Northern Rock [Archive] - SV650.org - SV650 & Gladius 650 Forum

gettin2dizzy

13-09-07, 10:54 PM

similar yeah. Barclays are very liquid though, they have a huge amount of money in many many different places. Northern Rock however are almost entirely reliant on mortgages and are very vulnerable to the capital markets. I think it'll be down to the media tomorrow how things go

injury_ian

13-09-07, 10:58 PM

Cant remember where i saw it, but its all to do with them Americans, lots of reposesions market slumps etc, banks are buckling up for a rough ride all over the world.

All mortgages and loans will get more expensive, on top of any BOE rate rises

gettin2dizzy

13-09-07, 11:07 PM

my mums already started shifting her properties as mortgages were becoming ridiculous. Apparently they lent money to high risk americans and now they won't be able to get it back.

haggis

13-09-07, 11:14 PM

(From the link above) : A money boffin said.....

"We don't know where the poison went from all these bad loans and you have to look at all these bad loans as a bit like a blancmange that's been hit very heavily by a spade and it's gone everywhere.

:rolleyes:
Riiiiiiiiiight!

I'm so glad my N.R. car loan ends next month.

tigersaw

13-09-07, 11:20 PM

Been reading up on this tonight. Seems only the HSBC is capeable of funding all its loans from deposits, the rest of them shift money between themselves all the time.

monkey

14-09-07, 02:30 AM

So how will this affect the interest rate? Should I get a fixed rate even though it's relatively high or wait? I was going to move early next year.

gettin2dizzy

14-09-07, 08:21 AM

The banks are all struggling - and that cost will be passed to us :(

maybe they should ease up on the £50m bonuses!

injury_ian

14-09-07, 10:56 AM

So how will this affect the interest rate? Should I get a fixed rate even though it's relatively high or wait? I was going to move early next year.

If your planning to move then move, if you keep waiting for the right time, it'll never happen.

rates go down, house prices will rise, then you'll wait for that to come down. lol

in reality, it all stays at about the same, take with one hand give back with another.

I stick with trackers mainly because i know the banks will usually make more from you on a fixed. tho that hasn't quite worked this year =;

Daimo

14-09-07, 11:12 AM

neio79

14-09-07, 11:30 AM

I've got a mortgage with NR. If it goes bust, do I have to pay it off still. Please say no. Im fixed though.

Maybe the next few days its "MAY" be a good idea to buy some stock in NR and hope the shares go up again?

I wish, if that is the case i think i will go and take out one on a lovely £1M house in the cotswolds!!

chrisdownes

14-09-07, 11:57 AM

I hope they sink and go bust!!

A few years ago I got into financial difficulties and NR were the only ****s who gave me grief and wouldnt accept my repayment proposal on a loan I had with them. Total bunch of tossers in my opinion

:smt067:smt067:smt067 - Northern Rock

monkey

14-09-07, 06:03 PM

Cloggsy

14-09-07, 06:09 PM

Question... If you have a Northern Rock Mortgage & they go under, does that mean you are Mortgage free :?: \\:D/

tigersaw

14-09-07, 06:29 PM

Question... If you have a Northern Rock Mortgage & they go under, does that mean you are Mortgage free :?: \\:D/

Nope - your loan becomes an asset for the liquidator, so in effect you just end up with a new lender.

Cloggsy

14-09-07, 06:31 PM

Nope - your loan becomes an asset for the liquidator, so in effect you just end up with a new lender.

Bugger :p

the white rabbit

14-09-07, 06:32 PM

Nope - your loan becomes an asset for the liquidator, so in effect you just end up with a new lender.

+1 on the buggering so to speak!

And I hope the FSA will make them stay to the fixed rate....:smt045

I'm with Daimo, could be a good share purchase. Someone will buy them soon if not very soon.

14-09-07, 07:54 PM

I'm with Daimo, could be a good share purchase. Someone will buy them soon if not very soon.

