Charlotte Posted September 29, 2008 Share Posted September 29, 2008 Half of the reason we're in this state is consumer confidence. If people weren't scared into withdrawing money and moving savings around the position of the banks might be better. Unfortunately Bradford and Bingley were greedy and did a deal with GMAC, which has meant they inherited loads of bad mortgages where people were already struggling to make repayments. Gaz is right, europe isn't in a much better state but people don't buy houses. Posted via Mobile Device Quote Link to comment Share on other sites More sharing options...
RedM Posted September 29, 2008 Share Posted September 29, 2008 I hope the lady in the bowler hat is okay. Let's not forget the human cost of all this. ...not Howard from the Halifax though. He's an idiot. Almost as irritating as spiky haired 'Thomas' from 'Leeds'. Quote Link to comment Share on other sites More sharing options...
Jake Posted September 29, 2008 Share Posted September 29, 2008 For God's sake do not go down to your bank/Building Soc tomorrow and withdraw all your money with all the other panicking sheep. Well, not unless you've got more than 35k in there anyway. You're just making things worse if you take all your money out - and that money is safe anyway. Quote Link to comment Share on other sites More sharing options...
imi Posted September 29, 2008 Share Posted September 29, 2008 If you have more than 35k in the bank then its not safe should the bank get into trouble. Should you have that kind of money and are worried by whats happening spread it around a few banks as the goverment will protect savings upto that limit. However make sure the banks are not owned by the same company. Ie halfax is now part of lloyds therefore only 35k is covered. I think im right in that someone correct me if i am wrong. IMO lloyds are the safest bank in our system. Guess the message is. To be in as much debt as possible cause even if the bank you owe (e.g:brad and bingley) goes bust, rest assured that you will still owe that money and WILL have to pay it back; unlike the other way round when the banks that do go bust get their debts written off...... how does that work? seems like the common man is being screwed everytime... Quote Link to comment Share on other sites More sharing options...
Pot Posted September 29, 2008 Share Posted September 29, 2008 Personally, I'm slightly annoyed at the Govt's eagerness to jump in and help out Mortgage lenders... (No offence to people with mortgages of course) - But those of us who can't afford/get a house of our own have to now sit back and watch whilst the Gov throws money into Mort Lenders, which we'll all end up paying for? It's bad enough being a single male, renting a humble flat, we have to deal with tax breaks for having a family (My punishment for not finding a decent 'bride' - (I wanted my own baggage, not someone elses)) - That working my ass of to get into a decent job (Just got promoted, a whole rise from £24.1k -> £25.5k - Shite for 80 hours a week) But our cash is being spent on people who have overspent on their mortgages?... Or have gambled on the 'wrong' company... What happened to 'The value of your stock may go up or down??? Quote Link to comment Share on other sites More sharing options...
imi Posted September 29, 2008 Share Posted September 29, 2008 Personally, I'm slightly annoyed at the Govt's eagerness to jump in and help out Mortgage lenders... (No offence to people with mortgages of course) - But those of us who can't afford/get a house of our own have to now sit back and watch whilst the Gov throws money into Mort Lenders, which we'll all end up paying for? It's bad enough being a single male, renting a humble flat, we have to deal with tax breaks for having a family (My punishment for not finding a decent 'bride' - (I wanted my own baggage, not someone elses)) - That working my ass of to get into a decent job (Just got promoted, a whole rise from £24.1k -> £25.5k - $#@!e for 80 hours a week) But our cash is being spent on people who have overspent on their mortgages?... Or have gambled on the 'wrong' company... What happened to 'The value of your stock may go up or down??? Free Speech is not all that it is made out to be when it only falls on deaf ears. The Govt allowed this to happen by privatizing the industry and like most other privatised industries, another one bites the dust. Welcome to the Capitalist system where the Rich are the winners. Quote Link to comment Share on other sites More sharing options...
Snooze Posted September 29, 2008 Share Posted September 29, 2008 All the talk of pumping more money into the housing industry also annoys me quite a bit - why not just let our overinflated house prices drop back down to where they belong? Like you say - those people who have gambled their savings by investing in multiple properties should just have to accept it was a mistake - they should have gotten out of the market last year..... Quote Link to comment Share on other sites More sharing options...
