Cyclone Posted October 6, 2011 Share Posted October 6, 2011 eh? Please develop this theme in the context of consumer debt. Ermm, I was replying to Wildcat If paying off debts was really good he would be advising banks and all institutions to do so Who specifically mentioned non consumer debt. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 Ermm, I was replying to Wildcat Who specifically mentioned non consumer debt. ok, no worries Link to comment Share on other sites More sharing options...
donkey Posted October 6, 2011 Share Posted October 6, 2011 I think that’s where the government comes in, they regulate banks and businesses and make sure they act in a fare way. The problem with the banks is that the governments of the world didn’t understand the complexities of all these debts that were being sold as investments. In fairness, if the people who are supposed to be specialised experts in these complex financial products couldn't work out what was going on, even though they were working with them day in day out, what chance would government ministers have, especially considering that their main source of information on the world of finance would almost certainly be the people who work in the world of finance? Link to comment Share on other sites More sharing options...
upinwath Posted October 6, 2011 Share Posted October 6, 2011 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. You're making a common mistake here. You're assuming something went wrong - It didn't. The people who hatched the plan made the fortune they intended to make. What makes you think they gave a rats about the mugs they took for a ride? Link to comment Share on other sites More sharing options...
donkey Posted October 6, 2011 Share Posted October 6, 2011 The thing is donkey the blame is usually on both sides of the deal. Irresponsible lenders lending to irresponsible borrowers. There is a fundamental flaw in expecting everyone will behave responsibly. A certain proportion of people just won't. That is guarenteed. On the other hand bankers are in their jobs because of the very fact that they are supposed to be extremely responsible. It is reasonable to expect them not to do things like deliberately targeting more credit at people who have already proven they can't control their finances. It is not reasonable to expect that everyone who they aimed such loans at would be able or willing to pay it back. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 You're making a common mistake here. You're assuming something went wrong - It didn't. The people who hatched the plan made the fortune they intended to make. What makes you think they gave a rats about the mugs they took for a ride? I know they probably planned it. But the way things turned is not a great outcome for the global economy as we are now finding. If 99% of people have been screwed over then something most likely went wrong somewhere. Link to comment Share on other sites More sharing options...
Tony Posted October 6, 2011 Share Posted October 6, 2011 In fairness, if the people who are supposed to be specialised experts in these complex financial products couldn't work out what was going on, even though they were working with them day in day out, what chance would government ministers have, especially considering that their main source of information on the world of finance would almost certainly be the people who work in the world of finance? Because the papers were full of adverts offering loans that exceeded the value of the security? Surely even the dimmest (‽) of Blair and Brown's little helpers should have smelled something as being not quite right? Link to comment Share on other sites More sharing options...
MrSmith Posted October 6, 2011 Share Posted October 6, 2011 Because the papers were full of adverts offering loans that exceeded the value of the security? Surely even the dimmest (‽) of Blair and Brown's little helpers should have smelled something as being not quite right? How true it doesn't take a genius to think there is something wrong with offering 125% mortgages, but the government were happy to watch it happen because all that extra money stimulated the economy and made them look good. Link to comment Share on other sites More sharing options...
I1L2T3 Posted October 6, 2011 Share Posted October 6, 2011 Because the papers were full of adverts offering loans that exceeded the value of the security? Surely even the dimmest (‽) of Blair and Brown's little helpers should have smelled something as being not quite right? It was a massive failing of the last government and one of my biggest disappointments with them, especially with the way it distorted the mortgage market - but mortgages are for another thread. Link to comment Share on other sites More sharing options...
Tony Posted October 6, 2011 Share Posted October 6, 2011 But don't 125% mortgages bring us back to sub-prime and... Link to comment Share on other sites More sharing options...
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