Posts Tagged ‘Housing’


September 18, 2015

Anyone interested in  setting up a housing co-operative to buy housing to then rent to our members along the lines of the idea below ?

My idea is to simply set up an organisation which would continuously seek crowdfunding  for redeemable shares offering (at present) about 3-4% which would be used to purchase rentable homes. The redeemable shares would enable savers currently offered laughable savings rates by the banks to be able to use this as a safe and reliable method of  savings offering much better returns than banks.

The tenants to which these homes would be rented  would also share in the profit their rent ultimately generates as it pays off the purchase cost. The whole idea is to enable the tenants to build up a sum of money from the profits of the organisation for them to use as a deposit to buy their own home.

If the funds borrowed to 100% fund the purchase are fully repaid by means of charging rent, at the end of a term similar to an average type of mortgage of, say 25 years, then at that point the organisation would own the asset outright. It would obviously then be able to offer a portion of the value of that asset to the tenant.

This portion would accrue from the moment the tenant commences paying rent and would be available to the tenant whenever he leaves  which could be at any time. He does not have to remain any longer than any initial short tenancy.

The tenant would always be paying a ‘market’ rent the same as any other tenant. But he would be getting something back that no other tenant ever does. He will be getting back a portion of the rent he has paid which he can then use as his deposit to go and buy his own home with an ordinary mortgage if he so wishes.

Instead of just paying rent to line a landlord’s pocket, tenants would get something back so their rent would be not completely wasted money dow the drain as it normally is for all tenants.

This model would thus enable a person with no capital whatever to accrue a deposit for their own home purchase, or even use this organisation to end up either a long leaseholder on  low rent if he wished to remain in the property. It could almost be viewed as a means of just turning an ordinary rental into a (different) type of mortgage for the ultimate purchase of a home. A mortgage where no deposit is needed at all. It’s just a rental that eventually just turns into actual home ownership.

It offers a means of home ownership which dis-enfranchises no-one and whereby any tenant turns progressively into an owner.

If set up as the legal concept of a Co-op, it is legally allowed to ask the public to invest in redeemable shares which  would pay an interest rate which might currently be 3-4%.

This is just a brief description of the idea, obviously there is a lot of detail to ramble on about, but I’ll leave that for  the moment as it isn’t needed until people want to know more and join.

Oh, by the way. I have spent a lot of time doing all the maths and the idea does work. You can have a look for yourself if you are interested & contact me.

With the help of the crowdfunding crowd, we can cut the legs of those greedy bankers and eventually take all their mortgage business away from them so that every penny people pay to live in a home goes directly towards actually paying for that home and not the huge profits for  greedy bankers.

This idea has wings; it could take off and fly !

leave a comment if you’re interested !



March 9, 2015

8th March 2015

I’ve just seen a TV programme about three single mothers being homeless and the utterly filthy way they are treated by their local councils. (BBC one March 3rd 2015 –  ‘No Place to Call Home)  see it here:

One woman & her two kids had been forced to leave the privately rented flat she was renting because the boiler broke  and the typically nauseating private landlord simply refused to mend it. So this single mother arranged to live with her own mother in the mother’s council house.

But the council found out and told the mother she would be evicted from her own council house herself if she continued to allow her daughter & two kids to stay with her as the council said that made the council house overcrowded.

As the threat from the council now meant the mother, daughter and two kids would all be thrown out on the streets to be homeless by this spiteful and vindictive council, the mother had no choice but to tell her own daughter to leave.

This made the daughter and two kids ‘street homeless’- they had absolutely nowhere to go except live on the streets because they could not find private accommodation they would be able to afford quickly enough, if at all, as rents were nearly all far higher than they had any hope of being to afford – even if they received ‘Housing Benefit’.

Housing benefit has been cunningly arranged by this disgusting Tory Government to be too low for tenants receiving it to have much hope of finding any privately rentable accommodation.

So, this single mother is obliged to inform the council she and her young children will be on the streets, and could the council therefore re-house her as the law says it has a legal obligation to do.

No, said the council. We know we have a statutory duty where an Act of Parliament says councils have a legal obligation to house homeless parents with children, but we’re not going to. And we’re not going to because part of that same Act of Parliament says that if a person has made themselves ‘intentionally homeless’ we are allowed to refuse people we would otherwise have a legal obligation  to re-house.

