Northern Rock is a billion pound dog for which Virgin is offering two half billion pound cats.
This really has to end. Even Olivant has walked away. Put the thing into administration.
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Fallen Angels
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7 comments:
I'm a bit(!) ignorant on the niceties here, but if NR is put into administration do we get our cash back or do those who currently have it just walk away with it?
Nomad,
Ask Gordon - he's in charge.
(Exit stage left, cackling maniacally)
It all depends on how much you care about our rank as creditors relatively to other creditors. Lavish and reckless government guarantees seem to give us a fairly low rank in the queue. We only stand to recover whatever is left over after every single creditor (including depositors of course) has been paid off.
Administration would give an orderly rather than disorderly closure before any more disastrous decisions are taken by a shamelessly greedy and incompetent management.
The £50, 60, 100, more, billion is gone for ever, it's just preferable not to allow Branson to trouser any of it. At least now it's giving work, housing, social shelter, and savings guarantees to the wretched of the earth.
HG: Thanks. That's what I thought might be the case. Very depressing.
Elby: Hasn't Lilith made your coffee yet?
HG, This a post on Guido today
"OT. Flat in my area (East Anglia). Value now 110,000 (IMHO - very optimistic, probably £80,000). Mortgage o/s 140,000 to Northern Rock. NR will not take into reposession. They are simply leaving the mortgage uncollected. That is the mortgage is in arrears. So they do not have to crystallise the loss.
So much for the quality of NR 'assets'"
Nomad - I'm Lilith's houseboy, so I get to make the coffee :-)
It was clear from the off that Northern Rock's mortgage book is home grown sub prime. It's nothing to do with America or a global credit squeeze. The Labour regime has been trying to run a socialist wealth transfer to 'their people' in the north east particularly, but to build a client vote across the country in general, with unaccounted for transfers of tax revenue and cheap credit.
We can't have such high levels of economic inactivity and these levels of consumption.
What happens is chain collapse of the financial institutions involved, total losses by shareholders (or partial losses if the financial institutions only write off the value of their bad loans), repossessions, or state support to financial institutions in return for allowing defaulters to remain in their lost housing, negative impact on demand, unless the central bank plays along by lowering interest rates, injecting liquidity which, in turn leads to a run on the pound ....hello this is a familiar landscape.
Mr HG has started spending money faster than me! He's building a heated swimming pool before inflation renders lots (lots for us that is) of money worthless.
Monolines going down. Bye bye pensions.
And Bloomberg, on that prudent Mr. Bean
http://tinyurl.com/2yluab
Must, must, must get on the allotment list.
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