I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 I'm skint so I'll borrow money I can't afford to pay back. I'm skint and can't afford to live (see bullcrap above) but I'm greedy and stupid enough to want a new car on credit I can't afford to pay back. I don't blame the lenders at all. They made a fat pile of cash from the stupid. Just good old fashioned capitalist exploitation. The lenders were out to make a profit and that's what they did. Only daft people lost out. Like it or not many people did borrow more than they could afford to pay back. I think they're stupid too but I can see why they might have done it, e.g. to maintain a standard of living. I'm not excusing them, just trying to understand. I could accept your point about banks making a profit if I thought you understood how debt was bundled up and sold on, traded, leveraged ever higher. But you clearly don't understand the difference between making acceptable levels of profits and the mega-profits from financialising consumer debt. The former is ok, the latter is to a point but has gone completely out of control. That kind of trading in sub-prime mortgages, for example, is what led to the trigger for the 2008 crisis in the first place. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 But don't the banks need us (the public) to pay our debts so that they can in turn pay their debts? What are the bank debts? What might they owe money for? Over-leveraged toxic financial products purchased from other banks and instituations perhaps? It's a very tangled web out there. Link to comment Share on other sites More sharing options...
upinwath Posted October 6, 2011 Share Posted October 6, 2011 The former is ok, the latter is to a point but has gone completely out of control. That kind of trading in sub-prime mortgages, for example, is what led to the trigger for the 2008 crisis in the first place. The morality may be in question but the fact they did their jobs is not. The people who wanted it to happen made a mint from it. Link to comment Share on other sites More sharing options...
Balpin Posted October 6, 2011 Share Posted October 6, 2011 I admit it. I was a stupid sucker that maxed out credit cards until paying them off would take forever with all the interest added every month. I fortunately paid the lot off with voluntary redundancy money and got a new job. But how I wish I'd taken my Dad's advice about saving money before:roll: . Why do people always assume Dads are wise about money? I am useless, I rely on my wife and kids to advise me. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 The morality may be in question but the fact they did their jobs is not. The people who wanted it to happen made a mint from it. Sorry, it's not just morality that is in question. Fractional controls were side-stepped by many banks. For example using Structured Investment Vehicles (SIVs). They side-stepped them so they can sell more mortgages and other products. Like I said Citigroup leveraged 280:1. That is they lent $280 for every $1 they held in deposits. Mind-blowing stuff - that is not somebody just doing their job. Link to comment Share on other sites More sharing options...
Cyclone Posted October 6, 2011 Share Posted October 6, 2011 If you can't see the difference between personal borrowing to buy the latest gadget and companies borrowing to invest or grow their business then you've entirely missed the point. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 David Cameron as already condemned the banks for irresponsible lending, there is little to be gained by continuing with the condemnation. He wants banks to lend responsibly too businesses and individuals, although he knows it would be good for people to pay down their debts he will also be aware that if they do, they will have less to spend which isn’t good for the economy. The country needs solutions to the problem and further condemnation isn’t a solution. The government aren’t deflecting blame they are trying to solve the problem. You see what you did there? You said that we should stop blaming the banks because Cameron has already told them off. If people on here are to be believed irresponsible consumers have been getting told off by the Tories since 2003. So by your logic the Tories should get off the backs of consumers too. So why are they so easy on the banks and still so tough on us? Oh, and you're not Bob Diamond are you? Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 If you can't see the difference between personal borrowing to buy the latest gadget and companies borrowing to invest or grow their business then you've entirely missed the point. eh? Please develop this theme in the context of consumer debt. Link to comment Share on other sites More sharing options...
MrSmith Posted October 6, 2011 Share Posted October 6, 2011 You see what you did there? You said that we should stop blaming the banks because Cameron has already told them off. If people on here are to be believed irresponsible consumers have been getting told off by the Tories since 2003. So by your logic the Tories should get off the backs of consumers too. So why are they so easy on the banks and still so tough on us? Oh, and you're not Bob Diamond are you? I didn't say you should stop blaming the banks, I said there is little to be gained if the government continues to blame them, you can blame them all you like and punish them by not using them. They are tougher on the banks than they are on me so I’m not sure how they are being tougher on us. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 I didn't say you should stop blaming the banks, I said there is little to be gained if the government continues to blame them, you can blame them all you like and punish them by not using them. They are tougher on the banks than they are on me so I’m not sure how they are being tougher on us. No, there is a lot to be gained. An awful lot. If the heat can be kept up on banks then the Vickers report could be implemented earlier. If the Tories and the banks have their way it will be progressively watered down and won't go in for another 8 years. So my view is by keeping up the pressure Vickers could be implemented earlier, within the realms of what is possible given the scale of the change, and consumer could get some insulation from the activities of investment banks. If we'd have had the separation 20 years ago we'd never have had a mortgage and credit boom in this country because the integration between retail and investment banking parts of banking groups would have been very strictly controlled, i.e. investment banking sections would not have been able to leverage retail deposits the way they did. I don't like Nick Clegg much but I liked what he said about getting the changes in well before 2019. Link to comment Share on other sites More sharing options...
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