Guest 698- Registered: 28 May 2010
- Posts: 8,664
O Alex that post is not worthy of a response. Do you not grasp the difference between a loan and an injection of share capital? Oi veh.
I'm an optimist. But I'm an optimist who takes my raincoat - Harold Wilson
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
No, Peter! There is no difference! Those banks went bankrupt, owing to how they were run.
Through sheer incompetence.
They were lent money which by law is supposed to be paid back, possibly with an interest.
Barry might tell us all how much that interest rate is.
While of-course telling us that everyone else should manage money better, and the top bankers can land whole banks in bankruptcy, have money lent to the banks in the order of many tens of billions of pounds, still give themselves top salaries and bonuses and golden pensions, but everyone else who needs a loan should pay the average interest rate of an average payday loan, which might be hundreds of percent a year.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Your grasp of financial matters gets no better Alexander.
Lets be clear - the government were part of the problem of why the banks needed a bail-out. It goes direct to the action of Gordon Brown in 1997. In the regime that operated prior to the Brown changes the banks would not have been allowed to operate as ordinary business ventures taking the risks they did in the American market in particular. Brown, remember, actively encouraged the banks to take the risks, HBOS and RBS did.
To bail them out the government bought shares in the banks providing the government with part ownership in the equity. That is not a loan but an investment. When the shares are sold the taxpayers will be repaid.
I have previously mentioned how much money was involved, being borrowed from the market by the government and why it is important not to undermine the new bank management teams as they prepare the banks for re-privatisation.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
after reading all the financial posts here that big bloke near me that goes around with a dog looks a reasonable proposition.
no complications about shares, equity, dividends etc just the certainty that the dog comes off of the lead.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Here is an extract from today's Sky News.
"The Government has provided £37bn of funding to Northern Rock since its collapse in 2007, meaning the taxpayer is in line to make a profit of up to £11bn.
But it will take up to 15 years to be delivered.
So £11 billion interest in 15 years on a £37 billion loan is quite reasonable.
It would be as borrowing today £37 and paying back £48 within 15 years.
So if the State can lend money to banks at a very low interest rate in an emergency, as was the 2008 case, at about 2% interest a year, so too is it in line to suggest the same State lend money to common citizens at a similar interest rate in times of personal financial crisis, ie in times of family or personal emergency.
My other point is, Barry, essential expenses as mentioned in the above posts does not mean luxuries, bonuses etc., so I am not suggesting a State institution lend money to a private citizen to pay him a bonus or a third mansion (see bankers), but to pay an outstanding rent, or mortgage rate on the first house, or clothes for the child, and similar.
The point is, Barry, that it is not fair that someone should have to repay such a loan with 38% interest a month. I find it fair to suggest they repay it at an interest rate of 2% - 5% a year, more or less in line with inflation, as is the case of Northern Rock.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Alexander - why is it you refuse to actually understand what you have been told here and what you read in the press? Why is it the facts are so inconvenient to you that you even cut and pasted posts you make are misinterpreted by you? It really is a waste of time trying to explain the same things time and time again.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
This doesn't address the basic problem of payday loans, Barry.
Sky News has explained in the recent past that these loans are taken out by people who are in a desperate need of money, but wouldn't have received a loan from the bank.
Often it's people who already have a loan to pay, such as a mortgage, and can'r afford to miss out on a rate-payment, and not being able to pay for some other essential expenses, take out a payday loan.
The interest rates on payday loans are extortionate, so the question is, why does a person have to pay extortionate interest on a short-tern loan?
Adding to that, overdrawing on a credit card without prior agreement with the bank leads to interest rates that are equivalent to a hefty fine (1000-4000% interest a year).
By explaining that everyone should get their finances in order and not take out loans in the first place, you're not showing any sign of practical knowledge of other people's economic situation.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Alexander - I have said that there is a problem of education and there are alternatives like credit unions. Also this matter of payday loans is under regulatory review.
One thing is certain your idea is utter nonsense and the State should keep out of this matter and not get involved in any kind of personal lending.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
A lot of things are utter nonsense, Barry!
But what you say the State should do or not do is not most final.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
You are the expert on nonsense Alexander. You cannot ever trust the State and it is mad to do so outside a very limited area of competence.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Barry, the Government is enjoying more and more sympathy from me, they are introducing great changes, and know that many are cheering them on.
This is also one reason why I won't be campaigning to bring down Gov. at any G. E.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Do not mix the government up with the State. Governments change, the State will always be there.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Tom, I read the article, and can consider myself fortunate to be working for peanuts without a debt to pay. But so many have become indebted, have paid back their original debt, and various times the same amount, but are still paying back the same debt, all due to extortionate interest.
It's nothing new in Britain, but, as Sky also pointed out recently, as does your link, it's getting worse!