The great interest rate rip off part 1

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AIG's crown jewel AIA makes hot Hong Kong debut

 

HONG KONG (Reuters) - AIA Group Ltd surged 17 percent in its Hong Kong debut as investors, chasing exposure to Asia's fast-growing life insurance business, piled into the record offering in the world's hottest IPO market.

Continue Reading

 

 

 

BA swings to profit as premium traffic returns

 

LONDON/MADRID (Reuters) - British Airways and merger partner Iberia expect further growth in 2011 after improved demand for premium-class travel and strict cost controls helped the pair return to profit.

UK, Aerospace & Defence 12:45pm BST

 

Goldman, Morgan Stanley and Allianz in rail bids - sources

 

AMSTERDAM/LONDON (Reuters) - Bid teams based around Eurotunnel and Goldman Sachs , Morgan Stanley , German insurer Allianz and two Ontario pension funds offered to buy Britain's only high-speed rail route, sources said.

6:12pm BST

 

Provinces mount pressure on Canada over Potash bid

 

TORONTO/OTTAWA (Reuters) - Saskatchewan lined up more support for its attempt to overturn a hostile bid for provincial crown jewel Potash Corp on Friday, increasing political pressure on the Canadian government to reject the deal.

Market Analysis, 7:56pm BST

 

FTSE inches down; weak miners offset energy gains

 

LONDON (Reuters) - Weakness from miners and banks nudged Britain's FTSE 100 index slightly lower by the close on Friday, ending the month on a whimper after a strong run since early September. | Video

5:52pm BST

 

F&C cheers net inflows on Thames buy

 

LONDON (Reuters) - F&C Asset Management reported higher-than-expected assets under management (AuM) in its third quarter, boosted by the takeover of rival Thames River and rising equity and bond markets. F&C said on Friday AuM swelled 13.5 percent to 108.2 billion pounds in the quarter to September 30, beating analyst forecasts for between 105 billion and 107.7 billion, after winning 600 million pounds of net new business.

1:25pm BST

 

OFT probes Ryanair's Aer Lingus stake

 

DUBLIN (Reuters) - The Office of Fair Trading (OFT) launched an investigation into Ryanair's minority stake in Aer Lingus on Friday, in a surprise move that prompted a scathing response from the low-cost airline.

1:39pm BST

 

EU sets sights on treaty change

 

BRUSSELS (Reuters) - The European Union on Friday set in motion plans to amend the EU's main treaty to create a permanent system to fight financial crises, and said a summit deal on new budget rules would strengthen the euro.

5:10pm BST

 

London and Warsaw IPOs fly while Enel cuts to sell

 

LONDON/MILAN (Reuters) - While investors flocked to Friday's IPOs of AZ Electronic and the Warsaw bourse, a dose of realism soured Enel's goal to raise 3 billion euros (2.6 billion pounds) from its green power unit.

1:29pm BST

 

Halliburton used flawed cement on BP well

 

HOUSTON (Reuters) - Halliburton Co. used flawed cement in BP Plc's doomed Gulf of Mexico well, which could have contributed to the blowout that sparked the worst offshore oil spill in U.S. history, a White House panel said on Thursday.

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Pontiac Falls From Muscle Car Glory to Graveyard

 

By NICK BUNKLEY 2 minutes ago

 

 

The brand came out with the powerful GTO in 1964, and soon other carmakers were adding horsepower. Sunday is the last day of Pontiac sales.

 

• Post a Comment
  

 

 

 

Gary McCracken for The New York Times

 

The last new Pontiac for sale on the lot at Lee Pontiac GMC in Fort Walton Beach, Fla., is a 2009 Pontiac Solstice coupe hardtop.

 

 

 

 

 

 

U.S. Economy Grew at 2% Rate in Third Quarter

 

By MICHAEL POWELL 1:27 PM ET

 

Friday’s numbers are not likely to provide much of a morale boost for President Obama and Democrats, who are days away from crucial midterm elections.

 

• Economix: Consumer Spending Up, but Can Fast Growth Last?
  
• Bernanke’s Reluctance to Speak Out Rankles Some
  

 

Replying to Report, Halliburton Says BP Is to Blame in Gulf

 

By JOHN M. BRODER 2:06 PM ET

 

The company issued a statement on Thursday after a panel said a failed cement job on the well had contributed to the blowout.

 

• Panel Says Firms Knew of Cement Flaws Before Spill
  
• Inquiry Puts Halliburton in a Familiar Hot Seat
  

 

Wall Street Takes G.D.P. Report in Stride

 

By CHRISTINE HAUSER 34 minutes ago

 

Reaction was muted given that the estimate for the country’s gross domestic product matched expectations.

 

DealBook

 

A.I.A. Shares Jump 17% in First Day of Trading

 

By CHRIS V. NICHOLSON 8:45 AM ET

 

AIA, the Asian life insurance unit of American International Group, rose 17 percent in its first day of trading in Hong Kong, its share price of 22.90 Hong Kong dollars making the company worth $35.3 billion.

 

• Economix: Valuing the Taxpayers’ A.I.G. Stake
  

 

Green Blog

 

Wind Power Growth Slows

 

By TOM ZELLER JR.

 

The American Wind Energy Association reports the slowest quarter since 2007, adding just 395 megawatts of wind power capacity.

 

• Solar Power Projects Face Potential Hurdles
  

 

Cruise Ships, and Sarkozy, Rescue Shipyard, for Now

 

By MATTHEW SALTMARSH 10:45 AM ET

 

The Chantiers de l’Atlantique, established in the mid-19th century, is hoping to hang on a few more years with support and some salesmanship from President Nicolas Sarkozy.

 

• Shipping Magnate Takes a New Tack: The Cruise Business
  

 

Media Decoder Blog

 

Super Bowl Ad Slots Sell Out Early

 

By STUART ELLIOTT 1:10 PM ET

 

Slots for commercials during Super Bowl XLV, robust since the summer, sell-out earlier than is typical for Super Bowls.

 

E.U. Rift on Plan for Handling Crises

 

By STEPHEN CASTLE

 

European Union leaders decided to create a permanent system to handle future sovereign debt crises for the years after 2013, when a €750 billion safety net thrown together early this year expires.

 

• Spanish Region Sells Bonds Locally-But at a High Price
  

 

F.D.A. Rejects Qnexa, a Third Weight-Loss Drug

 

By ANDREW POLLACK

 

Federal regulators seem to have heightened their scrutiny of diet pills that could pose risks.

