Omega Owners Forum
Chat Area => General Discussion Area => Topic started by: Banjax on 18 January 2011, 20:42:00
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BBC2 9pm worrying look at what happens if/when the banks fail again.......no bailout this time from us, theres nothing in the pot :o
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BBC2 9pm worrying look at what happens if/when the banks fail again.......no bailout this time from us, theres nothing in the pot :o
2nd part of silent witness for me. I'll record Peston and watch tomorrow while I'm counting my money :y
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did it before , will again.. not surprise.. nature of them :-/
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Oh no, we should all become socialists then, that will save the world, surely it will! ;D
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Unlikely to happen again in the foreseeable future. You would not believe how risk averse the boys and girls in the square mile are these days. They are obsessed with low risk, and the compliance depts. rule the roost and are not to be argued with.
People are leaving just because it has become an utterly tedious place to spend 70 hours per week.
But of course that doesnt sell papers or raise viewing figures. ;)
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
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It can never be completely safe BJ. It is after all a form of gambling, as is any method of making money.
When you drive to your shop in the morning you are gambling with the petrol your using, because if no customers turn up to buy anything today you have wasted it and lost the gamble.
The penalty for individual traders for heavy or sustained losses is the sack, simple as that.And if that happens they have zero chance of being re- employed on another trading desk. That is one of many reasons why there is huge pressure involved.
The kind of pressure you or I are unlikely to understand or come close to experiencing.
When senior management make mistakes on a large scale- Fred the shred for example - its a different matter of course, just like it is in most workplaces or industries. The blame then gets pushed down the line. ;)
Dont forget who set up the whole aneamic regulatory system will you ? your fellow countryman, the financial genius, who saved the world. ;)
FYI. I was a HBOS shareholder, so I wasnt immune from what happened. But then again the shotgun wedding between HBOS and Lloyds was also arranged by that same financial genius, and it has been an utter disaster for all involved. :(
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It can never be completely safe BJ. It is after all a form of gambling, as is any method of making money.
When you drive to your shop in the morning you are gambling with the petrol your using, because if no customers turn up to buy anything today you have wasted it and lost the gamble.
The penalty for individual traders for heavy or sustained losses is the sack, simple as that.And if that happens they have zero chance of being re- employed on another trading desk. That is one of many reasons why there is huge pressure involved.
The kind of pressure you or I are unlikely to understand or come close to experiencing.
When senior management make mistakes on a large scale- Fred the shred for example - its a different matter of course, just like it is in most workplaces or industries. The blame then gets pushed down the line. ;)
Dont forget who set up the whole aneamic regulatory system will you ? your fellow countryman, the financial genius, who saved the world. ;)
FYI. I was a HBOS shareholder, so I wasnt immune from what happened. But then again the shotgun wedding between HBOS and Lloyds was also arranged by that same financial genius, and it has been an utter disaster for all involved. :(
Oh Purrrrleease Albs......A person on minimum wage trying to bring up his/her family to the best of their ability.....is under far more pressure than any overpaid and underachieving banker . In the real world I have far more respect for the people who actually make a contribution to society ......doctors...nurses....manual workers..teachers...etc...etc....rather than greedy and inept bankers who have no interest in anyone but themselves.... :) :)....There is the world of banking .....and there is the real world....The real world has less champagne....and far fewer Ferrari....but it is the world where 99% of (normal)people have to live.... :y :y
Other than the above.....we are in full agreement Albs...... ::) ::) ::) :)
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
It's so easy for the banks BJ......They "casino gamble" with OUR money.......if they win it's big bonus time.....if they lose....they come crying like little children to us the taxpayer...please help mummy... :'( :'( :'(....What sort of capitalism is that?... >:( >:( >:(
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It can never be completely safe BJ. It is after all a form of gambling, as is any method of making money.
When you drive to your shop in the morning you are gambling with the petrol your using, because if no customers turn up to buy anything today you have wasted it and lost the gamble.
The penalty for individual traders for heavy or sustained losses is the sack, simple as that.And if that happens they have zero chance of being re- employed on another trading desk. That is one of many reasons why there is huge pressure involved.
The kind of pressure you or I are unlikely to understand or come close to experiencing.
