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Chip Douglas
Got it in one Peebo. This thread could not be a more perfect example. :)

 

I mean a Property finance lawyer in Edinburgh working at the 'coal face' who doesn't know where to find the ESPC quarterly stats......

 

I mean a Property finance lawyer in Edinburgh not even knowing that lenders are pulling back on their offerings by the day..........

 

And all this from a Property finance lawyer in Edinburgh who "know's what the market's like as it's my living to know"

 

You couldn't make it up.

 

Mr Crutch, you're at it again. Please debate the facts and leave the wild assumptions to one side. I'm not going to rise to your poorly veiled insults as they barely deserve the mention they're getting now.

 

You're taking a very isolated view of matters here but that's not surprising given your propensity to label things black and white "I'm right, you're wrong booya" approach to discussion.

 

Lets move the debate on slightly as I don't think I'm getting through to you.

 

Can you give me your considered view on the sub-prime market and its potential to interrupt investment and commercial lending in Scotland, seeing as that is just as likely/if not more likely to have a serious detrimental impact on the Scottish economy.

 

Take your time, peruse your bookmarked websites, chew the fact with your parents at dinner before you have to do your household chores, delve into the wonderful font of knowledge that is wikipedia and let me have your thoughts at your leisure.

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Has anyone noticed the similarity in CC's and Prancer's posting styles?

 

The only thing that makes me doubt it is CC's ever so slightly better grammar, and I mean ever so slightly.

 

Interesting, though.

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One thing is clear though. Brown is petrified about the prospect of falling house prices.

 

If house prices fall then he will lose the General Election. What a failure he will be compared to his hated twin Tony Blair. When he is deposed, the disastrous time of Brown as Chancellor and now Prime Minister/Chancellor will be very clearly shown. He will go down as one of the worst Chancellors this country has ever had.

 

The worry over house prices was shown with the pretend Chancellor Darling's comments today in the FT. "The easing and recovery of those [secondary mortgage security] markets is essential to stabilising the housing market" according to the Brown-noser. Why should the housing market be stabilised? Is it not possible that the price of housing has overshot? Don't see him commenting on why it would be necessary to stabilise the price of LCD TVs or mobile phone contracts. They are absolutely petrified about the prospect of falling house prices.

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Anybody see a prog on BBC about house prices, it implicated Barratt Homes of overpricing 1000's of properties, then giving huge discounts.The recorded price on the Land Registry was the initial price causing the average house price to soar across the country, meaning that the actual average price is / was a lot less. This in turn made it look like prices were rising / falling when in fact they were stable.

 

Hope this makes sense as i got lost whilst typing:confused:

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Anybody see a prog on BBC about house prices, it implicated Barratt Homes of overpricing 1000's of properties, then giving huge discounts.The recorded price on the Land Registry was the initial price causing the average house price to soar across the country, meaning that the actual average price is / was a lot less. This in turn made it look like prices were rising / falling when in fact they were stable.

 

Hope this makes sense as i got lost whilst typing:confused:

 

Most new house builders are over inflating the price of there houses or flats so they can give a 15% discount to investors.This in turn would give the investor a free house because the house builder is gifting the investor with 15% equity.But as coopercrutch posted some of the lenders are now asking for 25% equity.This is the area where the property market may go bang as there are 1000's of empty flats throughout the uk that investors bought of plan with the over inflated prices. Hope that makes sense.

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coppercrutch
Mr Crutch, you're at it again. Please debate the facts and leave the wild assumptions to one side. I'm not going to rise to your poorly veiled insults as they barely deserve the mention they're getting now.

 

You're taking a very isolated view of matters here but that's not surprising given your propensity to label things black and white "I'm right, you're wrong booya" approach to discussion.

 

Lets move the debate on slightly as I don't think I'm getting through to you.

 

Can you give me your considered view on the sub-prime market and its potential to interrupt investment and commercial lending in Scotland, seeing as that is just as likely/if not more likely to have a serious detrimental impact on the Scottish economy.

 

Take your time, peruse your bookmarked websites, chew the fact with your parents at dinner before you have to do your household chores, delve into the wonderful font of knowledge that is wikipedia and let me have your thoughts at your leisure.

 

I have noted many facts on this thread. You have just ignored them because they don't fit in with your ill thought out views. My facts on the FALL in house prices in Edinbutgh over the last 6 months for example ? How about you tell me what you think about that ? Considering you didn't know about it until I told you.