 

• Post a Comment | Read (103)
  

 

 

 

• Inflation and Unemployment Rise in Euro Region 6:50 AM ET
  
• Potash Shares Fall on Worries About BHP Deal
  
• Paul Kolton, Who Led the American Stock Exchange, Dies at 87 2:00 PM ET
  
• DealBook: Cheap Debt Fuels Private-Equity Revival
  
• Sales of Video Game and Flagship Software Lift Microsoft
  
• Samsung and Sony Report Profit Increases
  

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29 October 2010 Last updated at 19:59

 

BA in first profit for two years

 

British Airways reports a profit of £158m, its first in two years, as the company prepares to merge with Iberia of Spain.

 

• BA boss praises staff Watch
  
• Firms warn over 55% air tax rise
  
• BA to reinstate some crew perks
  
• BA jumps 6.4% on traffic rebound
  

 

US economic growth rate quickens

 

The US economy grew at an annualised rate of 2% in July-September, an acceleration on the previous quarter, official figures show.

 

• US foreclosure crisis spreading
  
• US sees 95,000 jobs go last month
  

 

 

Conrad Black convictions upheld

 

Former media tycoon Conrad Black has two convictions upheld and two reversed by a court of appeal in Chicago.

 

 

 

• Alstom loses Eurostar court case
   
  Alstom, the French engineering company, fails in an attempt to prevent Eurostar from running German trains through the Channel Tunnel.
  
• Energy firm SSE raises gas bills
   
  Scottish and Southern Energy is putting up its domestic gas tariffs by 9.4% at the start of December.
  
• EU clinches pact to defend euro
   
  EU leaders say tough new budget rules agreed at their summit in Brussels will protect the euro from a future Greek-style debt crisis.
  
• FTSE 100 executive pay rises 55%
  
• Demand for borrowing remains weak
  
• Saab increases losses at Spyker
  
• Church loses big in AIB wipeout
  
• Sony profits on PC and game sales
  
• Fines threat over child benefit
  
• EU frames eurozone crisis rules
  
• Spanish unemployment rate falls
  
• Medical company sold in £22m deal
  
• Big fall in German retail sales
  
• OFT to probe Ryanair-Aer Lingus
  

Worst way to bank

 

Bank of England governor speaks out on bank rules

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[/url]

 

Property market 'double-dip'

 

Economist says UK property market is in the midst of a “double dip” as mortgage lending drops to a tenth of the level of the previous month.

 

EU 'haircut' plans rattle bondholders

 

Investors face large potential losses under German plans likely to win EU backing – risking a boycott of Greek, Irish, and Portuguese bonds.

 

Roubini sees US 'fiscal train wreck' ahead

 

The US economy is a "fiscal train wreck" waiting to happen, US economist Nouriel Roubini warned on Friday.

 

BA posts first profit in two years

 

 

 

 

US consumer spending helps economy expand 2pc

 

 

 

 

Revealed: how Desire's advisers have cashed in

 

 

 

 

BP 'knew Gulf well was unstable'

 

 

 

 

Hovis nears truce with Tesco in battle over bread price

 

 

 

 

HMRC clamps down on deferred taxes

 

 

• Mervyn King must turn off the printing press
  

 

• We must liberate our cities to set the recovery free
  

 

 

• Why top accountants say child benefit fines will not work
  

 

 

US recovery quickens but more QE expected

 

 

 

Housing market double-dip warning, as home values drop again

 

 

 

 

UK banks are in a strong position to back recovery

 

 

 

 

Local growth is good but we must liberate our cities to set recovery free

 

 

 

 

UK consumers show surprise calm over spending cuts

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Breaking news

 

• 
  
• Air Berlin says Q3 EBIT rises to 171.7 mln euros - Reuters
  
• Madoff trustee spent $26.9 mln to recover $849,000 in Q2, Q3 - Reuters
  
• 'Saw 3D' makes the cut at Halloween box office - Reuters
  
• France sees Iraq as boost to trade-Minister - Reuters
  
• Apple sues Motorola, further escalating cellphone wars - Reuters
  
• NRG would want lower price in any new Dynegy deal - Reuters
  
• Qatar Airways urges more access to Canadian market - Reuters
  
• Jordan's Arab Bank 9-month profit down 19.7 pct - Reuters
  

 

 

 

• Focus DIY calls in bankers for possible sale as debts pile up
   
  Lazard asked to explore options for Focus, which is burdened with £230m in loans
  
• Marks & Spencer plans to re-enter European markets
   
  Marks & Spencer's strategic move could be confirmed next week when Marc Bolland, the new chief executive, unveils his review of the business
  
• Fed stimulus expected after US growth remains sluggish at 2%
   
  US economy grew at faster pace but the Federal Reserve is still expected to restart QE next week
  71 comments
  
• Construction gives Britain's economic recovery an unstable foundation
   
  George Osborne says the economy is growing strongly, but how much of that is down to a construction rally that is already petering out?
  12 comments
  
  • Housing dip feared as loan approvals stall
    

 

 

• Britain's firework manufacturers fears next year will be a damp squib
   
  As councils and corporate clients feel the squeeze, the tiny British pyrotechnics industry is starting to worry
  
• Staff at SSL International fear for jobs
   
  Employees made to reapply for posts as Bart Becht completes £2.5bn takeover of Durex and Scholl firm
   
  
  • Austerity Britain? Bosses' pay soars 55%
    
  • Bart Becht: UK's highest paid boss keeps low profile
    

  [*] BG launches £9bn project to liquify Australian coal seam gas

   

  The scheme, the company's biggest investment to date, is the first of a series of 'coal seam methane' initiatives in eastern Australia

   

  • Oil lobby in legal threat to wind farms
    

  [*] More business news

  [*] MGM studio heads for bankruptcy

  [*] Conrad Black faces new jail threat

  [*] Clubcard masterminds at the checkout

  [*] Gas price rise takes energy bills to £1,200

[interestrateripoff]

BG Group approves £9.4 billion Australian LNG project

 

SYDNEY (Reuters) - Energy corporation BG Group said on Sunday it had given final approval to a $15 billion (9.4 billion pounds) project to develop a major new liquefied natural gas project in northeastern Australia.

Continue Reading

 

 

 

UK, Germany seek ways to boost global trade

 

LONDON (Reuters) - Britain, Germany, Indonesia and Turkey are setting up an experts' group to suggest ways to boost global trade, Britain and Germany said on Sunday.

