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Old 02-18-2008, 03:08 PM   #1
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northern rock is now nationalized

http://www.guardian.co.uk/business/2...ationalisation

finance guy, i'd be curious to hear your thoughts on this.

others involved with northern rock as well. anyone here still a member?
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Old 02-18-2008, 04:33 PM   #2
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Re: northern rock is now nationalized

Quote:
Originally posted by Zoomerang96
http://www.guardian.co.uk/business/2...ationalisation

finance guy, i'd be curious to hear your thoughts on this.
Anatole Kaletsky slates the government's handling of the situation here

But I'm not sure how they could have handled things differently, once they decided to go public on the fact that this bank was receiving emergency funding from Bank of England.

The key government error was not allowing Lloyds TSB to step in with a rescue package when problems first emerged in Northern Wreck during the late summer of 2007.
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Old 02-18-2008, 06:03 PM   #3
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Re: Re: northern rock is now nationalized

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Originally posted by financeguy

The key government error was not allowing Lloyds TSB to step in with a rescue package when problems first emerged in Northern Wreck during the late summer of 2007.
what kind of package was it?
similar to what virgin was offering now?

kaletsky sounds almost hysterical in his extreme opposition to the government's decision to nationalize n.r.

he makes good points though, and i suppose things could easily fall part for the government... and more importantly, the people who have money tied in with northern wreck, as you so aptly referred to them as.

i haven't read any timeline, but i've seen it suggested that the government will sell it off shortly.

what could shortly possibly mean? how long will the bank of england have their hands tied up with this?

it's a mess... a huge mess, and the repercussions could be far worse than anyone realises.

read an interesting article today, suggesting that governments throughout the west will have to play a more active roll in banking as so many of these institutions (particulary in the united states) have been far too eager to cash in on something that you just KNEW would come back to bite them in the ass.

i don't know about elsewhere, but in canada you can now get a mortgage with 0 money down. outrageous.

i believe before that it was only something like 5 per cent, but it's the mentality of everything. it's entirely foolish. banks have been fostering this belief that it's okay to borrow money you won't be able to fully pay off until you've retired at 110 and died at 65.

one of the reasons the northern rock fiasco has been of such interest to me is because i truly think that this could potentially, as stated before and in other articles such as the one you linked to, be the start of something extremely dangerous on a world-wide scale.

i sound like a fear-mongerer don't i?
sorry about that...
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Old 02-19-2008, 01:59 PM   #4
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Re: Re: Re: northern rock is now nationalized

Quote:
Originally posted by Zoomerang96
what kind of package was it?
similar to what virgin was offering now?.
I don't know. I'm not sure if the details have even been made public.

Quote:
Originally posted by Zoomerang96
[B]read an interesting article today, suggesting that governments throughout the west will have to play a more active roll in banking as so many of these institutions (particulary in the united states) have been far too eager to cash in on something that you just KNEW would come back to bite them in the ass.
My opinion would be that we have had too much of the wrong sort and not enough of the right sort of banking regulation in recent years.

Quote:
Originally posted by Zoomerang96

i don't know about elsewhere, but in canada you can now get a mortgage with 0 money down. outrageous.
While I agree with you that 100% financing is not a good idea, as far as I am aware, Canada is not among those countries considered to be at significant risk of a housing price slump.
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Old 02-19-2008, 02:11 PM   #5
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Canada real estate is in for a slowdown.

Quote:
'The great boom is winding down'
LORI MCLEOD

Globe an Mail Update

February 15, 2008 at 4:39 PM EST

Resale home activity caught a case of the winter sniffles in January, a further sign Canada's mighty residential real estate market is finally in a slowdown.

Last month, seasonally adjusted unit sales declined by 0.4 per cent from the month before and 8 per cent from January, 2007, according to data released Friday by the Canadian Real Estate Association (CREA).

“With the further dip in January, Canadian home sales are now well below year-ago levels, adding further evidence that the great boom is winding down,” said Douglas Porter, deputy chief economist at BMO Nesbitt Burns Inc., in a research note.

Steadily rising home prices have benched potential buyers, particularly in Alberta. In January, unit sales in Calgary dropped by 30.9 per cent from the year before and by 21 per cent in Edmonton. At the same time, new listings in those markets surged by 35.3 per cent and 61.1 per cent, respectively.
http://www.reportonbusiness.com/serv...y/robNews/home
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Old 02-19-2008, 02:26 PM   #6
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I would be very surprised if price drops experienced in Canada are as severe as are being/will be experienced in countries like the US, Spain and Ireland.
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