When senior management make mistakes on a large scale- Fred the shred for example - its a different matter of course, just like it is in most workplaces or industries. The blame then gets pushed down the line. ;)
Dont forget who set up the whole aneamic regulatory system will you ? your fellow countryman, the financial genius, who saved the world. ;)
FYI. I was a HBOS shareholder, so I wasnt immune from what happened. But then again the shotgun wedding between HBOS and Lloyds was also arranged by that same financial genius, and it has been an utter disaster for all involved. :(
Oh Purrrrleease Albs......A person on minimum wage trying to bring up his/her family to the best of their ability.....is under far more pressure than any overpaid and underachieving banker . In the real world I have far more respect for the people who actually make a contribution to society ......doctors...nurses....manual workers..teachers...etc...etc....rather than greedy and inept bankers who have no interest in anyone but themselves.... :) :)....There is the world of banking .....and there is the real world....The real world has less champagne....and far fewer Ferrari....but it is the world where 99% of (normal)people have to live.... :y :y
Other than the above.....we are in full agreement Albs...... ::) ::) ::) :)
The usual bunch of cliches lifted from the headlines in the Grauniad.
I personally know of three bankers in their twenties in recent years who have gone to the top of their workbuilding and jumped off. I have seen the pressure involved at very close quarters, and I know you couldnt begin to understand.
My daughter has had ten years of it and is leaving the industry tomorrow for the sake of her health and sanity.
My advice is to actually learn something about the subject, rather than just reading newspaper headlines. Or frankly, dont comment.
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
It's so easy for the banks BJ......They "casino gamble" with OUR money.......if they win it's big bonus time.....if they lose....they come crying like little children to us the taxpayer...please help mummy... :'( :'( :'(....What sort of capitalism is that?... >:( >:( >:(
;D ;D ;D ;D :y
I dont want to go into specific details of banking and rules.. but the days of easy sweet profits are long gone.. in order to pay your interest andtheir expenses, banks must give credits , jump in the markets I'm afraid no other way.. and you cant win anything if you stay in your hot office , playing with the computer and talking to the dear ;D
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
It's so easy for the banks BJ......They "casino gamble" with OUR money.......if they win it's big bonus time.....if they lose....they come crying like little children to us the taxpayer...please help mummy... :'( :'( :'(....What sort of capitalism is that?... >:( >:( >:(
Yes, I do feel some resonance with these comments - although it's a much more complex issue than one would think.
I think we're reaping the 'benefits' of lax regulation and the worship of the financial sector to the detriment of manufacturing.
Yes, a sound financial industry is an essential part of any economy but to place a considerable emphasis on it (as was done) is very short-sighted given the capricious nature of many of those who practice it and the likelihood that emerging markets will soon overtake what has been the status quo.
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As I have said before - you bitter, twisted,jealous,headline reading, non thinking individuals who blame the banks for everything thats wrong with your life and everyone elses life - if you want to get your own back - buy some bank shares ( they are dirt cheap at the moment) - sit on them for 10 years, and then cash them in -KERCHING ! ::) ;)
No ? too scared ? ah well, just carry on whinging then. :D ;D
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
It's so easy for the banks BJ......They "casino gamble" with OUR money.......if they win it's big bonus time.....if they lose....they come crying like little children to us the taxpayer...please help mummy... :'( :'( :'(....What sort of capitalism is that?... >:( >:( >:(
Yes, I do feel some resonance with these comments - although it's a much more complex issue than one would think.
I think we're reaping the 'benefits' of lax regulation and the worship of the financial sector to the detriment of manufacturing.
Yes, a sound financial industry is an essential part of any economy but to place a considerable emphasis on it (as was done) is very short-sighted given the capricious nature of many of those who practice it and the likelihood that emerging markets will soon overtake what has been the status quo.
Wise words as usual Z. The fact is that like it or not, the economy of this country is completely reliant on the financial sector. If the square mile disappeared into the Thames tonight, people in Africa would probably be sending us food aid.
This is why each of the 3 main parties have made a lot of noise about bashing the banks, but when they have the opportunity to do som ething about it, they do very little.
The reality is that they know they cant, but they cant publically admit to it.
This needs to change, but that will take decades to achieve, so for the moment we are stuck with a dominant banking industry, which fortunately, has been extremely profitable for almost all of its long history.
I firmly believe that a very large part of its recent problems are directly due to the fact that Brown told them in no uncertain terms to "fill their boots" as long as a big chunk of it came to the treasury, it was all good, everybodys happy. The good times were here to stay, he had abolished boom & bust etc.