G20 4:12pm GMT

 

BHP Billiton plans to sweeten Potash bid: report

 

LONDON (Reuters) - BHP Billiton is planning to raise its $39 billion (24 billion pounds) hostile bid for Canada's Potash Corp , the world's largest fertiliser supplier, the Sunday Times reported, citing sources close to the situation.

2:17pm GMT

 

SNB chief says there is no currency war

 

GENEVA (Reuters) - It is an irresponsible exaggeration to say the world is in a currency war, even if countries have their differences over adjustment policies, the head of the Swiss National Bank said on Saturday.

30 Oct 2010

 

M&S looking to relaunch in Europe: report

 

LONDON (Reuters) - Retailer Marks & Spencer is looking to re-acquire some of the properties that it sold in 2001 when it exited Europe, the Sunday Telegraph reported.

1:06pm GMT

 

FTSE to tighten rules for foreign firms - report

 

LONDON (Reuters) - FTSE Group will tighten the rules for foreign companies looking to join its major indices such as the FTSE 100, the Independent on Sunday reported.

2:33pm GMT

 

WTO's Lamy says worried by currency interventions

 

BERLIN (Reuters) - International attempts to manipulate foreign exchange rates are a worry but the world has not entered a foreign currency war, World Trade Organisation Director General Pascal Lamy said in a newspaper interview. In the interview issued on Saturday, one day ahead of its official publication, Lamy was asked by German weekly Welt am Sonntag what risk there was of a currency war breaking out.

G20 30 Oct 2010

 

Top Swiss banker sees tax talks with France and Italy

 

GENEVA (Reuters) - France and Italy are likely to negotiate tax deals with Switzerland following agreements last week with Britain and Germany that preserve banking secrecy while paying tax on Swiss accounts held by their nationals, a top Swiss banker was quoted as saying on Sunday.

12:06pm GMT

 

Government to order Serco to explain cash demand - paper

 

LONDON (Reuters) - The government will order outsourcing company Serco to explain why it contacted suppliers to demand a 2.5 percent "cash rebate" on their work this year or risk losing future contracts, the Sunday Telegraph reported.

UK 4:14pm GMT

 

Special Report: For GM IPO, the government is back-seat driver

 

NEW YORK/DETROIT (Reuters) - Steve Girsky remembers sitting at his kitchen table in New York on the eve of President Barack Obama's election when he realized that General Motors was going to run out of cash.

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Portugal government, opposition reach agreement on budget

 

LISBON (Reuters) - Portugal's minority Socialist government and opposition Social Democrats (PSD) reached an agreement on the 2011 budget on Saturday, averting a political crisis in one of the euro zone's financially weakest members.

30 Oct 2010

 

Hungary targets below 3 percent/GDP budget deficit

 

BUDAPEST (Reuters) - Hungary's 2011 draft budget targets a deficit of below 3 percent of gross domestic product (GDP) and sees economic growth picking up to 3 percent, Economy Minister Gyorgy Matolcsy said on Saturday.

30 Oct 2010

 

Canadian provinces push Ottawa to block Potash bid

 

TORONTO/OTTAWA (Reuters) - Potash Corp's home province is racketing up pressure on the Canadian government to block BHP Billiton's hostile approach, while the company still insists that rival bids could emerge.

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Meet the godfather of the cuts

 

Canada's Paul Martin eradicated his country's deficit by harsh reductions in public spending. Matt Chorley meets the coalition's inspiration.

 

• FTSE lays down the law to foreign firms listing in London
  
• Denham claims new enterprise partnerships are 'a shambles'
  
• Hikma has war chest of $500m ready to spend
  
• Ringing change: Stars' jeweller crafts a move down market
  
• China's Guangzhou tower nears completion
  
• Bonus rules will lead to exodus of top bankers, EU warned
  
• Sugar sells D&G store for £68m
  

 

Stephen Foley: Fairness catches on as US consumer regulator goes for the simple approach

 

 

US Outlook: Elizabeth Warren is off to a cracking start in her job as architect of the new Consumer Financial Protection Bureau here.

 

 

• Stephen Foley: Sluggish growth pushes US towards more QE
  
• James Moore: Santander looks like it's catching a very nasty cold from the Spanish flu
  
• Sean O'Grady: Crisp new fivers are on the way – but that's the least of our problems
  
• James Moore: A cautionary tale about a float that's sinking
  
• James Moore: Is this a ray of light in the appalling mess of the British pension system?
  

 

Qatar's global spree shows no signs of slowing

 

The oil-rich emirate has been steadily increasing its stake in British businesses. Richard Northedge reports

 

 

• Terra Firma may be on shaky ground as EMI case concludes
  
• Asia's rising powers flex their muscles
  
• The businesss on...Mark Tucker, Chief Executive, AIA
  
• Jeremy Leggett: Solar storm coming: the battle for the UK energy industry
  
• The brains behind the smartphones
  

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31 October 2010 Last updated at 16:28

 

MGM film giant agrees rescue deal

 

Creditors of Hollywood's legendary MGM studio back a rescue deal offered by US firm Spyglass Entertainment.

 

• MGM bankruptcy or rescue?
  

 

BG clears biggest ever investment

 

BG Group approves biggest ever investment, a £9.3bn ($15bn) liquefied natural gas development in Australia.

 

 

BA in first profit for two years

 

British Airways reports a profit of £158m, its first in two years, as the company prepares to merge with Iberia of Spain.

 

 

 

• Ryanair ends Belfast City flights
   
  Ryanair's last flights leave from George Best Belfast City Airport, after a row over delays to a proposed runway extension.
  
• Turkey lifts its ban on YouTube
   
  Turkey lifts its ban on YouTube, two years after it blocked access to the website because of videos deemed insulting to the country's founder.
  
• US economic growth rate quickens
   
  The US economy grew at an annualised rate of 2% in July-September, an acceleration on the previous quarter, official figures show.
  
• Brazil finds massive oil field
  
• Conrad Black convictions upheld
  
• Help Loan debt collection halted
  
• Alstom loses Eurostar court case
  
• Energy firm SSE raises gas bills
  
• EU clinches pact to defend euro
  
• FTSE 100 executive pay rises 55%
  
• Church loses big in AIB wipeout
  
• Sony profits on PC and game sales
  
• Fines threat over child benefit
  
• EU frames eurozone crisis rules
  

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http://www.finfacts.ie/irishfinancenews/article_1020901.shtml

 

The Central Bank reported today that loans to Irish households again fell in September. There was a slight increase in loans to business in the month while bank deposits fell and domestic bank borrowing from the ECB (European Central Bank ) was €83bn.

