1 of 2
1
WOTY
Posted: 02 January 2008 01:24 PM   [ Ignore ]
Administrator
Avatar
RankRankRankRankRank
Total Posts:  4750
Joined  2007-01-03

I posted my choices for Words of the Year on the main site.

Profile
 
 
Posted: 03 January 2008 05:27 AM   [ Ignore ]   [ # 1 ]
RankRankRank
Total Posts:  362
Joined  2007-03-05

’Subprime’ is the one I’d think has had most airing in the UK last year due to the collapse of Northern Rock over here and news reports describing that kind of mortgage lending in the US.

Profile
 
 
Posted: 04 January 2008 05:13 AM   [ Ignore ]   [ # 2 ]
Avatar
RankRankRankRank
Total Posts:  815
Joined  2007-06-20

If there’s been a “word of the year” in the UK, it’s probably Madeleine, sadly.

One thing did stand out for me in Dave’s suggestions - how shocking and alien I found the expression “downtown London”. I’m not sure I’ve ever seen the adjective applied to a part of my city before, and my vague perception, as a Rightpondian, of the meaning of “downtown” is a comparatively small area, rather than the 12-miles-by-five-miles covered by the Congestion Charge zone, which would generally be called “central London”.

Profile
 
 
Posted: 04 January 2008 08:16 AM   [ Ignore ]   [ # 3 ]
Administrator
Avatar
RankRankRankRankRank
Total Posts:  4750
Joined  2007-01-03

Yes, it’s very American of me to call it “downtown.”

Profile
 
 
Posted: 04 January 2008 08:36 AM   [ Ignore ]   [ # 4 ]
RankRankRank
Total Posts:  444
Joined  2007-10-20

What? Petula Clark is still remembered I hope. Especially those delightfully long arms of hers. She was (and is) a most well equipped soldier in the regiments of invading British, who trod the footlights into our hearts. May she be held together there till Heaven unmembers her, when she will be remembered ever more.

Or something like that.

[ Edited: 04 January 2008 09:26 AM by Iron Pyrite ]
Profile
 
 
Posted: 04 January 2008 09:22 AM   [ Ignore ]   [ # 5 ]
RankRankRank
Total Posts:  362
Joined  2007-03-05

Hmmm - in Rightpondia (in my experience) we (colloquially) go down (the) town to shop or visit bars/nightclubs etc in the commercial/central area of any town but the area itself isn’t described as downtown, it’s usually just referred to as ‘town’. We might also go down the park, or down my gran’s house or down (to) Plymouth. Depending on topography, geography or the verbal accuracy of the speaker we might also go up (to) town, across (to) my mate’s house or over the park. Some people refer to going up to London wherever they live and Londoners sometimes go ‘up West’. Petula Clark was either being colloquial as above or (and I think this is more likely) using a conscious Americanism.

As far as I know ‘downtown’ in the American sense isn’t common anywhere in the UK, but I’m from the south west so I may be wrong about other areas.

Profile
 
 
Posted: 04 January 2008 11:10 AM   [ Ignore ]   [ # 6 ]
RankRankRankRank
Total Posts:  590
Joined  2007-02-22

I was pleased to see “bubble” in your list of choices, though the word has not seen much exposure here in the UK, probably because everyone, including the government, is trying desperately to ignore the fact that the housing market is showing all the signs of being a classic bubble once again.

On the question of up/down town, IIRC going “down town” is an expression used in the North East (I am sure Eliza will put me right here, if necessary), but elsewhere it’s “down the town”.

It’s always “up” to London, I believe, because London was always shown at the top of the stagecoach timetables, though why students always go “up” to Oxford or Cambridge beats me, Cambridge being a particularly low-lying city. For that manner, how to describe a journey from Oxford to London? Going down on the up train?

Edited to remove grocer’s apostrophe

bayard leaves the room to shoot himself

[ Edited: 08 January 2008 11:33 AM by bayard ]
Profile
 
 
Posted: 07 January 2008 05:18 AM   [ Ignore ]   [ # 7 ]
RankRankRank
Total Posts:  362
Joined  2007-03-05

’down town’ and ‘down the town’ about equal here in the South West.

Profile
 
 
Posted: 07 January 2008 08:36 AM   [ Ignore ]   [ # 8 ]
RankRankRank
Total Posts:  158
Joined  2007-02-14

I don’t think that the subprime crisis is a “classic bubble”.  I think of a bubble as being a market where buyers are overcome by “irrational exuberance” and speculative fever.  The current subprime crisis results more from a collapse of the credit markets that provide liquidity for the housing markets.

The problem is a combination of Wall Street’s violation of the old adage “don’t borrow short and lend long” and the fact that banks—with the expansion of the securitization and secondary markets for mortage loans—have become more brokers (making profits from fees) than lenders.  As a result, no one other than the rating agencies was watching credit quality—and the rating agencies—which are creatures of Wall Street—failed to understand that the securization market was subject to a “run on the banks” if investors with short term obligations backed by long term mortgages became worried about being able to cash out of their investments.

