The coming worldwide credit crunch

Again, I think the wrong end of the stick has been grasped here.  Karen, we are not complaining about the replies and I, for one, really appreciate the information you have given on community rules etc just in case I find myself in that position in the future (fingers crossed--NO!!!!).

What is annoying is that a Bucket thread was specifically set up to allow those that want to to play around.  The complaint is that is still spilling over into serious matters.  Trying to plough through sparkly text and picturs of "fwuffy pussies" is the most annoying thing on here.  If someone new joins, the sparkly brigade are the first to jump in tell them to post their queries in the right place. 

This site provides some of the best information around for anyone thinking of, or already has, moving to Spain.  It points out the pitfalls, the way to do things correctly, who to see when you want things done etc.  If certain people want to turn it into a type of kindergarten for people refusing to grow up, then many will turn to other forums available on the good old interweb which I note that some already have.

I am not averse to humour, banter, chit-chat etc, but please, keep it in the appropriate place.  And, by the way, its not big and its definitely not clever.  And what this has to do with the coming worldwide credit crunch, I don't know.  I have now copied some of the proper replies into a separate folder so I won't have to sift the dross out.

The world wide credit crunch seems to have come to a halt......at least the postings have!

Come on guys and gals.......the thread was really good to read, even if my comprehension was lacking, it's always good to learn about what's happening .

Hi Karen didnt mean to alarm you and when I started typing my post yours was the last on there pknott is clearly a quicker typist than me but then I answered three phone calls in the middle as well so didnt notice him getting things back on track - anyway had my say - its a free world and will never give personal grief and see both points of view - and as a gulity party for going off thread I cannot sit on my moral highground but I understand the photos and the glitz get peoples goats when it takes up a page and a half of the thread - its only my view and each to their own.

No problem Smiley, just did not want another free for all!!

I, too understand about the photos etc., but would rather it been brought up in a more friendly way.

Still it's over now, I hope and would REALLY like to get back to thread.

Ooooooooooooh Candyfloss - you are a brave woman!!

Love it!

Pssssst Rixxy,

You share my warped sense of humour then.....................

Hi ALL,

On sky news this morning they announced that"Northern Rock" one of the UK biggest mortgage lenders had to bailed out by the Bank of England.

looking in from the outside here in Spain i saw this coming.

If you lend someone 5,6 or 7 times their salary with a constant increase in the interest rate how do the banks expect them to actually pay it back?

There are on average 77 properties repossessed every day in the UK and Spain will not escape this latest trend!!!!

Regards

Georgia

Hi Candyfloss - yes very very warped..............................!

Wasnt a suprise there - its been bandied about for a while, watch to see the other ones go - house of cards.

The banks here are already tightening furiously.

Hi all,

The last few years in the UK i worked for a PLC company that owned approx half of all the high street agencies in the country.

I was head of Corporate business which sounds very grand but in fact was probably the most stressful and depressing career move ever made.

I hope this will give you an insight into what the position involved and the day to day tasks and maybe make a few people aware of what is happening within both the UK and Foreign housing market.

I was solely in charge of all the repossessed property across my region,i would receive a call from the Bank or Building society who had the mortgage owing on the property and accompany the bailliffs i(f needed),the locksmiths and a chartered surveyor.

I would then value the property and issue the bank with a market appraisal and what i actually thought the property would sell at in an open market,taking into consideration the timescale of 12 weeks untill the property would be placed at auction.

We always undervalued slightly to give ourselves a fair chance of selling and the bank to give their mortgage redeemed.

After the bank considered my information they would then come back with a price window that any prospective purchaser had 3 attempts of hitting before they were not allowed to offer again on the particular property,only myself and the bank had the figure required!!!

You would be suprised what i had offered to me in the past by investors looking for some inside knowledge!!!! disclosure of the figure would have seen me struck off and banned from practising as an agent!!!!

Anyway i could bore you with details of the amount of re'pos that came in and most in the early days were investors that caught a cold or people who watch too many property ladder programmes but the worrying thing that later it was families with young children.

I remember going to one particular house where the owners had not even packed or removed any items at all,the dinner plates were still on the table!!!!! all the toys were in the Kids bedrooms and this tough old agent actually had a lump in his throat.