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off, unfortunately we rarely learn from past mistakes and with very little serious changes and anaemic regulations it won't be long before one of the big banks goes down, if you have a system whereby banks are encouraged financially to take risks and are rewarded with massive bonuses and dividend payouts when they guess right but no penalty when it goes wrong i dont see how you can confidently say its unlikely to happen again - i make it almost impossible to avoid, but next time they wouldnt (couldnt) be bailed :o
It's so easy for the banks BJ......They "casino gamble" with OUR money.......if they win it's big bonus time.....if they lose....they come crying like little children to us the taxpayer...please help mummy... :'( :'( :'(....What sort of capitalism is that?... >:( >:( >:(
I would bet good money that you wouldnt recognise the names of the majority of the financial institutions in London.
The vast majority of them didnt take a penny of taxpayers money.
When they win, they are paid a lot of money - 50% of which goes directly to the treasury.
As I said earlier, if they lose they get sacked and are unemployable, unless they are at boardroom level.
They have contributed countless billions to the treasury and UK economy as a whole for many many years. The problems of the last couple of years (where some of them have been propped up by the taxpayer) originated in the U.S. and was a direct result of politicians steering their financial sector in the direction of lending money to people who couldnt afford to pay it back.
The taxpayers currently own a lot of shares in some big banks, and if the treasury play their cards right, we taxpayers will reap a huge return on that investment in the mediem term.
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I've just finished watching the programme. It seems pointless weighing the pros and cons on here because we have no chance of ever understanding any of it. Bankers and politicians dont understand it, it was designed that way.
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I've just finished watching the programme. It seems pointless weighing the pros and cons on here because we have no chance of ever understanding any of it. Bankers and politicians dont understand it, it was designed that way.
Quantum physics is difficult to understand and anyone who says otherwise doesnt know enough. Banking tho? It may be complex, but I think all this "oh, its much too difficult for any layman to understand - only the self-styled masters of the universe know how it operates" is a smokescreen, much like the Great and Terrible Oz behind the curtain its an insignificant little snake oil salesman desperately hoping everyone believes hes a god and goes away :y
The stock market where they all gamble our money was set up to raise capital for businesses and provide liquidity for investors, it was a useful and much needed tool.
Nowadays its all gambling with derivitives, options, traded options, etc you can bet on any move in the market and hence its become so volatile that its now pretty much pure speculation. It all works fine until it doesn't - its a house of cards, its a huge multi-trillion pound confidence trick. Lose that confidence and you get owned like Northern Rock and RBS or disappear like Lehman Bros
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Get down to London then BJ, spend a couple of relaxing years making yourself an easy few million........you really dont have a clue mate, honestly ::) ::)
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Get down to London then BJ, spend a couple of relaxing years making yourself an easy few million........you really dont have a clue mate, honestly ::) ::)
BJ and I would soon show these city sharks how to run a bank for the good of the people ....rather than for their own personal profit..... :P :P :P....it's not rocket science.... ;) ;)
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Which just demonstrates how utterly clueless, and blinded by prejuduce you are on the whole subject.
But prove me wrong,please, get down there and do it. Talk is cheap after all.
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Which just demonstrates how utterly clueless, and blinded by prejuduce you are on the whole subject.
But prove me wrong,please, get down there and do it. Talk is cheap after all.
If you wish to drop to your knees and worship the city banker like he is the new Messiah.....then that is entirely your prerogative Albs....In my view even the best of them possess only average talent. Plenty more are simply inept. There are plenty who could take their place and do a far better job for far less money than these so called whizz-kids demand. These adenoidal upstarts do not have my respect.....I'll save that for people far more deserving......
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I've just finished watching the programme. It seems pointless weighing the pros and cons on here because we have no chance of ever understanding any of it. Bankers and politicians dont understand it, it was designed that way.
Quantum physics is difficult to understand and anyone who says otherwise doesnt know enough. Banking tho? It may be complex, but I think all this "oh, its much too difficult for any layman to understand - only the self-styled masters of the universe know how it operates" is a smokescreen, much like the Great and Terrible Oz behind the curtain its an insignificant little snake oil salesman desperately hoping everyone believes hes a god and goes away :y
The stock market where they all gamble our money was set up to raise capital for businesses and provide liquidity for investors, it was a useful and much needed tool.
