oldgrumpy
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Post by oldgrumpy on Jan 31, 2017 8:57:07 GMT
Last matched 2.5% a big difference from yesterday's offer, what a difference a day makes Noticeable that even at almost nine a.m. all but a few very paltry (and low!) "borrower" offers have been removed while RS work out exactly what to do today .... play for time before the 1 Feb repayment influx, maybe.
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Post by beegee on Jan 31, 2017 11:42:31 GMT
Is the problem being caused by the returns from 5y and 1y not being reinvested in those platforms but being redirected to rolling. RS are having to refinance those on a monthly basis from rolling rather than the returns from 5y and 1y.
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Post by khampson on Jan 31, 2017 13:00:04 GMT
Is there a problem at Ratesetter? what is causing such fluctuations on the rolling market? is it because not enough lenders, not enough borrowers or end of month or another reason? I don't quite understand as I have never see it slide up and down the scale like I have the past week or so.
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DeafEater
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Post by DeafEater on Feb 1, 2017 10:13:25 GMT
The large borrower queue in rolling suggests we'll be seeing lending at low 4.n rates again today. Not entirely sure whether I should be pleased and grab it with open arms or running away in fear of what's going on there.
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Post by accumul8 on Feb 1, 2017 15:50:06 GMT
Is there a problem at Ratesetter? what is causing such fluctuations on the rolling market? is it because not enough lenders, not enough borrowers or end of month or another reason? I don't quite understand as I have never see it slide up and down the scale like I have the past week or so. The problem is that RS is acting like a bank (ie, borrowing short (1 month) and lending long (3 to 5 years)) but without the liquidity reserves that banks are required to have. This works fine until there is a run on short term deposits and then there is a problem. RS tries to solve that by jacking up short term rates to attract short term speculative inflows. So far this has worked, but one day it may not ...
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alender
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Post by alender on Feb 1, 2017 16:32:17 GMT
Does this remind anyone of Northern Rock.
As I have said before there is a good chance that sooner or latter RS will come unstuck as there will not be enough short term money for refinancing of these longer term loans. This may well be a lack of confidence cause by events in other P2P platforms or just a general downturn. Then there will be a lock in of the rolling market, with some funds locked in for up to 5 years at current rates, this on it's own will probably be the end of RS as I believe very few people would place money on any RS market in these conditions. Once this happens and RS is no longer profitable I would expect to see the admin costs and any bad loans (once the PF is exhausted, not long in its current state) taken out of all our repayments, interest and capital.
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mark123
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Post by mark123 on Feb 1, 2017 17:38:12 GMT
Does this remind anyone of Northern Rock. As I have said before there is a good chance that sooner or latter RS will come unstuck as there will not be enough short term money for refinancing of these longer term loans. This may well be a lack of confidence cause by events in other P2P platforms or just a general downturn. Then there will be a lock in of the rolling market, with some funds locked in for up to 5 years at current rates, this on it's own will probably be the end of RS as I believe very few people would place money on any RS market in these conditions. Once this happens and RS is no longer profitable I would expect to see the admin costs and any bad loans (once the PF is exhausted, not long in its current state) taken out of all our repayments, interest and capital. I believe that is a real possibility. Today there is £545k of "borrower offers" in the rolling market and only £238k plus £35k in the 1 and 5 year markets. This seems to imply (unless RS tell us otherwise) that the majority of lending is allocated to "borrow short and lend long". Over the last few days, there appears to have been a shortage of new rolling funds and rates have yo-yoed. New funds magically appeared in time. Could this be the first sign of the crisis that alender describes? In the mean time, the provision fund continues to drop further behind RS's targets - 118% (even including expected future income) instead of 125% to 150%. Of course, all these worries could be unjustified. In the past, Kev was able to give us information which avoided people jumping to the wrong conclusion. Now, RS presumably read this forum and apparently decide that silence is the best response. RS say " At RateSetter, we are big believers in transparency and its role in underpinning the growth of markets". If they want to live their published values, they should respond to the honest concerns expressed here over recent months by their more engaged lenders . Good luck, Mark
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am
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Post by am on Feb 1, 2017 23:33:16 GMT