Anyway,i suppose what i am trying to say is that the "credit crunch" or "bust" or "downturn" whatever you want to call it has far more serious victims than the odd merchant banker that had to give his Porche back,try looking into the eyes of a mother of three that has just placed the keys to her family home on your desk and walked away.

Soon after i resigned my position and moved to Spain,left a huge salary,company car,pension,bupa etc...etc... and found the real quality in life!!"!!

It is happening again,as the banks over lend to desperate people who need to buy and accept their terms it will only go one way.

Regards

Georgia

In fact as the Bank of England is now underwriting all investments in Northern Rock all investors are more secure now than yesterday

They are still selling mortgages 

The press release forecast profits with the new facility [ if used] at circa  £500m down from circa projected of £600m

NR depend more on money markets instead of small investors like some of the other mortgage banks and are just suffering from the turbalance on 8th August....Barclays also had to borrow from B of E

EU economy is still strong.....Spain and UK poss the best!

The issue with Northern Rock is that it relies almost totally on mortgage lending for it's business & therefore does not have funds held on deposit in the way other Financial Institutions have. This means that they have to borrow the money from the BoE in order to continue their core business - mortgages.

The Banks that do have customers savings use these funds to lend to other customers, which usually means that they do not have to borrow from the Bank of England to balance the books.

Over recent weeks major financial institutions have been maintaining their cash reserves rather than lending to one another, in order to mitigate the tightening credit belt. I think it was Barclays that had to approach the BoE a few weeks ago because the other big banks would not settle their overnight shortfall.

According to the news, Northern Rock have not actually drawn the funds that the BoE have agreed to lend them. Although given the lengthy queues outside branches today, it probably won't be long.

All the Banking Industry shares fell heavily today - mine fell to a 52 week low!!!

Noreen

Hi guys

Been very busy with moveing my family from SE Asia to Spain. Now up and running and even Telefonica has come up with the goods.

Anyway its been a very interesting few weeks as far as the credit crunch goes, anyone without thier head in the sand, and there is the odd one on here I see, must by now be convinced about the impending crisis. I won't go over all the stuff that has happened, but as a summary just look at the share price charts of Northern Rock, Bradford and Bingley, Royal Bank of Scotland etc. Also try the likes of Savills, the international property agent, its share price has been cut in half. The smart money is looking ahead and telling you what is going to happen.

More to date a German think tank yesterday published a report describing the UK miracle economy as an illusion -

The German authors of a new report into Britain’s economic ‘miracle’ described themselves as “disturbed” by the state of the British economy. “This is the year when the state sector in the UK as a share of GDP rises above the level in Germany. It’s shocking.”

They point out that even as the rest of Europe is trying to cut taxes, the UK is “relapsing into high tax and high-regulation sclerosis,” says Ambrose Evans-Pritchard in The Telegraph. This backwards slide has only been masked by the housing boom, which has in turn fuelled a debt binge, leaving UK consumers with no savings (compared to an 8.3% savings rate in 1992), and personal debt of £1,343bn, which is higher than annual GDP for the first time ever.

This has left us in no position to weather the coming storms. “The UK is now in worse fiscal shape than almost any other major Western country.”

That’s not exactly comforting at a time when house price growth - the major driver of our economy for several years now - is slowing. Monetary Policy Committee member Kate Barker has just warned that buy-to-let could be a potential trigger for prices to fall. “A source of weakness could be the buy-to-let market, given a combination of higher interest rates, little change in rents, and reduced expectations of price appreciation.” The sector accounted for 12% of mortgage lending in the first half of this year.

If this is the case with the UK, the Spainish economy is even worse, they have the second highest current account deficit in the world. Anyone who thinks the economy in Spain is strong is not looking at the facts.

Link to German report in Telegraph

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/10/22/bcnuksham122.xml

Here is something else to ponder

The UK's gold is worth around 4Bn GBP, call it US$8Bn. Bush has just asked for an extra $46Bn for Iraq, which takes the total to something like $640Bn.

Apparently they needed US$11Bn just to replace some armoured trucks.

So the armoured trucks are worth more than the UK's entire store of gold! which is the backing for our paper money the pound and the UK's miracle economy.

And .... every 15days they spend US$ 8bn on the war! This puts monetary printing and inflation into perspective.

Hola TJ!!! We've missed you!

Where in Spain are you, the move went ok by the sounds of it, Telefonica will yet reveal their true selves - dont worry!