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Old Sep 14th 2017, 9:04 pm   #1
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Default 10 year anniversary of Northern Rock run.

This week is the 10 year anniversary of me rushing down at my local branch of Northern Rock at lunchtime, and closing my account. It was my first and only experience of a run on a bank.
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Old Sep 14th 2017, 10:27 pm   #2
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by mrken30 View Post
This week is the 10 year anniversary of me rushing down at my local branch of Northern Rock at lunchtime, and closing my account.
So what?

Ian
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Old Sep 14th 2017, 10:58 pm   #3
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by ian-mstm View Post
So what?

Ian
I agree, so what. This was the start of, probably the biggest financial crisis in a long time. I'm sure it didn't affect many people. BBC has been running articles all week on this event.

I never knew until this week, that Northern Rock would get Lehmans to lend to the bad risk customers that they would not lend to, and then buy the mortgages back from Lehmans.
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Old Sep 15th 2017, 10:08 am   #4
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Default Re: 10 year anniversary of Northern Rock run.

Quote:
Originally Posted by ian-mstm View Post
So what?

Ian
So what Ian? SO It was the start of the biggest financial fraud perpetrated ever before in the history of banking. Because it involved the higher echelons of our supposed civilised banking world.. Not a b****y one of the devious,thieving , criminals went to jail. It revealed the US and THEM rule in all its dirty glory

There were one or two convenient scapegoats like Maydorf..and that guy in France...but umm that was it.. The world waited for some justice..So they punished Greece,tried to bury Portugal. destroyed thousands of families in the USA involved in the scandal of the sub prime deals. Pushed the blame back and forth across the pond...BUT no one got punished accept the ordinary people

well done M for getting your money out! Indeed day to celebrate
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Old Sep 15th 2017, 10:57 am   #5
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by GeniB View Post
So what Ian? SO It was the start of the biggest financial fraud perpetrated ever before in the history of banking. Because it involved the higher echelons of our supposed civilised banking world.. Not a b****y one of the devious,thieving , criminals went to jail. It revealed the US and THEM rule in all its dirty glory

There were one or two convenient scapegoats like Maydorf..and that guy in France...but umm that was it.. The world waited for some justice..So they punished Greece,tried to bury Portugal. destroyed thousands of families in the USA involved in the scandal of the sub prime deals. Pushed the blame back and forth across the pond...BUT no one got punished accept the ordinary people

well done M for getting your money out! Indeed day to celebrate
There was never any risk to anyone's money in Northern Rock.
In fact the panic fuelled by the tabloids only made the situation worse.
We had money in Northern Rock and took it out once the dust settles.
No one ever gets punished because there is little criminality involved.
Bad business decisions,incompetence yes but we always forget , NO bank is banging on your door or pushing fivers through the letter box.
The same greed you accuse bankers of was mirrored in all those taking advantage of relaxed financial rules to speculate in property, to buy a property they cannot really afford on the assumption that it will keep rising in value or that their incomes will keep rising.
Who will be to blame if in the years to come interest rates start to return to historic levels hitting those who have only ever known record low levels.
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Old Sep 15th 2017, 1:40 pm   #6
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by GeniB View Post
So what Ian? SO It was the start of the biggest financial fraud perpetrated ever before in the history of banking.
Again... so what? It was 10 years ago and it's been dealt with.


Quote:
The world waited for some justice...
I can assure you, the world didn't wait. It barely made a blip outside of Europe.


Quote:
... destroyed thousands of families in the USA involved in the scandal of the sub prime deals.
While similar practices took place in the US at about the same time, and while NR may have been the first bank to fail, they were not responsible for what happened in the US. It's a common fallacy known as post hoc ergo propter hoc.

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Old Sep 15th 2017, 5:59 pm   #7
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Default Re: 10 year anniversary of Northern Rock run.

https://www.mortgagestrategy.co.uk/n...fer-sub-prime/

Was it any coincidence that the two companies where stock holders lost all of their money were in partnership?

Quote from Northern Rock

“In return we will earn fee income but will not take any credit risk, nor will we administer the loans post completion.”

Also the UK Government took 4 days to guarantee assets in the bank. Did they learn anything?
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Old Sep 15th 2017, 10:30 pm   #8
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Default Re: 10 year anniversary of Northern Rock run.

Quote:
Originally Posted by EMR View Post
There was never any risk to anyone's money in Northern Rock.
In fact the panic fuelled by the tabloids only made the situation worse.
We had money in Northern Rock and took it out once the dust settles.
No one ever gets punished because there is little criminality involved.
Bad business decisions,incompetence yes but we always forget , NO bank is banging on your door or pushing fivers through the letter box.
The same greed you accuse bankers of was mirrored in all those taking advantage of relaxed financial rules to speculate in property, to buy a property they cannot really afford on the assumption that it will keep rising in value or that their incomes will keep rising.
Who will be to blame if in the years to come interest rates start to return to historic levels hitting those who have only ever known record low levels.
There was plenty of risk to people with money in Northern Rock.. They got their money back because the Government (using your tax money ) propped them up.

As to there being no criminality involved.. There was plenty.. started in a brain storming session in Goldman Sachs How to package high risk mortgage debt to make it sellable.. They decided it was too risky,but others decided to run with it..Namely Morgan Stanley and Lehman brothers. Read The Big Short and then decide if it was deserving of people being prosecuted...
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Old Sep 15th 2017, 10:39 pm   #9
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by ian-mstm View Post
Again... so what? It was 10 years ago and it's been dealt with.



