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    What started the credit crunch etc?

    I'm naive and quite thick lol. I'm trying to see where it all begun, but I can't really tell where, and I'm just wondering what started the downfall of all these companies?
    No insulting comments towards me please as I'm just trying to learn things!!! (Yes, I know English would be the first thing to learn for me...!)

    44 Comments

    All kicked off when the resources like oil etc started getting strangled.

    Higher prices = Less money to spend, Harder to pay off loans etc.

    No money = Stop buying things

    Stop buying things = shop go bust

    shops go bust = more expensive to buy more things

    So on and so forth. Its a lot more complicated than my post shows, but you get the general idea. A recession was pretty much inevitable sadly, and its gonna be a hard fight out of it.

    The banks along with us not spending enough, Plus Oil prices increased which increased cost of production along with other stuff.

    greedy corrupt American Bankers

    A guy called Morgan Stanley

    Original Poster

    Thanks so far for your posts, see I thought it was all to do when there were a few stories in the news that people had fiddled banks and other large companies out of millions of pounds/euros etc.

    midjet666;3952088

    Thanks so far for your posts, see I thought it was all to do when there … Thanks so far for your posts, see I thought it was all to do when there were a few stories in the news that people had fiddled banks and other large companies out of millions of pounds/euros etc.



    The banks were a lot to do with it. Because people and businesses werent paying their debts the banks stopped lending and forced premiums up. As soon as that happened - Critical hit to the economy.

    Debenhams and Next next??

    The greed of the utility companies. Have they dropped their prices? Nope. Petrol companies have though.

    The crash in house prices in the USA. Banks there were lending money to lenders with no income they are called NINJA loans- No Income No Job No Assets. A result of this crash banks stopped lending to each other as things got too risky and when they stopped lending there was no freely available credit and the result of that is the credit crunch!

    Here's a wiki quote and link ]Click

    A Ninja Loan is a type of subprime loan issued to borrowers with No Income, No Job, (and) no Assets. The phrase was coined by HCL Finance as a name for one of their finance products. They were especially prominent during the United States housing bubble of the 2000s but have gained wider notoriety due to the subprime mortgage crisis in July/August 2007 as a prime example of poor lending practices[1]. The term grew in usage during the 2008 financial crisis as the sub prime mortgage crisis was blamed on such loans. It works on two levels - as an acronym; and allusion to the fact that ninja loans are often defaulted on, with the borrower disappearing like a ninja

    brangelina;3952098

    Debenhams and Next next??



    I should imagine most multi-national companies should get through. Dont expect things to get any cheaper though.

    Banned

    it is mainly the publics fault but they don't like to admit it....

    bush essentially allowed the public to approve their own loan amounts and so people stretched how much they wanted to borrow, same in uk with 110% mortages ect and fixed rates for like 5 yrs ect.

    banks took these debts and repackaged them as bonds and sold them to other banks, who then repackaged them again and sold them on... each time making a little cut on top.

    lots of people started defaulting and so the bonds ended up worthless but banks didn't know who was losing out the most so stopped lending so freely.... and thid hurts businesses causing them to go bankcrupt.

    bottom line is... if the public hadn't got so greedy and tried to get so much credit then the banks would have stayed happy and kept on lending...

    crd67;3952101

    The crash in homes in the USA. Banks there were lending money to lenders … The crash in homes in the USA. Banks there were lending money to lenders with no income they are called NINJA loans- No Income No Job No AssetsHere's a wiki quote and link ]ClickA Ninja Loan is a type of subprime loan issued to borrowers with No Income, No Job, (and) no Assets. The phrase was coined by HCL Finance as a name for one of their finance products. They were especially prominent during the United States housing bubble of the 2000s but have gained wider notoriety due to the subprime mortgage crisis in July/August 2007 as a prime example of poor lending practices[1]. The term grew in usage during the 2008 financial crisis as the sub prime mortgage crisis was blamed on such loans. It works on two levels - as an acronym; and allusion to the fact that ninja loans are often defaulted on, with the borrower disappearing like a ninja



    That's just mental.

    Shengis;3952100

    The greed of the utility companies. Have they dropped their prices? Nope. … The greed of the utility companies. Have they dropped their prices? Nope. Petrol companies have though.



    Not true.

