NSC DECIDES - the US Presidential election

[tedebear]

I don't disagree with you. Doesn't make my argument any weaker.

It does I'm afraid, you can't buy something with nothing.

 

[Nibble]

You are insane, my little friend.

If your argument had been 'you are paying £250k for your £150k house, becuase of the interest charged on your mortgage' then you'd have some basis.

A £150k house, will cost maybe £65k to pyhsically build. Add the acceptable charges for the required services, plus the cost of the plot [typically worth considerably more than the building], add a bit more dpending on level of demand in the area, and hey presto - £150k.

again. That is not in question. I know what these things cost. They aren't worth it though and the price of everything is inflated through the banks charging unessesary interest. Fact.

 

[Nibble]

It does I'm afraid, you can't buy something with nothing.

No you can't but you can charge reasonably for it.

 

[hans kraay fan club]

again. That is not in question. I know what these things cost. They aren't worth it though and the price of everything is inflated through the banks charging unessesary interest. Fact.

Right, deep breath.

Step away from the keyboard, and think for a minute.

A house is worth what somebody will pay. The house in debate, costs £65k to build, the plot it stands on is worth a similar figure, and the current market value is £150k.

The value = the best price a buyer will pay for it.

That price is dictated by how much the prospective buyers are willing, or feel able to afford.

High interest on mortgages, will inevitably add significantly to their costs of buying the house over the life of their deal. They know this very well, and will budget accordingly.

Thus, knowing that they can only afford to borrow enough to offer £150k, that becomes the market value of the property.

HOWEVER, in your interest-free utopia, they could afford to borrow much more, as could the other prospective buyers, and so a bidding war will commence, driving the market value HIGHER.

Explain to me one more time, why high interest rates INFLATE property values. Please.

 

[Lokki 7]

Doesn't make my argument any weaker.

Only because you don't actually have an argument. What you have is a chip on your shoulder because you are at the bottom of the current financial system looking up. Are you a home owner? Do you have savings? Do you have your own successful business or a steady job? Do you have a pension? Do you have a family to support? If you answer NO to all of those then I guess you would want the system to collapse at it is so unfair. Boo hoo. f*** all those people that rely on it to feed their families though right? Just as long as we bring them all crashing down to your level. Nibble for president!

 

[tedebear]

No you can't but you can charge reasonably for it.

But what is reasonable and who is to ensure that reasonable stays reasonable.

Thats why markets work. (and why the government shouldn't have intervened) A few banks would have failed, the rest would have learnt not to lend to organisations who poorly judge their debt and to manage their "management cost" better, and all would have been hunky dory.

Gordon can't risk losing any more voters, which is why in a Daily Mail style he waded in to save the unprotected and left his economic sense behind for a moment.

Its a right pisser the rest of the world should have to bear the brunt of the stupidity of the American mortgage lenders, and that English bank and their workers should have their bonuses and salarys capped because our people demand our government restrict them on the back of an American style stuff up. But thats what the people wanted - isn't it....

Thats it in my world anyhow

 

[Nibble]

Only because you don't actually have an argument. What you have is a chip on your shoulder because you are at the bottom of the current financial system looking up. Are you a home owner? Do you have savings? Do you have your own successful business or a steady job? Do you have a pension? Do you have a family to support? If you answer NO to all of those then I guess you would want the system to collapse at it is so unfair. Boo hoo. f*** all those people that rely on it to feed their families though right? Just as long as we bring them all crashing down to your level. Nibble for president!

I have savings
I have a good, regular income
I earn considerable extra income acting (which my savings are based on)
I own land
I have a pension
I don't have a family

I don't have a choiuce but to place my earnings into a bank. It is the only system we have.

All the consequences of no interest you site would only happen in our enclosed fiscal system (!).

People are reluctant to acknowledge the banks wrongdoings because everything they have in life suddenly appeasr to be in the hands of others. What you have all thought was secure is revealed to be anything but that. No-one wants to admit they have been fooled. it is human nature and is understandable. What is slightly frustrating is the lack of willingness to even consider it could be done differently.

"No, No, No, this is the system that has been given to us. Even though in the last 6 months it has proven to be corrupt, cynical and downright useless I will continue to think only in terms of what I have been told to be true."

Right under our very noses the banks have lost our money and stolen it back from us and yet not one of you is prepared to consider what this means.

 

[tedebear]

Is it me - or is Sarah Palin just a bit weird?

 

[Nibble]

Is it me - or is Sarah Palin just a bit weird?