Nowadays its all gambling with derivitives, options, traded options, etc you can bet on any move in the market and hence its become so volatile that its now pretty much pure speculation. It all works fine until it doesn't - its a house of cards, its a huge multi-trillion pound confidence trick. Lose that confidence and you get owned like Northern Rock and RBS or disappear like Lehman Bros
ok.. STMO actually its not that hard.. assume all those banking system,papers,rules,stock markets as a highway which ends in the pockets of mega rich masters like Rockefeller, Rothschild, Ellison etc..
problem with the capitalist system is its designed so that whatever you spend and from whatever the path money follows it sooner or later reaches its final destination and ends in the accounts of few.. and its obvious that those few cant spend that much.. so the system goes into an irreversible state and freezes , which occurs periodically..
and of course apart from all monetary theories, the provided solution to that
the whole world production is calculated to be some 62 trillion US$ where as the complete world economic system claims to have 620 trillion US$ (most of it on papers) .. obviously thats another kind of problem which says that world is sitting on baloons that will explode sooner or later..
unfortunately none of those intelligent economists have the necessary real solution to solve those problems in capitalist system rules.. unless they change the system ;D :-X
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Just read this. I was mistaken, it's a piece'o'piss. ;D
http://en.wikipedia.org/wiki/Derivative_(finance)
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Which just demonstrates how utterly clueless, and blinded by prejuduce you are on the whole subject.
But prove me wrong,please, get down there and do it. Talk is cheap after all.
If you wish to drop to your knees and worship the city banker like he is the new Messiah.....then that is entirely your prerogative Albs....In my view even the best of them possess only average talent. Plenty more are simply inept. There are plenty who could take their place and do a far better job for far less money than these so called whizz-kids demand. These adenoidal upstarts do not have my respect.....I'll save that for people far more deserving......
you have demonstrated your ignorance and blind prejudice yet again. I try to deal in facts where possible. You deal in knee jerk reactionary rhetoric, typical off a lefty who will not let facts get in the way of what they want to believe to be true.
I dont worship anyone or anything, but I do think freely, and will happily swim against the tide if I believe it to be the right thing to do. You know that I know a little bit about the subject and you know why I know. I would like to be enlightened on what you actually know about the subject, and therefore base your wide sweeping statements on, rather than what you would like to think you know because the Grauniad said so.
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Which just demonstrates how utterly clueless, and blinded by prejuduce you are on the whole subject.
But prove me wrong,please, get down there and do it. Talk is cheap after all.
If you wish to drop to your knees and worship the city banker like he is the new Messiah.....then that is entirely your prerogative Albs....In my view even the best of them possess only average talent. Plenty more are simply inept. There are plenty who could take their place and do a far better job for far less money than these so called whizz-kids demand. These adenoidal upstarts do not have my respect.....I'll save that for people far more deserving......
you have demonstrated your ignorance and blind prejudice yet again. I try to deal in facts where possible. You deal in knee jerk reactionary rhetoric, typical off a lefty who will not let facts get in the way of what they want to believe to be true.
No one has ever called me a lefty before...... ;D ;D....I'm a proud Thatcherite.......and I read( and believe) the Daily Mail too....honest ::) :P :P
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I've just finished watching the programme. It seems pointless weighing the pros and cons on here because we have no chance of ever understanding any of it. Bankers and politicians dont understand it, it was designed that way.
Quantum physics is difficult to understand and anyone who says otherwise doesnt know enough. Banking tho? It may be complex, but I think all this "oh, its much too difficult for any layman to understand - only the self-styled masters of the universe know how it operates" is a smokescreen, much like the Great and Terrible Oz behind the curtain its an insignificant little snake oil salesman desperately hoping everyone believes hes a god and goes away :y
The stock market where they all gamble our money was set up to raise capital for businesses and provide liquidity for investors, it was a useful and much needed tool.
Nowadays its all gambling with derivitives, options, traded options, etc you can bet on any move in the market and hence its become so volatile that its now pretty much pure speculation. It all works fine until it doesn't - its a house of cards, its a huge multi-trillion pound confidence trick. Lose that confidence and you get owned like Northern Rock and RBS or disappear like Lehman Bros
ok.. STMO actually its not that hard.. assume all those banking system,papers,rules,stock markets as a highway which ends in the pockets of mega rich masters like Rockefeller, Rothschild, Ellison etc..
problem with the capitalist system is its designed so that whatever you spend and from whatever the path money follows it sooner or later reaches its final destination and ends in the accounts of few.. and its obvious that those few cant spend that much.. so the system goes into an irreversible state and freezes , which occurs periodically..
and of course apart from all monetary theories, the provided solution to that
the whole world production is calculated to be some 62 trillion US$ where as the complete world economic system claims to have 620 trillion US$ (most of it on papers) .. obviously thats another kind of problem which says that world is sitting on baloons that will explode sooner or later..
unfortunately none of those intelligent economists have the necessary real solution to solve those problems in capitalist system rules.. unless they change the system ;D :-X
the only real solution is that the production tools must belong to community or the masses otherwise you cant change the flow direction of money.. of course a state that arranges the monetary distribution equally can well balance the system.. which examples in the past and today are seen but violently tried to taken down by unequal forces (with money accumulated from long centuries )
I'm sure one day those will change but probably most of us cant see :-/
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Course you do.I rest my case.