 

As for your second point I have already answered that numerous times on this thread. How about you have a look to where I pointed out the FACTS of lenders that have reduced the amount they will lend out ? Those are FACTS and they are due to numerous reasons. One being the Worldwide credit crunch. Another being their fear that the UK is in exactly the same situation as the US, but probably worse. We have 'sub prime' in the UK. It is just not called the same. Anyone who has got a 100%+ mortgage, or a mortgage at 5+ times their salary is the UK equivalent of 'sub prime'.

 

That is what the lenders, and the Government as Coco points out, are so worried about.

 

And for the record the above post by myself is completely off the top of my head. I read websites and blogs to get other people's views on things. Then I make up my own mind on things. That is what a sensible person does.

 

That prediction I put about what may happen in Edinburgh is 100% my own. You won't see it anywhere else as far as I know. So if it comes true then you can come back and congratulate me on gauging the market so much better than the 'so called' experts out there.

 

:)

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Anyone who has got a 100%+ mortgage, or a mortgage at 5+ times their salary is the UK equivalent of 'sub prime'.

 

:)

But thats not what Sub-Prime is here ;)

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coppercrutch
But thats not what Sub-Prime is here ;)

 

Aye that is why I said equivalent !!

 

At the end of the day it is the same thing. In essence people who were loaned more money than they could really afford.

 

Whatever you want to call it that means a large proportion of the UK is ****ed.

 

I am just trying to warn the unfortunate people of JKB what is in store for them !! People clearly don't like what I have to say but I dont give a ****. It is the truth. Considering you are in the US just now I hope you understand what I am doing. I could just sit and look after myself from the sidelines. I will be ok. Nothing wrong with me trying to give a 'heads up' to the JKB massif out there !!

 

At least I have the balls to tell people what my plans are. What I intend to invest in. I don't see many other posters prepared to do that. I do see a few being smug and happy with the money they have made on their property. That is fine, good for them. But I doubt very much they had 'profit' in their mind when they bought their house 10 years ago....

 

I have stated how much I have invested in gold. I am now close to 25% up in less than 4 months. You would think that may persuade some people I could be worth listening to, if only out of interest...........

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Aye that is why I said equivalent !!

 

At the end of the day it is the same thing. In essence people who were loaned more money than they could really afford.

 

Whatever you want to call it that means a large proportion of the UK is ****ed.

 

I am just trying to warn the unfortunate people of JKB what is in store for them !! People clearly don't like what I have to say but I dont give a ****. It is the truth. Considering you are in the US just now I hope you understand what I am doing. I could just sit and look after myself from the sidelines. I will be ok. Nothing wrong with me trying to give a 'heads up' to the JKB massif out there !!

 

At least I have the balls to tell people what my plans are. What I intend to invest in. I don't see many other posters prepared to do that. I do see a few being smug and happy with the money they have made on their property. That is fine, good for them. But I doubt very much they had 'profit' in their mind when they bought their house 10 years ago....

 

I have stated how much I have invested in gold. I am now close to 25% up in less than 4 months. You would think that may persuade some people I could be worth listening to, if only out of interest...........

 

Can you trade on the NASD or NYSE? if so, check out Northgate Minerals (symbol NXG) its a long term one but worth looking at

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coppercrutch
Can you trade on the NASD or NYSE? if so, check out Northgate Minerals (symbol NXG) its a long term one but worth looking at

 

I can indeed. Cheers for that I will have a look. Been thinking about Uranium as well. Apparently the Chinese are building a raft of new nuclear reactors. It also looks many countries, including the UK, are considering ramping up the nuclear card again. If that happens Uranuim producers will be quids in.

 

Now I am off to find out what Northgate do !! :527:

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Aye that is why I said equivalent !!

 

At the end of the day it is the same thing. In essence people who were loaned more money than they could really afford.

 

Whatever you want to call it that means a large proportion of the UK is ****ed. ...

 

You're part emboldened is wrong.

 

The American sub=prime market is the equivalent of going to those dodgy loan companies that you see advertise in the back of the tabloids or on daytime telly.

 

A sub=prime lender is one who loans money to those with a crap credit rating at very high interest levels.

 

It doesn't mean they can't afford to repay it, it just means that they're more likely not to.

 

If you've got 100% LTV mortgage or one at 5x your salary, and you can afford the repayments, doesn't make you 'sub-prime'.

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You're part emboldened is wrong.

 

The American sub=prime market is the equivalent of going to those dodgy loan companies that you see advertise in the back of the tabloids or on daytime telly.

 

A sub=prime lender is one who loans money to those with a crap credit rating at very high interest levels.

 

It doesn't mean they can't afford to repay it, it just means that they're more likely not to.

 

What you say is not entirely true, particulary the first part and the second is partially true. Believe me, I was dealing with "B" paper clients.

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You're part emboldened is wrong.