The annual rate of change in loans to households was minus 4.5% in September 2010, following a revised decline of 4.2% in August. Lending for house purchase was 1.6% lower on an annual basis in September 2010 (minus 1.2%, August), whereas lending for consumption and other purposes had declined by 14.8% (minus 14.9%, August).

The net flow of household lending during the month of September 2010 was minus €279m, following a revised net monthly flow of minus €78m in August. The net monthly flow of household loans has been negative every month so far in 2010.

 

Tick tock...

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The 2nd crash is rolling

 

Telegraph: Britain's property market in 'double-dip'

 

Britain’s property market is in the midst of a “double dip”, economists reveal, as figures show mortgage lending dropping to a tenth of the level seen during the previous month.

Posted by doomwatch @ 09:10 PM 6 Comments

 

 

World war 3 ?

 

Yahoo afp: Iran forex reserves exceed $100bln

 

"We imported hundreds of tonnes of gold when its price was at an average of 656 dollar per ounce," Bahmani said at the seminar in Tehran on Saturday. "Today its global price has gone up to 1,230 dollars (per ounce). Given the current situation, billions of dollars have been added to the country's foreign exchange reserves." He said the reserves were brought into the country "to avoid being seized by other countries due to sanctions."

Posted by mark @ 06:01 PM 4 Comments

 

 

Who signs these deals off?

 

Daily mail: So astonishing I'm lost for words

 

I can't even find words to comment on this.No doubt the gestapo fear will put off comments put in writing.I simply do not understand this at all but its true and real

Posted by taffee @ 11:11 AM 24 Comments

 

 

Let them go private

 

FT: Most schools to have budget cut

 

In my mind's eye I see Michael Gove with a school cap and satchel. If Spitting Image were still going they'd have a field day with him. A bit off topic, but it is the weekend. And it's more interesting than gold. (As ever, search title in Google to view)

Posted by letthemfall @ 10:29 AM 2 Comments

 

 

An investment manager talks about saving

 

Telegraph: Doomsayers are selling Britain short, says top fund manager Tom Dobell

 

“Unfortunately, we had become complacent that our place in the world was assured. The mistaken idea that rising house prices and hopes of winning the lottery might be a plan for retirement are national characteristics that will have to be amended. “The truth is we are going to have to work hard and save hard. But it was not UK Plc that went bust; it was the government finances that were in tatters because we were living beyond our means. The man in the street was also being encouraged to borrow too much and it is difficult to see how that could have been sustained.

Posted by quiet guy @ 09:46 AM 4 Comments

 

 

When the Levee Breaks

 

Bloomberg: Ireland, Greece Debt Woes Reverse Sovereign Default Swaps Rally

 

A bondholder showdown in Ireland, slumping Greek tax revenue and political gridlock in Portugal reversed Europe’s biggest sovereign debt rally in three months. The average price of credit-default swaps on Portugal, Italy, Ireland, Greece and Spain rose to 406.5 basis points from 363.5 last week, according to CMA. That’s the biggest weekly increase since Aug. 13. Governments of Europe’s so-called peripheral nations are struggling to lower their budget deficits even as they impose public spending cuts and increase taxes. A review of Greece’s 2009 budget showed the deficit was above 15 percent of gross domestic product, more than previously estimated, and the nation has “serious tax compliance issues,” Finance Minister George Papaconstantinou said this week.

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Rate rise threat for 3m home owners

 

Almost three million homeowners would struggle to pay their mortgage if interest rates rose by just 2 percentage points, according to new industry figures.

 

M&S to relaunch in Europe

 

Marks & Spencer is plotting an audacious return to retailing in Europe by buying back shops it controversially sold almost 10 years ago.

M&S plans to take Twiggy international

 

 

 

Obama highlights India's power and rivalry to China

 

The arrival of President Barack Obama in Mumbai next weekend has been hailed a turning point in India's standing as a political and economic power.

 

MPC to hold fire on more QE

 

 

 

 

Anger as Serco forces 'cash for cuts' on suppliers

 

 

 

 

Crown Currency boss had sentence for theft

 

 

 

 

Betfair could join UK exodus

 

 

 

 

BP profits trail behind rivals

 

 

 

 

Doomsayers are selling Britain short

 

 

• All eyes turn to the 'printing money' issue
  

 

• Mervyn King's stand for bank reform needs support
  

 

 

• America is once again the main focus of investors' attention
  

 

 

Forget QE, the UK needs rate rises to fend off the threat of inflation

 

 

 

Will there be a comedown after this sugar rush?

 

 

 

 

Angela Merkel consigns Ireland, Portugal and Spain to their fate

 

 

 

 

Mervyn King makes a stand for reform as banks seem intent on forgetting

 

 

 

 

A must week in the US markets for investors

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http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/8097272/Rate-rise-threat-for-3m-home-owners.html

 

Almost three million homeowners would struggle to pay their mortgage if interest rates rose by just 2 percentage points, according to new industry figures seen by The Sunday Telegraph. This equates to more than one in three (37pc) of all mortgage holders.

 

Even if rates rose by less than 2 points, an estimated 1.6 million mortgages would be deemed "unaffordable", according to guidelines set out by the Financial Services Authority.

 

There are growing concerns that interest rates might rise sooner than previously predicted, given last week's better than expected growth figures. This would cause further misery for many struggling families, already facing rising taxes, higher-than-expected inflation and the prospect of widespread job losses, particularly in the public sector.

 

According to figures from the Council of Mortgage Lenders (CML), if mortgage rates rose by 2 percentage points from their current rate, about 2.9 million homeowners would have home loans that breached the regulator's affordability guidelines. The usual advice for those whose finances are this precarious is to take out a fixed-rate mortgage: it may cost more in the short term, but should safeguard their income against future rate shocks. However, a significant proportion of these borrowers are unable to afford or gain access to a fixed-rate deal.

 

Falling house prices and more stringent lending criteria have left tens of thousands of homeowners stuck on their current deal, unable to remortgage elsewhere. For those lucky enough to have a mortgage with C & G or Nationwide, for example, this may not be too bad: both have a standard variable rate (SVR) of just 2.5pc. But the average is significantly higher at 4.75pc, with some lenders, such as Kent Reliance Building Society, charging 6.08pc.

 

One of the main problems is that people don't have enough equity in their property to move. David Hollingworth of London & Country mortgage brokers said lenders offered their best rates only to customers who have at least 25pc equity in their home, and there are almost no deals available to those with less than 10pc equity.