The Raven Posted September 30, 2008 Author Share Posted September 30, 2008 All the talk of pumping more money into the housing industry also annoys me quite a bit - why not just let our overinflated house prices drop back down to where they belong? Like you say - those people who have gambled their savings by investing in multiple properties should just have to accept it was a mistake - they should have gotten out of the market last year..... The problem with letting the house market return to its normal level is the fact that a great deal of people have burrowed on the family house to buy "white goods" People have seen the house price go up so fast they thought why not burrow for a new car or hoilday or take a loan out for a new kitchen. The house market crash would leave millions of normal home owners facing up to paying for a house thats worth 30% less of what they owe. Trust me the smart people the ones that brought houses to rent are doing just fine. The more people cant pay the more people have to rent. That said the housing auctions are like ghost towns now. Guess the message is. To be in as much debt as possible cause even if the bank you owe (e.g:brad and bingley) goes bust, rest assured that you will still owe that money and WILL have to pay it back; unlike the other way round when the banks that do go bust get their debts written off...... how does that work? seems like the common man is being screwed everytime... Yes that it summed up. If the bank you are with goes bust you will still owe all debt. However if it went bust with 50k of your money the goverment would only see you right for 35k the rest would probably be lost. I have to say again that unless you have over 35k in the bank then there is no need what so ever to panic about your savings. I am sure we will see the people running to the banks taking out the life savings and such. Only to be picked off by chavs 40 yards down the road. Quote Link to comment Share on other sites More sharing options...
Mike_Mac Posted September 30, 2008 Share Posted September 30, 2008 I am sure we will see the people running to the banks taking out the life savings and such. Only to be picked off by chavs 40 yards down the road. Well at least it keeps the money in circulation! Quote Link to comment Share on other sites More sharing options...
Snooze Posted September 30, 2008 Share Posted September 30, 2008 The house market crash would leave millions of normal home owners facing up to paying for a house thats worth 30% less of what they owe. Why does that matter? As long as they didn't borrow more than they could afford to repay per month (in which case they deserve to get slung out on the street), then negative equity isn't anything new. It doesn't really mean anything - even if these people need to move house, then the property that they will be moving into will have dropped by the same amount too. As long as people can afford to carry on paying their monthly payments, it's all just numbers on paper. The reason people complain about negative equity and dropping house prices is because they somehow feel they have a "right" to automatically move up the property ladder without actually doing anything. As mentioned before, these people just have to accept that buying a house is an investment in property, and investment values can, indeed, "go up or down". I am part of this too: the value of our house is in freefall at the moment, but so are all the houses around us, so if we really want to move, it can still be done...... just because it looks like turning out now that we would have been better waiting for house prices to come down before getting on the property ladder, that's our mistake - we, just like the millions of others threatened with negative equity, are perfectly capable of dealing with it. It was an investment mistake - that's all - get over it! Quote Link to comment Share on other sites More sharing options...
stevie_b Posted September 30, 2008 Share Posted September 30, 2008 For anyone worried about their savings: http://www.fool.co.uk/news/your-money/savings/2008/09/29/the-facts-about-the-savings-guarantee.aspx I agree with Snooze. It's pointless trying to prop up house prices artificially. I feel genuinely sorry for people who have very recently bought a house, but you win some, you lose some. Some losers may lose their jobs, homes etc, but you simply can't keep prices in any market (e.g. house prices, bank shares) artifically high without causing huge damage eventually. Quote Link to comment Share on other sites More sharing options...