The shares fell 200 points today - what a mauling. I am sure that somewhere someone is looking at them very hard.

Whatever, I can't see that the senior management have much of a future.

On the flip side - I feel sorry for the staff. It's not a problem of their making and suddenly they face job insecurity. I deal a lot with NR and I find their call centre very helpful, they actually return calls, and they pay out mortgage money on as little as an hour's notice. Up there with C&G in terms of service, I think.

Biker Biggles

14-09-07, 08:13 PM

Must dig out my history books.
Let me see was it 1926 Wall Street?
Who said crash:rolleyes:

tigersaw

14-09-07, 08:20 PM

What is probably nothing to worry about has become a consumer panic fuelled by the media. People queuing to take their money out FFS.
Reminds me of the sugar shortage in the 70's. There never was a shortage of sugar, but suddenly shelves were bare across the country as people raced to stock their larders - sort of a self fulfilling prophecy.

Filipe M.

15-09-07, 03:29 PM

What is probably nothing to worry about has become a consumer panic fuelled by the media. People queuing to take their money out FFS.
(...)
sort of a self fulfilling prophecy.

My thoughts exactly. :(

Pedrosa

17-09-07, 01:57 PM

I am totally with Tigersaw on this. Thousands of people proving they are not the most sophisticated of investors anyway if all they rely on are time bond B.S. saving accounts or the like. Plus they knee jerk react as opposed to drawing from "educated" opinion from those in the know.The problem is a world wide thing, it is just unfortunate that NR have been caught in the spotlight.

So those smart people who queuede for hours to withdraw their cash in the past days,where are they going to deposit it now?

I think their will be many a house burglar rubbing their hands with glee knowing that record amounts of cash are presently stashed under mattresses, in drawers and behind photographs in homes throughout the UK..

Cynic? Yes sirree.

Davies

17-09-07, 02:11 PM

Isn't Northern Rock a Building Society which is guaranteed to be backed by the government, therefore protected from going bust? :-k

rigor

17-09-07, 02:20 PM

Nope, it's a bank. It de-mutualised in 1997.

sarah

17-09-07, 02:27 PM

But the Bank of England have agreed to lend them as much money as they need if the need arises.

wyrdness

17-09-07, 02:48 PM

Maybe the next few days its "MAY" be a good idea to buy some stock in NR and hope the shares go up again?

I wondered about that too, but there share price has been in freefall since the spring. Even when the stock market was going to an all-time high in July/August, their share price was still dropping. If this was just a temporary drop, I'd buy once the price starts to recover, but not if they're in long-term decline.

I'm not a stock market expert, so feel free to ignore my advice.

Luckypants

17-09-07, 02:54 PM

But the Bank of England have agreed to lend them as much money as they need if the need arises.

Well that ain't all that likely..... The Bank of England does not have unlimited supplies of cash. And in the case of bailing a bank out, it needs to be hard currency - cash, gold etc. Borrowed money only makes the spiral worse.

If they really start running short of cash, they'll be calling in mortgages and loans to raise the money required. Then the fun starts.

17-09-07, 02:58 PM

I'm amazed at all these people standing in line to get their money out. What are they going to do with it, put it under the mattress?

With the BofE loan - whose money is this - is it taxpayers' money, and when is the loan repaid?

The Basket

17-09-07, 03:00 PM

I am amazed how easy that people get the panic. Acting as if in a Banana Republic...read somewhere that the MD of NR got a mill and a half last year.

Nice work if ya can geddit. He should be paying it back though if it was performance related.

northwind

17-09-07, 04:04 PM

Good old fashioned bank run! Like in the Depression. Bank gets into mild difficulty. Hundreds of thousands of investors withdraw all their savings overnight. And now, the bank's in more difficulty because of the panic withdrawals than because of the initial shortfall.

It's the exact same as panic buying. "o noes! There's going to be a water shortage! Quick, everyone buy lots of bottled water!" Shops sell out of water. "AAARGH! There's a water shortage! Just as well we bought all this water eh?"