So I don’t think that “bubble” accurately describes the problems in the financial markets in 2007 and 2008.

Profile
 
 
Posted: 07 January 2008 10:48 AM   [ Ignore ]   [ # 9 ]
Rank
Total Posts:  15
Joined  2007-02-18

Wikipedia defines real estate bubble as:

A real estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real estate markets. It is characterized by rapid increases in valuations of real property such as housing until they reach unsustainable levels relative to incomes and other economic elements.

By that definition (and as someone who recently lost $40K selling a house) I’d say that “bubble” describes the financial housing problems (in SE MI anyway) quite well.  2 years ago the joke in our area was that you could get a nice little $80K starter home for about $160K.  Suddenly thousands are being laid off and dozens of large businesses are moving out of state or closing.  Add that to the easy, no money down mortgage trend and now you’d be lucky to get 80K selling the same house.

[ Edited: 07 January 2008 10:52 AM by brightlady ]
Profile
 
 
Posted: 07 January 2008 01:45 PM   [ Ignore ]   [ # 10 ]
RankRankRankRank
Total Posts:  1276
Joined  2007-03-21

I agree with Jim Wilton on this. A bubble is developed by irrational speculation.  This past disaster was created by faulty--some might even say, criminal--lending practices.

FWIW, AHD4 has this definition 5b, “A speculative scheme that comes to nothing: lost money in the real estate bubble. “

Still, what brightlady describes in her situation is what I would call a “real estate bubble.”

edit: removed “subprime” from between irrational and speculation.  Subprime lending and affiliated practices that Jim outlines in his note are the main cause of what happened last year and moved the word into WOTY candidacy.

[ Edited: 07 January 2008 02:34 PM by Oecolampadius ]
Profile
 
 
Posted: 08 January 2008 07:32 AM   [ Ignore ]   [ # 11 ]
Administrator
Avatar
RankRankRankRankRank
Total Posts:  4750
Joined  2007-01-03

I have to disagree with my brother and go along with brightlady on this one. While perhaps it’s not a classic bubble, it is a bubble nonetheless.

First, the general public behaved with irrational exuberance, buying more house than they could afford or financing other spending using home equity, and using financial instruments with adjustable rates, assuming that interest rates would remain low and value would continue to grow.

Second, the financial institutions did something similar, investing heavily in risky, subprime loans--albeit in a secondary market, speculating that rising housing values would negate the risk.

In short, everyone bought into an asset, speculating that its value would continue to rise, even though every rational analysis of the market said it was heading for a fall. That’s a bubble.

Profile
 
 
Posted: 08 January 2008 09:22 AM   [ Ignore ]   [ # 12 ]
RankRankRank
Total Posts:  158
Joined  2007-02-14

We can agree to disagree.  The mortgage loans that were securitized were packaged by Wall Street in investments that certainly were not speculative investments. 

One of the scary things about this downturn is that mortage backed securities even made their way into cash equivalent investments such as money market funds.  The functioning of the money market funds depended on liquidity in the securities markets to allow holders of the funds to redeem their shares.  Illiquid mortage backed securities are currently found throughout the money supply in the U.S. in places where investors did not make any conscious decision at all to acquire these securities.

To date, the big Wall Street players have mostly been taking the hit and bringing these investments back on their balance sheets to prevent the loss of investor confidence (and litigation) that would result if money market funds were to “break the buck” and no longer function as cash equivalents.  We’ll see if that continues as the markets remain illiquid in 2008 and the Wall Street players begin to run up against reserve regulations that limit their ability to deal flexibliy with defaults on these securities.

Sorry for a post that is now seeming off topic.

Profile
 
 
Posted: 16 January 2008 10:28 PM   [ Ignore ]   [ # 13 ]
RankRankRank
Total Posts:  115
Joined  2007-02-24

However you look at it, the bubble has burst for a whole lot of folks. More regulation (again) will be the only option that starts the balloon growing again.

Profile
 
 
Posted: 17 January 2008 12:59 AM   [ Ignore ]   [ # 14 ]
RankRankRankRank
Total Posts:  590
Joined  2007-02-22

Ah, yes regulation - the politician’s panacea.

Profile
 
 
Posted: 29 January 2008 09:49 AM   [ Ignore ]   [ # 15 ]
Rank
Total Posts:  15
Joined  2008-01-12

Get-rich-quick schemes will ever lure the imprudent and gullible into copying their inventors, until excesses bubble and then burst or threaten to burst, at which point they’ll become illegal in some fashion… Think tulips, pyramids, Florida land, cartels, buying stocks on margin, cornering the market in commodities, house-flipping!  They are especially appealing if you can use OPM (other people’s money).

The U.S. government’s panacea is devaluation of the currency through excess sale of credit instruments to foreign entities, not just regulation,—plus designating war costs and other major expenditures as “off the books”.  When did you ever see politicians deny the administration an increase in the debt ceiling?

[ Edited: 29 January 2008 10:28 AM by ArtLvr ]
Profile
 
 
   
1 of 2
1
 
‹‹ Eskimo      TURNCOAT ››