Monday morning

[Satch]

and I think I might as well go back to bed and wait for some good news from the US.

Been out of touch for a bit in the wilds and return to find:

Bradford and Bingley sold off to the Dons for a pittance leaving us (i.e taxpayers )with the dirty end of the stick. Santander also owns Abbey National together with Alliance and Leicester, so perhaps Trafalgar Square will have to be renamed soon.

Fortis Bank bailed out (well maybe) by three European Governments who are more than a tad anxious

German property company Hypo Real Estate gets emergency funding making most of the German banks looks very sick in the process.

Now Glitnir Bank ( Icelandic) bailed as well. Who cares you cry? Well any of you who have put money into Kaupthing Bank, who have been marketing really hard in the UK and offering 7.15% on deposits. Now you know why.

Meanwhile, back in the US Wachovia, which last week was supposed to be taking on Morgan Stanley to save it, is now seeking to jump in bed with Wells Fargo because it was stupid enough to fork out $24 Billion a while back for "Golden West Financial Corp." a rubbish California mortgage lender that lent even stupidly than most and now has a terrible default rate.

Morgan Stanley, which last week saw a third of its prime brokerage asset vanish as clients legged it, is now looking to Mitsubishi Bank again, who have already taken up a 20% stake.

And it is not even lunchtime!

 

[kikkthecat]

It seems nice work to me that banking malarkey. Get it right and pocket the big rewards, get it wrong and the taxpayer bails you out.

I wonder if I can get that kind of deal for Newmarket on Saturday ?

 

[Ted]

Looks like Motorworld may haver gone under........

 

[oldcro]

Put all the Bankers (hope that is the correct spelling) in jail. They had a duty of care looking after peoples savings and abused that duty while paying themselves huge a bonus.

Remember all the wealth of the world is made by people who make things, produce things and add value to things. Banks, insurance companies and stock brokers etc. just shuffle the cash around while taking a large percentage for themselves.

 

[st4]

Put all the Bankers (hope that is the correct spelling) in jail. They had a duty of care looking after peoples savings and abused that duty while paying themselves huge a bonus.

Remember all the wealth of the world is made by people who make things, produce things and add value to things. Banks, insurance companies and stock brokers etc. just shuffle the cash around while taking a large percentage for themselves.

A slightly niave point of view but never mind....

I do agree there has been some major failings in the financial sector, and as a result of a "globalised economy" one does feel the pinch of bad practices going on in America, and some of our own institutions have been involved.

However you surely have knowledge of the money creation process, so without any financial institution the money supply simply wouldn't grow

Just remember these bankers who have these fat bonuses, they're taxed, and that goes into the states coffer so I wouldn't for the state of UK PLC want to regulate out the bonus culture.

 

[Satch]

Just thought you like to know that Iceland is finally about to sink under the weight of debt. Borrowing by the three big Iceland banks now amout to 500% of GDP.

Bauger is in a world of trouble now as many of their borrowings flow through the Stodir (in administration) and Giltner Bank (bust) chain are secured on their properties and businesses. Stand by for turmoil of the UK High Street: major shareholder and finance provider gone down the tubes so who is going to buy those in the current market at anything other than fire sale prices?

http://www.ft.com/cms/s/0/36513eee-8e29-11dd-8089-0000779fd18c.html

A company linked to Baugur, the Icelandic investment group, filed for administration on Monday as the fallout from the nationalisation of Glitnir, the Icelandic bank, threatened to reach the British high street.

Stodir – formerly known as FL Group – was the biggest shareholder in Glitnir and said on Monday it had filed for administration after last year making the largest loss in Icelandic corporate history.

The investment company, controlled by Jon Asgeir Johannesson, said in July that it had acquired a 39 per cent stake in Baugur, the group that owns a swathe of UK retailers from Karen Millen to Hamleys.

Mr Johannesson is executive chairman of Baugur. Neither Stodir nor Baugur was immediately available for comment. However, a source close to Baugur said the deal for Stodir to take 39 per cent of Baugur was yet to complete and the company had no stake.


”The application will be taken before the court today and an authorisation for the moratorium granted and administrator appointed,” said Stodir in a statement quoted on Reuters.

It was unclear what repercussions the administration of Stodir would have for Baugur and its large number of UK retail investments.


In April Baugur had sought to make a clean break from property and Icelandic banks by shifting its exposure to two new, separate companies and highlighting its focus on non-Icelandic retailers.

Baugur said at the time that it was selling to ”two new independent companies” its stakes in FL Group, which holds shares in banks and property, and separate media and technology assets for a total of £430m in cash and loan notes.

But although the two new companies, Styrkur and Stodir, were separate from Baugur they have a similar ownership structure to Baugur itself, which is majority owned by Mr Johannesson, executive chairman and co-founder, and his family.

FL Group said at the time that it would not be affected by the change in its biggest 37.2 per cent shareholder as it would continue to be ”controlled by the same people”. Gunnar Sigurdsson, chief executive of Baugur, confirmed that Mr Johannesson and his family had a majority stake in the new companies but said that a ”substantial part” of the £430m transfer was in cash.

Baugur has faced repeated questions about its indirect exposure, via Stodir, to Glitnir as well as its general funding position amid turbulence in the Icelandic economy centred on the financial sector.

Mr Sigurdsson said the deal ”had nothing to do with a lack of faith in those underlying assets”.

