成人快手

Declan:

The R word, will be a welcome thing to hear!

"They then loaned that on to us, and we invested in over-priced assets like housing"

From 'way up there' it's so easy for the Guvnor to generalise and make assertions like that. He has to face financial institutions head-on across the table. He'll never have to do that with 'consumers', no ho!
Thus - blaming the consumer - at any level is a comfortable escape route and of course, it spreads the blame and naturally (smirk) that would certainly make the lenders feel a lot better.

In fact, if I'm right, the blame will shift more and more to 'us' as the recession gathers pace. Moreover whilst Guvnor can look down on us from the dizzy heights of Threadneadle St., we don't get to talk to him and put our case. Ain't that ever so?

Assuming (and it's a big assumption) that the question of how much we borrowed we borrowed is even any of his business (and the concept of borrowing can hardly be described as novel), then the reality, as he perfectly well knows, is that he's had 4 years or more to tell us and certainly 2 years since he was warned about the oncoming credit crunch. With his background, Deputy Governor from 1998 to 2003, Chief Economist and Executive Director from 1991 and Professor of Economics at the LSA that kind of 'wise after the event' remark is a bit bloomin' rich.

What's worse is that the checks that all lenders have in place are supposed to assure ability to pay. Of course - strip away a person's livelihood with a hyper-recession like this one - and nothing really makes nay sense at all, but if Guvor wants to dish out the blame then 'overlent' rather than 'overborrowed' would be more appropriate.


GC

RB's nicked all your readers Declan

GC

Do you have a Buy to let portfolio Declan?

Its about time someone pointed out the role the end user had in all this, yes the banks are to blame for over lending and overvaluing assets, but the unreasonable behaviour of some of the buy now pay later consumers must take some of the blame. As the housing market was running away there were plenty of complaints about people not being able to get mortgages and not being able to get on the property ladder, but I didn鈥檛 hear too many complaints from people taking no deposit mortgages or 110% mortgages, the media was full of programs encouraging people to gear up and become property developers.
Yes the banks got it wrong but its about time some took the responsibility for their own actions, blaming everybody else or claiming ignorance does not excuse the financial irresponsibility of some.

It is easy to blame the people who took out the loans and credit cards and got into debt, but the buck stops with the people responsible for the lending.

There cannot be a single one of them who hand on heart did not know that the amount of debt that they were allowing their customers to build up was untenable. It is simply not possible to borrow a mortgage that is 6 or 7 times your salary, put down no deposit and think that it is a safe loan.

I have said for the last few years that the bubble would be over when the people who wanted to get on to the ladder found that the bottom rung was no longer in reach, not even when standing on the shoulders of their partners and family. You simply cannot have a continued increase in property prices without a solid foundation for them to rest on. The banks, media and Govt. all encouraged us as a nation, and frankly the same encouragement was made in America and some other western states too, to go out and spend and feel good. Live in houses that had 110% mortgages against them, spend, spend, spend on your credit card to buy new kitchens and bathrooms and the latest mod cons and gadgets, take out a loan for a new car to go on the drive of the mortgaged house.

How were these things to be paid for? When people like me mentioned it, We were mocked as gloom and doom merchants, "Go and get a loan and do up your kitchen, it will make you feel better!" I was told on one occasion.

Any child knows that in a closed system, the amount of growth always reaches a finite limit. When everyone has a second car, how do you sell them a third? When everyone has the latest flat screen huge TV, why would they want another one, we can only watch one at a time. The myth of perpetual growth is that we have periods of growth, followed by recessions. This is the reality of the free market capitalism we have in the West. The wealth always trickles upwards, and the bailouts are always paid for by the people at the bottom, taxpayers like you and me.

There is a choice we can all make at this time, do we want to carry on like this, funding the select few with lifestyles we can not even dream of, or do we want to have a system that rewards work, not simply rewarding wealth.

Its all well and good saying
鈥渁ny child knows that in a closed system the amount of growth always reaches a finite limit鈥�.
If that were the case it only puts more blame on the people who took out the loans and credit cards and got into debt that they could not service.
You can鈥檛 absolve these people of any blame at all as they say it takes two to tango and they should share some of the blame with the banks.
Ask yourself it was that easy and you saw this coming what was peoples motivation?
Greed and the knowledge that in today鈥檚 society individuals far too easily get away with claiming innocence and ignorance as an excuse for their own shortcomings.

#7, If you constantly barrage people with the idea that credit is cheap and that rates will stay low and it is perfectly acceptable to run up large debts on credit cards, then that is exactly what they will do.

