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Credit Crunch (Other Biscuits Are Available)

geewizz
Grafter
Posts: 1,125
Registered: 01-08-2007

Credit Crunch (Other Biscuits Are Available)

To reply to the following quote would have taken the thread off topic, so I've started a new thread to discuss it.
Quote from: dialupnet
Secondly if you have not noticed, theres a massive credit crunch going on.

I certainly haven't noticed. I've heard lots of people talking about it and how the world economies are going to go into recession. I've also heard people saying for months that we are already IN a recession.
The thing is, the financial markets are wavering up and down and a few banks have gone bust but I see no evidence of a credit crunch. I just hear people talking about abstract numbers with currencies attached to them. This $700bn figure that the US governement (probably) intend to pump into the economy doesn't actually exist. What they are saying is that the government (representing the people of the United States) will back the economy (which belongs to the people of the United States but is run in trust by a few individuals) to the tune of $700bn in commodities. These commodities can be anything from buildings to $1.4tr worth of Mars Bars. And the same thing will happen around the world. The financial markets are simply agents for the trade of IOUs. Still, it beats carrying a pig into town on your shoulders for a few loaves of bread and getting your change in chickens.
So, is there a credit crunch? Is there really going to be a recession? Is there even going to be a slow down in inflation?
I'm going with no, no, yes.
13 REPLIES
techguy
Grafter
Posts: 2,540
Registered: 12-09-2008

Re: Credit Crunch (Other Biscuits Are Available)

The trouble is that if banks stop lending and credit dries up, individuals and companies won't spend and so this has an effect on the ability of a company to generate turnover and cover its costs let alone turn a profit.
In order to reduce resource costs the company will target its most expensive asset that is a fixed cost each month, its staff and of course this is where the trouble starts because they default on their commitments and thus it turns into a 'snowball' effect.
The governments are now trying to restore confidence in the system to get banks lending and customers and companies spending
Sure I won't shed a tear for the bankers who got into this mess but there is a lot of people that worked for the likes of Lehman Brothers that made the company work that are facing ruin.
Like it or not, banks are the engine of any economy.
Frankly, they should seize the ill gotten gains of the scum that got us into this mess, not turn to the taxpayer.
The unspoken Treasury motto
"There are some things money cant buy, for everything else there's the taxpayer "
Community Veteran
Posts: 1,850
Registered: 11-08-2007

Re: Credit Crunch (Other Biscuits Are Available)

first thing they could usefully do is shutdown all those casinos where they trade in rubbish at the expense of working business, junk bonds, futures, derivatives and the like.  the whole nature of investment and shareholding needs to change radically.  instead of buying shares and then expecting an annual dividend, the investment can carry a set amount of payback if the company invested in becomes successful and turns a profit.  the investment is returned, plus limited bonus and the company is free of debt.  it doesn't have to constantly concern itself with a huge bottom line to service an ever-increasing debt.
asset-stripping still goes on and has an appalling effect on the lives of lower-paid people.  this should stop.
it is not the business of government to run business.  it is the business of government to govern and they seem to have forgotten how.  businesses are allowed to muck about and then turn to the government for a bail-out.  strong expletive them.
we value all the wrong things.  we pay our agricultural workers rubbish money, yet we'd be in a parlous state if no-one was willing to work the long, hard hours to produce our food.
the people engaged in the useless practise of speculation earn far more than is reasonable.  if they haven't put money aside for the bad times, i have no sympathy when they lose their jobs.
techguy
Grafter
Posts: 2,540
Registered: 12-09-2008

Re: Credit Crunch (Other Biscuits Are Available)

I agree that regulation should be kept to a minimum but it appears that when the financial sector is allowed to self regulate, people will get away with what they can and have.
As I said, the companies and government know who these traders are and should be persuing them to recover some of the money.
People make mistakes yes but doing extremely risky things such as providing mortgages to people with no proof of income needs to be outlawed, not just against a finance institution's lending policy.
Community Veteran
Posts: 7,149
Thanks: 51
Fixes: 2
Registered: 30-08-2007

