NationStates Jolt Archive

http://news.bbc.co.uk/

Interesting how they show the banks shares fall thing in the middle, while the stock information to the right shows us at least temporary good news. The BBC are making this worse by constantly telling us how the economy will collapse and talking about a "recession" when we're not even in one.

That's because bad news sell more and on the other hand because economy is driven by emotion, not by rational thought.

Public trust is critical, so is selling your product.

edit:
Hence there's a distinct conflict between news companies and economic trust. :p

http://news.bbc.co.uk/

Interesting how they show the banks shares fall thing in the middle, while the stock information to the right shows us at least temporary good news. The BBC are making this worse by constantly telling us how the economy will collapse and talking about a "recession" when we're not even in one.Ireland's in recession. You know what would be worse? Them not talking about it and it happening. Kills off whatever confidence is necessary to keep it running and to ever start it up again.

We're not in a recession?

Why is unemployment rising, the stock market dropping and house prices falling?

Were not in a recession yet in America, im confident it'll turn around, maybe not soon, it'll take time, but we'll get out of it just the same as the other times, it's the beauty of free-market Capitalism. I do believe we don't need a bailout, we need to lower taxes for Everyone (McCain). I personally think Obama's near-socialist agenda will destroy the economy. Honestly, who raises Corporate Tax in a time of Economic Crisis? We need to fund and cut businesses, Democrat's may complain that, Hey! Why are you giving this money to greedy Corporations and not the people! Well It's the Businesses who employ people, and provide jobs, raising taxes will only cut jobs. And Obama is likely to raise Capital Gains, taxes on stock, who in their right minds would do that? Now even less are gonna buy stock!!

tbh BBC has been pissing me off with it lately even with the good news but then again it has gone rather downhill hasn't it?

SNIP

and that has worked when?

Wait? There's a financial crisis? When did this happen? The media haven't covered it at all.

We're not in a recession?

Why is unemployment rising, the stock market dropping and house prices falling?
We're not in a recession because as yet we've not had two consecutive quarters of economic contraction. Last figure released (for Q2) was growth of 0%, so I reckon we'll be in a recession by the end of the year.

Wait? There's a financial crisis? When did this happen? The media haven't covered it at all.
I believe there's some sort of popularity contest going on somewhere as well.

We're not in a recession because as yet we've not had two consecutive quarters of economic contraction. Last figure released (for Q2) was growth of 0%, so I reckon we'll be in a recession by the end of the year.
Yeah. Kinda hard to avoid it when real estate markets are imploding and the average Brit is actually more indebted than the average Yank.

The bounce in share prices says first and foremost that people are starting to feel confident the government measures will prevent the banking system from collapsing completely. That doesn't mean there won't be a recession.

We're not in a recession?

Why is unemployment rising, the stock market dropping and house prices falling?

The decline in housing prices is not a product of the recession but a rather a key cause of this current economic slowdown. Housing was obscenely overpriced for several years and we're finally getting the correction needed to bring things back to more realistic levels.

The decline in housing prices is not a product of the recession but a rather a key cause of this current economic slowdown. Housing was obscenely overpriced for several years and we're finally getting the correction needed to bring things back to more realistic levels.

I disagree, banks were happy to give mortgages to buy the overpriced houses and prop up prices when they were doing well. It's the economic crash that has restricted lending and lowered prices.

Yeah. Kinda hard to avoid it when real estate markets are imploding and the average Brit is actually more indebted than the average Yank.

The bounce in share prices says first and foremost that people are starting to feel confident the government measures will prevent the banking system from collapsing completely. That doesn't mean there won't be a recession.
Or that thousands of traders are trying to make a quick buck by buying at atypically low prices and selling at the peak of the 'dead-cat bounce' (I love that phrase).