    The utility companies buy in bulk. If they bought a barrel for $100 then they need to make a profit. Fair enough it may be $75 or whatever now but they cant sell for that untill they buy for that.

    how come petrol prices down but my taxi fare went up by 30p today??

    edit to original post
    A result of these NINJA loans crashing the banks stopped lending to each other as things got too risky and when they stopped lending there was no freely available credit and the result of that is the credit crunch!

    brangelina;3952132

    how come petrol prices down but my taxi fare went up by 30p today??



    More traffic?

    Jo3l;3952122

    Not true.The utility companies buy in bulk. If they bought a barrel for … Not true.The utility companies buy in bulk. If they bought a barrel for $100 then they need to make a profit. Fair enough it may be $75 or whatever now but they cant sell for that untill they buy for that.



    Where do you buy a barrel of electricity or gas? Tell me they're not profiteering scum, better yet, show me some proof. The fact is petrol prices HAVE dropped, gas and electricity hasn't.

    Shengis;3952141

    Where do you buy a barrel of electricity or gas? Tell me they're not … Where do you buy a barrel of electricity or gas? Tell me they're not profiteering scum, better yet, show me some proof. The fact is petrol prices HAVE dropped, gas and electricity hasn't.



    You joking? :w00t:

    Electricity -> Needs turbines, powered by. FOSSIL FUELS.

    Gas -> Needs to be harvested and piped to you. Guess what. FOSSIL FUELS.

    Original Poster

    alright alright no arguing! I just wondered what had started it all and although I'm still a bit confused, it's not as bad as it was!!
    I'm going to bed now as I'm ker-nackered so I'll check back tomorrow and see what else has been said.
    Thanks again to all who have contributed xxx and night night xxx

    Jo3l;3952157

    You joking? :w00t:Electricity - Needs turbines, powered by. FOSSIL … You joking? :w00t:Electricity -> Needs turbines, powered by. FOSSIL FUELS.Gas -> Needs to be harvested and piped to you. Guess what. FOSSIL FUELS.



    And the raw price of fossil fuels has dropped.... Follow that thought.

    Banned

    tinkerbell28;3952114

    I think DSG may go, they expanded too quickly into Europe during the good … I think DSG may go, they expanded too quickly into Europe during the good times and have since just made their first loss. I don't think they are competitve enough either.............



    would be suprised if they do as they have a lot of customers paying on the never never so they are guaranteed regular payments from people each week ,month or whatever

    Shengis;3952169

    And the raw price of fossil fuels has dropped.... Follow that thought.



    BUT THEY CANT FOLLOW YET.

    They need to make a profit, until they shift all the oil they paid loads for they can start buying more lower priced oil.

    Im sure you'd be delighted when the power companies go bust, better yet have to be bailed out by the government, then force your taxes up.

    Jo3l;3952179

    Im sure you'd be delighted when the power companies go bust, better yet … Im sure you'd be delighted when the power companies go bust, better yet have to be bailed out by the government, then force your taxes up.


    Yeah I would. Renationalise the lot:thumbsup:

    Shengis;3952199

    Yeah I would. Renationalise the lot:thumbsup:



    You have my vote on that - most are foreign owned and are charging us more than customers in their own countries - look at EDF, EON and N-Power as prime examples.

    Banned

    crd67;3952101

    The crash in house prices in the USA. Banks there were lending money to … The crash in house prices in the USA. Banks there were lending money to lenders with no income they are called NINJA loans- No Income No Job No Assets. A result of this crash banks stopped lending to each other as things got too risky and when they stopped lending there was no freely available credit and the result of that is the credit crunch!Here's a wiki quote and link ]ClickA Ninja Loan is a type of subprime loan issued to borrowers with No Income, No Job, (and) no Assets. The phrase was coined by HCL Finance as a name for one of their finance products. They were especially prominent during the United States housing bubble of the 2000s but have gained wider notoriety due to the subprime mortgage crisis in July/August 2007 as a prime example of poor lending practices[1]. The term grew in usage during the 2008 financial crisis as the sub prime mortgage crisis was blamed on such loans. It works on two levels - as an acronym; and allusion to the fact that ninja loans are often defaulted on, with the borrower disappearing like a ninja



    +1

    Shengis;3952100

    The greed of the utility companies. Have they dropped their prices? Nope. … The greed of the utility companies. Have they dropped their prices? Nope. Petrol companies have though.



    +1

    Shengis;3952141

    Where do you buy a barrel of electricity or gas? Tell me they're not … Where do you buy a barrel of electricity or gas? Tell me they're not profiteering scum, better yet, show me some proof. The fact is petrol prices HAVE dropped, gas and electricity hasn't.