 

 

If you've got 100% LTV mortgage or one at 5x your salary, and you can afford the repayments, doesn't make you 'sub-prime'.

 

No, but the ratio or the fact that it was 5 x your income would most likely make it a sub prime mortgage. Maybe not up in the double digits, but I bet it would be 8 or 9% (when the market was 6%) Showing savings in the bank only accounts for so much with an underwriter.

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...I have stated how much I have invested in gold. I am now close to 25% up in less than 4 months. You would think that may persuade some people I could be worth listening to, if only out of interest...........

 

I'm going to get me some of those gold shares...

 

....For example how are my shares doing ? Up almost 15% after tax in little over 4 months. No property in Edinburgh has made that much in the last 4 months.....

 

Up 10% in 24 hours!;)

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I can indeed. Cheers for that I will have a look. Been thinking about Uranium as well. Apparently the Chinese are building a raft of new nuclear reactors. It also looks many countries, including the UK, are considering ramping up the nuclear card again. If that happens Uranuim producers will be quids in.

 

Now I am off to find out what Northgate do !! :527:

 

http://www.northgateminerals.ca/

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What you say is not entirely true, particulary the first part and the second is partially true. Believe me, I was dealing with "B" paper clients.

 

This was only my understanding of it.

 

Can you clarify, in terms that we would relate to over here, what sub=prime actually is?

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This was only my understanding of it.

 

Can you clarify, in terms that we would relate to over here, what sub=prime actually is?

 

To be honest with you there are many definitions but nobody puts it more simple than the Wikipedia page http://en.wikipedia.org/wiki/Subprime_mortgage particulary the Definition paragraph

 

Its worth noting that a lot of the true "bad" lenders were forced to close in the County I live in because of their lending practices. They were really taking advantage of this market and horsing buyers left right and center, not only with interest rates but fees etc. This was called Predatory lending and the courts forced a lot of brokers and some direct lenders from doing business in this county. It actually affected the hispanic market more than anything. The real sad part was it was hispanics screwing hispanics when for the most part they stuck together and thats what they got in return for their loyality.

 

I'll give you an example of this that I witnessed first hand right in the middle of all this court case etc on predatory lending. I was the listing agent on a home and we were at Settlement (closing) and the buyers agent , the lender agent and the buyer were all there. The attorney who was conducting the closing was looking at the closing sheet and noticed a bunch of fees that were being charged to the buyer, he took the buyers agent and the lender outside the room talked with them then took me out to explain what was happening. I hadnt really been paying attention to the closing sheet at this stage but it was then pointed out to me that there was in excess of $3,700 of junk fees on the buyers side being charged by the lender and broker. The lawyer told them that the settlement was not going ahead unless these fees were reduced to what they should be, and if settlement did go ahead then the first thing he was doing after it was reporting them to the courts and authorities. Next thing we know is that over $2,100 was removed from the buyers costs

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To be honest with you there are many definitions but nobody puts it more simple than the Wikipedia page http://en.wikipedia.org/wiki/Subprime_mortgage particulary the Definition paragraph

 

Its worth noting that a lot of the true "bad" lenders were forced to close in the County I live in because of their lending practices. They were really taking advantage of this market and horsing buyers left right and center, not only with interest rates but fees etc. This was called Predatory lending and the courts forced a lot of brokers and some direct lenders from doing business in this county. It actually affected the hispanic market more than anything. The real sad part was it was hispanics screwing hispanics when for the most part they stuck together and thats what they got in return for their loyality.

 

Cheers.

 

I'll give you an example of this that I witnessed first hand right in the middle of all this court case etc on predatory lending. I was the listing agent on a home and we were at Settlement (closing) and the buyers agent , the lender agent and the buyer were all there. The attorney who was conducting the closing was looking at the closing sheet and noticed a bunch of fees that were being charged to the buyer, he took the buyers agent and the lender outside the room talked with them then took me out to explain what was happening. I hadnt really been paying attention to the closing sheet at this stage but it was then pointed out to me that there was in excess of $3,700 of junk fees on the buyers side being charged by the lender and broker. The lawyer told them that the settlement was not going ahead unless these fees were reduced to what they should be, and if settlement did go ahead then the first thing he was doing after it was reporting them to the courts and authorities. Next thing we know is that over $2,100 was removed from the buyers costs

 

Makes you wonder how many times they pulled that scam undetected.

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Cheers.

 

 

 

Makes you wonder how many times they pulled that scam undetected.

 

All the time, That was the issue

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Chip Douglas
I have noted many facts on this thread. You have just ignored them because they don't fit in with your ill thought out views. My facts on the FALL in house prices in Edinbutgh over the last 6 months for example ? How about you tell me what you think about that ? Considering you didn't know about it until I told you.

