Mortgages Archives - Page 4 of 4 - Emile Woolf writes

The great credit collapse: what have we learnt

  Sir Thomas Gresham was a formidable figure in the late 16th Century. He built the Royal Exchange, the most fabulous commercial building of its day. Modeled on the Antwerp Bourse, it contained 150 small shops, making it one of the world’s first shopping malls. Yet its chief virtue was that, for the first time, […]

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Regulators, rating agencies, accountants, economists: they haven’t a clue.

Accountants are mere recorders, whereas forecasting lies within the province of chartists, economists and strategists. Yet accountants must share at least some of the blame for the lapse in forecasting reliability. After all, investment strategists require indicative source material in the form of financial statements prepared and audited by accountants. The principal justification for today’s […]

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Did weird accounting support the credit disaster?

It has been argued that hi-tech accounting wizardry, including the “fair value” principle of valuing current assets at market value, has played a devilish part in the present credit meltdown. After all, it allowed banks to overstate their assets and understate their liabilities with recourse to off-balance sheet “structured investment vehicles” that everyone thought had […]

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Banks deserve our opprobrium: they have forgotten all basic principles

Banks deserve our opprobrium: they have forgotten all basic principles   The Chinese Sage Lao Tsu wrote, on the subject of government, that in the golden age people do not even know they are being governed; in the silver age they revere their leaders; in the iron age they respect them; and in the age […]

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Where have all the losses gone? There are no corresponding gains!

I have always assumed that gains and losses balance out in the big picture, assuming the lapse of sufficient time.  If I sell an investment for less than I paid I incur a quantifiable loss.  This does not mean that whoever buys it will make a profit since he too may sell for less than […]

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Bank lending scandal: sorting fact from fiction

The lending spree is over.  It will be a while before credit and risk are re-acquainted.  It is symptomatic of the latest squeeze that virtually every rule of sound banking was ignored. If, in the 1990s, conventional risk assessment dictated that mortgages should not exceed either 90 per cent of the property’s value or a […]

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Borrowers must face the reality of their choices

Since gaining its independence from the Treasury 10 years ago the Bank of England’s pledge to control inflation as its overriding priority has, until now, been visibly honoured and we have all benefited. Unlike the Treasury, however, the Bank’s sole weapon in fulfilling its mission is its autonomy over setting interest rates, and the present […]

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