 

Looks like the VI's are panicking that if rates rise they will be in trouble being swamped with bad loans.

 

Probably might have been better if they hadn't been so greedy in the first place.

 

The BoE are screwed if they do and screwed if they don't. Pity they didn't clamp down on the boom before it was too late then a lot of this might have been avoided.

 

Luckily the recovery will save the mortgage holders....

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Why Twitter’s C.E.O. Demoted Himself

 

By CLAIRE CAIN MILLER

 

 

Evan Williams may embody a classic Silicon Valley type: the inspired entrepreneur with good ideas for a start-up, but not the leader to execute a sophisticated business strategy.

 

 

 

Noah Berger for The New York Times

 

Evan Williams recently stepped down as Twitter’s chief in order to focus on product strategy. It is considered a sign that Twitter — which Mr. Williams calls “a 6-foot-tall sixth grader” — is maturing.

 

 

 

 

 

 

Fox and Cablevision Deal Returns Signal

 

By BRIAN STELTER and BILL CARTER

 

Fox comes back to life in three million homes served by Cablevision just before Game 3 of the World Series.

 

• Post a Comment
  

 

Making Sure Nickelodeon Hangs With Cool Kids

 

By BROOKS BARNES

 

For the first time in years, Nickelodeon has momentum. It is searching for new franchises to fend off Disney Channel and cement its popularity with children and young teenagers.

 

Everybody’s Business

 

Innovation: It Isn’t a Matter of Left or Right

 

By STEVEN JOHNSON

 

Most people assume that market forces drive inventions. But over the last two centuries, collaborative, nonproprietary innovation has eclipsed, and transformed, the marketplace.

 

Portugal Ends Long Standoff Over Budget

 

By RAPHAEL MINDER

 

The deal helps the country avoid a possible collapse of its government and is likely to be welcomed by investors.

 

Iraqi Gold’s Glitter Dims for Dealers Under Siege

 

By JACK HEALY

 

Ruthless jewelry store robberies may be financing Qaeda operations, security officials say.

 

Digital Domain

 

When the Assembly Line Moves Online

 

By RANDALL STROSS

 

New companies are offering to speed the completion of repetitive work — by parceling it out over the Internet.

 

Fundamentally

 

Raising a Caution Flag on Corporate Revenue

 

By PAUL J. LIM

 

After four relatively bright quarters, the corporate sales picture is looking cloudier.

 

 

 

• Letters: When to Shrink the Budget Deficit?
  
• New York World: A Polish-American Paper’s Final Edition
  
• Mortgages: More Closing Jitters
  
• Consumed: Good News, Bad News
  
• Weekend Business
  

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Beware The Eurozone....

In an interesting piece AEP opines....

Bondholders will discover burden-sharing. Debt relief will be enforced, either by interest holidays or haircuts on the value of the bonds. Investors will pay the price for failing to grasp the mechanical and obvious point that currency unions do not eliminate risk: they switch it from exchange risk to default risk.

 

Really? We shall see. I know, I know, there's going to be some sort of "Cramdown" in the EU Treaties through Article 48. So it is claimed. Let's see it happen first.

Mrs Merkel needs a treaty change to prevent the German constitutional court from blocking the bail-out fund as a breach of the EU law, and a treaty change is what she will get. “This will strengthen my position with the Karlsruhe court,” she admitted openly.

Ah, but is it enough? I'm not yet convinced. It may well be, but let's see the proof in the pudding before we go jumping to conclusions.

One might argue that bondholders should have been punished for their errors long ago. The stench of moral hazard has been sickening, on both sides of the Atlantic. An orderly bankruptcy along lines routinely engineered by the International Monetary Fund is exactly what Greece needs. It makes no sense to push Greece further into a debt compound spiral by raising public debt from 115pc of GDP at the outset of the “rescue” to 150pc at the end of the ordeal.

Well yeah. So when does it happen? And why do you think it will happen now?

Yet opening the door to bondholder haircuts at this delicate juncture -- with spreads reaching fresh records in Ireland last week, and Portugal struggling to pass a budget – is to toss a hand-grenade into the eurozone periphery.

We now know that that ECB’s Jean-Claude Trichet warned EU leaders on Thursday night that it was dangerous to stir up this hornets’ nest, and moreover that the politicians did not understand what they were unleashing. He was slammed down acrimoniously by French President Nicholas Sarkozy, who later denied that he lost his temper.

Ah, so now China stepping in to talk to Greece - and others - about buying their debt might be some sort of.... engineered "solution"? What does China get in return for their "graciousness", if they could be exposed to haircuts? Do you really think this is simply "an investment" decision to buy said bonds?

Neither do I.

Local banks have stepped into the breach, borrowing cheaply from the ECB to buy their own state debt at higher yields in a `carry trade’ that concentrates risk. These four countries account for the lion’s share of the €448bn in ECB funding for banks (Spain €98bn, Greece €94bn). Frankfurt is propping up this unstable edifice. Mr Trichet may well fret.

There's nothing like a Carry Trade within one's own borders. Oh wait - we're doing that too, aren't we? Uh, Primary Dealers borrowing from The Fed at 1/4% and then buying our bond issues at 2.5 or 3.5%. Yeah, that kinda looks like a carry too, doesn't it? And it makes for an interesting discussion as to exactly how and when one can unwind said "extremely low rates for an extended period" language without detonating all the banks instantly, doesn't it?

Hmmm.......

[interestrateripoff]

Foreclosuregate Roundup, Weekend of 10/31

Given the "spooky" nature of the day, it appears to be the appropriate time to make the usual rounds.

Let's start with Manhattan, where a judge seems to have done the right thing:

U.S. Bankruptcy Judge Martin Glenn in Manhattan ruled yesterday that Wells Fargo can’t bypass the automatic shield against legal claims triggered by Mims’s filing for personal bankruptcy in July.

Wells Fargo couldn’t document how it acquired the rights to Mims’s mortgage, which originated with another lender, the judge said.

Here's the problem:

Records showing that Mims’s loan was assigned by Mortgage Electronic Registration Systems Inc. a week before Wells Fargo moved in court to foreclose on her home didn’t mesh with the history of the loan’s transfers, Glenn found.

“

Wells Fargo has not supplied the court with any evidence that the note was physically delivered or assigned

,” Glenn wrote.

Right.

See, the loan is supposed to go from the originator to the sponsor to the depositor (really just a straw corporation - necessary to get bankruptcy-remote treatment) and then to to the trust.

This means there should be at least three assignments on the physical note.