 

As for your second point I have already answered that numerous times on this thread. How about you have a look to where I pointed out the FACTS of lenders that have reduced the amount they will lend out ? Those are FACTS and they are due to numerous reasons. One being the Worldwide credit crunch. Another being their fear that the UK is in exactly the same situation as the US, but probably worse. We have 'sub prime' in the UK. It is just not called the same. Anyone who has got a 100%+ mortgage, or a mortgage at 5+ times their salary is the UK equivalent of 'sub prime'.

 

That is what the lenders, and the Government as Coco points out, are so worried about.

 

And for the record the above post by myself is completely off the top of my head. I read websites and blogs to get other people's views on things. Then I make up my own mind on things. That is what a sensible person does.

 

That prediction I put about what may happen in Edinburgh is 100% my own. You won't see it anywhere else as far as I know. So if it comes true then you can come back and congratulate me on gauging the market so much better than the 'so called' experts out there.

 

:)

 

 

Try again Mr Expert. I'm asking you about COMMERCIAL not residential/retail/domestic lending.

 

You, of all people, should be on my wavelength.

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heart of lothian

If the property market is not going to fall in Britain then why are Banks and Builders shares half the value?

 

I think that our subprime is Self-certification. How many people have lied about their income to buy houses?

 

Interesting to hear first hand about your experiences in the U.S. Tom, I lived in P.A. for 3 years, and I hope things dont get bad.

 

'Throwing Mortgages at customers who could not afford them' Sound familiarhttp://http://www.dailyrecord.co.uk/news/editors-choice/2008/03/05/140-000-scots-face-mortgage-hike-misery-86908-20340888/

 

Not looking good for the U.S. Will it be us next?

http://http://www.fool.com/investing/value/2008/03/03/its-so-much-worse-than-you-think.aspx

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coppercrutch
Try again Mr Expert. I'm asking you about COMMERCIAL not residential/retail/domestic lending.

 

You, of all people, should be on my wavelength.

 

Commercial lending feeds its way through to residential lending. That is the issue. If banks are unwilling to lend to each other, then they have to reign in what they will lend to your average Joe. Unless I am very much mistaken that is exactly what is happening. This is what happened to NR. They couldn't borrow commercially anymore and so essentially became bankrupt overnight.

 

Of course they were the most exposed bank out there to this sort of lending. Many others though are not far behind, B & B amd A & L I think are the most at risk.

 

Anyway let's see what happens. As you say no-one knows the future, but when the people who deny things until the last possible minute (Bank chiefs, Government etc...) start telling us it's getting pretty bad...............

 

Well you can safely say it is going to get a lot worse than pretty bad.

 

I should be ok. I have no debts, no one has any hold of me, I can go and work where I wish and I have savings safely tucked away. :welldone:

 

It is the average punter in the UK that should be worrying. The only problem is I think this Government is doing all it can to drag us sensible folk down with the losers. Using my tax to back up a failed bank is not particularly fair in my opinion. It should have been left to go bust. If the companies I have shares in go bust I won't be looking for hand outs.

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The Old Tolbooth
To be honest with you there are many definitions but nobody puts it more simple than the Wikipedia page http://en.wikipedia.org/wiki/Subprime_mortgage particulary the Definition paragraph

 

Its worth noting that a lot of the true "bad" lenders were forced to close in the County I live in because of their lending practices. They were really taking advantage of this market and horsing buyers left right and center, not only with interest rates but fees etc. This was called Predatory lending and the courts forced a lot of brokers and some direct lenders from doing business in this county. It actually affected the hispanic market more than anything. The real sad part was it was hispanics screwing hispanics when for the most part they stuck together and thats what they got in return for their loyality.

 

I'll give you an example of this that I witnessed first hand right in the middle of all this court case etc on predatory lending. I was the listing agent on a home and we were at Settlement (closing) and the buyers agent , the lender agent and the buyer were all there. The attorney who was conducting the closing was looking at the closing sheet and noticed a bunch of fees that were being charged to the buyer, he took the buyers agent and the lender outside the room talked with them then took me out to explain what was happening. I hadnt really been paying attention to the closing sheet at this stage but it was then pointed out to me that there was in excess of $3,700 of junk fees on the buyers side being charged by the lender and broker. The lawyer told them that the settlement was not going ahead unless these fees were reduced to what they should be, and if settlement did go ahead then the first thing he was doing after it was reporting them to the courts and authorities. Next thing we know is that over $2,100 was removed from the buyers costs

 

 

Good find on Wikipidea Tom, it probably sums it up better than anyone has managed on here so far ;)

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coppercrutch
I'm going to get me some of those gold shares...

