scotsman: Our cult of the amateur has let Brown destroy Britain

I feel that the UK may not successfully dump New Labour at the election, as they have established and expanded a privileged public sector elite, of course to the ultimate detriment of all. This article is mainly about Brown's poor decisions but there are many points pertaining to what is essentially a government regime. I wonder at what point private sector workers will just throw in the towel.

Posted by stillthinking @ 12:13 PM 6 Comments

Gordon Brown Bankrupting Britain as Tax Payer Liabilities Soar- Update

The market oracle: Gordon Brown Bankrupting Britain as Tax Payer Liabilities Soar- Update

This article and the one previous (UK Recession Watch- Britain's Great Depression? - source: seem to paint a gloomier picture than what I thought of the status of the UK economy and the extent of the taxpayer liability.

Posted by zorbeh @ 11:12 AM 0 Comments

More banks close

CNN: Regulators shutter 2 more banks

But brown said it was all huny dory and we were all ok.......yeh yeh can you believe anything this guy says............

Posted by mark @ 11:02 AM 0 Comments

Repossed property marketing goes mainstream US Foreclosure Auction Giant Comes to 'Flood UK Property Market'

A massive US property auction company, currently specialising in foreclosed properties, is coming to the UK, reports the Guardian. The company, Real Estate Disposition Company has been approaching UK mortgage lenders about selling their properties, and plans to use the same signs as it uses in the US, which clearly state that a home has been repossessed. UK residents are worried that these signs, and th fact that REDC will flood the market with cheap properties, could devalue surrounding homes and even destabilise the property market in an area.

Posted by britishblue @ 09:07 AM 9 Comments

MPC admit should have paid more attention to HP Inflation

Times: IRs predicted to reach 0.5%

They could have re-written this article with a single sentence: "The MPC and BoE should have listened to"....

Posted by voiceofreason @ 08:51 AM 23 Comments

Little comfort for pressed borrowers as rate hopes rise

Times: Borrowers left in cold by bailout

Huge swathes of borrowers at government-backed banks have plunged into negative equity and will not be helped by the banks commitment to lend more in return for a 600 billion bailout. Lloyds, Britains largest mortgage lender after it saved HBOS from collapse in January, predicted property prices would fall by another 15% this year taking them down around 35% from their peak. Borrowers with little or no equity in their home will not be helped by moves to force lenders to pump billions into the mortgage markets. They will be stuck on lenders standard variable rates which banks can change at will as they are unlikely to be eligible for any new deals.

Posted by mytimeisnigh @ 08:40 AM 4 Comments

Brown note, the toxic mortgage lending that sparked the current crisis was done by mortgage brokers

Politico: Bankers to Obama: Stop trashing us

"We stand ready to work with your administration to promote policies that will clear the way to do what banks do best: finance business and families that are ready to move the economy forward. But these efforts will only be inhibited by misperceptions about our industry."

Posted by troy @ 08:00 AM 2 Comments

The economy, "would shrink by up to half of its size" without banking secrecy.

Breitbart: Swiss minister hints at 'concessions' on banking secrecy

Finance Minister Hans-Rudolf Merz said Saturday that Switzerland might have to make some concessions on banking secrecy to avoid being placed on an international backlist. ~~~~ A leading Swiss private banker, Ivan Pictet, warned in a newspaper interview this week that Switzerland's financial services industry, a pillar of the economy, "would shrink by up to half of its size" without banking secrecy.

Posted by troy @ 07:55 AM 0 Comments

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