The alternative is that the note could have been endorsed in blank. But if it was, then it is identical to any other sort of bearer instrument - you have to have physical possession of the original, and if it is lost or destroyed, unless you can prove it was destroyed, you're cooked.

You can endorse a check (which is just a demand-payment note) any number of times. But if you endorse it to cash, then anyone who has physical possession of it can cash it, while at the same time it becomes nearly impossible to prove who's supposed to have it in the event it "disappears." This is very similar to a $100 bill - the commonly held sort of bearer instrument we all handle in our daily lives. If you burn a $100 bill or put it in the paper shredder, Treasury is not required to replace it for you, and in fact unless you can prove that you had possession of it, generally by providing them a substantial amount of the remaining pieces of it, they won't.

These issues get rather complex in the context of the UCC (Uniform Commercial Code) yet they are very important. There are two ways one can possess an instrument (in this case a mortgage note) in the general sense - you can be an "assignee" or you can be a "holder in due course." The difference is that in the latter case you are not financially responsible if the person(s) in front of you did something wrong, where in the former case you are!

Why is this important? Primarily because if the Trust is a Holder in Due Course they are entitled to collect, including perfection of the security interest, even if there was fraud in the inducement against the borrower!

That is, the borrower's recourse does not extend through the MBS structure. But this protection only exists if the formalities granting a Holder In Due Course status were complied with. If they weren't then the MBS Trust is an assignee and has successor liability for the acts all the way back to the originator.

The Bankruptcy Judge was thus correct to demand that Wells show up with proof of the status of that note - not a simple assertion. He is required (and in fact foreclosure judges should be required) before granting a judgment that is the perfection of said security interest to determine whether the alleged owner of it can actually document having possession - that is, the right to foreclose at all, and further, whether they can escape questions of propriety in acquisition of the debt in the first place.

Determination of these facts is not automatic. That is, the fact that Joe Bank shows up and says through affidavit that it has the right to foreclose establishes nothing more than a bare assertion. In both Judicial and Non-Judicial States it should be an absolute requirement that the filings include the entire chain of assignment for the security instrument going back to the original signatures on the page at the closing table. Only through those signatures and the dates they took place can one establish that value was given and that the transaction at the time it was undertaken was in good faith by the holder.

Electronic records can, in some cases, meet these requirements under the UCC. But here the priority rests with the actual paper. Indeed, when it comes to paper instruments a handwritten statement overrides a manually typewritten one which overrides a machine-printed one. Written letters (e.g. "two dollars") override numerals (e.g. "2.00"). The intent here is that one can examine (in court if necessary) a signature, but it is hard to examine a machine. Therefore, priority in a dispute goes to wet ink - as it should.

 

More at the link.

[interestrateripoff]

http://market-ticker.org/akcs-www?post=170719

 

Ohio Attorney General going after the bankers...

[interestrateripoff]

http://www.mortgagerates.org.uk/news/house-price-cras/

 

Howard Archer, the chief economist at IHS Global Insight was quoted in saying: “Latest housing market data and surveys have been consistently weak, and the housing market really does not seem to have got much going for it at the moment. Critical to the development of house prices over the coming months will be the amount of houses coming on to the market, mortgage availability and how well the economy and jobs hold up as the fiscal squeeze increasingly kicks in.”

 

Market insiders are no longer asking themselves whether there will be a house price crash but instead how deep the crash will be. September alone slashed house prices down £6,000.

 

Ed Stansfield, chief property economist at Capital Economics, said: “The fact that house prices now appear to be on their way back down after the past year’s rather unexpected surge should not be a surprise. Not only is the market overvalued on most measures, but house price falls are entirely consistent with the drop in buyer inquires and mortgage approvals that we have seen in recent months. They also square with reports that lenders have begun to tighten credit standards again.”

 

If property prices crash remember the banks have already been bailed out before this bad debt hits...

[interestrateripoff]

Breaking news

 

• 
  
• Deals of the day -- mergers and acquisitions - Reuters
  
• GM to sell 365 mln shares for $26-$29 each-sources - Reuters
  
• Security pressure seen on passenger jet cargo - Reuters
  
• Security pressure seen on passenger jet cargo - Reuters
  
• US STOCKS-Markets flat as focus shifts to vote, Fed - Reuters
  
• McKesson to buy US Oncology, boost specialty share - Reuters
  
• US STOCKS SNAPSHOT-Wall St turns flat, banks weigh - Reuters
  
• M&T Bank snapping up bargain-priced Wilmington - Reuters
  

 

 

 

• Strong manufacturing survey eases double dip fears
   
  George Osborne hails 'good news' as Markit/CIPS survey shows boost to manufacturing for first time in seven months. By Larry Elliott
  1 comment
  
  • Manufacturing growth beats forecasts
    
  • Manufacturing: What the economists say
    
  • Construction gives recovery an unstable foundation
    

  [*] Asda names Simon King as No 2

   

  Wal-Mart-owned supermarket names ex-Tesco executive Simon King to become new boss Andy Clarke's chief operating officer

  [*] Serco apologises for demanding rebate from suppliers, but shares still down 6%

   

  Over the weekend came reports that Serco had written to 193 suppliers demanding a 2.5% rebate as a result of the coalition's austerity drive

  7 comments

  • Was Serco right to ask suppliers to share the pain?
    

  [*] Claridge's owner loses 'bad bank' case

   

  Property tycoon fails in attempt to stop loans related to his London hotels group being acquired by the Irish government's 'bad bank'

 

 

• Ryanair fares to rise almost 10%
   
  No-frills airline says an increase in ticket prices over the next six months will push up profits to between €380m and €400m
  24 comments
  
  • O'Leary warns against air security crackdown
    
  • BA offer ' best available', says union
    

  [*] Coalition launches small business growth plan as PM's advisers clash

   

  Lord Young clashes with another of David Cameron's advisers, Sir Philip Green, over calls for government to save cash by delaying payments to small firms

   

  • Cameron admits difficulties in getting banks lending
    

  [*] More business news

  [*] National Enquirer owner files for bankruptcy protection

  1 comment

  [*] Anger as Thomas Cook refuses to pay 5% of hotel bill

  [*] Law firms bring in non-execs ahead of legal changes

  [*] Hometrack sees biggest drop in house prices since January 2009

[interestrateripoff]

Miners and banks lift FTSE as U.S. QE decision looms

 

LONDON (Reuters) - Miners led top shares higher on Monday, boosted by strong data from China, but gains were tempered as investors looked ahead to the outcome of the U.S. Federal Reserve's meeting on Wednesday.