Just take a squint at what they own or have significant stakes in. Then remember it was all done on debt

http://baugur.com/

 

[Seamster15]

Looks like Motorworld may haver gone under........

Yep, their website just says "offline" oh dear.

 

[bigk]

Just thought you like to know that Iceland is finally about to sink under the weight of debt. Borrowing by the three big Iceland banks now amout to 500% of GDP.

Bauger is in a world of trouble now as many of their borrowings flow through the Stodir (in administration) and Giltner Bank (bust) chain are secured on their properties and businesses. Stand by for turmoil of the UK High Street: major shareholder and finance provider gone down the tubes so who is going to buy those in the current market at anything other than fire sale prices?

I bet you everyone in the financial sectors are saying 'Bauger' quite a lot at the momment!!

 

[Satch]

Last year all you had to do with a dog retailing stock was to link it with Bauger and watch the price lift off.

Questions have always surrounded the whole outfit, especially Jon Asgeir Johannesson:

"He resembles a 1970s heavy metal guitarist, with his flowing locks and fondness for black clothing. And his deep dislike of personal publicity has done little to keep his name out of the headlines.

He has fought a long court battle over allegations of fraud. He has talked about an overfondness for booze and there were wild allegations in a Miami courtroom in 2003 about exotic parties on a yacht. All were firmly denied by Baugur. "

"Icelandic business has never shaken off allegations, always firmly denied, that its startling incursions into the UK might have relied on some odd sources of funds. Iceland has a population of 300,000, but companies there have bought heavily into areas such as retailing and stockbroking, apparently out of all proportion to the size of the country.

Some have highlighted the convenient air travel between Reykjavik and Moscow. But no firm links have ever been established. "

http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article3026166.ece

 

[Benzowner]

Does this not go to prove that governments really have no financial control over their nations, it is the unelected bankers who have all the control, or maybe not even them

 

[Corrado]

Oh great . Heard on R4 that Nationwide Building Soc have to shoulder a substantial part of the burden to bail out the Bradford and Bingley pirates .

Small fry, perhaps, in today's billions, but I'm not a chuffed bunny.


Been a lovely sunny day though

 

[Satch]

Does this not go to prove that governments really have no financial control over their nations, it is the unelected bankers who have all the control, or maybe not even them

No Government ever has control. Lots of thoughts on the subject of course, such as that which says the Bilderberg Group rules the world.

Truth is that history and international fiscal events are not subject to the Conspiracy Theory nor the C0ck Up Theory.

It is all the result of a series of c0cked up conspiracies coupled with an increasing trend to hubris, greed, stupidity and near limitless human capacity for individual and collective self delusion.

Tips for the future? Go long cash, get lots of supplies laid in, arrange alternative heating sources and make sure you have plenty of ammo.

 

[jaymanek]

Looks like Motorworld may haver gone under........

yep bankrupt... all stores closed last week.

 

[oldcro]

A slightly niave point of view but never mind....

I do agree there has been some major failings in the financial sector, and as a result of a "globalised economy" one does feel the pinch of bad practices going on in America, and some of our own institutions have been involved.

However you surely have knowledge of the money creation process, so without any financial institution the money supply simply wouldn't grow

Just remember these bankers who have these fat bonuses, they're taxed, and that goes into the states coffer so I wouldn't for the state of UK PLC want to regulate out the bonus culture.

On your first point I would say MANY major failings have occurred in the financial sector.

Secondly I never suggested we do not need financial institutions, but a few who put the customer first would help

Thirdly it is the farmers, miners and factory workers of the world who provide the cash to pay fat bonuses of the bankers. To my mind I think it is naive to think UK PLC relies on idiots who lend my money to someone who cannot repay it and get a fat bonus for doing so. The factory worker earns a bonus by producing more and that puts more money into the countries coffers.

That is my opinion which is just about all I am entitled to these days.

 

[Dieselman]

However you surely have knowledge of the money creation process, so without any financial institution the money supply simply wouldn't grow

Isn't the growth of money supply what's causing the current problems. It was only paper money with nothing to back it.
Now the debt has been called in there is nothing to pay it with.

Why do we need a growth in money supply, other than to give cheap lending which then fuels inflation.?
Payday comes for all debts eventually.

 

[oldcro]

Isn't the growth of money supply what's causing the current problems. It was only paper money with nothing to back it.
Now the debt has been called in there is nothing to pay it with.

Why do we need a growth in money supply, other than to give cheap lending which then fuels inflation.?
Payday comes for all debts eventually.

Our banks need a growth in money supplies so they can buy more American banks debts which stand little chance of ever being repaid.:bannana:

 

[DITTRICH]

Well, Well, Mr Satch

It's now "not even bed time" and the US House of Representatives has just rejected the USD 700 squillion bailout for "toxic" assets. Rejected by quite a margin. The markets are all now in La-La land.

Les

 

[Ted]

Auto Windscreens in trouble....... (cutting back on jobs)

 

[st4]

Isn't the growth of money supply what's causing the current problems. It was only paper money with nothing to back it.
Now the debt has been called in there is nothing to pay it with.

Why do we need a growth in money supply, other than to give cheap lending which then fuels inflation.?
Payday comes for all debts eventually.

It was actually bad debt, but the basic concept of money supply/growth is a good one.