So we are telling you, single mother with two young kids, that we think you are intentionally homeless and you can go F**k yourself; we’re not going to house you.

The Council used the Alice in Wonderland logic that this single mother was “intentionally homeless’ because she had ‘voluntarily’ left ‘her previous accommodation’ the privately rented accommodation with it’s broken boiler the private landlord refused to mend  with winter approaching.

The council seemed to have a convenient memory lapse in forgetting it was the council itself which had forced her own mother to evict her daughter, throw her out onto the streets with her kids  by threatening to make all of them homeless by taking the council house away from the woman’s own mother. This is a brutally corrupt piece of pure Kafkaesque wickedness on behalf of the council.

Another single mum with three kids had been evicted by her private landlord as revenge because she had asked him to do essential repairs like stop the excessive dampness which was making all the walls and ceilings covered in black mould – which is dangerous to health as it produces lung disease. She was intentionally homeless too, said the council.

I know of another single parent evicted from their house by the fraudulent USA bank Lehmans, who went bankrupt after causing the recent World wide recession by their criminally  dishonest, immoral, grasping and evil banking activities.

The council told that parent too they were ‘intentionally homeless’ on the grounds they shouldn’t have bought their house several years previously by using a mortgage as ‘they ought to have known they would be unlikely ever to work again because they were a single parent’.

I know the councils up and down the country are actually breaking the law ( I’ve checked the legislation) by using this ‘intentional homeless’ nonsense in the way they are, but more of that later.

Then I saw today’s (8th March 2015 BBC) news rabbiting on about the sixty thousand homeless people in New York right now, enduring the coldest winter weather, lots of ice & snow, for decades. New York is always very cold in winter anyway, so this must be awful if you’re living on the streets.

Then the news item featured a single mum in her early thirties working in the financial industry who still didn’t earn enough to afford the stratospheric rents of New York, so she was sharing  hostel accommodation with other homeless families.

This housing crisis is almost entirely caused by the banks ramping up the price of housing so they can lend ever larger sums of money. Housing in the UK is now about eleven times an average salary instead of the three times it was in about 1970 – before the greedy banks got into the business of mortgage lending by destroying most of the building societies.

But what should a house really cost do you think ? The average (slightly approximate) cost of building a new house is about £1200 a square metre. And the average British rabbit hutch of a new house is now only 76 sq metres, not big enough to swing  a cat, (see Daily Mail story here –  ).

That would cost £91 200 to build, plus the extra cost of buying the land on which it stands. Agricultural land averages about £10 000 at the moment and with at least 16 tiny little rabbit hutches to the acre the land should cost a miniscule £62 or so, and it did a couple of generations or so ago.

But of course today, the bureaucracy and corruptions of the entire housing market and in particular that Orwellian gem of corruption ‘planning permission’ has made a nonsense of land value to build housing on and consequently it can cost millions per acre.

Apparently the average cost land with building permission per acre is now about £800 000 which makes one building plot to build a tiny rabbit hutch of a house on with the average of 76 sq metres for this type of house, is now about £50 000.

So after adding that extortionate £50 000 cost of the building plot to the build cost of  £91 200 we get the total cost of a new house for £141 200. Actually the average price is about twice that at present. That will be the £141 000 profit for the house builder then !

But, whatever the price new, shouldn’t the cost of a second hand house decrease at least a bit over time just like other second hand, used goods ?

Errrrrr, yes, I should think it ought to and certainly did before property started to become a good wheeze for Spivs & speculators from about 1950 onwards.

So, take my ordinary four bedroomed London terrace house of 200 square metres which would cost about £240 000 to build new today, plus the average cost of £50 000 for the plot of land, that would be £290 000 built new today. But actually the current value is about £1.4 million.

Anyway, back to the real cost of building it at £290 000. If the house lost just one half per cent a year in value ( about £1500 in the first year) the 135 year old house would have lost 67% of its original cost and would be about £194 300 to buy today. Or that rabbit hutch house costing £141 200 today would cost about £94 604 when 135 years old; (except it will never get to be 135 years old because that type of house is generally built so badly & shoddily it is unlikely to have life of barely more than 20 years).

