Thursday, 1 May 2008
In my Bloomberg column yesterday I mainly focussed on British banks. People are over-looking the extent to which the banks are going to get blamed for the housing crash that now looks inevitable. They are going to be pressurised to cut their margins to bring mortgage rates down - although its not their fault money has become more expensive. And once the repossessions start, they are going to come under a lot of pressure to give people mortage holidays to keep them in their houses. All that is going to cost a lot of money and that is going to come out of the profits of the banks.