A rant about banks...

[ClubMan]

I want my investment to be safe, accessible and provide a return.

Those are slightly conflicting requirements since safe/accessible normally means low returns while taking on more risk/volatility and a longer investment term often implies higher potential returns.

There are so many opportunites for fraudsters to get hold of your money that I'm afraid to use a Financial Adviser

Seems like a very prejudiced and short sighted approach to me but each to his own.

Regarding those agencies you suggest, fine, but they don't stick counter ads on the TV. For example you see on TV ads to drink sensibly, smoking kills etc. Have you seen any ad on TV saying borrowing may not be right for you?.........

I thought that IFSRA ran an advertising campaign to hightlight their ItsYourMoney website a while ago? Whatever about raising awareness and the level of education about potential risks of running up debt do you honestly believe that people should be handheld into protecting themselves against making their own mistakes? As soon as this happened you'd surely have another mob shouting "nanny state!".

 

[quarterfloun]

Clubman, in my limited experience I bow to your words however I fail to see the parallel between advertising on the scale that drink driving, drinking sensibly, smoking kills you, safe sex etc. gets on TV and a website being advertised.

I'm sure you saw those UK hard hitting ads against drink driving where the driver rolls his car over a fence onto a kid playing footy. I'd bet if you saw a similar ad showing a family and their belongings being put on the side of the road, families broken up and put into different B&B's till council accomodation on drug infested estates is found.

Now tell me advertising a website is the same thing.

Some people do need "handheld into potecting themselves" because they are vulnerable when being bombarded with ads for refinancing debt.

I bet an ad on telly saying "Do not under any circumstances exchange unsecured debt for secured debt. The CCCS or MABS can negotiate on your behalf a way out by freezing interest, arranging a budget based on your situation and get these debts off your back and manageable" would go down well with the loan companies.

I don't know who is behind all these companies but look at all the unsecured debt out there. I could well believe that the banks are behind them so that their unsecured debt get turned into secured debt by the back door at higher APR than a loan they would give you.

Nice.

 

[ClubMan]

Some people do need "handheld into potecting themselves" because they are vulnerable when being bombarded with ads for refinancing debt

Why? Regardless of whether or not they are bombarded with advertising the ultimate decision to buy a particular product or service lies with themselves and they must take some (and in the absence of misleading advertising or misselling, I would say all) of the responsibility for what happens thereafter.

I bet an ad on telly saying "Do not under any circumstances exchange unsecured debt for secured debt.

That would be silly. It is not the case that doing this is undesirable in all circumstances and it may well suit some people and their needs - especially if the repayment of the consolidation/top-up is arranged over the same period as the original loans thus saving the individuals money.

I don't know who is behind all these companies but look at all the unsecured debt out there. I could well believe that the banks are behind them so that their unsecured debt get turned into secured debt by the back door at higher APR than a loan they would give you.

Secured loans (e.g. mortgages) normally charge significantly lower rates than unsecured loans! Your argument doesn't really make sense and I personally don't believe that people should be unnecessarily protected from making decisions (and - if it somes to it - mistakes) for themselves and living with the consequences. As long as there is reasonable regulation and oversight of advertising and industry practices (e.g. to prevent misleading advertising and misselling etc.) then I can't see what the problem is.

 

[quarterfloun]

Thats my point about secured loans....

Bank gives you a Credit Card.
You find yourself unable to pay (whatever the reason)
You go to bank asking for a solution (ie a loan) at x %
Bank says no.
Bank sells your debt
Collection agency threatening you
Loan Company offers you a way out (but securing the debt) at x plus 5%
Bank owns Loan Company.

So by refusing you a loan to cover the CC bill they palm your debt over to a company they own and manage to secure the debt and rake in a higher interest rate. Neat.

I also take it from your unsympathetic viewpoint that people who get themselves pressurised into doing things and how it is ultimately their responsibility (even though the advertising does not highlight the dangers) then pushing drugs on kids is entirely the kids fault because they did not have to take them. The fact that "celebs" like Moss, Gallaghers, Ryder, Deaton, Self, Marks etc. are all still allowed column inches is similar to advocating that drugs are OK. Surely you see the police providing "reasonable regulation and oversight" of that industry or has Law and Order been failed?

 

[ClubMan]

Thats my point about secured loans....

You seem to be a bit confused. A secured loan is a loan secured on some asset used as collateral (often a property) which mitigates the risks to the banks (they can always take ownership of the asset if the borrower defaults) and usually results in lower rates of interest than unsecured loans. What you describe is not a secured loan but a debt that is sold on or perhaps a securitised loan (although that's not necessarily the same either).

I also take it from your unsympathetic viewpoint that people who get themselves pressurised into doing things and how it is ultimately their responsibility (even though the advertising does not highlight the dangers) then pushing drugs on kids is entirely the kids fault because they did not have to take them.