Continue Reading

 

 

 

Ottawa decision looms on BHP's bid for Potash

 

TORONTO/MELBOURNE (Reuters) - The biggest takeover of the year moves to the Canadian capital this week, as Ottawa decides if it will allow No. 1 global miner BHP Billiton to buy Potash Corp, one of Canada's biggest companies.

Market Analysis 6:45pm GMT

 

Bank seen keeping rates steady

 

LONDON (Reuters) - Solid growth and sticky inflation mean the Bank of England is likely to keep policy on hold on Thursday pending clearer evidence of an economic slowdown, though there remains an outside chance of more quantitative easing.

UK 2:34pm GMT

 

Oracle-SAP testimony nears

 

OAKLAND, California (Reuters) - Jury selection has kicked off in a Silicon Valley legal drama that could make for some of the best theatre the technology industry has seen in years.

6:52pm GMT

 

IBM wins Bank of Ireland contract away from HP

 

NEW YORK (Reuters) - International Business Machines Corp won a five-year technology services contract with Bank of Ireland away from rival Hewlett-Packard Co .

7:22pm GMT

 

U.S. says won't solve China currency issue at Seoul G20

 

WASHINGTON (Reuters) - The United States said on Monday it does not foresee China bowing to pressure over its yuan currency during a Group of 20 summit in Seoul, playing down expectations for major progress on global economic imbalances.

FXpert, G20 6:23pm GMT

 

AIB shelves sale of UK units

 

DUBLIN (Reuters) - Allied Irish Banks has put the sale of its businesses on hold after failing to get any decent bids, its new chairman said on Monday, meaning the state may end up owning around 95 percent of the lender.

6:18pm GMT

 

U.S. group State Street to administer national pension fund

 

LONDON (Reuters) - The new national pension scheme for workers with no retirement provision said on Monday it had appointed State Street Corp to administer its funds and was seeking managers for five investment mandates.

5:16pm GMT

 

Manufacturing PMI rises unexpectedly in October

 

LONDON (Reuters) - Manufacturing activity unexpectedly picked up pace last month, a survey showed on Monday, reinforcing expectations the Bank of England will hold off on injecting more stimulus.

5:51pm GMT

 

Bats Europe bemoans slow progress on clearing

 

LONDON (Reuters) - A lack of competition among Europe's clearing houses is holding back growth of the region's equity market, the chief executive of ultra-fast trading platform Bats Europe said on Monday.

[interestrateripoff]

Online shops demand Royal Mail ups its game

 

 

More than four-fifths of UK online firms are critical of the Royal Mail, and accuse the service of "stifling" the development of their businesses.

 

• Primark and M&S plan store expansion drive
  
• Double-dip recession fears ease
  
• Outsourcer Serco apologises over rebate demand
  
• Cameron appoints Lord Young as Enterprise Tsar
  
• Ryanair reveals half-year profits rise
  
• BG gives the green light to $15bn gas plant in Oz
  
• Manufacturing set to rise on domestic demand
  

 

Stephen Foley: Fairness catches on as US consumer regulator goes for the simple approach

 

 

US Outlook: Elizabeth Warren is off to a cracking start in her job as architect of the new Consumer Financial Protection Bureau here.

 

 

• Stephen Foley: Sluggish growth pushes US towards more QE
  
• James Moore: Santander looks like it's catching a very nasty cold from the Spanish flu
  
• Sean O'Grady: Crisp new fivers are on the way – but that's the least of our problems
  
• James Moore: A cautionary tale about a float that's sinking
  
• James Moore: Is this a ray of light in the appalling mess of the British pension system?
  

 

Sean O'Grady: Pontiac brand another casualty of recession

 

 

“It’s been a great ride” says the Pontiac website. Well, they’re right about that – there have been some fabulous cars bearing the pointy Pontiac badge – but the firm hasn’t been independent since 1926, when it was acquired by General Motors, who have now decided to kill the brand.

 

 

• Qatar's global spree shows no signs of slowing
  
• Terra Firma may be on shaky ground as EMI case concludes
  
• Asia's rising powers flex their muscles
  
• The businesss on...Mark Tucker, Chief Executive, AIA
  
• Jeremy Leggett: Solar storm coming: the battle for the UK energy industry
  

[interestrateripoff]

1 November 2010 Last updated at 20:06

 

Serco cancels demand for rebates

 

Outsourcing company Serco cancels plans to pass on the impact of government spending cuts to its suppliers and apologises "unreservedly".

 

Ryanair's half-year profits soar

 

Ryanair's latest half-year profits rise 15% as the airline enjoys a big increase in passenger numbers.

 

• Air passenger tax increases again
  
• Emirates says profits quadruple
  

 

 

Price of oil hits six-month high

 

The price of oil hits a six-month high after strong manufacturing data in the US and China boosts confidence in the global recovery.

 

 

 

• Manufacturing output rate 'rises'
   
  The rate of growth in UK manufacturing output rose in October for the first time since March, a survey finds.
  
• AIG raises $37bn to repay bailout
   
  AIG, the US insurer bailed out by the US government at the height of the credit crisis, raises almost $37bn (£23bn) to repay its $100bn debt.
  
• Pay freezes hit company directors
   
  Almost half of UK company directors had their pay frozen or cut last year, according to a survey by the Institute of Directors.
  
• Enquirer owner set for Chapter 11
  
• Banks support India microfinance New
  
• US manufacturing 'picks up pace'
  
• Air passenger tax increases again
  
• New help for small firms unveiled
  
• PM calls for action on terrorism
  
• Pension protection fund surplus
  
• Graduate jobless rate rises again
  
• Lord Young named enterprise tsar
  
• Emirates says profits quadruple
  
• China factory activity speeds up
  

 

Huge pay gap

 

PLC bosses doing better than private-sector peers

Sigh of relief

 

The latest growth figures bring good news

[interestrateripoff]

[/url]

 

US heads for QE as UK prospect fades

 

Rebound in US manufacturing hands ammunition to those at the Fed uneasy about further quantitative easing, as the central bank starts crucial meeting.

 

Oil price jumps $2 as Saudi minister fuels inflation fears

 

The Saudi Arabian energy minister pushed up oil futures by $2 per barrel, after implying the powerful nation won't do anything to stop price rising to $90.

 

UK house price show first year-on-year fall

 

House prices dip 0.1pc in October from a year earlier, the first year-on-year fall since January as a stand-off between buyers and sellers emerges.

