So, this £800bn

[CoolC]

Now I'm the first to admit I don't have much knowledge of financial policy, and workings....

...But

Gordon has spent £800bn saving the banks, who were mainly in trouble because of giving all and sundry a mortgage whether or no they could afford it.


Would it have been cheaper to just pay off every mortgage in the UK? lets face it a nation of mortgage free people would spend more, which could only be good for the recession.

How much does the UK owe in mortgages?

As I say I'm not a financial wizard, so I'm more than ready to be shot down/corrected, or shown to be a numpty.

[TeamD]

So why do you think that people with mortagages are more deserving that those without? both groups funded the 800 billion.

[CoolC]

I don't particulally, I just wondered if that was a cheaper option.

[Martial Arts Man]

I don't think £800B would touch the sides of the UK's total mortgage debt.

No evidence to back this up, of course....

[theaxe]

The money was/is just loans, most of which has already been paid back and much of the remainder will come back with interest (assuming the government don't interfere too much).

[dangerousB]

What I'm a little more perturbed at is the sum paid to the "advisers".
c. £100m. WTF!!!!!!
How many of them are there ferchrissake? A single policy decision made extremely quickly and that's the sum agreed for "advice"?
Every cloud does indeed have a silver lining for the chosen few.
fking incredible.

[TeamD]

But it would be grossly unjust to do so, whether it was cheaper or not.

[Trommel]

dangerousB said:

What I'm a little more perturbed at is the sum paid to the "advisers".
c. £100m. WTF!!!!!!
How many of them are there ferchrissake? A single policy decision made extremely quickly and that's the sum agreed for "advice"?
Every cloud does indeed have a silver lining for the chosen few.
fking incredible.

Do you have any idea of what's involved to negotiate, structure and document something like this?

You don't just decide to do it and press the button.

[dangerousB]

Trommel said:

dangerousB said:

What I'm a little more perturbed at is the sum paid to the "advisers".
c. £100m. WTF!!!!!!
How many of them are there ferchrissake? A single policy decision made extremely quickly and that's the sum agreed for "advice"?
Every cloud does indeed have a silver lining for the chosen few.
fking incredible.

Do you have any idea of what's involved to negotiate, structure and document something like this?

You don't just decide to do it and press the button.

You can drop the patronising tone fella. I've never negotiated on those kinds of figures, and I shouldn't imagine that you have either.
Do you think that's what the money was for? The "difficulty" of putting this deal together? Is that why the "advice" cost so much? Because it needed the finest minds?
Or perhaps you mean because it's so difficult it takes a lot of time? Documentation should be done by civil servants. They're paid a salary. Negotiation should be done by civil servants. They're paid a salary. Structuring a deal of this sort would call for industry intermediaries, "advisers" if you wish.
I don't consider for one second that £100m represents the remuneration for the time taken to "negotiate, structure and document" this decision.
More remuneration based upon the sums involved. That's my point.
£100m buys 25,000 days work for someone earning £20k A WEEK. This was all carried out in what? Several months?

[Nick_F]

theaxe said:

The money was/is just loans, most of which has already been paid back and much of the remainder will come back with interest (assuming the government don't interfere too much).

If most has already been paid back, and the liability is still £800Bn, then how much was at risk before 'most' was paid back?

[thehawk]

dangerousB said:

I don't consider for one second that £100m represents the remuneration for the time taken to "negotiate, structure and document" this decision.
More remuneration based upon the sums involved. That's my point.
£100m buys 25,000 days work for someone earning £20k A WEEK. This was all carried out in what? Several months?

It doesn't represent the time taken, it represents the experience and knowlege needed. You may employ an advisor for 6 months, but you also are paying for his 20 years of experience.

[pkitchen]

thehawk said:

dangerousB said:

I don't consider for one second that £100m represents the remuneration for the time taken to "negotiate, structure and document" this decision.
More remuneration based upon the sums involved. That's my point.
£100m buys 25,000 days work for someone earning £20k A WEEK. This was all carried out in what? Several months?

It doesn't represent the time taken, it represents the experience and knowlege needed. You may employ an advisor for 6 months, but you also are paying for his 20 years of experience.

Don't think there is any real arguement there, it's just that £100m which if accurate, seems a shed load of money, to be paying for 20 years of experience. I have 35 doesn't seem to do me much good.......

[dangerousB]

thehawk said:

dangerousB said:

I don't consider for one second that £100m represents the remuneration for the time taken to "negotiate, structure and document" this decision.
More remuneration based upon the sums involved. That's my point.
£100m buys 25,000 days work for someone earning £20k A WEEK. This was all carried out in what? Several months?

It doesn't represent the time taken, it represents the experience and knowlege needed. You may employ an advisor for 6 months, but you also are paying for his 20 years of experience.

And you don't consider 20k a week sufficient remuneration for the "experience and knowledge" needed to broker a deal of this manner?
I know they're only arbritary figures, but it just hints at how £100m stacks up . . . and it's easy to kiss that money goodbye when it's someone elses.

[JRM]

To get back to the OP's interesting first question, national mortgage debt hit £1Trillon in 2006:

http://news.bbc.co.uk/2/hi/business/5128220.stm

[Jimbeaux]

Same thing with our "stimulus package". Enough money to give everyone in the U.S. around $250,000, for mortgage or whatever they wanted. Either way, the influx of cash would have charged up the economy far better than the BS is has been used for thus far.

[pkitchen]

anonymous said:

[redacted]

It ain't peanuts....Don't know which planet you live on. Not mine.

[JRM]

anonymous said:

[redacted]

You're right although Slaughter's partners are probably more than triple that figures.

Ironically of course the corporate and investment banking sectors also advised teh UK and US governements, hence they returned some of the highest profits in Q3 of this year for advising how to get out of the mess.

[theaxe]

Nick_F said:

theaxe said:

The money was/is just loans, most of which has already been paid back and much of the remainder will come back with interest (assuming the government don't interfere too much).

If most has already been paid back, and the liability is still £800Bn, then how much was at risk before 'most' was paid back?

Something like £320Bn of insurance has been 'paid back' so far. Of the £800Bn being quoted today £720Bn ish is loan protection and insurance rather than actual money out of the door. Yes, every possible loan/policy could default/pay out but it's unlikely.

The remaining £80Bn or so is certainly a non-trivial amount but with good management it should be possible to get a good proportion of it back.

[ErnestM]

Eliminating/modifying mark to market would have been cheaper...

stands by with flame proof trousers