Kids are not grown adults with the necessary experience and responsibility to make full and informed decisions. I was talking about adults in relation to financial decisions.

The fact that "celebs" like Moss, Gallaghers, Ryder, Deaton, Self, Marks etc. are all still allowed column inches is similar to advocating that drugs are OK. Surely you see the police providing "reasonable regulation and oversight" of that industry or has Law and Order been failed?

As it happens I do believe that adults should be allowed take whatever recreational substances that they want or do whatever they want as long as they harm nobody else (even if they may harm themselves in some cases) but as long as the law states that certain activities are illegal and remains unchallenged/unchanged I would not condone illegal activity.

 

[CCOVICH]

Bank gives you a Credit Card.

On foot of an application from the individual in question. Banks can't give you an unsolicited credit card, and they can no longer increase your limit with your permission. They can offer people these things, but it's up to the customer to say yes. When you apply, you sign up to the 'terms and conditions' which clearly state the penalities for failing to clear the balance on time etc.

So by refusing you a loan to cover the CC bill they palm your debt over to a company they own and manage to secure the debt and rake in a higher interest rate. Neat.

Indeed. The fact of the matter is that people with a 'tainted' credit history end up paying higher interest rates. Sometime those circumstances may be outside their control, but that's the way the system works, nothing is ever perfect.

Advertising is regulated. Ads for secured loans (such as mortgages) warn borrowers that "your home may be at risk if you don't keep up repayments" etc.)

Comparing banks advertising credit to celebreties promoting drugs is quite a jump.

People don't borrow money for the sake of it-they borrow to spend. Banks don't create demand for credit, it's estate agents, car dealers, retailers etc. Why not ban all forms of advertising so people won't feel that they 'have' to buy anything? That way, nobody will feel pressurised into borrowing, banks will go out of business, and we can all go back to putting our money under the mattress.

 

[quarterfloun]

Should either of you get ill or have a circumstance that puts you the wrong side of these enterprises your views may change.
I'm not concerned about the cars, the houses etc. my concern is when things go wrong (especially through NO intentional fault) people get left high and dry by these people.
It is also wrong to assume that its wholly the merchandise that causes people to take out credit or that its wholly the fault of the person taking the credit.

Maybe you are too you to remember HP and how it used to work - You needed a deposit of your own before being lent the rest. This made it safer for those who could not really afford it insofar as if they could not save up the deposit they could not afford the payments.

The problem with this was that banks could not lend the volumes that they would like so easier ways of getting credit into the hands of people were found.

Ultimately it is Capitalism that is at fault and not the lending institutions. They do however have a hand in it because of spiralling and sometimes irresponsible lending. At the end of the day I take your points that people get themselves into it but very few people get in a car with the purpose of ending up in an RTA either.

 

[CCOVICH]

Ultimately it is Capitalism that is at fault and not the lending institutions.

Well that's a much larger argument, and one that should be had in a separate thread perhaps?

 

[ClubMan]

Should either of you get ill or have a circumstance that puts you the wrong side of these enterprises your views may change.

I was unemployed for the best part of a year a while ago. I cut my cloth to meet my measure rather than expecting somebody else to fund the lifestyle to which I had grown accustomed prior to redundancy.

I'm not concerned about the cars, the houses etc. my concern is when things go wrong (especially through NO intentional fault) people get left high and dry by these people.

There are welfare and tax safety nets for people such as this that should help them to avoid getting immersed in debt.

Ultimately it is Capitalism that is at fault and not the lending institutions.

So why wasn't that rather than a tirade against the banks the subject of your original thread? I'd be interested to hear what your alternative to free market capitalism is so and how you are working towards a change?

At the end of the day I take your points that people get themselves into it but very few people get in a car with the purpose of ending up in an RTA either.

Signing a loan agreement is not an accidental occurrence but a deliberate decision so the comparison is fallacious.

 

[TarfHead]

From today's Guardianhttp://technology.guardian.co.uk/news/story/0,16559,1644361,00.html"set out to demolish offending articles by quoting them and then attacking them line by line - a practice that became known as 'fisking', a derogatory reference to the Independent writer Robert Fisk, a regular victim of the approach".Clubman - are you a 'fisker' ;-) ?PS the formatting options are disabled here - is that just me ?</p>

 

[ClubMan]

I am not a big fan of Robert Fisk to be honest so any similarities are purely coincidental. By the way, don't confuse fisking with:

... the Usenet style of responding to an argument line by line by replying to a message while quoting the original message with >s in the left column. The difference is that with a Usenet line-by-line discussion, often a large number of unrelated arguments can develop while the main point of the original article and original response gets lost.

There are some problems with the formatting options/buttons that we need to look at...