So this example means over a theoretical life of a house off 200 years each inhabitant pays a modest half percent cost of the total building cost which  is £1 500 a year towards the building cost of the London house costing £290 000 to build in 2015. But instead, if you rent that same house today in London you will be paying the 6% of the 2015 ‘value’ the house has of £1 400 000 that landlords expect to rent homes out to tenants for and this will be a cool £84000 a year rent you will paying instead of £1500 previously mentioned.

That’s what it used to be like for centuries until the modern era, when the banks made houses repositories of value, rather than real homes to live in.

Bastards !

So, what with the builders building revoltingly cheap and nasty miniature homes too small even to contain normal necessary possessions and making extortionate profits of up to 100% and even higher, and the banks making billions of pounds out of expensive, often rip-off loans to people to buy homes, the entire country is in the icily corrupt grip of a bunch of thieving sharks really. And at the bottom are the people being forced to live on the streets or in repulsively inhumane  council ‘emergency accommodation’.




April 15, 2013

April 15  2013

I have an idea !

Well, actually, I partially nicked it from the Co-op movement. It is already up and running; I just want to do it bigger & better, so to speak.

I want to organise an alternative way of  both renting and buying a home. The idea would be to make it easier and cheaper to either rent or buy, completely bypassing the banks and other traditional mortgage lenders or private landlords.

It will almost certainly be a housing Co-op which would be a non profit making organisation with members having an equal say and equal voting rights in how it is run.

My ambition, ideally, is to set up an organisation which will ultimately attract money from Joe public (internet based crowdfunding ?) to assist it’s funding and it will tap the usual mortgage lenders available as well. As time goes on  the organisation will be able to build up it’s own capital and increasing funding abilities. The general aims are:

– To offer an infinitely more reliable and attractive rental model than the vagaries of the current private landlord  buy to let market, whereby tenants can choose to remain tenants on  exceptionally attractive terms compared  with what is currently available in either the private rental market or the social housing market, or they can become homeowners utilising only their rental history if that is their only source of funding.

– To enable tenants to become homeowners by means of using their rental incomes in an appropriate manner, probably exactly similar to a rare but existing model already set up by a housing co-op.

– To actively expand the organisation as far and wide as possible to make it very widely available – ultimately ideally throughout the country.

– To use marketing and publicity skills to do this in order make the public widely aware  of an alternative method of a more ‘user friendly’ concept of accessing housing, sweeping away much of the expensive nonsense which has been largely generated during the past few decades in both the rental market and the house purchase market.

The housing market, whether buying or renting, was utterly different sixty or seventy years ago. Since then layers of utter nonsense have been imposed on it, making it increasingly expensive to either rent or buy. Most of this expensive, restrictive & thoroughly poisonous nonsense has been driven directly and indirectly by the banks who have been the architects responsible for shaping the entire housing market as it currently stands.

Because of this the cost of buying a house has soared from about three times  a person’s annual income to about ten or eleven times today. Equally, rental costs have soared to unaffordable levels too. The only beneficiaries are really only banks and private landlords. All other classes of home occupiers are disadvantaged and will continue to be so until something changes this.

All this is only likely to get worse until the stranglehold of the banks on the housing market is broken. The only way this can be achieved is to provide the sort of alternative I have in mind, whereby, ultimately, funding for housing will be increasing taken away from the banks and put into the hands of existing homeowners and ‘Joe public’ who will find it attractive to place savings to be used to fund home purchase because their savings will be safer than with banks and return a higher amount of interest on any loans made for home purchase than the banks normally pay to savers.

It becomes possible to understand this can be done simply by imagining a private landlord setting up in business to borrow money to buy homes to rent to people and instead of the profit becoming  owned by the landlord, the profit is used only to expand the business and enable the tenants to both rent on far more attractive terms than elsewhere or to eventually own their own home.

I would wish to explore the possibility of turbo boosting what I have in mind by enrolling high profile help from others. Possibly, for example, certain existing housing trusts, charities and others to be considered in due course.

There are ‘social lenders’ out there who lend at low interest rates for housing purposes. And, interest bearing shares can be marketed in a ‘Community Land Trust’.

Is anyone interested in becoming involved in this ?