If it was just the people who were frivolous who had go into trouble then your case would be easier to make, but the sad fact is that people who most would think of as world wise and mature in outlook were also convinced by the media, the government and yes, also the banks and credit card companies, that the way to get on in life was to take out debts.

If I had 拢1000 to invest, and I invested it in the form of a loan to someone who I felt would not be able to repay the loan, then I am the one to blame for loosing my money when they default.

When I first started work and wanted to open a bank account, I had to go with my dad and see the bank manager. Despite the fact that I was earning pretty good money at the age of 18 relative to others of my age, I was told no way would I get even a debit card until I had an account with them for at least a year and showed some record of what sort of a risk I was.

During 2007, I know of people who have got a county court judgement for defaulting on a loan on the Friday and within two weeks, they were getting offers of credit cards and loans, some even acknowledging their bad credit risk! How exactly is that prudent banking?

The banks stopped being responsible and decided to go on the hunt for bigger and bigger profits. Simply look at how targets were set for staff in branches, they had to make up quotas of loans and mortgages and credit cards, their take home depended on how many customers could be convinced to take on debt.

Yes, some individuals were going in with eyes open, but the blame needs to rest firmly with the financial institutions who went to almost any length in the quest for continuing month on month growth in sales figures.

Anyway, the vast amount of the problem in the credit crunch is not the consumer debt, but the massive gambles in derivatives, the global consumer debt pales into insignificance when you compare it to the $530 trillion of derivatives which are lurking as a time bomb set to go off any time, and when that goes, no central bank on the earth can print more money to deal with it.

"[The banks] borrowed more and more from each other, on short-term loans that had to be renewed regularly. They then loaned that on to us, and we invested in over-priced assets like housing."

That doesn't quite add up! If the banks are borrowing only from each other, where does the additional credit come from? Someone has to save more for others to borrow more. The answer is of course that countries with large export surpluses have been saving and lending to us, so that we can continue to buy their goods and oil. The interbank lending is just the mechanism, and it has come under stress because these flows have grown too large and now they have been disrupted.

But assuming that everything stabilises, how will the more fundamental structural problem sort itself out? That is the interesting question.

Absolving individuals from any blame encourages a very low standard for the public in general, its all too easy in life these days to abdicate responsibility for one鈥檚 own actions, some of us have been prudent and not overstretched and got into debt which we could not service, yet others it seems do not know how to resist temptation, but it seems these days being prudent is a waste of time as when something goes wrong the un prudent simply look to someone else to bail them out. You may say it鈥檚 the banks fault for offering credit but, if someone is in debit on several credit cards and then runs up debt on another one just to get the latest fashion accessory, mp3 player, flat screen TV or for that matter purchase a property (with a mortgage) they cannot afford are they not just as guilty.
May be it is all the banks fault but I am afraid that is a terrible indictment on the level of intelligence of individual now accepted as the norm. And now look who鈥檚 already getting the blame for doing the very thing you ask, it鈥檚 the big bad banks that are not lending to small business, only giving 75% mortgages and repatriating the collateral they were given against loans and mortgages.
As for it all being the fault of derivatives, Foreign exchange and interest rate derivative have been around over 20 years now and have helped many companies in protecting themselves from adverse market movements, without interest rate derivates fixed rate mortgages would not be readily available leaving individuals open to volitile mortgage repayments, credit derivatives have not been around as long, so lets not kid ourselves the bottom line is that if people had continued to service their debt this whole credit crunch would not have been triggered.

This comment was removed because the moderators found it broke the house rules. Explain.

For myself and for the many for whom I do speak (being something of a campaigner on this on modest scale - wish it could be bigger), I don't really want anyone 'blaming anyone else for the lending' - what happens now, with borrowers in trouble, well, I am definitely on the warpath with that one.

The trouble with the blame culture is it solves nothing and merely sets one side against the other to no good end - they are both equally culpable and liable - and it has, disgracefully - spread quickly to the general population where the 'haves' are blaming the 'have nots' which is the last thing a divided country like the UK needs at this time.

It is indisputably true however that the financial institutions started the blame game.

What I'm demanding is Christian decency and tolerance from the lenders and an end to what has become, for many, the worst fallout of usury. I understand that in the USA the situation is 1000 times worse, socially and economically.

I say Christian because those ethics would call for forbearance, respect, and never would countenance the attribution of 'fault' nor punish perceived 'irresponsiblity' - methodologies completely alien to lenders in the Christian world.

We are not seeing that Christian decency and tolerance and the first the poor owner will learn about 'Gordon Brown's new guidelines to courts' in the matter of how repossession proceedings are handled will be when they are standing in front of the judge. The whole business of 'repossession' and the way it is handled 'legally' is a DISGRACE. I can only speak for the UK.

