- #1
Schrodinger's Dog
- 835
- 7
Ok this is becoming quite a hot topic and I'm sure most people have heard of the Northern rock fiasco? But do you think your government should step into bail out banks? And what sort of interest should they charge, to ensure the taxpayer is not forced to foot the bill? Clearly the banks suffering has knock on effects, but should we be giving businesses special treatment because they are losing money or even going under? What is the banks credit rating?
What should be done, and what shouldn't be?
http://www.telegraph.co.uk/money/main.jhtml?view=DETAILS&grid=&xml=/money/2008/04/17/ncrisis117.xml
What should be done, and what shouldn't be?
http://www.telegraph.co.uk/money/main.jhtml?view=DETAILS&grid=&xml=/money/2008/04/17/ncrisis117.xml
Gordon Brown: Banks must admit the truth
Banks must disclose the size of their debts from poor quality home loans, Gordon Brown said on Wednesday night, amid signs that the impact of the global credit crisis may be even worse than suspected.
In a meeting with leading Wall Street bankers, the Prime Minister called on lenders to be more open about the bad debts that have created turmoil in the mortgage markets in the past six months.
Gordon Brown and Michael Bloomberg, the New York mayor
Gordon Brown and NY mayor Michael Bloomberg. Mr Brown urged banks to be more transparent
His intervention came amid fears that the banks are becoming more wary of lending to one another than even the official data suggest.
The crisis, which has left banks and building societies short of money to lend to home buyers, is now so severe that the Treasury is preparing to approve a multi-billion pound emergency loan package for mortgage lenders next week.
Senior officials are ready to agree the plan, whereby the Bank of England will lend billions of pounds to banks - secured against their residential mortgage portfolios.
However, critics said that taxpayers could be saddled with large losses if the housing market falls and the Bank ends up with the bad debts.
The developments came on another troubled day for the market, during which:
advertisement
• The biggest mortgage lender, the Halifax, increased the rate on its two-year deals by half a percentage point - one of the biggest single increases since the start of the credit crisis - adding £1,000 a year to a £200,000 home loan.
• The market for buy-to-let mortgages suffered a blow as 16 lenders, including NatWest, were found to have pulled out of the market - including four in the past week.
• A study by Equifax, a credit research agency, showed that half of all first-time buyers were considering pulling out of potential house purchases, which could have a serious impact on the market.
• Figures suggested that 150,000 home owners could have their properties repossessed this year.