 

 

 

Up 10% in 24 hours!;)

 

Gold is not something for the faint hearted. Like a ****ing yo yo !!

 

Only problem is I don't know when to sell !!

 

I can understand the logic of taking a profit, whatever amount it is. The cash will be in your pocket after all and even if it goes up much higher you have still won - you have just not won as much as you might have.

 

A 6-0 thrashing is fantastic, but a one nil victory is nothing to get depressed about.

 

On the other hand I can see Gold being the next 'big thing' for idiot investors like me to get into. Your average Joe has not even considered getting into gold yet. Think about the last 2 huge booms, dot.com and property. At the height of these booms every Tom Dick and Harry had an interest in them. If Gold is to become the next 'boom' then we have a long way to go before people at my work start asking each other over lunch how much they have 'made on gold' this week. If that point does occur I would be selling up quick sharp !!

 

I only have a little knowledge about this. I could do with some more !! :dunce:

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Chip Douglas
Commercial lending feeds its way through to residential lending. That is the issue. If banks are unwilling to lend to each other, then they have to reign in what they will lend to your average Joe. Unless I am very much mistaken that is exactly what is happening. This is what happened to NR. They couldn't borrow commercially anymore and so essentially became bankrupt overnight.

 

Of course they were the most exposed bank out there to this sort of lending. Many others though are not far behind, B & B amd A & L I think are the most at risk.

 

Anyway let's see what happens. As you say no-one knows the future, but when the people who deny things until the last possible minute (Bank chiefs, Government etc...) start telling us it's getting pretty bad...............

 

Well you can safely say it is going to get a lot worse than pretty bad.

 

I should be ok. I have no debts, no one has any hold of me, I can go and work where I wish and I have savings safely tucked away. :welldone:

 

It is the average punter in the UK that should be worrying. The only problem is I think this Government is doing all it can to drag us sensible folk down with the losers. Using my tax to back up a failed bank is not particularly fair in my opinion. It should have been left to go bust. If the companies I have shares in go bust I won't be looking for hand outs.

 

We'll get there in the end.....

 

I'm talking about lending to investment companies, property developers, limited company businesses, high net worth individuals, LLPs and the like.

 

Corporate and commercial banking, if you like.

 

What's your expert view on the main banks/lenders current approach to this type of lending? Does it follow the trends in Scotland we are seeing from the retail lending sector?

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coppercrutch
We'll get there in the end.....

 

I'm talking about lending to investment companies, property developers, limited company businesses, high net worth individuals, LLPs and the like.

 

Corporate and commercial banking, if you like.

 

What's your expert view on the main banks/lenders current approach to this type of lending? Does it follow the trends in Scotland we are seeing from the retail lending sector?

 

I reckon all forms of lending are slowing down. This thread was starting about estate agents however, they are probably more interested in residential lending I would imagine. All linked in the end though.

 

This link below from the FT was from October. Pretty gloomy outlook. I can't imagine commercial lending has done anything but slow down since then. If it hasn't then these banks are even more stupid than I already thought.

 

Looks like the banks have massive exposure to both residential and commercial property lending just as it's about to go down the pan. Nice work. :eek:

 

http://www.ft.com/cms/s/0/b89db1d2-8332-11dc-b042-0000779fd2ac,dwp_uuid=d355f29c-d238-11db-a7c0-000b5df10621.html

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Sheriff Fatman
Of course they were the most exposed bank out there to this sort of lending. Many others though are not far behind, B & B amd A & L I think are the most at risk.

 

I notice that you aren't mentioning RBOS any more and saying that there are rumours that they aren't doing well and how they an outside bet for the next bank to get into difficulties.

 

I can see why you wouldn't, seeing as how they announced a 9% increase in profits, even with their sub-prime related issues. Your sources got that one wrong.

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coppercrutch
I notice that you aren't mentioning RBOS any more and saying that there are rumours that they aren't doing well and how they an outside bet for the next bank to get into difficulties.

 

I can see why you wouldn't, seeing as how they announced a 9% increase in profits, even with their sub-prime related issues. Your sources got that one wrong.

 

I still think they are in trouble, not going bust trouble but possibly having difficulty with their capital. The profits they announce do not include any 'off balance sheet' losses they may have. Who knows how much they add up to.

 

And this is nothing to do with 'sources'. If RBS are in trouble I doubt anymore than 10 people would actually know.

 

Try asking yourself why after their fantastic results have their share prices dropped by over 10%. Of course this is partly due to the negative vibes about the banking sector in general. Thing is however the UK banks have nearly all announced profits better than expected, and yet their share prices have all tanked recently and show no signs of recovery. The big boys in the city don't believe what they are telling them, and they should know, they have been a part of this binge as much as anyone.