Gazboy Posted September 30, 2008 Share Posted September 30, 2008 Why does that matter? As long as they didn't borrow more than they could afford to repay per month (in which case they deserve to get slung out on the street), then negative equity isn't anything new. It doesn't really mean anything - even if these people need to move house, then the property that they will be moving into will have dropped by the same amount too. As long as people can afford to carry on paying their monthly payments, it's all just numbers on paper. The reason people complain about negative equity and dropping house prices is because they somehow feel they have a "right" to automatically move up the property ladder without actually doing anything. As mentioned before, these people just have to accept that buying a house is an investment in property, and investment values can, indeed, "go up or down". I am part of this too: the value of our house is in freefall at the moment, but so are all the houses around us, so if we really want to move, it can still be done...... just because it looks like turning out now that we would have been better waiting for house prices to come down before getting on the property ladder, that's our mistake - we, just like the millions of others threatened with negative equity, are perfectly capable of dealing with it. It was an investment mistake - that's all - get over it! This isn't about trying to keep houses at a certain price point (though you don't want houses worth £10k while the money owed is £200k) but trying to stop millions of people losing their jobs and homes and to stop entire countries going under. Quote Link to comment Share on other sites More sharing options...
tbourner Posted September 30, 2008 Share Posted September 30, 2008 If house prices drop it doesn't directly affect people, but it means they can't borrow on their homes to buy other things, so businesses lose profit and go under. Am I right in thinking that most of the issues in the news are centered around well off people? Stock market traders and people with lots of savings and shares and stuff? So the majority of the public who have debts and a mortgage but are on top of their payments should be OK? Quote Link to comment Share on other sites More sharing options...
grahamc Posted September 30, 2008 Share Posted September 30, 2008 If house prices drop it doesn't directly affect people, but it means they can't borrow on their homes to buy other things, so businesses lose profit and go under. Am I right in thinking that most of the issues in the news are centered around well off people? Stock market traders and people with lots of savings and shares and stuff? So the majority of the public who have debts and a mortgage but are on top of their payments should be OK? Not limited to just that unfortunately. When companies start losing too much money the EXECs will either close the company or sell it off, which means that a lot of people are going to lose jobs, their incomes and then the knock on effects from that. I did like the one comparison to the $700billion figure, it is said that they could wipe out child poverty for a fraction of the 700 figure. Much better to spend the money, IMHO, and you get change Quote Link to comment Share on other sites More sharing options...
tbourner Posted September 30, 2008 Share Posted September 30, 2008 It annoys me that the media keep using the phrase 'tax payers money' as well, that's what riles everyone. It's not tax payers money at all, I'm a tax payer and my money is in my bank account. We elect a government and say we're happy for them to look after the country, for which they need money, therefore we pay tax. So why don't the media say the government is spending their money or 'money from taxes' rather than making out we've all got to dig into our pockets!! Quote Link to comment Share on other sites More sharing options...
Snooze Posted September 30, 2008 Share Posted September 30, 2008 Yes - it shows that actually having and keeping a job is a much more important thing to worry about than the paper value of your house dropping (and stopping you releasing equity to buy that flat screen TV or that daily £5 coffee from Starbucks). Maybe a recession will represent a long-overdue reality check. Quote Link to comment Share on other sites More sharing options...
Gazboy Posted September 30, 2008 Share Posted September 30, 2008 It annoys me that the media keep using the phrase 'tax payers money' as well, that's what riles everyone. It's not tax payers money at all, I'm a tax payer and my money is in my bank account. We elect a government and say we're happy for them to look after the country, for which they need money, therefore we pay tax. So why don't the media say the government is spending their money or 'money from taxes' rather than making out we've all got to dig into our pockets!! It is tax money if all this money is not paid back, this £160bn has to come from somewhere. Osbourne said yesterday he couldn't cut taxes as the country is skint. Regarding the other point about the media concentrating on rich people, this is not so, in the main they are talking about Average Joes. Quote Link to comment Share on other sites More sharing options...
caseys Posted September 30, 2008 Share Posted September 30, 2008 I think this story points out the systemic issues that the whole financial system is working on. It's all based on trust, risk and greed and now the trust has gone, replaced with fear. The risk is still hanging on in there... and the greed has long since fled to a non-extradition country, or the people behind it have fled. http://www.itjungle.com/tfh/tfh092908-story04.html Also the reg are running a very interesting storyline http://www.theregister.co.uk/2008/09/29/destroying_banks/ There's going to be a massive consolidation of financial markets in the US and EMEA imho while everyone's picking up the pieces on this. The general public have been allowed a lot of free flowing credit, people spend beyond their means, others are willing to finance that because of their greed to earn more money in a shorter interim and now those rich people are asking for a bailout. Asia-pac region are weathering it a lot better than the US and EMEA are. I'm looking at switching some of my finances to HSBC as quite frankly they're one of the strongest banks with a UK presence currently. I work in the financial world and hear from people in mutual building societies, banks and a friend in the FSA. Turbulent times indeed... And to think my brother was the one with the economics degree! Quote Link to comment Share on other sites More sharing options...
