It genuinely appears that there is no stopping them, they just keep on doubling their bets (using borrowed money) in the hope that something will turn up...
Northern Rock is to revive its mortgage business with up to £14bn in new loans by 2011, the government has announced. The Newcastle-based bank is expected to take on about £5bn in new mortgages this year and up to £9bn from 2010.
They will be financed with money from new deposits, repayments on existing loans and more government money. The move is part of wider plans to restructure the nationalised lender and follows a government decision to reverse the wind-down of its loans.
Seriously, £14 billion ain't going to be enough; that's just enough to lure a hundred thousand gullible first time buyers into buying a house over the next two years. But remember that the number of sales and purchases is down from a long run average of well over a million per annum to about half a million; the house price bubble is deflating at the rate of £1 or £2 billion per day etc etc.
So in a few months time it will be another £30 billion, then by next year they'll be talking about another £100 billion and so on. Heck knows where this money is going to come from ... oh, I see.
Monday, 23 February 2009
Another day, another reckless throw of the dice (22)
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4 comments:
'Doubling their bets' - my opinion exactly.
Trouble is how do we stop them, now? Because if we do not by the time an alternative regime gets to pull the levers of power we'll be so badly screwed that it'll take yonks and yonks to sort it out.
I have a fundamental belief in the rule of law but I am getting closer and closer to deciding that the only way to stop these idiots is by some form of civil disobedience. I even caught myself contemplating political assassination - and I am not a violent bloke - which must mean something is very Wrong indeed.
L, the next government will be The Tories, the Homeowners' party. You'll see in the article that while their spokesman says that this is being badly handled, he does not appear to disagree with the general principle. They are all going for the votes of people who would rather starve to death than see their houses fall by one penny in 'value'.
Yes, The Tories rail about excessive government borrowing, but it appears as long as this money is going into the house price bubble, they are prepared to turn a blind eye.
So there's no room for optimism just yet.
I have seen signs among the people I deal with (by defintion vaguely sensible) that they have no real interest in the price of their houses. They know that it is all fiction. But there again they are not over-mortgaged and have savings and investments.
(We do come across some people who do worry about their house price. Generally these are those that are selling up to go into long term care of one sort or another and need the capital. Of course these are trebly hit by a lower sale price than they expected, higher care costs and bugger all return on their savings.)
new deposits means attracting savers money with higher interest rates.
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