Here are some interesting web sites to have a look at.

Leave a comment if you might be interested in becoming involved in any way – either by becoming a member or just helping to organise it.

CHILDREN – BANNED ! (Nasty, Pesky Things – Keep Them Them Out of Sight)

August 28, 2009

I just heard the most extraordinary thing ! My eleven year old son’s schoolmate just came to our house to ask him out to play today. He casually told my son he wouldn’t be able to visit him when their family moved into their newly rented house because the landlord had banned any children from being allowed into the house his parents were renting !

Think about this for a moment. An ordinary middle class, very civilised family, both parents working in extremely well paid jobs and with two sons of eleven and fourteen. They decided to sell their own house and rent a house from a private landlord for a year while they look for something attractive to buy.

They find a suitable four bedroomed house in an attractive village in Sussex and they would like to pay the fifteen hundred odd pounds a month to rent it for their family of four for a year.

But the landlord says other children are not allowed to be in the house. How utterly insulting this idiot landlord is. Why does he think he has a right to impose his warped, narrow minded, busybody control freakery on other people ?

What a pathetic, sad individual he must be ! No doubt he must be one of those dreadful people employed by the government whose full time job it is to be an interfering bureaucrat of some sort; paid a high salary to be an official professional control freak on one of those Labour Government pointless job creation schemes that squanders billions of pounds of our money.

Perhaps it is this that gives him delusions about telling people who rent his house what sort of people they can socialise with.

It does seem the countless horde of Labour Government employees – now most of the workforce and still rising – are living in a fantasy World where they all have the delusion their duty is to tell the rest of the population exactly what to do every minute of their lives; to control everyone with a positive blizzard of forms and tickboxes. Databases for everything and everyone with lists of all the details of the entire population’s daily lives. Video cameras malignantly following your every move, wherever you go. A Police State monitoring you, threatening constant arrest and State sponsored violence and thuggery whatever you are doing at the time, however innocent it might be.

My own son has been mercilessly persecuted by the goody goody interferers of the bizarre anti-child brigade ever since I moved to this Sussex market town seven years ago.

– A visit from the police after a member of the public reported my then ten year old son being seen playing in the park ‘too often’ and observed holding small cans of some sort in his hands. I was asked if this meant he was a graffiti sprayer because the cans might be spray paint. They were soft drink cans.

– Reported to social services by the headmaster of the boy’s school when an officious idiot of a teacher told him my then eight year old boy was actually allowed to go and play in the nearby park all by himself without an adult being with him.

– The subsequent visit from a social worker who told me that no child under the age of fourteen should ever be allowed out without an adult being with them !

– The retired ex-headmaster of the local secondary school who is the Chairman and gimlet eyed controller of my allotment association telling me allotments were actually dangerous places for children and they were not allowed there unless their parents rented an allotment.

Even then they were absolutely forbidden to leave their parents allotment and go anywhere else on the site. In addition, the allotment rules would not even allow children on their own parents allotment unless they were actually working on the allotment. They were not allowed to play on their parent’s allotment, only work.

No visiting their friends on nearby allotments then. Hard labour only – or else !

– Official letter of warning from the boy’s headmaster at school that he had been seen riding a bike to school without a ‘permit’.

– The amazing Pizza restaurant – “Sorry Sir. We don’t allow children here except at lunchtime”.

And so it goes on – endlessly. These are only a small fraction of the barrage of anti children complaints I have had to deal with from a population of miserably humourless, self centred, misogynistic fools nurtured into existence by the evils of a politically correct socialist mindset which has gripped the UK in it’s deathly embrace as the Labour Government systematically wrecks what used to be the best country in the World to live in.

Now, it is rapidly becoming one of the worst.

It has also been officially branded by the rest of the World as one of the most unpleasant countries in the World to be a child.



January 22, 2009

and all the poverty and misery that results from their actions.

Let me shed a little light on the financial crisis.

Money itself is simply a symbol of trust. It has no other value than to allow one person in possession of some money to pass it on to another person in exchange for something that does have real value – a loaf of bread, or something else that’s really useful, like a house to live in.

Our system of money is now in complete shambolic meltdown because nobody can trust it; it has become unreliable. Why ?