She's a f***ing nutjob.

 

[tedebear]

She's a f***ing nutjob.

Whats with the Alaskan brother in law or some such story?

 

[Nibble]

Whats with the Alaskan brother in law or some such story?

Not sure. I gave up on her about 2 months ago.

 

[Dick Knights Mumm]

Right under our very noses the banks have lost our money and stolen it back from us and yet not one of you is prepared to consider what this means.

This part is true. The chap on Newsnight last night ventured the opinion that the banks have lost our money - and now taxes are being raised to bail those same banks out. That is the re-distribution of wealth - but not as we might like. From the poor to the rich. It does ring true to me.

 

[tedebear]

This part is true. The chap on Newsnight last night ventured the opinion that the banks have lost our money - and now taxes are being raised to bail those same banks out. That is the re-distribution of wealth - but not as we might like. From the poor to the rich. It does ring true to me.

Its a twisted way of looking at it though.

Would we be bailing the banks out if the government hadn't stepped in?

 

[Dick Knights Mumm]

I don't see it as twisted. The banking system is built on confidence - the banks screwed that up - we have all lost out. The banks themselves don't lose out as they are bailed out by the tax-payer (i.e. us) including those on lower pay. The banks are currently all positioning themselves to allow themselves to be able to carry on paying the bonuses they are used to - on the back of taxes paid for by people who earn a fraction.

In addition - all ready for the next time - because now the banks know the back-stop is they will always be bailed out.

 

[tedebear]

I don't see it as twisted. The banking system is built on confidence - the banks screwed that up - we have all lost out. The banks themselves don't lose out as they are bailed out by the tax-payer (i.e. us) including those on lower pay. The banks are currently all positioning themselves to allow themselves to be able to carry on paying the bonuses they are used to - on the back of taxes paid for by people who earn a fraction.

In addition - all ready for the next time - because now the banks know the back-stop is they will always be bailed out.

My point is that the government chose to bail them out with our money - if that had been an election issue - would you have voted to allow it? The government took it upon themselves (or himself) to give our money to the bleeding banks.

So how can it be the banks fault? I lay the blame at the feet of the government for not having enough balls to let them fail and have faith in the fact that the market could correct itself.

 

[Dick Knights Mumm]

I understand. The good thing about the government though is that they can be voted out. The problem is (don't tell Nibble) any government would have done the same.

 

[Simster]

This part is true. The chap on Newsnight last night ventured the opinion that the banks have lost our money - and now taxes are being raised to bail those same banks out. That is the re-distribution of wealth - but not as we might like. From the poor to the rich. It does ring true to me.

Absolutely spot on. But one thing that should be made clear is that it doesn't matter what system we live with, the public absolutely has to have confidence in the banking system.

In laymans terms, I believe the problem is this: A bloke has £100, he pays into bank X. Bank X consider he'll only ever want 10%/£10 of that back at any time, so they lend £90 to Bank Y. Bank Y consider Bank X will only ever want 10%/£9 of that back at any time so they lend £81 to Bank Z. And so on. So that £100 has been lent out 9 or ten times over!

If any of the banks lend to someone who consequently defaults, the whole system runs into trouble when that original bloke wants anything more than £10 back. Therefore if you don't bail out the banks, then all savers go into their banks armed with wheelbarrows looking to take back their life savings before the banks money supply literally runs out. This is what happened in the great depression of the 30s when the govt didn't bail them out.

So here is the unpleasant conclusion. You cannot afford for your banking system to fall apart. It doesn't matter what your politics are. The only conclusion is to regulate it properly, and self regulation is NOT enough. In my example, a) far more stringent checks on loanees should have been made and b) the percentage of money held by banks on which they can loan out needs to be strictly monitored.

As for Nibble's opinion, I'd be interested to hear what his alternative is to a properly regulated banking system?

 

[Nibble]

My point is that the government chose to bail them out with our money - if that had been an election issue - would you have voted to allow it? The government took it upon themselves (or himself) to give our money to the bleeding banks.

So how can it be the banks fault? I lay the blame at the feet of the government for not having enough balls to let them fail and have faith in the fact that the market could correct itself.

Your first mistake is believing banks and governments are two seperate institutions.

 

[Nibble]

As for Nibble's opinion, I'd be interested to hear what his alternative is to a properly regulated banking system?

Properly regulated? That sounds nice. When can it start?

 

[Simster]

Your firsdt mistake is believing banks and governments are two seperate institutions.

That'll be news to Lehman Brothers.