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davemclaren
I still think they are in trouble, not going bust trouble but possibly having difficulty with their capital. The profits they announce do not include any 'off balance sheet' losses they may have. Who knows how much they add up to.

 

And this is nothing to do with 'sources'. If RBS are in trouble I doubt anymore than 10 people would actually know.

 

Try asking yourself why after their fantastic results have their share prices dropped by over 10%. Of course this is partly due to the negative vibes about the banking sector in general. Thing is however the UK banks have nearly all announced profits better than expected, and yet their share prices have all tanked recently and show no signs of recovery. The big boys in the city don't believe what they are telling them, and they should know, they have been a part of this binge as much as anyone.

 

 

 

Most UK banks have relatively low exposure to the sub prime market it would seem. Share price movements aren't always rational and based on any facts.

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coppercrutch
Most UK banks have relatively low exposure to the sub prime market it would seem. Share price movements aren't always rational and based on any facts.

 

 

That is what they tell us.............And I personally would not take that as gospel.

 

In any case it is their exposure to the UK 'Whatever you want to call if dodgy mortgages' market they should be worried about. :eek:

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I still think they are in trouble, not going bust trouble but possibly having difficulty with their capital. The profits they announce do not include any 'off balance sheet' losses they may have. Who knows how much they add up to.

 

And this is nothing to do with 'sources'. If RBS are in trouble I doubt anymore than 10 people would actually know.

 

So, who are the other nine?

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Most UK banks have relatively low exposure to the sub prime market it would seem. Share price movements aren't always rational and based on any facts.

 

Indeed, share prices are based on objective (as far as is possible) views of future earnings potential, not simply on historic results.

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The Old Tolbooth
This is one of the finest examples of threadjacking ever.

 

But at least Chip and CC have kissed and made up by the looks of things, big hugs all round.

 

Friends.jpg

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But at least Chip and CC have kissed and made up by the looks of things, big hugs all round.

 

Friends.jpg

 

Which one is the pussy?

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The Old Tolbooth
Which one is the pussy?

 

If you cant tell the difference by now then I worry about you Peebo :D

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Elroyofderovers
I still think they are in trouble, not going bust trouble but possibly having difficulty with their capital. The profits they announce do not include any 'off balance sheet' losses they may have. Who knows how much they add up to.

 

And this is nothing to do with 'sources'. If RBS are in trouble I doubt anymore than 10 people would actually know.

 

Try asking yourself why after their fantastic results have their share prices dropped by over 10%. Of course this is partly due to the negative vibes about the banking sector in general. Thing is however the UK banks have nearly all announced profits better than expected, and yet their share prices have all tanked recently and show no signs of recovery. The big boys in the city don't believe what they are telling them, and they should know, they have been a part of this binge as much as anyone.

 

 

 

WOW. What a thread.

 

Just finished a stint working with RBS last year (I run a small consultancy firm) and I can say I don't think they are in trouble. Granted the share price has dropped drasticly over the last 6 months etc. Yes they think (they don't fully know as the finances are so layered and complex) they are exposed to about ?2b of American sub-prime and may well be reviewing their lending criteria (as all banks are). They have potential future exposure to bank charge claims (scamming bloody customers knew the deal when they signed up). That doesn't even get close to them being in trouble though.

 

They are still paying their staff (drones included) 10% bonuses (plus what ever management get), still operate a final salary pension scheme (one of the few), heavily subsidised canteens, starbucks etc etc etc. They as a company probably carry about 10-15% of fat at any given time (stuff they can lose quickly) and could easily stabilise the business and live on that at least for a few years until things (inevitably) come back. They still have huge potential synergies that could reduce costs by as much as 20% p/a (Natwest, Ulster Bank and Capital etc. Never mind ABM Amro synergies they have just started working on). Massive inefficiencies could be addressed within their projects / marketing / IT divisions like you wouldn't believe. Huge savings could be made over night if required.

 

You also need to remember that when the courts rule that Bank charges have been unfair to the customer and the rest of the beggars go cap in hand to get their money back all that will happen is a new opportunity will present itself for the banks (they are all frantically working behind the scenes as we speak to get their systems and processes ready). Regular charges for ALL banking services. ATM withdrawal, internet banking, number of branch visits per year, just to have any bank account will incur a regular fee (even better than charging for unauthorised overdrafts etc is it is guaranteed regular income) etc etc. The list is endless. What we in the UK take for granted and expect to be free will be no more.

 

There are only a few constants. Things will always change, Banks will always make money (they just make money in new ways) but not as much as the HMRC!!