Because it has become unreliable, individuals and businesses are unable to be certain there will be an adequate flow of money for them to continue to function. Business cannot function without reliable flows of money purchasing it’s products from which it then pays it’s workers, who are then enabled to eat and pay their mortgage.

Money was originally ‘invented’ by banks as merely a trusted symbol of exchange to replace the clumsy idea of barter. They have been in control of it ever since. It is important to be an honest person when handling money as there is always a temptation to find an excuse to keep some or all of it for yourself.

Dishonesty has always been around to some extent, and there have always been people whose job it is to handle money not belonging to them, who have stolen some.

Because theft is so damaging and disruptive, society has always sought to achieve a high degree of honest morality in all public dealings of any kind. Without it, all civilisation crumbles into anarchy, chaos and brutality. Dictatorships, violence, famine and death have always been the consequence throughout history.

We have always recognised that banks have to be trustworthy for the system of money to be able to function at all. This is because the banks completely control everything that happens, or can happen to money – how reliable it is and how freely it moves from person to person.

Every time money moves from one person to another, it creates something useful and valuable; real wealth of some sort. Employment, enabling workers to use their wages to eat and house themselves.

Millions of people Worldwide are now losing their jobs, their houses and their wages enabling them to eat and survive. Homelessness and starvation is being forced on them, not because they do not want to work; on the contrary, they are pretty desperate to work. Very few people like to be idle.

The only reason these people’s lives are being wantonly destroyed is because the people and organisations in charge of maintaining the reliability and integrity of money have completely wrecked it.

Wrecked the whole delicate system of trading, rolling back civilisation to poverty and primitive barter as that fragile symbol of trust – money – is destroyed and debased by the very people we all trusted to cherish it on our behalf.

These people are the banks.

In recent times the banks have invented excuse after excuse to construct more and more reasons to take some of our money we entrusted to them for themselves.

Some examples of this, and there are many, might be the quaint idea of inventing something called the penalty charge. This can range from a charge of millions to a business, or a small amount to an individual who fails to precisely control even the pettiest detail of his finances.

This results in banks looking for excuses to ‘justify’ a penalty charge and their artfully constructed self-righteous, twisted, logic then turns their honest customer into an enemy with whom the bank battles with and often then irretrievably harms by wrecking every aspect of that person’s finances.

Every time this little bit of dishonest, fraudulent dealing occurs in some tiny little corner of the financial system, a small amount of trust is destroyed and ripples out far beyond that bank and the customer it is stealing from, magnified beyond recognition as it touches huge numbers of other people.

A good example of the cumulative effect of this is the ‘sub-prime’ mortgage. This is a farce. An artificial construction by banks designed to milk outrageous amounts of money from people unable to defend themselves from what amounts to blatant fraud in a form the law describes as ‘conversion’.

Conversion is simply when you unlawfully ’convert’ property rightfully owned by another to your own use in such a devious manner it cannot be legally seen as obvious common theft because it is disguised. Sounds familiar in your dealing with banks ?

The banks deliberately set out to create this type of mortgage because it is more profitable than the old fashioned type based on honest trust and fair dealing which no longer provided enough profits to fuel the bank’s rapacious greed.

This is how it is done.

A perfectly respectable, reliable, person has an ordinary mortgage with an old fashioned building society – one of those ‘high street’ lenders. That person’s life may be disrupted by common events. It may be divorce, sickness, temporary unemployment, for example. Nothing that would normally destroy people’s financial lives to the extent of being unable to have enough money to keep the roof over their head and feed themselves. Disruption of this sort normally happens to a huge proportion of the population.

What does a modern bank do when such a person become a few months in arrears with their mortgage ? Why, it first of all makes it more difficult for that person to recover their financial stability as the bank imposes arbitrary ‘penalty’ charges which are designed to rapidly mount up into thousands of pounds.

It then ‘black lists’ the unfortunate individual by notifying the credit agencies that they are financially unreliable. This is used as an excuse by any other financial organisation to make life even more impossible for that person by pushing them further and further into uncontrollable debt by using the excuse to milk them of more money by penalising them financially at every possible opportunity; using sanctimonious self-righteousness to blame the unfortunate individual they are manipulating for what the banks are actually doing themselves.

