The manic markets and credit crunch appear to have claimed their latest victim with the imminent announcement that the Bradford and Bingley will follow the footsteps of the Northern Rock down the route of Nationalisation.
The Chancellor is expected to announce at some time before the markets open tomorrow that the Government are going to step in to save the stricken financial institution.
The cause of its demise appears to be the large number of risky mortgages especially buy to let mortgages which are currently seeing a higher than expected number of bad debts. The fall in property prices has not helped the situation as even if people default and the B&B repossess the property they are unlikely to be able to recover all the money they lent.
The Bradford and Bingley has about 2 million savers and whilst the scenes witnessed under the Northern Rocks demise have not been repeated thanks to the Government's Financial Services Compensation Scheme. This guarantees everyone who has savings of less than £35,000 with the B&B that they will get their money back should the business go bust. However, as the bank is expected to be nationalised then even if you have more than £35,000 is savings it is unlikely you will lose out unless the Government goes bust.
The news of the B&B coupled with other financial stories in Europe and the USA are likely to lead to another roller coaster of a ride for shareholders.
Sunday, September 28, 2008
Wednesday, September 17, 2008
Financial meltdown
What a shocking last few weeks for those involved in the financial industry, firstly we had Lehman Brothers, the fourth largest investment bank in the US filing for bankruptcy then we had Merrill Lynch, another big US investment bank being taken over by Bank of America and now in the UK we have HBOS about to be taken over by Lloyds TSB.
The stock markets have been on a downward spiral with the FTSE 100 closing at its lowest level for about 3 years whilst stockmarkets around the world have also been badly effected. The Russian stock exchanges have been suspended and have fallen 60% since their high back in May 2008.
The whole world appears to be affected and it makes you wonder if you are better simply putting your savings under the mattress rather than invest them in shares or is now the time to buy shares as how much lower can the markets fall before they bounce back up?
The stock markets have been on a downward spiral with the FTSE 100 closing at its lowest level for about 3 years whilst stockmarkets around the world have also been badly effected. The Russian stock exchanges have been suspended and have fallen 60% since their high back in May 2008.
The whole world appears to be affected and it makes you wonder if you are better simply putting your savings under the mattress rather than invest them in shares or is now the time to buy shares as how much lower can the markets fall before they bounce back up?
Friday, September 12, 2008
Energy saving package
Gordon Brown has recently announced an energy saving package that will cost £910m. The money is to be used to help people who are struggling to cope with the spiralling cost of electricity and gas prices.
The package offers half price insulation for all UK households as well as several offers aimed at the old and poor including free cavity wall and loft insulation and an increase in cold weather payments.
The government expects the large energy companies to pay for the package but one wonders where they will get the money from - I can't see their shareholders taking a dividend cut, or their directors taking a pay cut, however I can see them increasing the costs of gas and electricity to recover their costs - a sort of giving with one hand and taking away with the other - of course I could be wrong but if the energy companies wanted to be generous why not just reduce prices?
The package offers half price insulation for all UK households as well as several offers aimed at the old and poor including free cavity wall and loft insulation and an increase in cold weather payments.
The government expects the large energy companies to pay for the package but one wonders where they will get the money from - I can't see their shareholders taking a dividend cut, or their directors taking a pay cut, however I can see them increasing the costs of gas and electricity to recover their costs - a sort of giving with one hand and taking away with the other - of course I could be wrong but if the energy companies wanted to be generous why not just reduce prices?
Monday, September 08, 2008
No Derybshire or Cheshire windfalls
It now looks likely that the members of both the Derbyshire and Cheshire building societies will receive no windfall payments even though they have affectively being taken over by the Nationwide.
According to the Nationwides website "in order to preserve capital within the enlarged Nationwide for the benefit of its combined membership there will be no distribution to Derbyshire's or Cheshire's members. Members of The Derbyshire and The Cheshire will benefit from the security of joining the UK's largest building society".
The days of the carpetbagger which looked as though it might make a revival after the Nationwide merged with the Portman now looked completely unlikely to reappear.
According to the Nationwides website "in order to preserve capital within the enlarged Nationwide for the benefit of its combined membership there will be no distribution to Derbyshire's or Cheshire's members. Members of The Derbyshire and The Cheshire will benefit from the security of joining the UK's largest building society".
The days of the carpetbagger which looked as though it might make a revival after the Nationwide merged with the Portman now looked completely unlikely to reappear.
Sunday, September 07, 2008
Nationwide mergers
Apparently the Nationwide Building Society is in advanced discussions about taking over two smaller building societies namely the Cheshire and Derbyshire.
This could mean bonuses for members of the Cheshire and Derbyshire if the Nationwide is successful. Last year the Nationwide merged with the Portman building society and each Portman member received a windfall payment of between £200 and £1,000.
The current credit crunch has affected financial institutions such as the Northern Rock badly and it could be the smaller societies are struggling to cope or alternatively the Nationwide could be looking to expand its branch network in Cheshire and Derbyshire whilst at the same time remove two of its local competitiors.
This could mean bonuses for members of the Cheshire and Derbyshire if the Nationwide is successful. Last year the Nationwide merged with the Portman building society and each Portman member received a windfall payment of between £200 and £1,000.
The current credit crunch has affected financial institutions such as the Northern Rock badly and it could be the smaller societies are struggling to cope or alternatively the Nationwide could be looking to expand its branch network in Cheshire and Derbyshire whilst at the same time remove two of its local competitiors.
Wednesday, September 03, 2008
Turning junk into cash
As the credit crunch continues to bite lumps out of the cash in peoples pockets one popular way of biting back is to sell some unwanted clothes, books, DVDs, toys or any other items that you have that are no longer used.
This used to be done via car boot sales but since the arrival of ebay and other online auction sites these online sales are by far the most popular method.
Online costs for the seller generally include a listing fee, a feature fee (if you want additional features such as bold headings, more pictures etc) and a final value fees (this is a percentage based on the selling price).
In order to create some extra auctions ebay have decided to reduce listing fees to only 5p on Thursday 4 September so if you were thinkig of clearing out that cupboard be quick and list the items tomorrow and turn that junk into cash.
This used to be done via car boot sales but since the arrival of ebay and other online auction sites these online sales are by far the most popular method.
Online costs for the seller generally include a listing fee, a feature fee (if you want additional features such as bold headings, more pictures etc) and a final value fees (this is a percentage based on the selling price).
In order to create some extra auctions ebay have decided to reduce listing fees to only 5p on Thursday 4 September so if you were thinkig of clearing out that cupboard be quick and list the items tomorrow and turn that junk into cash.
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