Moving my money

[Jenx]

Thanks Dan ...
I have to say, I agree with you 100%

When I started out married life ( 1985 ), the bank would give me
3x my wages or 2.5x the combined pay of me & the missus.
to the tune of a 95% Mortgage. - maximum over 25 yrs

We've now heard of 100 year mortgages, for 125% or more of the value &
as you say 7 or more times the annual income,
and people buying property between 4 or more individuals.
-- Absolute lunacy, and the main reason we have stayed put for so long.

Seems to me that the economy in recent years has been entirely based on credit, large debt and borrowing that was difficult if not impossible to sustain in the medium to longer term.

We only have to look at the TV, -- we have television advertising now, almost encouraging people to go down the route of IVA's and other insolvency agreements etc ... it almost borders on encouraging people to get into real financial difficulties, and not to worry a toss about doing so, because there's an easy "escape-route"... the TV says so !
This to me seems utterly irresponsible.. but I'm not sure on who's part this irresponsibility is ? Government ? Financial Services Industry ? perhaps a bit of both.. and a few more besides.

I'm not a particularly political animal, but it seems to me that we have oscillated between the "right" ... who's very name 'conservative' is derived from the verb 'to conserve' or in other words, to 'save', and the left, who have had perhaps much more of a tendency to throw caution to the wind.
Neither appears to "work", and after years of one, we almost need to then endure years of the other just to maintain a 'swinging pendulum' of what we perhaps recognise as the boom-to-bust and back to boom economy that the country has experienced certainly in my lifetime ( I'm 44 ), and I would guess well beyond.
Depending on when an individual arrives on this earth during this cyclical swapping from right to left, gives rise to how that individual's life will unfold and how easy or otherwise he/she will find it to provide himself with a nice place to live for him and his family, once that all arrives.

We've allowed ourselves to become a culture of greed, of irresponsible risk-taking, of 'have it now and worry about how to fund it, tomorrow'

Perhaps there is no other way... perhaps we have to exist in this cycle of boom & bust.. I'm not sure.
It doesn't appear to work, in the long term though.

Will we 'learn' from this latest chaos ? One would hope so.. but cynicism does make me doubt that in the 'long term' ( 20+ years lets say ), we'll avoid finding ourselves in a similar type of situation. Perhaps not the best legacy to leave our kids or grandkids..
But lets hope not.

You've given me some food for thought there.. an extension !
that may well be a very viable route to go down for us too....
Cheers !

[/i]

 

[devonwoody]

Yes but the last 50 years as seen terrific prosperity compared to my grandfathers days from the 1890's to the 1950's.

So is that bad?

He would be in the workshouse today.

 

[Karl]

I know it is off-topic, but I think the single biggest thing that could be done to bring house prices back in line is to outlaw Interest Only mortgages. They give a false perspective of the type of property which one can own and, when taken in conjunction with the high multiples offered by most lenders, have contributed significantly to ever increasing price rises. IMHO.

Cheers

Karl

 

[Jenx]

Yes but the last 50 years as seen terrific prosperity compared to my grandfathers days from the 1890's to the 1950's.

So is that bad?

He would be in the workshouse today.

You have point there too D/W ...
'Prosperity' is probably something that could never be accused of as being bad.
I don't know.. perhaps its the methodology of whats driven that prosperity thats more in question ?
It'd probably also be true to say that there have been more personal bankruptcy's, more 'falls' from relative security into more desperate circumstances in the last 50 years , than may have been in your father's time ... reflecting the boom & bust mentality, i guess .

I think we're possibly a more 'selfish' society, a more 'greedy' society, and perhaps even a less 'caring' society at this point than maybe we've ever been. .. would there be some substance to that, do you think ?