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I dont know why you're so pro-banker Albs, if as you say it was all big, bad, Gordon Browns fault then you're agreeing with me, Opti and birthday boy Cem because of GB's "light touch" he believed the bankers who promised they'd behave in the best interests of the city, the government and business - that was the mistake he made - he foolishly and naively believed they wouldn't act like the greedy, selfish spivs they are and always were. dont put a fillet steak in front of a dog and leave the room.....unless you dont want the steak back :y
not all of them can be motivated by greed.......some are far too wealthy to care anymore ;)
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off,
<snip>
I think the banks, certainly the high street ones, could do a little MORE risk-taking.
Asking for a 30 or 40% deposit on a mortgage for a building (whether commercial or residential) which is at a rock-bottom price already (and WILL go up in price - land is the only thing we can't get more of) is
IMO, stifling the recovery of the economy.
I'm renting a warehouse for the same price I could BUY one five times the size - and that includes the business rates and all the other costs - IF I could get a mortgage.
I could expand my business, and take on 5 extra staff if I could get a new warehouse - I can afford a 100% mortgage, but can't afford the 40% deposit any of the banks want.
As it is, I'm just, barely, covering my costs in employing myself and my son.
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Banking should be tedious and safe, surely Albs. :o
If you're going to be brave - do it with your own money, i'd welcome the "risk-takers" foxtrotting off,
<snip>
I think the banks, certainly the high street ones, could do a little MORE risk-taking.
Asking for a 30 or 40% deposit on a mortgage for a building (whether commercial or residential) which is at a rock-bottom price already (and WILL go up in price - land is the only thing we can't get more of) is
IMO, stifling the recovery of the economy.
I'm renting a warehouse for the same price I could BUY one five times the size - and that includes the business rates and all the other costs - IF I could get a mortgage.
I could expand my business, and take on 5 extra staff if I could get a new warehouse - I can afford a 100% mortgage, but can't afford the 40% deposit any of the banks want.
As it is, I'm just, barely, covering my costs in employing myself and my son.
they're only lending to companies with turnover of £10m and above - they wont admit it and they'll swear blind to anyone who asks that its not the case, but it is - they're not wise, brave or trusting enough to judge a business anymore, plus they got caught with their pants down 2 years ago and are still smarting :-/
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I dont know why you're so pro-banker Albs, if as you say it was all big, bad, Gordon Browns fault then you're agreeing with me, Opti and birthday boy Cem because of GB's "light touch" he believed the bankers who promised they'd behave in the best interests of the city, the government and business - that was the mistake he made - he foolishly and naively believed they wouldn't act like the greedy, selfish spivs they are and always were. dont put a fillet steak in front of a dog and leave the room.....unless you dont want the steak back :y
not all of them can be motivated by greed.......some are far too wealthy to care anymore ;)
Yes, in general terms I would agree with that BJ but I would stop short of condemning an entire industry.
I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
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I dont know why you're so pro-banker Albs, if as you say it was all big, bad, Gordon Browns fault then you're agreeing with me, Opti and birthday boy Cem because of GB's "light touch" he believed the bankers who promised they'd behave in the best interests of the city, the government and business - that was the mistake he made - he foolishly and naively believed they wouldn't act like the greedy, selfish spivs they are and always were. dont put a fillet steak in front of a dog and leave the room.....unless you dont want the steak back :y
not all of them can be motivated by greed.......some are far too wealthy to care anymore ;)
Yes, in general terms I would agree with that BJ but I would stop short of condemning an entire industry.
I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
they cant all be irresponsible i agree, Z and no doubt many are highly intelligent financial wizards - but in general they've shown they cant be trusted so their industry needs to be heavily regulated for their own good - we cant afford another bailout and we need to ensure banks keep large stashes of cash instead of constantly gambling with everything - yes they maybe wont make as much money, but they'll be far safer.
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I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
The original Financial Services Act was introduced in 1986 to counter an element of unregulated trading on the market floors. However, trading in those days was very simple...and thus easy to police, once the law was enacted.
Ironically, it was not market floor trading that created the current problem but rather its successor - electronic trading. Once computers became widespread, trading became much cheaper (no need to pay commissions to "real people" on the trading floors), and much more accessible. Business thus mushroomed. On top of this, computing power enabled much easier and faster credit transfers around the world which, in turn, also led to increased business. Furthermore, derivative contracts - which (pre-computer days) would have required the establishment of a new trading floor - could now be set up cheaply within a short time frame on a server. Additionally, the old commodity futures markets - which featured contracts based on physical supply - soon became eclipsed by new cash settlement contracts in financial securities; initially gilts, bunds and the like, but latterly in debt instruments.