 

Serco retracts cash rebate demand

 

 

 

 

Government talks to Smiths Group over cargo security

 

 

 

 

Irish 'bad bank' fends off challenge

 

 

 

 

Desire and Faroe drop on more oil drilling setbacks

 

 

 

 

Ryanair profits jump, attacks disruptive strikes

 

 

• Merkel consigns Ireland, Portugal and Spain to their fate
  

 

• Forget QE, the UK needs rate rises to fend off threat of inflation
  

 

 

• New enterprise tsar trashes key Green proposal
  

 

UK manufacturing shows surprise growth

 

 

 

China manufacturing accelerates in October

 

 

 

 

Obama needs a peace treaty with corporate America

 

 

 

 

Britain's complex rules put off foreign investors

 

 

 

 

Pensions safety net is in the black

[interestrateripoff]

Fed Is Set to Act on Economy, but Impact Is Uncertain

 

By SEWELL CHAN 54 minutes ago

 

 

Some economists doubt that the Federal Reserve’s expected resumption of buying Treasuries will have a big effect.

 

• Post a Comment
  

 

 

 

Jim Young/Reuters

 

Ben S. Bernanke, chairman of the Fed, said in August that “central bankers alone cannot solve the world’s economic problems.”

 

 

 

 

 

 

News Analysis

 

Central Banker Takes a Chance by Speaking Out

 

By JACK EWING 2:15 PM ET

 

Axel Weber’s strident, public dissents may be dimming his chances of becoming Europe’s top central banker.

 

• Post a Comment | Read (1)
  

 

Mixed Day for Markets Ahead of Elections and Fed

 

By CHRISTINE HAUSER 14 minutes ago

 

A crucial manufacturing index rose in October, but attention could be fleeting as traders turn to the midterm elections and the Fed meeting.

 

• U.S. Personal Spending Weak as Income Slips
  

 

Itineraries

 

The New Spa Treatment: Short and Sweet

 

By ABBY ELLIN 52 minutes ago

 

Hotel spas have tried to adjust to a downturn in business by scaling back in size, offering shorter treatments and trying to lure local residents.

 

Nokia Taking a Rural Road to Growth

 

By KEVIN J. O'BRIEN 2:55 PM ET

 

The cellphone maker will expand its agricultural data service to Nigeria as it continues its push into emerging markets.

 

DealBook

 

Exco Chief Makes $4.36 Billion Takeover Bid

 

By DEALBOOK

 

The company's chairman and chief executive is partnering with the billionaire Boone Pickens and the investment firms Oaktree Capital and Ares Management.

 

DealBook

 

Ambac Seeks Prepackaged Bankruptcy

 

By DEALBOOK 8:31 AM ET

 

The troubled bond insurance company said in a regulatory filing on Monday that it is in talks with creditors about filing a bankruptcy plan.

 

DealBook

 

McKesson to Buy US Oncology in $2.16 Billion Deal

 

By DEALBOOK

 

McKesson Corporation, the healthcare services and IT company, said Monday that it would acquire US Oncology in a deal worth $2.16 billion including debt.

 

Debt Collectors Face a Hazard: Writer’s Cramp

 

By DAVID SEGAL

 

Debt buyers used questionable tactics well before the recent foreclosure mess, lawyers say.

 

Lost the Remote? Another Reason to Use an App

 

By JOSHUA BRUSTEIN

 

The locus of control in the family room is being replaced, mostly by smartphones.

 

 

 

• ImClone Ex-Chief Embarks on New Biotech Venture
  
• Intel Takes a Wider Role, Making Chips for Others
  
• Spielberg and DreamWorks Energize the Magic Machine Anew
  
• Irish Court Backs 'Bad Bank' Structure 9:25 AM ET
  
• Nonprofits Rush to Solicit Donations via Text, but the System Is Flawed
  
• A New Search Engine, Where Less Is More
  
• Nation’s Political Pulse, Taken Using Net Chatter
  

[interestrateripoff]

http://www.telegraph.co.uk/finance/economics/8102785/Bank-of-England-must-use-QE-to-buy-bad-mortgages-warns-Fathom-Consulting.html

 

Britain is in danger of creating a generation of "zombie households" that plunge the economy into a Japan-style lost decade unless policymakers take radical action to fix the banking system properly, a leading economic think tank has warned.

 

In a paper published on Tuesday, Fathom Consulting has urged the Treasury and the Bank of England to join forces and create a new "bad bank" to buy lenders' worst mortgages in a bid to "unblock" the credit supply.

 

Outlining unprecedented policy measures, Fathom said the purchases should be done through a second round of quantitative easing (QE).

 

"Put simply, [banks] have lent too much money against assets that have fallen in value, and those losses have to be fully recognised. Until they are, the economy will not be free to move forward," Danny Gabay and Erik Britton argue in the paper.

 

Mr Gabay added: "Compare Britain today to Japan in 1997 and there's not much difference. They had zombie companies, we're in danger of creating zombie households."

 

Fathom argued that, like Japan's companies, many British households "are being kept afloat by near-zero interest rates, which can not last forever, at least not with a functioning economy".

 

Banks are not writing down the potential bad debt as low rates allow them to avoid the issue. However, Fathom says, lenders are aware they "remain vulnerable … hence credit supply will remain constrained".

 

Mr Gabay said Fathom's proposal offers a way for politicians to realize their conflicting ambitions of strengthening banks' balance sheets and simultaneously increasing lending to support the economy. He added that it has followed "extensive discussion with Monetary Policy Committee members and other interested parties".

 

Research from the Council of Mortgage Lenders found that 2.9m homeowners would have home loans that breached the regulator's affordability guidelines if rates rise by just 2 percentage points above the current of 0.5pc rate.

Fathom's analysis found that if rates were to rise to 3.5pc "the debt servicing burden would match its peak at the height of the crisis". Banks currently have a capital shortfall of about £20bn if assets were marked to market, Fathom added, but the shortfall would rise to £180bn if house prices were to fall by 20pc by 2012 – triggering another credit crunch.

 

Fathom said, recent data suggests that households are no longer paying off their debts as they grow used to low interest rates – potentially trapping policymakers with near-zero rates. To avoid this, Fathom said the Treasury should create a "bad bank" to buy non-performing mortgages from lenders – "in essence the Northern Rock plan writ large across the whole banking sector".

 

Er no your wanting to lend to support house prices and not the wider economy. The UK has to move away from the economy being house price increases.

 

Yet another insane idea, bailout malinvestment with free money.