observer Posted February 9, 2011 Report Share Posted February 9, 2011 Seems the Gov has done a deal with the Banks - bonuses will be conditional on their lending money to buisiness! Now, let's rewind a bit: wasn't the bonus culture built on high risk, speculative lending; which all turned to tears when folk couldn't repay the loans? Quote Link to comment Share on other sites More sharing options...
inky pete Posted February 9, 2011 Report Share Posted February 9, 2011 But on the other hand, a business starved of credit to invest in new premises, machinery, technology or skills, is a business which is stagnating and on the road to failure. Quote Link to comment Share on other sites More sharing options...
observer Posted February 9, 2011 Author Report Share Posted February 9, 2011 Think the key word here is "responsible" lending. Quote Link to comment Share on other sites More sharing options...
inky pete Posted February 9, 2011 Report Share Posted February 9, 2011 I see nothing is being done about the interest rates being charged on business loans. Â Figures around 13% are common - while the BoE base rate is still down at 0.5% - someone's filling their pockets! Â It's cheaper to borrow on a credit card than it is to take out a business loan. Quote Link to comment Share on other sites More sharing options...
observer Posted February 9, 2011 Author Report Share Posted February 9, 2011 Just for interest: are there any stats on buisiness "start ups" and consequent "failiures"? Would this indicate the % risk? Quote Link to comment Share on other sites More sharing options...
inky pete Posted February 10, 2011 Report Share Posted February 10, 2011 I can understand a higher interest rate - or some form of insurance backed guarantee - being charged for finance to an unproven startup company. Â But an established company who may have won a large contract and need to invest in new equipment in order to deliver it and grow their business getting charged 13% per annum on a capital investment is ridiculous. Â There are also many machinery manufacturers who need bank finance to enable them to manufacture to order large machines which are then leased out to customers (often because the customers can't get reasonably priced finance to buy the things outright!). The lease income often totals several times the purchase price of the machine over it's lifetime - and also gives the manufacturer the opportunity to sell lucrative engineering services, spare parts and consumables contracts to maintain the machine and keep it running. But if the manufacturer can't get the finance to build the thing they can't make this money on it - AND the customer can't get their hands on it to enable them to compete in their marketplace. Â The result is foreign manufacturers who can get finance backing for their lease deals get to sell their machines into the UK, and they get to make all that money on the spare parts and consumables for the next 10 years or so. Quote Link to comment Share on other sites More sharing options...
observer Posted February 10, 2011 Author Report Share Posted February 10, 2011 Don't disagree with "responsible" lending, based on carefull assessment of an application that presents a buisiness case; but throwing unsecured loans to all comers doesn't constitute prudent banking imo. Quote Link to comment Share on other sites More sharing options...
inky pete Posted February 10, 2011 Report Share Posted February 10, 2011 "Unsecured" loans are very rarely made to businesses. They're only really commonly made to consumers. Â There's always far more detailled investigation into a companies credit worthiness and ability to pay back a loan - or even an overdraft - than has ever been applied to individuals. Â Plus, businesses get charged a fortune every month for simple banking facilities which Joe Public gets for free. Quote Link to comment Share on other sites More sharing options...
observer Posted February 11, 2011 Author Report Share Posted February 11, 2011 Well, given the retiscence of the Banks to lend to buisiness and the Governments obvious eagerness for them to start lending - would it be better if the Gov just taxed them and diverted this revenue via a buisiness lending scheme? Perhaps Alan Sugar and his Dragons could run it! Quote Link to comment Share on other sites More sharing options...
asperity Posted February 11, 2011 Report Share Posted February 11, 2011 Obs you're a tax maniac! And you seem to be getting your reality TV progs mixed up Quote Link to comment Share on other sites More sharing options...
observer Posted February 11, 2011 Author Report Share Posted February 11, 2011 Errm not really Asp: there are several ways of providing for the "public good" and contributing to the well being of society and it's economic progress - one is a progessive tax system, based on the principle of the provision of services based on the democratic will of the people and funded by mandatory taxation. The others rely on some form of charity or patronage, and depend on the will of the individual donors - by any standards, a bit hit and miss. Quote Link to comment Share on other sites More sharing options...
asperity Posted February 11, 2011 Report Share Posted February 11, 2011 You really do lack a sense of humour don't you Obs. Truly amazing Quote Link to comment Share on other sites More sharing options...
observer Posted February 11, 2011 Author Report Share Posted February 11, 2011 You mean you don't want me to take you seriously?! Quote Link to comment Share on other sites More sharing options...
asperity Posted February 11, 2011 Report Share Posted February 11, 2011 Only when I'm making a serious point Quote Link to comment Share on other sites More sharing options...
RENT-A-GOAT Posted February 13, 2011 Report Share Posted February 13, 2011 ...a business starved of credit to invest in new premises, machinery, technology or skills... Not that this ever happens in the UK anymore Quote Link to comment Share on other sites More sharing options...
inky pete Posted February 13, 2011 Report Share Posted February 13, 2011 Contrary to popular belief, the UK's manufacturing sector is not dead. In fact, we are still the 6th largest manufacturer in the world by value of goods manufactured. Â We can only ontinue to stay ahead of the developing economies with their plentiful cheap labour pools by investing in the newest high-tech machinery. That's a very capital intensive business and is not possible without access to affordable business credit. Quote Link to comment Share on other sites More sharing options...
Lt Kije Posted February 13, 2011 Report Share Posted February 13, 2011 I think we are 7th behind Italy Quote Link to comment Share on other sites More sharing options...
Bazj Posted February 13, 2011 Report Share Posted February 13, 2011 I think we are 7th behind Italy  well that just about shows how low Great Britain has sunk Quote Link to comment Share on other sites More sharing options...
Lt Kije Posted February 13, 2011 Report Share Posted February 13, 2011 And shows how little you know about Italy Quote Link to comment Share on other sites More sharing options...
Bazj Posted February 13, 2011 Report Share Posted February 13, 2011 They sell pizzas and spaghetti and were crap at fighting   what else is there to know? Quote Link to comment Share on other sites More sharing options...
Lt Kije Posted February 13, 2011 Report Share Posted February 13, 2011 At this point the prosecution would like to end, as per the previous post the defence have no defence Quote Link to comment Share on other sites More sharing options...
Bazj Posted February 13, 2011 Report Share Posted February 13, 2011 well they didn't as I recall and all their tanks had 6 reverse and one forward gear! Quote Link to comment Share on other sites More sharing options...
Lt Kije Posted February 13, 2011 Report Share Posted February 13, 2011 Quote Link to comment Share on other sites More sharing options...
observer Posted February 13, 2011 Author Report Share Posted February 13, 2011 The old ones are still the best Baz! Quote Link to comment Share on other sites More sharing options...
Bazj Posted February 13, 2011 Report Share Posted February 13, 2011 I know...... I got Kije in a classic pincer movement; just when he thought he had a chance of winning the argument......BANG; he was outta there!! Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.