Re: Credit Crunch (Other Biscuits Are Available)

As a hypothetical scenario, put yourself in the position of the fat-cats who've it seems been at the core of this "crisis" and, hand on heart, stand up and say that you would not have taken the bonuses, intensives or whatever else was on offer, lived in the lap of luxury, and not given two-hoots for those less fortunate. I'm not defending them, I'm just pointing out that you and I would have taken "the shilling" if we'd had the chance. 
Experience; is something you gain, just after you needed it most.

When faced with two choices, simply toss a coin. It works not because it settles the question for you. But because in that brief moment while the coin is in the air. You suddenly know what you are hoping for.
Community Veteran
Posts: 38,244
Thanks: 933
Fixes: 54
Registered: 15-06-2007

Re: Credit Crunch (Other Biscuits Are Available)

Funnily enough I was in a position with one of my previous employers where they offered certain senior managers a very substantial hidden bonus for every member of our staff we could persuade to relocate 200 miles north.
I was one of the very few who refused to get involved but others did to the extent of making promises as to the future which weren't honoured.
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Credit Crunch (Other Biscuits Are Available)

I thought it was counted in Guinea's
Community Veteran
Posts: 38,244
Thanks: 933
Fixes: 54
Registered: 15-06-2007

Re: Credit Crunch (Other Biscuits Are Available)

Pieces of silver  Grin
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Credit Crunch (Other Biscuits Are Available)

No must be Gold Dubloons  (their all a load of Pirates)
geewizz
Grafter
Posts: 1,125
Registered: 01-08-2007

Re: Credit Crunch (Other Biscuits Are Available)

Quote from: Petlew
As a hypothetical scenario, put yourself in the position of the fat-cats who've it seems been at the core of this "crisis" and, hand on heart, stand up and say that you would not have taken the bonuses, intensives or whatever else was on offer, lived in the lap of luxury, and not given two-hoots for those less fortunate. I'm not defending them, I'm just pointing out that you and I would have taken "the shilling" if we'd had the chance. 

Nope. Smiley
And neither did my brother. He just got his redundancy from a city bank after several months of trying to get out. He disagreed with the way things were being done because he has a conscience. He could have made a lot of money by playing along but he made a moral judgement and refused to be responsible for the misery that would be caused by what they wanted him to do. He was pressurised but stood his ground. His working life was made miserable and they refused to let him go. He ended up with depression and threatened to take the bank to a tribunal. He is now enjoying 2 weeks holiday before he moves on to a new job.
I don't work for money either. Obviously I get paid but I could charge much more for what I do. I choose to work for a reasonable and mutually beneficial rate of pay. I have no ambition to be rich, just happy.
techguy
Grafter
Posts: 2,540
Registered: 12-09-2008

Re: Credit Crunch (Other Biscuits Are Available)


Here here geewiz
So long as I can pay my utilities, learn to drive and fuel my car, afford clothes and food and maybe the odd trip to the cinema/holiday that is all the matters to me.

pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Credit Crunch (Other Biscuits Are Available)

well if you want you can go back and edit it to remove the quote, it is also possible to modify the title if it is you thread, you ask GeeWiz he had a bad turn of that recently - nearly forgiven
Community Veteran
Posts: 7,149
Thanks: 51
Fixes: 2
Registered: 30-08-2007

Re: Credit Crunch (Other Biscuits Are Available)

@ geewiz. I bow to yours and your brothers integrity,
Experience; is something you gain, just after you needed it most.

When faced with two choices, simply toss a coin. It works not because it settles the question for you. But because in that brief moment while the coin is in the air. You suddenly know what you are hoping for.
techguy
Grafter
Posts: 2,540
Registered: 12-09-2008

Re: Credit Crunch (Other Biscuits Are Available)

Noted and corrected pierre