 

Housing market could go either way. Nobody can say with certainty (the only real FACT). It doesn't matter though as there will always be winners and losers and it is all relative.

 

Oh last point on this massive post. Nobody mentioned the fact that salaries had been increasing in certain areas & sectors at record rates (has a huge impact on ability to pay and house prices), RPI and it's impact on the economy or the very basic fact that a house is worth whatever someone is willing to pay for it regardless of what banks and markets say.

 

Phew :eek:

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Elroyofderovers

 

I should be ok. I have no debts, no one has any hold of me, I can go and work where I wish and I have savings safely tucked away. :welldone:

 

BULLY FOR YOU

 

It is the average punter (THIS SAYS IT ALL. YOU THINK YOU ARE BETTER THAN THE AVERAGE PUNTER) in the UK that should be worrying. The only problem is I think this Government is doing all it can to drag us sensible folk down with the losers (CLEARLY BITTER ABOUT FOLK THAT HAVE BEEN LUCKY AND MADE SOME MONEY). Using my tax to back up a failed bank is not particularly fair in my opinion. It should have been left to go bust. If the companies I have shares in go bust I won't be looking for hand outs.

 

 

So better than Mr Average how come you are so rosey?

1) What do you do for a living that you pay tax and can go work anywhere?

2) What are your current living arrangements?

3) Why are you so bitter?

4) You said in one of your previous posts (#86) "If I was looking at making money in the last 10 years I probably would have got in and had a piece of the pie !!" are you honestly saying you were not looking to make money in the last 10 years? :o

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I still think they are in trouble, not going bust trouble but possibly having difficulty with their capital. The profits they announce do not include any 'off balance sheet' losses they may have. Who knows how much they add up to.

 

And this is nothing to do with 'sources'. If RBS are in trouble I doubt anymore than 10 people would actually know.

 

Try asking yourself why after their fantastic results have their share prices dropped by over 10%. Of course this is partly due to the negative vibes about the banking sector in general. Thing is however the UK banks have nearly all announced profits better than expected, and yet their share prices have all tanked recently and show no signs of recovery. The big boys in the city don't believe what they are telling them, and they should know, they have been a part of this binge as much as anyone.

 

Ex-div date. Will be another year before people are entitled to the dividend again:welldone:

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The Old Tolbooth

Hey CC, I found this on an ad at the bottom of the page on this site, this looks like the sort of thing I avoid like the plague as it looks like the usual scam, however I know that it's probably the sort of thing you might like to get your teeth into, and for ?20 (refundable if not satisfied) your just the fella to have the time on his hands to study it ;)

 

http://www.propertyinvestmentsecrets.co.uk/offer/index.htm

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coppercrutch
So better than Mr Average how come you are so rosey?

1) What do you do for a living that you pay tax and can go work anywhere?

2) What are your current living arrangements?

3) Why are you so bitter?

4) You said in one of your previous posts (#86) "If I was looking at making money in the last 10 years I probably would have got in and had a piece of the pie !!" are you honestly saying you were not looking to make money in the last 10 years? :o

 

Calm doon !!

 

I never said I am 'better' than Mr average. I simply pointed out that Mr Average has **** loads of debt. I do not. That is why I am not 'Mr Average'. I have been prudent when others have been idiots with money so I hope to reap the benefits. Anything wrong with that? Isn't that fair ? I used the word 'losers' because I think anyone in a huge amount of debt could be in big trouble soon. These people with huge debt have been the 'winners' up until now. The tide is about to turn.

 

1) I work for myself contract stuff. I explained before that I have no debts and no ties, I owe no-one any money. That means I can up sticks and head off anywhere I like when I feel like it. Many people are not in that situation. I wasn't meaning I do a job that everyone is desparate for. Everyone is expendable. :eek:

 

2) I have also stated this many times, I am staying at home with my folks just now, trying to save as much as I can while I get the opportunity. So that if times get pretty bad I have a nice cushion to support me. I can head off to Thailand for 6 months to ride out the worst of it if I feel like it - and not lose out too much. Not many other people could say the same.

 

3) I am not bitter, I am just saddened by the state this nation has go into. People being rewarded for being stupid with money. People wanting everything now. People not being prepared to save first and buy later. I have been one of the sensible ones and I deserve to benefit from that. Up until now it seems those were are foolish with their money have benefited. I think that is changing. I see that as a good thing.

 

4) No, I was not looking at making money in the last 10 years. I spent 4 years at Uni having a laugh, and then about 5 years travelling around the World from place to place enjoying myself. Investments, mortgages etc.. were the last thing I was interested in.

