Planet Sillicon

Isn’t this how we got here?

By blog on Sep. 18, 2009.

I say that in reference to the financial crisis the world economy is still trying to pull itself out of and the prolific amount of fast loan places that are popping back up.

You see, what really sparked this entire collapse was a few people in the U.S. deciding it would be a grand idea if they gave people large loans, we’re talking house loans here, with no down payment. That’s right, loaning the full 100% of the total amount for a house. This of course lead to many people being the horrible situation of having a home and a home loan, but loan repayments too hefty to keep up with. They are referred to as high-risk loans. What then happened is other financial establishment went and bought those loans from the banks and so forth who originally issued them. Now, on the books, this looks like the company has a certain amount of assets, but if the person defaults, if they can’t keep up with their payments, that company that thought they had a few hundred thousand in assets suddenly has to write that off. Completely.

This is just one of the causes of the current financial instability – which seems to be somewhat on the mend – but it was a major factor in why so many companies lost so much money in such a short amount of time.

Anyway, what bothers me is that I feel people should have learned that quick credit, fast cash, short-term loans, all have a nasty way of coming back and biting you. I know it’s a pretty damn difficult time for most people, at the moment, but if they continue to buy into the cycle of loans, and then paying back at a minimum 20% – though you’d probably find it’s much more if you cared to check it on one of those loan calculator things – more than they borrowed, it’s going to be very difficult to break out of.

I suppose I also feel a sense of frustration with these loan brokers, that they are so happy to cash in, in spite of how it effects people. Bah! Anyway, if you are considering one of those short-term loans, please don’t if you can avoid it in any way!

Financial crisis close to home

By blog on Jun. 7, 2009.

My SO has that wonderful knack of being able to talk to random people. I don’t have this ability, I am more of avoid eye-contact and keep to myself kind. I mean sure, I will say hello to someone I walk past when I am out for a walk, but I don’t want to talk to them any more than that. My SO, on the other hand, doesn’t mind stopping to talk for a few minutes, and after five minutes chatting with one of the neighbours, she has all the gossip for the entire street we live on.

Earlier today she went out to grab our newspaper, and stopped to talk to our next-door neighbour, the local gossip. Apparently in the last month, two houses in our street were repossessed. I suppose this shouldn’t be a shock with the financial crisis still going on , but still, when it is that close to home it actually makes the whole business seem much more real, and not some nebulous far removed issue.

In spite of a hint of reprieve earlier this year, house prices have continued to fall for the best part of two years, and now the number of house repossessions seems to be steadily rising. The government and others are doing what they can to avoid this happening, but it is unavoidable for some; this financial crisis is just an ongoing kick in the teeth.

To think that this all started because of the greed of less than a dozen people, who largely got away with it, and the rest of the entire world is suffering for it! In property alone, the whole world has experienced devaluing of property. Lex Luthor were around he could buy the entire planet if property values got much worse… Okay that was ridiculous.

I feel a tad sore about it today, just because it now feels so close to home. I am very pleased to own my home outright, with all this going on, but I know that this financial climate will still affect me in other ways. Our house is worth less now than we paid for it close to a decade ago. Not to mention the fact that everything other than housing is becoming more and more expensive! It’s enough to make you grind you teeth into powder, but I can’t do that because I know the dental bill would be huge!

Finding the best bank account

By blog on Apr. 2, 2009.

I don’t like to shop, really, and there really are few things more irritatingly complex to shop for as bank accounts. You would think if you banked with one bank for a decade, that you could rely on them to, oh I don’t know, do business the way they always have! But no, with all this financial ruin going, on banks are raising their fees all over the place. Those that are still in business, anyway.

It isn’t just bank fees, either, it is also the banks trying to keep profit margins at the same line at the sacrifice of customers and lower level staff. The last time I walked into my bank, at 11:00am in the morning mind you, I was waiting in line for 25 minutes! Why? Because there were two tellers, a manager who was also the loans officer, and that was it! The rest of their staff had either had their hours massively reduced, or been laid off. I couldn’t believe it, this was a branch that was normally very busy!

So after seeing the bank’s notice of upping fees, and in light of the branch being so under staffed, I decided it was time for a change. Now I get to the complicated task of looking at which bank charges what for which type of account, and what sort of account do I want anyway? I have to say, I also don’t want to jump ship to a sinking boat, so many banks have collapsed I want to be sure the bank I chose wouldn’t be one of them.

I went around gathering up every banking brochure I could find, and after pouring through them, with alternate highlighter colours for different types of accounts and levels of bank fees, I decided to go over to Nationwide and use their savings account. For one, I know they aren’t about to collapse, as they just bought out Dumfermline, and secondly, the fees are pretty good.

My ultimate goal is to never have to leave my house, never have to interact with people I don’t choose to, and never have to stand in line at a bank for 25 minutes at what should be the slowest time of the day.

So after all my highlighting, I suppose the choice wasn’t that difficult… I just really didn’t like all the running around I had to do to find a new bank. It is worth, though, to not be losing that much money each month in fees.