I can assure you, the world didn't wait. It barely made a blip outside of Europe.



While similar practices took place in the US at about the same time, and while NR may have been the first bank to fail, they were not responsible for what happened in the US. It's a common fallacy known as post hoc ergo propter hoc.

Ian
The practice was started in the USA.!! Nothing 'similar' about it at all...Northern Rock was simple the first bank to fail in Europe.. As to it barely making a 'blip' in the US ask those involved in the failure of Fanny Mae and Freddie Mac The foreclosures on sub prime putting families on the street.. I guess you don't live anywhere near those districts. though .Lucky you.
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Old Sep 15th 2017, 10:54 pm   #10
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by GeniB View Post
The practice was started in the USA.!! Nothing 'similar' about it at all...Northern Rock was simple the first bank to fail in Europe.. As to it barely making a 'blip' in the US ask those involved in the failure of Fanny Mae and Freddie Mac The foreclosures on sub prime putting families on the street.. I guess you don't live anywhere near those districts. though .Lucky you.
Also I guess that little blip called Lehmans was insignificant. I doubt if anyone even noticed.

This article lists some of the changes since

https://www.ft.com/content/d05c3ea4-...2-cde3f882dd7b

The tax payer still owns a large chunk of HBOS in the UK. QE and low interest rates are now the norm.
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Old Sep 15th 2017, 11:17 pm   #11
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Default Re: 10 year anniversary of Northern Rock run.

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Originally Posted by GeniB View Post
Northern Rock was simple the first bank to fail in Europe.. As to it barely making a 'blip' in the US ask those involved in the failure of Fanny Mae and Freddie Mac The foreclosures on sub prime putting families on the street.
Oh dear god - which part of what I've wrote didn't get through to you? No one in the US cared what happened to Northern Rock. This is true... and that's what I wrote. I didn't say that the failure of Fanny Mae and Freddie Mac didn't cause a panic in the US... but Northern Rock remains practically unnoticed by those outside of Europe.

If you're going to attempt to criticize a post, at least have the decency to actually read and understand what was actually written rather than what you think was written.

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Old Sep 15th 2017, 11:34 pm   #12
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Default Re: 10 year anniversary of Northern Rock run.

Quote:
Originally Posted by GeniB View Post
There was plenty of risk to people with money in Northern Rock.. They got their money back because the Government (using your tax money ) propped them up.

As to there being no criminality involved.. There was plenty.. started in a brain storming session in Goldman Sachs How to package high risk mortgage debt to make it sellable.. They decided it was too risky,but others decided to run with it..Namely Morgan Stanley and Lehman brothers. Read The Big Short and then decide if it was deserving of people being prosecuted...
There was never any risk because no UK bank will be allowed to fail.
What you regard as criminality is just a different degree of risk.
What is criminal about investors being sold a high risk high return product.
As Gordon Geko said its all about greed, from the commission gained by the salesman who sell you a high risk product to you thinking that you are more intelligent because you can see an opportunity that others do not.
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Old Sep 16th 2017, 6:59 pm   #13
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Default Re: 10 year anniversary of Northern Rock run.

The boss of Equitable life just wrote an interesting article. The cause of the crisis was low interest rates. The remedy put in place by Government, was to decrease interest rates.

https://www.ftadviser.com/regulation...-our-mistakes/
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Old Sep 17th 2017, 8:11 am   #14
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Default Re: 10 year anniversary of Northern Rock run.

Quote:
Originally Posted by ian-mstm View Post
Oh dear god - which part of what I've wrote didn't get through to you? No one in the US cared what happened to Northern Rock. This is true... and that's what I wrote. I didn't say that the failure of Fanny Mae and Freddie Mac didn't cause a panic in the US... but Northern Rock remains practically unnoticed by those outside of Europe.

If you're going to attempt to criticize a post, at least have the decency to actually read and understand what was actually written rather than what you think was written.

Ian
Oh do calm down Ian.. your post wasn't very clear at all... re -read it yourself.

The question of 'decency' does not arise. you silly man. Its a debate.
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Old Sep 17th 2017, 8:25 am   #15
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Default Re: 10 year anniversary of Northern Rock run.

Quote:
Originally Posted by EMR View Post
There was never any risk because no UK bank will be allowed to fail.
What you regard as criminality is just a different degree of risk.
What is criminal about investors being sold a high risk high return product.
As Gordon Geko said its all about greed, from the commission gained by the salesman who sell you a high risk product to you thinking that you are more intelligent because you can see an opportunity that others do not.
I would have thought that the 'criminality' was clear. That the people at the end of the 'product' they peddled .The people sold the sub prime mortgages ,would be the ones out on their ear when it all failed. They knew it would fail,because they gambled on it. They 'bet' it would happen. If thats not criminal I don't know what is.
Goldman Sachs deliberately lied about the solvency of Greece when they investigated for Deutsche Bank. They sold them a 'pup ' THEN they bet on its failure.. Nice one!

The banks 'colluded ' to fix the Libor rate.

I could go on... In ordinary business you go to jail when you are caught doing any of the above. It comes under every sort of criminal law.. Not so if your a banker.
You say banks cannot be allowed to fail.. Well that thought changed after what they did 10 yrs ago. Now they can,and they have. You have only to look at what happened to Banco Espirito Sancto to know that. I only have to talk to my neighbour to know that they lost hundreds of thousands in that scandal.Forcing them out their home and back to the UK. At least one of B*****s is under house arrest for it. Will he eventually go to jail? hmmmm
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