If we had all the answers, I suppose we wouldn't even be debating the question --
I do feel that as a whole, we've collectively taken some bad decisions and have, ( as a big generalisation ) kind of lost our way a little bit.
The issue is so broad ranging, - the way the world operates now isn't fully for the better... everything is ''want it yesterday / call centres in a very far off land / buy it online and no personal touch involved -- which is ok until there's problem with something -- / Huge Multi-national conglomerate-controlled etc " that some of the methods of years past may not look such a bad option now.
I'm not suggesting that we go back to the horse and cart , or preserving our meat in a salty barrel in the shed... but perhaps looking to the past could teach us something for the future, on many levels.

Anyways.. its off to the diabetic clinic in 5 minutes for me ....
now there's something that does work reasonably well... we have good healthcare here ... sure, the NHS cops a lot of criticisms sometimes, but overall.. I'm glad its available and not something left to the individual to source, fund and monitor.
I guess its not all bad :wink:

 

[ByronBlack]

The co-op would be a good choice if you are thinking of safety. They aren't as frivolous and maverick as the regular banks and have recently agreed to merge with Brittania to make them even bigger and more secure.

However, you need at least 3% maybe more to protect your savings from the massive inflation that we are going to see in the coming years due to all the cash that is currently and in the near future being printed.

Personally, I would spend it all or retire early

 

[Grinding One]

The little guy always pays the big guys share....taxes,the big guy gets loopholes so he doesn`t pay any taxes...lately he has been putting his company`s business offshore (Third world countrys)So if he is making money he is also putting that offshore as well.Who is left to pay taxes?? The little guys,you and me ,while the Government is spending like never before money that is not there.Who is going to pay back all that money??Our kids,might as well be called serfs again...
Where to put money?? I would buy into Gold,it is the only thing left that is multinational as far as value...all currency is based on it.

 

[ByronBlack]

G1 - It is not true that all currency is based on the gold standard. The dollar for example is one that isn't.

 

[BradNaylor]

I know it is off-topic, but I think the single biggest thing that could be done to bring house prices back in line is to outlaw Interest Only mortgages. They give a false perspective of the type of property which one can own and, when taken in conjunction with the high multiples offered by most lenders, have contributed significantly to ever increasing price rises. IMHO.

Cheers

Karl

You are quite right, Karl.

It is often said that the current financial crisis is as a result of 'sub-prime' mortgages dished out in the USA.

This is to ignore completely the UK's own sub-prime mortgage industry which has been rampant for years.

Interest only mortgages...
Self certified mortgages...
125% mortgages...
7 x income mortgages...

All designed to bring in the maximum commission for the salesman and profit for the bank. These pieces of crap were then bundled up and sold on as A1 assets. In other words fraud!

They were also designed to inflate house prices through the roof, which of course they did. Thereby increasing the value of the security held by the banks.

The British public have been victims of a monstrous Ponzi (pyramid) scheme perpetrated by the banks. There is no difference between them and Bernie Madoff.

Complicit in all this of course, have been the government AND the opposition.

Better get used to the idea of 25 years of austerity...

Dan

Who is not that bothered as I've lived in austerity all my life!



:lol:

 

[Mattty]

Matt- Who is off to find out what 'austerity' means...

 

[BradNaylor]

Matt- Who is off to find out what 'austerity' means...

Its how you're living since the building trade went tits up!

:lol:

Onwards and upwards, though...

Dan

 

[big soft moose]

Well in the 50's they didnt take wifes earning into account when setting a mortgage, now they do, if I tell the banks to take into acounts childrens earnings do you think they would take that one up.

What will put the prices up again is that thing called inflation, do you think there will never be inflation again?

Of course there will, that is the way those debts that are around will eventually be paid.

I never said that prices wouldn't go up again; just that they would be more closely linked to earnings.

ie. they would rise in line with inflation.

Dan

Thats assuming that earnings will go up in line with inflation - as a public sector worker i have had a below inflation rise for the last two years, and it looks like happening again as thanks to gordon halfwit brown and his merry interest rate cutting (to stimulate an already overinflated housing market :roll: ) some councils are three million quid or more short on revenue ( as a result of shortfall on invested capital), not to mention tht councils who had money invested in ice save didnt get it all back.