Around the turn of the millennium, banks and non-banking financial institutions began to hire "geeks" to devise computer trading programs which analysed risk/return characteristics and effectively did the necessary buying/selling without human interference. Indeed, it has been suggested that one such algorithm, used on Wall Street, had a defective risk element which contributed to the credit crunch.
IMHO, it was not greed that caused the problem, but rather the technological explosion. The industry became too vast, and too complex, to be adequately controlled using the methods envisaged by the FSA, the SEC and other regulatory bodies.
The endless polemics on here, based as they are on a class war against 'upstart bankers greedily fleecing the people' neatly avoids a harder, more complex and more thought-provoking analysis of the situation. ;)
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I dont know why you're so pro-banker Albs, if as you say it was all big, bad, Gordon Browns fault then you're agreeing with me, Opti and birthday boy Cem because of GB's "light touch" he believed the bankers who promised they'd behave in the best interests of the city, the government and business - that was the mistake he made - he foolishly and naively believed they wouldn't act like the greedy, selfish spivs they are and always were. dont put a fillet steak in front of a dog and leave the room.....unless you dont want the steak back :y
not all of them can be motivated by greed.......some are far too wealthy to care anymore ;)
Yes, in general terms I would agree with that BJ but I would stop short of condemning an entire industry.
I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
they cant all be irresponsible i agree, Z and no doubt many are highly intelligent financial wizards - but in general they've shown they cant be trusted so their industry needs to be heavily regulated for their own good - we cant afford another bailout and we need to ensure banks keep large stashes of cash instead of constantly gambling with everything - yes they maybe wont make as much money, but they'll be far safer.
they cant.. else you need to pay double interest rates in any kind of credit.. :(
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I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
The original Financial Services Act was introduced in 1986 to counter an element of unregulated trading on the market floors. However, trading in those days was very simple...and thus easy to police, once the law was enacted.
Ironically, it was not market floor trading that created the current problem but rather its successor - electronic trading. Once computers became widespread, trading became much cheaper (no need to pay commissions to "real people" on the trading floors), and much more accessible. Business thus mushroomed. On top of this, computing power enabled much easier and faster credit transfers around the world which, in turn, also led to increased business. Furthermore, derivative contracts - which (pre-computer days) would have required the establishment of a new trading floor - could now be set up cheaply within a short time frame on a server. Additionally, the old commodity futures markets - which featured contracts based on physical supply - soon became eclipsed by new cash settlement contracts in financial securities; initially gilts, bunds and the like, but latterly in debt instruments.
Around the turn of the millennium, banks and non-banking financial institutions began to hire "geeks" to devise computer trading programs which analysed risk/return characteristics and effectively did the necessary buying/selling without human interference. Indeed, it has been suggested that one such algorithm, used on Wall Street, had a defective risk element which contributed to the credit crunch.
IMHO, it was not greed that caused the problem, but rather the technological explosion. The industry became too vast, and too complex, to be adequately controlled using the methods envisaged by the FSA, the SEC and other regulatory bodies.
The endless polemics on here, based as they are on a class war against 'upstart bankers greedily fleecing the people' neatly avoids a harder, more complex and more thought-provoking analysis of the situation. ;)
Yes, I can see much of that however I would say irrespective of the technology introduced to exploit trading and financial dealings based on the instant analysis afforded by those new systems, button pushers were required to make the system work.
The entire sector was much more organically orientated with individuals deciding whether or not to make deals, shape future trends, bet on variables and so on, the technology simply allowed them to do this more conveniently.
The spur for this aggressive attitude, in my view, was the desire by many in the industry to make money not only for their employers but for themselves.
With regulation being so poor it was inevitable that many would push the boat out too far so I don't blame the machines, I blame the people using them for doing exactly what they did.
Any system that depends on what essentially is gambling faces potential difficulty and this industry, as a result, now faces the harvest of those bitter seeds.
There was obviously a fundamental disconnect between those looking at the computer monitors and making the decisions and the reality of their actions as experienced by many people on the streets outside those august establishments.
I did say in an earlier post that these were indeed complex issues and I certainly agree that no amount of ‘bank bashing’ will rectify the problems we now face.
I would still maintain however that throughout this whole sorry episode we witnessed human excess and incompetence at its worst.
