Credit Crunch……What Is It?

Posted on October 8, 2008

Can’t quite get my head round this “credit crunch” lark, but it would seem that we are all fucked! Falling house prices rising inflation, no money left to borrow or lend, where does it all end? I suppose if we are all fucked there is some sort of equilibrium, as we are all in the same boat. I want to sell my house, but I am told it is a bad idea, but surely if I sell it cheap, I buy the next one cheap? If mine is worth fuck all then so is everyone else’s surely, it’s all relevant. The really fucked people are the one ones who have spent their “equity” and the banks stupid enough to lend them their “equity”.

I am no expert, but simply put, it must work like this:

  1. The Royal Bank of Cretins Lends Fred Fuckwitt £250k to buy house
  2. Fred Fuckwitt see his property soar to £300k
  3. The Royal Bank of Cretins offers Fred Fuckwitt loans and Credit cards for holidays, cars, and other varying dead money projects. Fred Fuckwitts mates think he is loaded
  4. Fred Fuckwitt gets a bit carefree but The Royal Bank of Cretins don’t mind they will lend him some more, if not, there is always Ocean Finance
  5. Fred Fuckwitt has been laid off from his Sales Job, business is bad. He can’t afford his mortgage and house prices are tumbling, his house has decreased in value to £220k and his borrowings are £290k ( his 30k BMW Soft Top is now worth 10k) Fred is Fucked.
  6. The Royal Bank of Cretins want their money back as Fred Fuckwitt is defaulting on his repayments. Problem is he owes them £290k and the property is worth £220k and falling, they are £70k down and counting. Robin B’stard Financial and Mortgage Planner for The Royal Bank of Cretins is keeping his head down, he sanctioned over 500 100% mortgages like this from his branch alone, and he only came 25th in the Royal Bank of Cretins “sales” chart (made some good commision though).
  7. Robin B’Stard is sacked. His earnings of over 100k a year allowed him to buy a £500k house, however, his house has now plumetted to £350k in value and he owes his former employer £450k. Like Fred Fuckwitt, Robin is also fucked. The Royal bank of Cretins act quickly to find out who could have sanctioned such a large mortgage to Robin…..Oh dear, it was Robin’s boss Brian Backhander who has already been sacked and is finding it impossible to keep payments on his £900k Royal Bank of Cretins mortgage, especially as his house is now worth £600k and he owes his employers £800k. Brian, like Fred and Robin, is fucked, in fact the bank is fucked, as mortgages like these have been sold to hundreds of thousands of people across the country. This, it turns out, is a 24 Carat Class A fuck up of biblical proportions.
  8. Peter Cretin, Chairman of The Royal bank of Cretins, reluctantly agrees to a £6million severance package as the rest of Cretin empire approach the government for a bail out which they agree at the taxpayers expense. The government are apparently unfamiliar with the term “throwing good money after bad”.
  9. Government sanction the injection of cash to rescue The Royal Bank of Cretins. They throw a blooody great party at Claridges to celebrate their change of fortune slugging back £600 bottles of champagne, and act like…………………..a bunch of cretins!!!
  10. Meanwhile Fred’s wife has left him, his debt is too much for her to cope with, Robin has been found hanging from tree in his back garden, and Brian Backhander has arrived home to his soon to be repossessed home to find reinstated Chairman Peter Cretin humping his wife on the solid oak kitchen table he can’t afford the repayments on.

2008, the year capitalism ate itself.

1 Reply to "Credit Crunch......What Is It?"

  • Toby Jones
    October 8, 2008 (11:11 am)

    Excellent explanation of the “crunch” Bob – I have been waiting for a meaningful insight to the current economic downturn. I did however read an interesting article in the Evening Standard last Friday that looked at the history of sub-prime lending. The origins can be traced to the Clinton administration when, in a bid to get more of the poorer classes (mostly Hispanics and blacks) into stable and permanent housing, the president ordered the banks to be more “creative” in the way they loaned money to “high risk” individuals. The banks listened reluctantly but the government took it even further by introducing penalties to lenders who were seen to be discriminating against (and not lending to) the poorer classes. As usual in America they went completely overboard and even sponsored landmark court cases awarding compensation to one legged, Hispanic/black lesbians who clearly couldn’t meet the 1st or any subsequent repayment on any loan let alone a cunting mortgage. The idea was that by allowing the poorer community to take ownership of their “own” house, the crime rate would come down. As it happens it did (apparently). So if the ES article is anything to go by, the blame for the current economic black hole is not entirely on the shoulders of the global banking community – but I agree with the sentiment that they are all a bunch of greedy cunts – but on that smug cunt Clinton.

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