So, someone who may have a loan for only half the value of their house and be only as few as three months in arrears will have re-possession proceedings brought against them by the the bank. They are threatened with eviction and homelessness, with the inevitable consequences of forced unemployment, family breakup, increased debt and even illness.

The bank evicts them, and the house may remain empty so long it loses value as it deteriorates. Or it is likely to be sold at a considerable loss. That former homeowner is now blacklisted as too uncreditworthy to be lent money again by the ordinary high street mortgage lenders.

Curiously, that same bank just happens to wholly or partially own another company which also lends money for buying houses. But this one only lends to people with ‘impaired’ credit. The same sort of people who have just been refused an ordinary, standard mortgage.

People are also refused standard mortgages for infinitely more trivial reasons. They may have a county court judgement of just a few pounds against them. It may be such a frivolously brought claim they may have chosen to simply contemptuously ignore it.

But such a thing and a myriad other excuses are used by the banks to push people into the more profitable ’sub-prime’ mortgage lending arena with one of those subsidiary companies the banks own.

Or they are pushed into this rapacious ‘sub-prime’ lending market by all sorts of other restrictions manufactured by lenders.

A common one is the borrower not earning enough money to afford the ‘high street lender’s loan. Funny how that doesn’t stop the same financial organisation lending the money to the same ‘unreliable’ , ‘uncreditworthy’ person at higher rates of interest and with huge penalties imposed by another partly or even wholly owned lending business subsidiary to the one that refused the fairer loan !

Now the banks have manipulated someone into a position where the banks can produce an excuse to charge more for a mortgage – much more.

Enticed by a low starting rate of interest that escalates after a while to often as much as double monthly repayments and with penalty charges of thousands of pounds if the borrower has to terminate the mortgage in a year or two, the borrower has nowhere to turn.

All the banks collude to stop him obtaining an honest loan costing less. The banks want their extra profits ! And here is a mug who can’t complain and has nowhere to turn to and the banks know it. Don’t they just.

They have carefully manipulated their affairs by jointly creating this stranglehold over money by pooling their resources and their information to enable them to work together to create this extra profitable ‘sub-prime’ lending market. Pretty much exactly the same techniques used by the door to door rip off loan shark illegally charging annual percentage rates of thousands of per cent to impoverished workers.

It is exactly the same process at work. Fraud, theft, manipulation, threats, fear. These immoral sub-prime lenders have much in common with criminal door to door loan sharks and other thieves. Their victims are caught like flies in spiders webs. There is no escape.

But wait. It doesn’t just end there does it ? Having established this wicked system of modern banking that provides such huge profits to the banks, they wanted more. Greed is good they seemed to think. Yes, that’s what they said. Greed is good !

So they started using the same ludicrous types of manipulation on each other as lending between banks escalated beyond reason or comprehension to prop up the fragile system of deceit the banks were busy creating.

The banking system seemed to become more and more like a giant ‘Ponzi’ scheme where banks borrowed money from other banks to repay their own debts before it was discovered they had no money left at all to meet their obligations, because they had lent the lot as they forced increasingly large amounts of loans onto a gullible population who simply couldn’t understand what was going on.

All people could see was the value of houses increasing to levels of un-affordability where everyone was forced to borrow gigantic amounts of money just to have a home to live in.

But, like all ‘Ponzi’ or pyramid selling schemes based on fraud, the banking system was becoming more and more fragile. It was so riddled with double dealing, fraud, dishonesty and mistrust, banks became too fearful of even each other’s reliability to lend to each other anymore. The banks had successfully created a system based on deceit, mistrust and lies which had also spread into the whole wider community of individuals and business.

The Global banking system went into meltdown as money disappeared into the banks from wherever they could grasp it. The biggest con trick of all was persuading Governments ‘to bail them out’ by giving huge amounts of money – hundred of billions of pounds to stop them going bust and then even more of our money disappearing into oblivion.

The banks kept it for themselves where it is actually useless. Money is only useful and only performs it’s function when it keeps moving from person to person. The banks stopped the World money supply from moving.

So, in the same way the banks are the places where money is created to make trade and commerce become possible, so it is that money is destroyed and is now completely vanishing from existence by the banks being able to reverse the process.