That's the trouble with the markets, at the end of the day it's like any other mob, it's exactly as clever as it's most stupid member.

Pedrosa

17-09-07, 05:58 PM

Northy...So perfectly put,nice one.

northwind

17-09-07, 06:33 PM

I said much the same thing at work today, and got back "I don't think the banks should be lending out people's money. They should always have to have enough in reserve so that if everyone wants to take out their money, they can." To which the only possible response was, GOOD LORD! YOU WORK IN A BANK!

sarah

17-09-07, 06:44 PM

I think they said on the radio that NR have much greater assets than the cash people have invested in them anyway. It's more of a cash flow problem.

17-09-07, 10:40 PM

That's the trouble with the markets, at the end of the day it's like any other mob, it's exactly as clever as it's most stupid member.

...of which there seems to be a depressingly high number.

Pedrosa

18-09-07, 09:21 AM

I wonder how many of those people grabbing their handful of savings, would have headed straight to a stock broker and had a punt on NR shares? It had to be a good option in my mind with an upward trend the more likely option?

Even a short term holding could deliver a nice little return.

NR shares up 10% when I looked earlier.;)

18-09-07, 10:12 AM

...and now we have the government guaranteeing deposits - every deposit, not simply private depositors. I think they will end up regretting it. Who else are they going to bail out? I object to the use of my taxes in this way.

Pedrosa

18-09-07, 10:29 AM

Ed you surprise me with your comment. The government has taken an unprecedented step in order to back the expert opinion that no real crisis exists,apart from that being created by misinformed and worried savers not wishing their hard earned cash to be lost and making desperate withdrawals,(interesting though that some reports are bveginning to mention people actually making deposits once again with NR). How many more times...this is a question of liquidity not asset value of NR. It is a display of confidance and a PR exercise no more by the government.

Other banks are already hovering like vultures with a view to a take over if things deteriorated but the real chance of that happening I believe is very small.

Furthermore the actual bailing out of savers with your taxes is extremely unlikely to happen. I am sure you would not need to think for too long to find other alternatives where perhaps your taxes have been used more "frivolously" by succesive governments?

Flamin_Squirrel

18-09-07, 10:39 AM

With the BofE loan - whose money is this - is it taxpayers' money, and when is the loan repaid?

Gordon Brown doesn't think it's tax payers money, he thinks it's his. I can imagine him spending his saturday nights counting penies...

18-09-07, 11:40 AM

Pedro - I agree that this is really a window dressing exercise. The frivolous waste of our money happens every day. What I'm really concerned about are two points:

1. They should have guaranteed consumer deposits only - it's fair to protect consumers but not to protect those sufficiently informed to look after themselves and make an informed decision. Given the window-dressing because of NR's apparent solvency this of course isn't really an issue for now.
2. It's the future precedent. Will the government guarantee other banks which turn out not to be solvent? And who else will receive this sort of support? If you read the signals and timed your share purchase correctly, some investors will have profited hugely from the fact that the government was so panicked. I can't honestly think why, with such huge swings in the share price, dealings in NR shares weren't suspended. Perhaps this partly explains the timing of the government announcement.

Pedrosa

18-09-07, 02:00 PM

Two points exquisetly outlined Ed.;)

The Basket

18-09-07, 02:38 PM

I never cease to be amazed by the stupidity of the common man.
Not including you, of course, dear Motorcycle owner.

The government has to step in to save Banking in UK!!! Can you beleive that!

Without trust...its back to the caves for us!

Flamin_Squirrel

18-09-07, 02:56 PM

...its back to the caves for us!

Where a large proportion of the knuckle draggers that make up the population no doubt belong...

gettin2dizzy

17-02-08, 04:50 PM

Not good news, it's being nationalised :(

Will lenders supply the loans needed for NR to survive? I doubt it, and that leaves us open to the possibility our ?50 billion liability could soar, multiply even; that's a sh*tty place to be.