US Government steps in to rescue banks
07 September 2008, 06:58 PM
#1
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US Government steps in to rescue banks
Fannie Mae and Freddie Mac bailed out by the USA Government 
$5 TRILLION worth of debts ......
This looks very bad for the world economy
$5 TRILLION worth of debts ......
This looks very bad for the world economy
07 September 2008, 07:45 PM
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Here we go again ...yadda, yadda, yadda...
Pete, it's been quite 'economy and house prices' free on here whilst you've been having your colostomy plumbed in.
Don't go starting this old tosh again.
Even if it's true.
Pete, it's been quite 'economy and house prices' free on here whilst you've been having your colostomy plumbed in.
Don't go starting this old tosh again.
Even if it's true.
07 September 2008, 08:26 PM
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Of course they have trillions in debts, that's what the deal in. They are the biggest providers of mortgage liquidity in the US. Your mortgage, I assume you have one, is a debt to the lender, so if your mortgage is £100, 000, that means your lender "owns" £100,000 of debt, whereas the cash in your current account is in effect an asset of the bank. The banks trade in debt, and use their assets as a guarantee of their ability to service the debt.
What that means in the current economic climate is that they're fecked two ways. Borrowers are defaulting on their loans, and their assets are being severely reduced, as people like you and me start living of their savings, and our account balances reduce.
The whole economic boom of the last 10 years or so was founded on cheap debt, thanks to low interest rates. Houses were growing in value, fuelling a demand for mortgages, we were all spending like mad on new cars, white goods, luxury items, holidays, often using credit cards which are a form of debt, and that demand was driving industry, manufacturing, service industry growth. Increased company growth, means more commercial borrowing, and also more people in work, more money to feed demand and so it goes around in a big circle.
Now there's a shortage of liquidity in the debt market, no-one wants to take on more debt, the whole cycle is under threat. Add in rising costs, mainly attributable to the rise in energy prices, and there simply isn't "spare" money floating around to fuel the system.
All IMHO, and I'm no economist.
What that means in the current economic climate is that they're fecked two ways. Borrowers are defaulting on their loans, and their assets are being severely reduced, as people like you and me start living of their savings, and our account balances reduce.
The whole economic boom of the last 10 years or so was founded on cheap debt, thanks to low interest rates. Houses were growing in value, fuelling a demand for mortgages, we were all spending like mad on new cars, white goods, luxury items, holidays, often using credit cards which are a form of debt, and that demand was driving industry, manufacturing, service industry growth. Increased company growth, means more commercial borrowing, and also more people in work, more money to feed demand and so it goes around in a big circle.
Now there's a shortage of liquidity in the debt market, no-one wants to take on more debt, the whole cycle is under threat. Add in rising costs, mainly attributable to the rise in energy prices, and there simply isn't "spare" money floating around to fuel the system.
All IMHO, and I'm no economist.
07 September 2008, 09:00 PM
#4
Of course they have trillions in debts, that's what the deal in. They are the biggest providers of mortgage liquidity in the US. Your mortgage, I assume you have one, is a debt to the lender, so if your mortgage is £100, 000, that means your lender "owns" £100,000 of debt, whereas the cash in your current account is in effect an asset of the bank. The banks trade in debt, and use their assets as a guarantee of their ability to service the debt.
What that means in the current economic climate is that they're fecked two ways. Borrowers are defaulting on their loans, and their assets are being severely reduced, as people like you and me start living of their savings, and our account balances reduce.
The whole economic boom of the last 10 years or so was founded on cheap debt, thanks to low interest rates. Houses were growing in value, fuelling a demand for mortgages, we were all spending like mad on new cars, white goods, luxury items, holidays, often using credit cards which are a form of debt, and that demand was driving industry, manufacturing, service industry growth. Increased company growth, means more commercial borrowing, and also more people in work, more money to feed demand and so it goes around in a big circle.
Now there's a shortage of liquidity in the debt market, no-one wants to take on more debt, the whole cycle is under threat. Add in rising costs, mainly attributable to the rise in energy prices, and there simply isn't "spare" money floating around to fuel the system.
All IMHO, and I'm no economist.
What that means in the current economic climate is that they're fecked two ways. Borrowers are defaulting on their loans, and their assets are being severely reduced, as people like you and me start living of their savings, and our account balances reduce.
The whole economic boom of the last 10 years or so was founded on cheap debt, thanks to low interest rates. Houses were growing in value, fuelling a demand for mortgages, we were all spending like mad on new cars, white goods, luxury items, holidays, often using credit cards which are a form of debt, and that demand was driving industry, manufacturing, service industry growth. Increased company growth, means more commercial borrowing, and also more people in work, more money to feed demand and so it goes around in a big circle.
Now there's a shortage of liquidity in the debt market, no-one wants to take on more debt, the whole cycle is under threat. Add in rising costs, mainly attributable to the rise in energy prices, and there simply isn't "spare" money floating around to fuel the system.
