Tuesday, 18 December 2007

14 finance flops and counting

Cactus Kate asks why anyone is considering putting money in Finance Companies when you can get 8.5% at the ANZ?

I don't think we need worry too much about that, at present all energy is being put into trying to get money out, not putting it in.

But this does raise a question that has been bothering me ... what are the banks doing with all the money they are paying 8.5% for?

With the slowing real estate market they surely have less mortgages going out the door. They could be picking up some of the developments that the finance companies have left stranded, but going by the number of developments that get put over our desk at the moment, me thinks not. My only thought is that it is be farmed out onto the the ever growing debt that is credit cards.

I suppose the festive season will suck up a lot of money they have sloshing around?

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