If anything good comes out of this, it could be that Brown handles the situation reasonably successfully and with confidence and decisiveness and is then in a respectable position politically. *crosses fingers*

I disagree, banks were happy to give mortgages to buy the overpriced houses and prop up prices when they were doing well. It's the economic crash that has restricted lending and lowered prices.

Actually the majority of subprime mortgages were underwritten by mortgage companies/brokers but that's not important.

Housing prices are falling because they reached absurd levels (in some markets), the price of real estate in North Dakota hasn't changed terribly while stuff in California, Florida, and New York has been hardest hit. Once the housing market started to correct the value of the collateral securing many questionable loans devalued and the banks/companies took losses as they could no londer recoup enough out of the property to cover the loans they made.

Banks in areas where housing prices didn't overheat was much (or those that avoided high LTV and subprime lendind altogether) are in much better shape than those that didn't.

Lending has become more restrictive because people finally came to their senses and began to restore the pre-Housing Boom underwriting standards. Much of the "credit crunch" is the inability of people with poor credit scores and weak financial positions being denied for credit they could have gotten last year. What's drying up is easy credit, which is something that should have happened a long time ago. People with good credit scores and solid income have little trouble getting loans.

There are some banks that have cut back on all lending due to risk, but many have not done so. We're entering into a prolonged period of deleveraging, both from banks and from customers, IMO a long overdo one. It will be quite painful for awhile but with any luck we'll come out better off on the other side.

Actually the majority of subprime mortgages were underwritten by mortgage companies/brokers but that's not important.

Housing prices are falling because they reached absurd levels (in some markets), the price of real estate in North Dakota hasn't changed terribly while stuff in California, Florida, and New York has been hardest hit. Once the housing market started to correct the value of the collateral securing many questionable loans devalued and the banks/companies took losses as they could no londer recoup enough out of the property to cover the loans they made.

Banks in areas where housing prices didn't overheat was much (or those that avoided high LTV and subprime lendind altogether) are in much better shape than those that didn't.

Lending has become more restrictive because people finally came to their senses and began to restore the pre-Housing Boom underwriting standards. Much of the "credit crunch" is the inability of people with poor credit scores and weak financial positions being denied for credit they could have gotten last year. What's drying up is easy credit, which is something that should have happened a long time ago. People with good credit scores and solid income have little trouble getting loans.

There are some banks that have cut back on all lending due to risk, but many have not done so. We're entering into a prolonged period of deleveraging, both from banks and from customers, IMO a long overdo one. It will be quite painful for awhile but with any luck we'll come out better off on the other side.

I'm in the UK.

Bank holiday today; bond markets closed, so no-one really knows if any of these measures have worked. Unless Euribor and LIBOR get slammed to the mat tomorrow I would go long lead.

I made a shit load of money today, 'cos I bought huge into closed end munibond funds on friday am. (meep meep). But it could well turn out to be a pyrrhic victory if the above measures don't work.

In any event, even if it does work, nearly every one is screwed anyway.

Yeah. Kinda hard to avoid it when real estate markets are imploding and the average Brit is actually more indebted than the average Yank.[QUOTE]

I was lying awake this weekend pondering this very thing. I'm not sure that this tells the whole story. The question is who has what debt, and who owes it to whom. Granted, britian is more indebted on average, but it doesn't have the income disparity that the US does. (We do poor people well). So it's sort of a question of percentage of insolvent households, rather than just a gross look at the average indebtedness maybe.

This is not to say that the UK is not completely fucked. But it may be that fewer personal bankruptcies may be the case over there because the distributed debt may be more easily serviced , which is the opposite of what you'd expect at first blush. Fortunately US commercial banks have a lower leverage ratio, so it's probably a wash. Though at this point, nobody in their right mind would be involved in anything to do with financials.

[QUOTE=Neu Leonstein;14096879]The bounce in share prices says first and foremost that people are starting to feel confident the government measures will prevent the banking system from collapsing completely. That doesn't mean there won't be a recession.

Wasn't my reason for buying.