All IMHO, and I'm no economist.
FYI : A loan receivable is an asset for the bank and cash on your current or savings account is a liability.
08 September 2008, 09:12 AM
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08 September 2008, 09:50 AM
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Not good that they felt the need to step in, but good that they did step in and not let them go under.
Will be interesting to see how the market reacts to that. I can see the reaction going either way.
Will be interesting to see how the market reacts to that. I can see the reaction going either way.
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08 September 2008, 10:42 AM
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As a child I always used to believe a country just used to go and print whatever money it needed.
Where does the USA and UK get the dosh from to do things like this?
Anyway,the names are funny
Where does the USA and UK get the dosh from to do things like this?
Anyway,the names are funny
08 September 2008, 11:08 AM
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Like we have done in the Northern Rock affair, the American taxpayer will have to stand the loss. They may get a bit cut up about that when it sinks in.
I imagine there will be a short lived jump in world economies until it all falls back into desolation yet again!
Les
I imagine there will be a short lived jump in world economies until it all falls back into desolation yet again!
Les
08 September 2008, 11:10 AM
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It comes from all us taxpayers!
Les
08 September 2008, 11:21 AM
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I was thinking back to when I was about ten Les.
Obviously I 'partially' understand the basics,where does all that 'backed up' money come from when everyone (government wise)keeps pleading poverty ?
Where did all that money come from to give back to the US taxpayers to get them spending? Where did all the Northern Rock money come from when UK is skint etc?
This is a very poor post but I think you will get what I mean!
Obviously I 'partially' understand the basics,where does all that 'backed up' money come from when everyone (government wise)keeps pleading poverty ?
Where did all that money come from to give back to the US taxpayers to get them spending? Where did all the Northern Rock money come from when UK is skint etc?
This is a very poor post but I think you will get what I mean!
08 September 2008, 12:42 PM
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..Always look on the bright side of life, didum......etc
08 September 2008, 12:56 PM
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08 September 2008, 12:57 PM
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Yep, the moderators aren't going to stick up for him anymore
PS It wasn't me
08 September 2008, 01:17 PM
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08 September 2008, 02:02 PM
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Oh and I am by no means a Pete supporter, merely a case of the infraction system is now proving beyond all doubt that it is a system being widely abused if it is being used for reasons that you mention. People are infracting because they don't like that poster.
Last edited by Bravo2zero_sps; 08 September 2008 at 02:04 PM.
08 September 2008, 02:36 PM
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08 September 2008, 02:37 PM
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That is a prime example of the infraction system being abused then. It is not for the 'community' to say who can and can not post on SN but for the owners and mod team to decide that.
Oh and I am by no means a Pete supporter, merely a case of the infraction system is now proving beyond all doubt that it is a system being widely abused if it is being used for reasons that you mention. People are infracting because they don't like that poster.
Oh and I am by no means a Pete supporter, merely a case of the infraction system is now proving beyond all doubt that it is a system being widely abused if it is being used for reasons that you mention. People are infracting because they don't like that poster.
Les
08 September 2008, 03:11 PM
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How come the Stock Market rocketed up on this news at 8am and has flatlined all day since? Really weird
Did everyone stop trading at 8.01??
Breaking News, Business, Financial and Investing News, Personal Finance & More | Reuters.co.uk
Did everyone stop trading at 8.01??
Breaking News, Business, Financial and Investing News, Personal Finance & More | Reuters.co.uk
08 September 2008, 04:44 PM
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How come the Stock Market rocketed up on this news at 8am and has flatlined all day since? Really weird
Did everyone stop trading at 8.01??
Breaking News, Business, Financial and Investing News, Personal Finance & More | Reuters.co.uk
Did everyone stop trading at 8.01??
Breaking News, Business, Financial and Investing News, Personal Finance & More | Reuters.co.uk
09 September 2008, 12:09 PM
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I was mentioning the validity of the infraction itself for a post which could never be described as trolling which was the reason given.
We should all be concerned at the way the infraction system was being used in this case.
Les
09 September 2008, 12:13 PM
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09 September 2008, 12:19 PM
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Someones going to post up a thread pertaining to this storey ffs :rollleyes:
-t might as well be Pete - he appears to have time a plenty and actually comes up with some good points even if he cant actually back them up 1/2 the time ..!
Good point about printing money - im really not sure its just a childhood dream
-t might as well be Pete - he appears to have time a plenty and actually comes up with some good points even if he cant actually back them up 1/2 the time ..!
Good point about printing money - im really not sure its just a childhood dream
09 September 2008, 10:24 PM
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Apparently if your PSL you can.
Funny really. OP post states facts. Mae and Mac were bailed out. They do have $5 trilion of debt. The world economy does look bad. He get's banned.
Then look at the post at 09:12. Why post this rubbish. The OP may not be liked, but it's news worthy, factual, and relevant to NSR.
So, what exactly is rubbish about the OP?