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Yes, I can see much of that however I would say irrespective of the technology introduced to exploit trading and financial dealings based on the instant analysis afforded by those new systems, button pushers were required to make the system work.
The entire sector was much more organically orientated with individuals deciding whether or not to make deals, shape future trends, bet on variables and so on, the technology simply allowed them to do this more conveniently.
The spur for this aggressive attitude, in my view, was the desire by many in the industry to make money not only for their employers but for themselves.
With regulation being so poor it was inevitable that many would push the boat out too far so I don't blame the machines, I blame the people using them for doing exactly what they did.
Any system that depends on what essentially is gambling faces potential difficulty and this industry, as a result, now faces the harvest of those bitter seeds.
There was obviously a fundamental disconnect between those looking at the computer monitors and making the decisions and the reality of their actions as experienced by many people on the streets outside those august establishments.
I did say in an earlier post that these were indeed complex issues and I certainly agree that no amount of ‘bank bashing’ will rectify the problems we now face.
I would still maintain however that throughout this whole sorry episode we witnessed human excess and incompetence at its worst.
Have to disagree somewhat, Zoo-Lou. Of course, humans set the systems up, and, yes, they were designed to make money. But substantial trading decisions were taken by computer programs. That's the point I am making.
Furthermore, I still don't get this human excess angle. Practically everyone wants to better themselves. A corner shop owner will buy a new product at the cash-and-carry in the hope and expectation that someone will pay him more than he paid for it - and he will charge as much as the market can, in his estimation, bear. It's a gamble. All he does is take it back to his shop and place it on his shelf! Is that a gamble? Yes, of course it is.
Bankers buy things, be it debt or assets, in the hope that, at some point, someone will pay more than the original paid price. Is that a gamble? Yes, of course it is.
Either way, the corner shop owner and the banker both have a role to play in society. :y
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Have to disagree somewhat, Zoo-Lou. Of course, humans set the systems up, and, yes, they were designed to make money. But substantial trading decisions were taken by computer programs. That's the point I am making.
Furthermore, I still don't get this human excess angle. Practically everyone wants to better themselves. A corner shop owner will buy a new product at the cash-and-carry in the hope and expectation that someone will pay him more than he paid for it - and he will charge as much as the market can, in his estimation, bear. It's a gamble. All he does is take it back to his shop and place it on his shelf! Is that a gamble? Yes, of course it is.
Bankers buy things, be it debt or assets, in the hope that, at some point, someone will pay more than the original paid price. Is that a gamble? Yes, of course it is.
Either way, the corner shop owner and the banker both have a role to play in society. :y
I would be very surprised (and disappointed) should these computer programmes have been autonomous, surely there must have been some requirement for people to analyse their performance or develop the programme to further suit their requirements? Should this not have been the case I would suggest that that omission was recklessness in the extreme.
I think the scenes played out by many of those wide-boy types typified this excess and it appeared to me, at least, that many in the 'City' existed in a bubble while being divorced from reality when attempting to experience a level of ‘living’ few had witnessed up to that point.
If gambling is/was such an intrinsic part of commerce I have to say that, in the case of the financial sector, it's very much a case of the 'beaten docket' being the victor.
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Have to disagree somewhat, Zoo-Lou. Of course, humans set the systems up, and, yes, they were designed to make money. But substantial trading decisions were taken by computer programs. That's the point I am making.
Furthermore, I still don't get this human excess angle. Practically everyone wants to better themselves. A corner shop owner will buy a new product at the cash-and-carry in the hope and expectation that someone will pay him more than he paid for it - and he will charge as much as the market can, in his estimation, bear. It's a gamble. All he does is take it back to his shop and place it on his shelf! Is that a gamble? Yes, of course it is.
Bankers buy things, be it debt or assets, in the hope that, at some point, someone will pay more than the original paid price. Is that a gamble? Yes, of course it is.
Either way, the corner shop owner and the banker both have a role to play in society. :y
I would be very surprised (and disappointed) should these computer programmes have been autonomous, surely there must have been some requirement for people to analyse their performance or develop the programme to further suit their requirements? Should this not have been the case I would suggest that that omission was recklessness in the extreme.
I think the scenes played out by many of those wide-boy types typified this excess and it appeared to me, at least, that many in the 'City' existed in a bubble while being divorced from reality when attempting to experience a level of ‘living’ few had witnessed up to that point.
If gambling is/was such an intrinsic part of commerce I have to say that, in the case of the financial sector, it's very much a case of the 'beaten docket' being the victor.