1. IF your home is repossessed, it will be sold (auctioned) at some value (over which you have no control).

2. You will be then liable for the shortfall of the amount borrowed plus interest.

3. Bankrupcy proceedings will inevitably follow almost immediately (and sometimes on the same day if you have an all-risks mortgage) where virtually everything else you own will follow the same route except that the sale of items at seizure will yield little more than scrap value. Bankrupcy proceedings often preceed repossession as a means to facilitate the latter.

Bankrupcy - despite the smooth reassurances of some insolvency practitioners (including on this site, to my horror) that 'it only lasts X years' is quite simply a life prison sentence for the poor victim, unless they can hide their past by marriage and change of name or make a fortune, which of course is most unlikely except in the most extraordinary cases. IVA would be helpful had it not such stigma attaching (eg: Private Eye - 'IVA is just bankrupcy by another name') and it the creditors were required to abide by the practioner's advice to accept settlement rather than vote on it.

Repossession is really just bankrupcy by another name and the 'legal' measures and initiatives suggested so far by the Government on either or both belong in the same bucket.

I have never been a victim of those things of which I speak but speak for many who have been or will soon be.


GC

#10, I agree to an extent.

However, you are intelligent enough to know what dangerous weapon a credit card is and some folk just_don't_think_the_way you and I do! No ho.

Moreover, whilst I would not condemn High St lending rates on ordinary loans and mortgages especially and per se, credit card interest is another matter and that matter is usury.

Rates of over 20% variable. This can mean, beyond a certain threshold that the amount owed will never drop unless you get a major change in your personal cirmcumstances. Usury and quite indefensible. The Church knows all about usury and had predicted what we are facing 10 years ago but no-one in Government listened.

I recently wrote, fwiw to the Bishop of Lincoln:
"there is a war of usury vs decency going on out there. Democracy has failed us and you may agree with me that the church may be the weapon of last resort to bring some sense to it all... there is a way to stop the socio-economic trainwreck heading our way and I have repeatedly tried to campaign on this to my MPs, via my firm's website and also via a No10 petition, freeze on loan, mortgage and credit card interest, moratorium on foreclosures, repossessions, bankrupcy orders, court orders and seizures and all the ghastly repertoire of the Dickensian British insolvency system.

I watched so many friends go bust in the 90's. I knew of numerous suicides, marital breakdown, nervous breakdowns. The Govt just smugly said (were they not always smug under Major?) ''new firms are replacing the old (ergo -failed) ones and things will be fine''. You can't replace old established firms with new ones, the expertise, technology, skill, systems, archives are irretrieveably lost once a well-constituted firm goes down. In every case I knew, which was many, the fundamental cause of the collapse was the reasons you have stated. In EVERY case.

The PM could do this at the stroke of a pen and frankly, it he wants the people behind him, he better do it mighty quick.

There are so few ways to speak out, and the time to do it is going fast before the financial system goes to work 'in the same old way' on all of us."

In his kind reply to me the Bishop of Lincoln said to me 'you are right on every count' and remarked, morever, that the Church 1)cannot gain the publicity they need to demonstrate that they are engaged in this and 2) that the Government is deaf to their pleas.


Are you hearing this 成人快手?

GC

Maybe the blame game is not the way to go but what we do need is for people to take responsibility for their own actions. Tolerance is fine but if we continue to bend over backwards and offer no downside to the irresponsible or na茂ve, will they ever learn?
What do you say to the person who struggles to live within their means going short of many things when they see the irresponsible running up large debts to live beyond their means without penalty?
Those who are more responsible will end up asking themselves what is the point.
It鈥檚 not so much about the have and have not鈥檚 there are just as many have鈥檚 who have acted recklessly as there are have not鈥檚 who have acted very prudently.
More and more these days we are seeing people being allowed to abdicate their responsibility (not only financially) should this trend continue many more will ask why I should bother.
I do not believe religion has any place in this debate but if you do wish to introduce religion maybe you should look at something other than Christianity after all there are religions out there that do not allow their financial systems to operate in this way.

# hi 14

I'm for responsibilty but unfortunately these things aren't on the compulsory school curriculum and when one takes out reasonable liabilities based on categorical assurances of stable macroeconomics and they then fail one can hardly be held to account for the fallout, after all the concept of borrowing can hardly be described as novel, it makes the whole banking system work, or should. The issue is realy a question of balance and invariably it is those least able to resist or manage their finances that suffer most. Hardly a hanging offence.

As for religion, yes, I happen to be in favour of the Islamic banking system, but from a historical perspective you're wrong regarding the role of the Anglican Church.