tbourner Posted September 30, 2008 Share Posted September 30, 2008 It is tax money if all this money is not paid back, this £160bn has to come from somewhere. Osbourne said yesterday he couldn't cut taxes as the country is skint. Yeah but it's not tax payers money, people who pay tax don't have to give their own personal net earnings towards it, so why bother making out that's the case!! If taxes go up in future because of this then so be it, but that's a different issue and would result in the government taking the blame for not sorting it in a different way, but going around saying "Why do we have to pay out to save the banks" is stupid because we're not having to pay out anything!!! Quote Link to comment Share on other sites More sharing options...
b_have Posted September 30, 2008 Share Posted September 30, 2008 Yeah but it's not tax payers money, people who pay tax don't have to give their own personal net earnings towards it, so why bother making out that's the case!! If taxes go up in future because of this then so be it, but that's a different issue and would result in the government taking the blame for not sorting it in a different way, but going around saying "Why do we have to pay out to save the banks" is stupid because we're not having to pay out anything!!! Of course its tax payers money! In fact its also non taxpayers money, its the money that should be funding our kids education, our healthcare and all the other services we need. Its OUR money down the drain Quote Link to comment Share on other sites More sharing options...
Gaz6002 Posted September 30, 2008 Share Posted September 30, 2008 Yeah but it's not tax payers money, people who pay tax don't have to give their own personal net earnings towards it, so why bother making out that's the case!! If taxes go up in future because of this then so be it, but that's a different issue and would result in the government taking the blame for not sorting it in a different way, but going around saying "Why do we have to pay out to save the banks" is stupid because we're not having to pay out anything!!! which paper do you read? Quote Link to comment Share on other sites More sharing options...
tbourner Posted September 30, 2008 Share Posted September 30, 2008 which paper do you read? I don't read papers. Why? Of course its tax payers money! In fact its also non taxpayers money' date=' its the money that should be funding our kids education, our healthcare and all the other services we need. Its OUR money down the drain [/quote'] Yes, fine, but the way it's put on the news and the way it seems to have been put in America is that all normal people on the street have to stump up something from their monthly cashflow to give away to these companies that are going under, and it's simply not true! It's up to the government what they spend THEIR money on, we voted them in and gave them that power, if you want to be annoyed at them and say they should spend it on our kids education, healthcare and paying to feed the starving in lower eastern quizbekistan then fine, but don't keep pretending we're having to pay out from OUR OWN PERSONAL money!!! Get it? Quote Link to comment Share on other sites More sharing options...
R Black Posted September 30, 2008 Share Posted September 30, 2008 Govt coffers are made up from taxes, to keep the country running, so any money used is ours no? Or am i missing something??? Posted via Mobile Device Quote Link to comment Share on other sites More sharing options...
tbourner Posted September 30, 2008 Share Posted September 30, 2008 You're missing something. It was ours when we were given our gross pay, then we PAID taxes to the government (who we elected) for the purpose of paying to run the country. We have no more say in it as it's NOT OUR MONEY any more, it's been given to the government, it is the governments money, made up of taxes, they decide what to spend it on, it doesn't belong to us any more!!!!!! Get it now? Quote Link to comment Share on other sites More sharing options...
Soop Dogg Posted September 30, 2008 Share Posted September 30, 2008 So if the govt have to bail out more banks in the future, using revenue raised from taxes, don't you think there's the possibility that taxes on us will have to be increased to ensure we still have the NHS, schools, police etc, etc? Our net pay will be eaten into a little more each time taxes are increased to pay for the increasing debt of the nation. Of course it's our money! Quote Link to comment Share on other sites More sharing options...
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