 

As for RBS I am not arguing with anything you have said above. The main problem however is that at this time every bank would like to have a big wad of cash/capital sitting in the back ground. RBS would have had this except they decided to go and buy a portion of AMRO for about ~50 billion cash. ( Correct the figures if wrong I can't be bothered looking !! )

 

They have got rid of their 'savings' at precisely the time they should have held on to them. This is the view of many far more qualified people than myself BTW. Many stories out there in the press if you have a google.

 

I think banks will usually make money, but not always. Citigroup, the Worlds largest bank, are losing money this year. If it can happen to them it can happen to RBS or any other huge bank. I don't think they will go bust or anything but they may have to go to the ECB ot the BOE to ask for a short term capital injection. Now both these organisation have changed their rules in light of NR - so any bank they may have gone and asked for help already. None of us would be the wiser. ;)

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coppercrutch
The very basic fact that a house is worth whatever someone is willing to pay for it regardless of what banks and markets say.

 

Sorry, just missed a bit in your previous post.

 

Your logic here is a little bit incorrect. How many people do you know that have 'bought' a house? Probably very few.

 

People need the banks to give them the money to get a mortgage. If the banks start pulling back on their lending, which is happening by the day, then it doesn't matter if Mr Smith wants to pay half a million for the home. The bank will decide if he gets it or not. This is what could lead to a massive crash in house prices in the next few years.

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coppercrutch
Hey CC, I found this on an ad at the bottom of the page on this site, this looks like the sort of thing I avoid like the plague as it looks like the usual scam, however I know that it's probably the sort of thing you might like to get your teeth into, and for ?20 (refundable if not satisfied) your just the fella to have the time on his hands to study it ;)

 

http://www.propertyinvestmentsecrets.co.uk/offer/index.htm

 

I hope you are taking the mick Mr Mitchell !!! These fraudsters are a complete joke. :1132:

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The Old Tolbooth
I hope you are taking the mick Mr Mitchell !!! These fraudsters are a complete joke. :1132:

 

You did notice the wee wink at the end of the post didnt you? ;)

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portobellojambo1
Indeed, share prices are based on objective (as far as is possible) views of future earnings potential, not simply on historic results.

 

Would agree with that totally, although suspect someone will produce figures via google to suggest otherwise (and if information can be located on google it is FACT, google www.hibs.net for confirmation of this, everything you see is fact, or maybe it is just opinion).

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Most UK banks have relatively low exposure to the sub prime market it would seem. Share price movements aren't always rational and based on any facts.

 

Dave, I'd have to research this a wee bit more but I'm fairly certain that RBOS purchased a significant of the subprime loans or they gave funds to some of the US banks. I'm not exactly sure what it was but I'm confident that they took a big dunt.

 

Talking of Banks losing money, take Countrywide Home Loans for instance, they were the biggest self funding home mortgage lender in the country, I think they service something like 25% of all mortgages in the USA, they were running along nicely during the boom here and for the most part they were an "A" paper lender, they opened a sub-prime division called Full Spectrum Mortgage got involved in that market then all of a sudden they are in real dire straits. Share price went from something like $18 to $45, then all of a sudden its down in the single digits. Bank Of America has now bailed them out but there will be jobs losses and foreclosures continue to rise with them

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coppercrutch
Dave, I'd have to research this a wee bit more but I'm fairly certain that RBOS purchased a significant of the subprime loans or they gave funds to some of the US banks. I'm not exactly sure what it was but I'm confident that they took a big dunt.

 

Talking of Banks losing money, take Countrywide Home Loans for instance, they were the biggest self funding home mortgage lender in the country, I think they service something like 25% of all mortgages in the USA, they were running along nicely during the boom here and for the most part they were an "A" paper lender, they opened a sub-prime division called Full Spectrum Mortgage got involved in that market then all of a sudden they are in real dire straits. Share price went from something like $18 to $45, then all of a sudden its down in the single digits. Bank Of America has now bailed them out but there will be jobs losses and foreclosures continue to rise with them

 

That is the problem Tom Heaney. There are countless examples of huge companies that have been doing great and then all off a sudden been destroyed. Enron being the classic example. The recent demise of NR being another. Now NR is not quite in the same league but it was still the UK's 6th largest bank. Running along nicely, hundreds of millions of pounds of profit, employees getting nice bonuses. Then what ? It pretty much went bankrupt overnight.

 

That is how easy these things can come about. Anyone who thinks RBS, HBOS or the likes are too big too fail are seriously naive. I do think this Government would try to bail them out. But seeing the public reaction to the NR bailout I cannot imagine how they could support a giant like RBS or HBOS if they were looking shaky. Over 100 billion to guarantee NR ? I imagine to guarantee RBS it would take something like 500 billion. I don't think even this joke of a Government would attempt that.

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