Let's be honest. An element of gambling is everywhere. If you had control over your pension, you'd gamble by placing your fund wherever you thought you'd get the best return. Indeed, you'd be foolish not to! ;)
"Computer selling/buying" is not an unknown reason for market movements. Essentially, in fast moving markets, buying and stop-loss triggers are placed which are automatically activated at certain price levels. These could be missed by mere humanoids. As far as the faulty risk algorithm is concerned, I used to have a link but I think it is sadly long gone. :(
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I think the trading floors (and ancillary arms) of this incarnation of the Stock Exchange have indeed shown us how many working within their portals (and financial sector in general) deviated from sound responsible activity when the prospect of great wealth was apparent and regulation lax.
We must never forget that we need a sound, imaginative financial sector but common sense dictates that this must be well regulated.
The original Financial Services Act was introduced in 1986 to counter an element of unregulated trading on the market floors. However, trading in those days was very simple...and thus easy to police, once the law was enacted.
Ironically, it was not market floor trading that created the current problem but rather its successor - electronic trading. Once computers became widespread, trading became much cheaper (no need to pay commissions to "real people" on the trading floors), and much more accessible. Business thus mushroomed. On top of this, computing power enabled much easier and faster credit transfers around the world which, in turn, also led to increased business. Furthermore, derivative contracts - which (pre-computer days) would have required the establishment of a new trading floor - could now be set up cheaply within a short time frame on a server. Additionally, the old commodity futures markets - which featured contracts based on physical supply - soon became eclipsed by new cash settlement contracts in financial securities; initially gilts, bunds and the like, but latterly in debt instruments.
Around the turn of the millennium, banks and non-banking financial institutions began to hire "geeks" to devise computer trading programs which analysed risk/return characteristics and effectively did the necessary buying/selling without human interference. Indeed, it has been suggested that one such algorithm, used on Wall Street, had a defective risk element which contributed to the credit crunch.
IMHO, it was not greed that caused the problem, but rather the technological explosion. The industry became too vast, and too complex, to be adequately controlled using the methods envisaged by the FSA, the SEC and other regulatory bodies.
The endless polemics on here, based as they are on a class war against 'upstart bankers greedily fleecing the people' neatly avoids a harder, more complex and more thought-provoking analysis of the situation. ;)
Nickbat, imo no need for detailed analysis.. in the final case humans take the money, not the computers ;D :y
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Let's be honest. An element of gambling is everywhere. If you had control over your pension, you'd gamble by placing your fund wherever you thought you'd get the best return. Indeed, you'd be foolish not to! ;)
"Computer selling/buying" is not an unknown reason for market movements. Essentially, in fast moving markets, buying and stop-loss triggers are placed which are automatically activated at certain price levels. These could be missed by mere humanoids. As far as the faulty risk algorithm is concerned, I used to have a link but I think it is sadly long gone. :(
Sadly I don't think we'll ever agree on this Nick.
With all the sophistication of the electronic systems used within the industry and the regulatory bodies and legislation used to govern it we are left with legacy of what was, in my view at least, a fundamental breakdown in the financial sector.
I would maintain that this was a result of the desire to amass wealth/improve the trading position/enhance the bottom line by many of those involved in the industry (from clearing banks to market traders, credit providers, building societies and so on) - irrespective of the consequences or reckless nature of their actions.
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so wait a second Nickbat, they're not financial geniuses after all, just drones sitting at dumb terminals having tough decisions spoon-fed to them based on algorithms they have no idea about and less control over?
i'm confused now...so are these "masters of the universe" just really greedy or really stupid? :y
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so wait a second Nickbat, they're not financial geniuses after all, just drones sitting at dumb terminals having tough decisions spoon-fed to them based on algorithms they have no idea about and less control over?
i'm confused now...so are these "masters of the universe" just really greedy or really stupid? :y
Not what I said, or implied.
An analysis of the banking crisis requires thought, research and the ability to present a serious critique.
On the other hand, you can just bandy words like "greedy" and "stupid" around, if that's all you can manage. ::) ::)
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so wait a second Nickbat, they're not financial geniuses after all, just drones sitting at dumb terminals having tough decisions spoon-fed to them based on algorithms they have no idea about and less control over?
i'm confused now...so are these "masters of the universe" just really greedy or really stupid? :y
Not what I said, or implied.
An analysis of the banking crisis requires thought, research and the ability to present a serious critique.
On the other hand, you can just bandy words like "greedy" and "stupid" around, if that's all you can manage. ::) ::)
i've said plenty on the subject - i'm boring myself now ;D ;)