It was Church's acquiescence of Henry VIII's Act regarding interest on loans and the emergence of the Lombard system (no more than usury by another name - for which the Jews had been persecuted for centuries) that got us into this mess in the first place.

The Catholic Church was hardly better, both condemning the practice of interest on loans formally under Pope Benedict XIV and then subsequently turning a blind eye to it for the next 263 years.

In fact - if look back thru history in almost any culture and you will find closer links between banking systems and religion (including Quakers oddly enough) than any other sector of society. This is importantly true of the Islamic banking system and having a high regard for the Islamic faith I say quite right too.

I fully respect that you wish to leave religion out of it but this is a public forum where freedom of speech rules apply and mercifully some of the English clergy seem to feel the way I do that there is a moral duty beholden on the Church to speak out for those who are in trouble and cannot defend themselves.

One notable Anglican Archbishop published this in the Spectator and I quote:

"And this is part of the same mindset that turns the specific, goal-related transactions of borrowing and lending into a process producing pseudo-things, paper assets 鈥� but pseudo-things that (when matters do not go well) cause real and crippling damage to actual persons and institutions"

GC

Sorry I made no mention of hanging offences, just that people should be take some responsibility for their actions.
Thank you for the history lesson but I think you will find I said I did not believe religion had any place in this DEBATE I did not say religion had no place in the history of finance.
I would also point out I made no reference to the Anglican church so why say I was wrong about the Anglican church ?
Your are correct the freedom of speech rules do apply and I never implied you were not entitled to voice your opinion, just that I did not think this was the correct debate, a view which I am equally entitled to voice.
Perhaps in your next letter to the Archbishop in order to promote your Christian values you should suggest that instead of investing the churches money in the capitalist financial markets , the church should get back into finance and uses some of its millions to provide interest free mortgages where, should the mortgagees default you will not seek repossession .
In order avoid taking this blog completely off topic I will avoid posting again

#15 said "In fact - if look back thru history in almost any culture and you will find closer links between banking systems and religion (including Quakers oddly enough) than any other sector of society. This is importantly true of the Islamic banking system and having a high regard for the Islamic faith I say quite right too."

Could you expand on what you mean with regards to the link in Islam? This is not to knock what you have said, I am genuinely interested.

#17 - I must point out that I am no expert on this, I just decided recently to explore the background to banking systems. Because religion is such a personal issue I want to stress that I believe in tolerance and respect for all religions.

Suffice to say I have read enough to be very impressed by Islamic Banking which enshrines the principles of fundamental decency, ethical conduct, trust and respect that are often missing 鈥� we can now all see - from our 鈥榃estern World鈥� Lombard and Fiat money systems. And it has done so for centuries.

Islamic banking must conform to the strict ethical and religious principles of Sharia 鈥� Islamic Law. Sharia is of course based first and foremost on the the teachings of the Prophet Muhammad with added consensus, reasoning,debate and precedent from senior clergy.

The fundamental principle of Islamic banking is the sharing of profit and loss and the prohibition of riba (usury) and it emerged as a cornerstone of commerce during the aptly named 鈥楪olden Age鈥� of Islam (around the century AD 5th to the 12th). Rightly named because it was a time of the most extraordinary developments in science, engineering, chemistry, astronomy, agriculture and countless other fields.

Invasions by of Islamic lands between the 11th and 13th centuries pretty-well signalled the end of that Age, especially the Mongol invasions of the 13th century that led to Baghdad in 1258 - the new capital of the Abbasid and first true Islamic city. Baghdad was, what we would now call an intellectual 鈥榗entre of excellence鈥� with learned institutions teaching every field of intellectual activity.


Guiding principles on financial transactions established in those very early times have stood the test of time because of strict religious supervision and observance. Quoting if I may from the Institute of Islamic Banking, set up in London in 1991 (whose website is well worth reading)

鈥淭he universal nature of these principles is immediately apparent even at a cursory glance of non-Muslim literature. Usury was prohibited in both the Old and New Testaments of the Bible, while Shakespeare and many other writers, particularly those writing in the 19th century, have attacked the barbarity of the practice. Much of the morality championed by Victorian writers such as Dickens - ranging from the equitable distribution of wealth through to man's fundamental right to work - is clearly present in modern Islamic society."

GC

sorry, for some reason the 成人快手 upload turns all my inverted commas into question marks..

GC

typo - led to the destruction of Baghdad in 1258

Wish these blogs allowed self-edit I must say..


GC

How refreshing! A 成人快手 Business/Economics journalist who manages to present the facts in a balanced way without resorting to doom laden sensationalism.

On the basis of a profit for every loss who are the clever people who have made 拢1.8 trillion whilst the bank have been losing it - and more to the point where are they keep9ing it ?>