Does this remind anyone of Northern Rock. As I have said before there is a good chance that sooner or latter RS will come unstuck as there will not be enough short term money for refinancing of these longer term loans. This may well be a lack of confidence cause by events in other P2P platforms or just a general downturn. Then there will be a lock in of the rolling market, with some funds locked in for up to 5 years at current rates, this on it's own will probably be the end of RS as I believe very few people would place money on any RS market in these conditions. Once this happens and RS is no longer profitable I would expect to see the admin costs and any bad loans (once the PF is exhausted, not long in its current state) taken out of all our repayments, interest and capital. I believe that is a real possibility. Today there is £545k of "borrower offers" in the rolling market and only £238k plus £35k in the 1 and 5 year markets. This seems to imply (unless RS tell us otherwise) that the majority of lending is allocated to "borrow short and lend long". Over the last few days, there appears to have been a shortage of new rolling funds and rates have yo-yoed. New funds magically appeared in time. Could this be the first sign of the crisis that alender describes? In the mean time, the provision fund continues to drop further behind RS's targets - 118% (even including expected future income) instead of 125% to 150%. Of course, all these worries could be unjustified. In the past, Kev was able to give us information which avoided people jumping to the wrong conclusion. Now, RS presumably read this forum and apparently decide that silence is the best response. RS say " At RateSetter, we are big believers in transparency and its role in underpinning the growth of markets". If they want to live their published values, they should respond to the honest concerns expressed here over recent months by their more engaged lenders . Good luck, Mark Money lent out in the 5 year market is tied up for 60 months; on the rolling market for only 1 month. This means that if 50% of loans were allocated to each market, and the size of the markets was static, the daily turnover in the rolling market would be 60 times larger than in the five year market. Other variables make it hard to infer the division of lending between markets from the daily borrower offers, but unless the great majority of lending is directed to the 5 year market one should expect the rolling market daily borrower offers to be much the larger. (I has moved 90% of my RS holding into AC's QAA - I didn't think that the diversification was worth the 0.5% or more lower rate. If RS's market settles at a higher level I might move some back.) I do wonder to what degree the shortage of lender offers is due to funds being repurposed to pay tax bills, or to fund ISAs (though it's a bit early for the last minute ISA rush).
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jonah
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Post by jonah on Feb 2, 2017 6:30:39 GMT
Interestingly, looking at the rate trends graph, this week looks like RS is going to have its busiest week in terms of loans this year. Can't really tell how big yet, but likely to be in the top 3 for volume of loans in a week ever.
So in part the increase in rates could be being driven by that thing people here have been asking for... an increase in borrowers!
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Post by ruralres66 on Feb 2, 2017 9:35:21 GMT
Don't RS "earn" from "churn"? Don't RS extract a "fee" from each borrower loan arranged? So, rolling generates revenue for them where as 5 year is effectively static terms of a revenue generator?
So, fulfilling long term loans from short term rolling is a "win win" for RS. It will be a problem if lots of folk take up the offer to free withdraw before March though and place their loot elsewhere.
Also, Rolling and churn give RS the authority to change PF contributions from borrowers more often, "upting" it as and when, whereas 5 year and 1 year are locked into the fees for that purpose.
RS want their cake and eat it it appears.
Rolling does not provide sufficient stability and predictability of income for lenders with volatile rates and very short loans.
It does appear there is the writing on the wall in some ways.
Where in the Terms & Conditions does it allow RS to "change the rules" in the way they are suggesting, with the "offer" suggested, thereby bypassing and without going through a predefined, process agreed with their P2P association?
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Post by GSV3MIaC on Feb 2, 2017 11:16:44 GMT
There is no churn in the borrower end (which is where the fees are paid) .. there are no '1 month rolling' borrowers out there, except RS themselves .. the money is used to fund longer term loans (go log on and pretend to want to borrow .. 1 month or rolling is not an option).
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jonah
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Post by jonah on Feb 3, 2017 5:59:59 GMT
Interestingly, looking at the rate trends graph, this week looks like RS is going to have its busiest week in terms of loans this year. Can't really tell how big yet, but likely to be in the top 3 for volume of loans in a week ever. So in part the increase in rates could be being driven by that thing people here have been asking for... an increase in borrowers! Currently 4th busiest week ever, but still got Friday, Saturday and Sunday so likely to end up higher.
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jonah
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Post by jonah on Feb 4, 2017 9:25:57 GMT
With the weekend to go, this now looks pretty guaranteed to be the second largest week for RS volume of loans ever. Arguably we should be congratulating them and hoping for continuation of the level, especially if it gives us a few extra fractions of a percent.
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elsee
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Post by elsee on Feb 8, 2017 12:37:42 GMT
Rolling now headed for 5%
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oldgrumpy
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Post by oldgrumpy on Feb 8, 2017 12:42:35 GMT
Rolling now headed for 5% B*gg*r! I chickened out at 4.6% today edit 13:27 just had my 4.6% gobbled up ... don't think 5% will actually be achieved today.
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