"prudence" brown dont make me £$%&ing laugh

 

[big soft moose]

duplicate - hit quote instead of edit - doh

 

[Jake]

Plenty of private sector people are taking real pay cuts (pre-inflation).

 

[BradNaylor]

Interesting...

When I posted my views on banks, the property market, and a then looming recession a year or so ago, people like Roger S and Jake replied with strident defences of the banking system.

Now they're very quiet.

What happened, guys?

:wink:

Dan

 

[mahking51]

Hi All,
My two cents worth:

I do not think that we have got to anywhere near the bottom of this mess yet.

The full impact of debt/equity swap scams has yet to really make its impact with it associated 'insurance' risks. I believe Barclays are heavily exposed here. The first class action cases are coming up in the US which will put the cat well and truly in with the pigeons.

Potential exposure is in the trillions.

The **** government is about to start printing money as all else has failed.

Interest rates are non viable for savers/ people looking from income

The classic historical hedge for all this is gold but really only if one is able to take a 3-5 year view in my humble opinion.

Personally I have bought physical Krugerands and will continue to do so on significant dips. I very occasionally take profits but as I believe the long term price will well exceed £1k per ounce ( some US pundits give $2000!) I find it tragic that Brown as Chancellor picked with uncanny instinct the precise moment to sell a vast amount of our gold reserves when the price was at is lowest for ages!

Cheers,
Martin

 

[lurker]

Thanks for your advice folks.
much confirmed what I had thought.

After discussion with SWMBO (this is no jest in our house).

We will contiue to bank with Leics Alliance, but one foot wrong & we move to Co-op. No more savings with them though - just day to day stuff.

Couple of K into premium bonds for a dream.

As currrent bank ISAs ripen & other rainy day savings we will move to the local building Society -maybe: will have to "interview" them out first.

 

[ByronBlack]

Luckily I have no money or assets to speak of, so unlike you Lurker I don't have to worry to much, but, it sounds like you have the most sensible approach. Despite the massive tragedy waiting to happen in the form of CD Swaps and what-not I don't think we'll end up in a post-apocalyptic mad max style society.

However, IF I did have money, I would certainly look into personal gold, and perhaps stock up on non-perishable food, water and a secure shelter of some-sort just in case we suffer a blip and looting/panic buying starts - which might not be far off.

 

[BradNaylor]

Hi All,



The classic historical hedge for all this is gold but really only if one is able to take a 3-5 year view in my humble opinion.

Personally I have bought physical Krugerands and will continue to do so on significant dips. I very occasionally take profits but as I believe the long term price will well exceed £1k per ounce ( some US pundits give $2000!)

The ramping of gold as a safe haven investment on hundreds of websites around the world amuses me.

It is quite clearly a well-orchestrated plot to entice in millions of small investors disenchanted with the interest on their savings.

And when gold does hit $2k per ounce...


The plotters will have long disappeared - with your money!

All you will be left with is a small chunk of yellow metal which has little actual intrinsic value other than the value it is perceived to have.

A bit like a tulip bulb, actually!

Cheers
Dan

 

[Jenx]

clearly a well-orchestrated plot

By so few, to the detriment of so many ?
Surely not ! :wink:

The'illuminati' still looking after their own... its preposterous :wink:

 

[ByronBlack]

Dan, you are wrong about gold, it has always had an intrinisc value, hence it's historical standing as a 'standard' and will continue to do so - and the reason why is because it's a finite resource, therefore the value cannot be diluted by the introduction and creation of more, unlike money which is the polar opposite and can and is currently being diluted.

If you put 10k into a bank, in a few years time it will be worth less than it is now due to the dilution (inflation) of our currency as it's not back by any finite resource.

Gold on the other hand will always return a degree of value, and if anything, is likely to go up over time like it has done over the course of history as we have come to rely on non-backed infinite resources such as currency.

I know where I would rather have my money in the long-term. (if I had any