That is exactly what the banks have done. It is the biggest fraud in history.

Looking for someone to blame other than themselves, the banks immediately blamed the ‘sub-prime’ borrowers.

The banks claimed it was all their fault because they were unreliable individuals who couldn’t afford to keep up the payments on the loans they should never have had in the first place; mainly because they were too poor to be able to afford them.

All those very bad borrowers had misled the poor innocent banks into lending them money. It was all their fault, the banks said. But they weren’t too poor for the banks to take their money, were they ?

The banks are liars. Sub-prime was deliberately created by the banks as a means to make more money and take advantage of people. and the banks in their breathtaking greed were too stupid to know when to stop, so they still haven’t stopped.

They are still foreclosing on homeowners even if there is loads of equity remaining in the property. Business loans are forcibly being demanded to be prematurely repaid to the banks and further new loans are rare and generally mostly unavailable.

So, the result is World-wide economic meltdown and poverty and misery of all sorts. Word wide trade and commerce is being destroyed by banks being irresponsible, greedy, and nasty.

Thank you very much, the banks.


Consider this.

A little clue it cannot be sub-prime lenders responsible for the gigantic sums of money disappearing into oblivion is simply that the amounts of money now vanishing into a black hole is apparently reaching into trillions -many trillions. It is a sum my calculator cannot understand or even cope with. So I haven’t much hope of understanding it either. Nor have you.

Let’s do some maths. If the average house price is £200 000 and the loan to buy it is 100 per cent, then one million sub-prime borrowers failing to pay a single penny of that back, ever, means a total loss to the banks of 200 000 million pounds or 200 billion pounds.

Of course this calculation is a complete fiction, because usually the banks re-possess the homes and get all their money back and then some. Sometimes, just sometimes, the banks will not be able to sell the homes for the full amount of the loan and there will be a loss. But the banks still won’t lose that money without pursuing the former homeowner for years to recover anything still owed from their wages.

The banks will not be suffering much in the way of loss from re-possessions and I imagine any losses are more than compensated by profit. So where might this loss they all whinge about be ? Search me ! Perhaps they might like to tell us ?

Here is a slightly more realistic calculation which tells another part of the story. The Council of Mortgage Lenders here in the UK say that each re-possessed house costs £35 000 to repossess. So each bad sub-prime mortgage loan is costing £35 000 and not actually the full value of the property at all.

Even that figure is misleading because it, apparently, is what the CML say the cost is, but they carefully bend the truth by omitting to mention that whole cost is usually born only by the borrower and never by the lender, unless the sale price of the property falls below the value of the loan; something almost unheard of here in the UK in normal circumstances.

But, assuming there is that cost of £35 000, and not arguing about who bears it, multiplying it by one million feckless sub-prime borrowers having their homes repossessed makes a total figure of 35 thousand million or just thirty five billion pounds,

Do you recall the hundreds of billions, even trillions of pounds forthcoming recently from Governments to subsidise the banks ? Seems to be a bit of a discrepancy here somewhere, don’t you think ?

Figures of annual repossessions in the UK were running at about 50 000 homes a year until a few months ago. Nothing like that fictional figure of one million used above. So what does fifty thousand repossessions look like costing at the official Council of Mortgage Lenders figure of £35 000 ?

Why, that comes down to only one thousand, seven hundred and fifty million pounds or 1.75 billion pounds; virtually all of which is borne by the borrower and is not a loss to the lender at all.

Frankly, I doubt if lenders even lose ten per cent of that and that would reduce the figure of apparent loss to just one hundred and seventy five million. Tiny, miniature, compared with the eye watering losses the banks are complaining about and the Governments are pumping into the banks to keep them from going broke. As America has about five times the population of the UK you might, roughly, multiply that figure by five to get an approximate figure for the USA. At 1.75 billion it’s nothing like the losses banks are claiming sub -prime mortgages have cost them, is it ?

That’s thousands of millions, or hundreds of billions, even trillions, remember ?

The inescapable conclusion is someone is not telling the truth ! I wonder who that could be ?

I think it might be the banks.

I was always told that people who didn’t tell the truth were called liars.

If the banks are lying, and it looks like they are, then how can they be trusted to be in charge of the money supply ?