    +1

    Banned

    tinkerbell28;3952187

    But that's not being paid to them, the customers are paying back on the … But that's not being paid to them, the customers are paying back on the never, never to a seperate finance company. DSG get their money in a lup sum from the finance company on completion of the deal.



    thought they had their own inhouse finance

    i remember when id just turned 18 i went mad and bought a load of stuff from them on never never

    come to think of it i dont think i ever paid for it:whistling:

    It all started when the 'war' in Iraq and Afghanistan became very costly for all the major contributing forces, especially the USA and UK.

    Caused widespread instability across the world, knock on affect to the oil industry, which has a knock on effect on the prices of everything that derives from it, petrol, diesel, plastics etc....

    meanwhile over in the finance world, people got nervous because markets became less stable. Stock prices start becoming rocky and then rollercoasting. Large corporate greed results in dodgey practices and increased risk taking....we then step into the realm of consumer debt, heavy lending by banks to consumers/businesses, increasing the banks figures on papers, consumer/businesses gets cash that they cant pay back (banks know this as they are insured so knock on effect to the insurance industry and underwriters of large corporate finance institutions), consumer goes nuts with the cash/credit cards etc ladens themselves up with debt and start to default on their commitments, mortgages etc. Banks struggle to cope with the level of defaulted debt, they hang off for as long as possible and do some more dodgey dealing trying to sell off the debt. One bank finally has to come clean and hold their hands up...in steps government with billions of pounds of the taxpayers money that should be getting spent on the taxpayer improving services, police, schools etc but now less money for that so budgets are cut.

    Banks become less stable as they stop lending to each other on a daily basis to cover the short change until the next day, banks start to become in real danger of collapsing....very bad for the economy and public confidence.

    Banks start to call in their debts with other companies as they cant/wont/refuse to lend more money. Business start to collapse, people get made redundant, widespread job losses.

    and here we are today in the biggest pile of brown smelly stuff we've ever been in for many years. Tail between legs and kiss your **** goodbye scenario......and goodnight vienna baby :w00t:

    Happy New Year by the way :w00t:

    Banned

    blame the fat cat million pound bonuses.....

    Jackie Chan;3952339

    Click the links there's nothing racist or hateful, just quotes from … Click the links there's nothing racist or hateful, just quotes from washington, martin luther king, jesus, and churchill + further reading:thumbsup:



    How the **** can you get a quote from Jesus? LOL

    He didnt speak ada English my friend, he spoke Aramaic. :lol:

    Wtf???

    Shengis;3952362

    Wtf???



    Dont m8, he's in the middle of some psychotic episode and a crusade against the whole world... :lol:

    Not an unbiased website Mr Chan - I do hope you don't believe everything you believe you read on the internet!
    The Stormfront White Nationalist Community is a white supremacist,[a] neo-Nazi[b] Internet forum that has been described as the Internet's first major hate site,[c] and the first and most popular racist website.
    ]http//en…te)

    PS I think you'll find that Jesus was Jewish!

    StevenA2000_uk;3952366

    Dont m8, he's in the middle of some psychotic episode and a crusade … Dont m8, he's in the middle of some psychotic episode and a crusade against the whole world... :lol:



    Oh, so by his own definition he must be a jew :lol:

    Shengis;3952371

    Oh, so by his own definition he must be a jew :lol:



    LOL :lol: Nice one.

    Banned

    lmao everyone knows jesus was black

    casparwhite;3952380

    lmao everyone knows jesus was black



    According to the Uncle on Goodness Gracious Me - he was Indian!

    Shengis;3952371

    Oh, so by his own definition he must be a jew :lol:



    I am?
    **** gone to commit hara kari,

    casparwhite;3952380

    lmao everyone knows jesus was black



    Apart from the church ;-)

    Banned

    harri krisna?

    Jackie Chan;3952330

    sorry but it was [SIZE="4"]]JEWISH GREED[/SIZE] read more interesting … sorry but it was [SIZE="4"]]JEWISH GREED[/SIZE] read more interesting ]facts herek bye




    crd67;3952369

    Not an unbiased website Mr Chan - I do hope you don't believe everything … Not an unbiased website Mr Chan - I do hope you don't believe everything you believe you read on the internet!The Stormfront White Nationalist Community is a white supremacist,[a] neo-Nazi[b] Internet forum that has been described as the Internet's first major hate site,[c] and the first and most popular racist website.]http://en.wikipedia.org/wiki/Stormfront_(website)PS I think you'll find that Jesus was Jewish!



    When all else fails quote WiKi!
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