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Post by bikeman on Jun 17, 2020 12:47:26 GMT
Explains why they gave up on P2P investors so readily. One has to wonder if their inflexible terms were drafted with this in mind.
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Post by bikeman on Jun 16, 2020 14:39:13 GMT
If you log into your account and click on cash - deposit - it'll show your account name. Address is Growth St, 133 Whitechapel High St, London E1 7QA This was from a lot of digging around rather than them telling me but should be correct ? I just posted a transfer form with the address Irongate House, 22-30 Dukes Pl, London, EC3A7LP Personally I don't think for one minute that between GS, the destination ISA and Covid-19 that any transfer request will actually happen so I may just try a cash withdrawal before they grab it back.
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Post by bikeman on Jun 15, 2020 16:56:27 GMT
Yes, gain to date on ISA is now £0.00 Yes mine too. I graciously called them incompetent.. Now I am calling them <redacted>
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Post by bikeman on Jun 15, 2020 13:37:04 GMT
Just received an email from GS calling a RE. No surprise there!
- Blindly followed ill thought out terms.
- Cut off new investment
- Override investor settings to continue lending
- Sat on their butts for 90 days
- Forced their borrowers into defaulting by giving notice to repay
Incompetence.
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Post by bikeman on Jun 1, 2020 15:07:37 GMT
No, it took years for dividends and indexes to recover. But the FTSE 100 remains over 15% below its 1999 level. No capital increase in 21 years (but dividends have been paid of course). No, the markets rebounded remarkably quickly considering the halving of prices. How long did it take US stocks to recover following the Wall St crash? Stocks took less than 5 years to rebound following GFC. No-one seriously measures world stocks based on the FTSE100 - it's remarkable because it's so concentrated in sectors like finance (remember 2007/8 was a financial crash), mining, oil & gas, not to mention housebuilders, airlines etc.... not exactly representative. My SIPP and ISA's (mainly multi-index funds) are now fully recovered since 21 Feb.
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Post by bikeman on Jun 1, 2020 14:56:41 GMT
Judging by the massive queues at IKEA I'd say the feared job losses have been staved off for the time being by the furlough scheme and there is a pent up demand for spending (and credit).
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Post by bikeman on May 31, 2020 15:25:07 GMT
GS really need lenders to support them by not trying to withdraw funds, and this could keep the platform functioning, but that doesn't seem likely to happen unfortunately. Which leaves lenders in 'a you might get (some of)) your capital back over an extended time period maybe'. If GS need lenders to support them by not trying to withdraw funds, they need to do something about their inflexible LE terms which practically guarantee that is what is going to happen.
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Post by bikeman on May 29, 2020 18:37:01 GMT
Point 3 interested me, specifically the reference to 'cover[ing] the sum of previously requested withdrawals'. I've emailed them to ask: 1) Does this mean that, if the Liquidity Event is lifted, GS will be attempting to action withdrawals requested before the Liquidity Event was called in priority to any further withdrawals requested? That doesn't seem very fair. And as soon a the LE is lifted there will be a rush by remaining investors to withdraw and the cycle starts again.
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Post by bikeman on May 22, 2020 14:42:10 GMT
1. So if I accept that the issue is not caused by defaulting borrowers, after all the LE was declared very early on when presumably there wasn't too many defaults. The LE was declared when it needed to be declared because there wasn't enough cash left for us to withdraw. Nothing to do with defaults whatsoever. GS declaring a LE as soon as a few lenders wanted to withdraw is counter productive How could they have done it later? The deployment rate literally reached 100% 1. they prevent new investments compounding liquidity and 2. they spook investors causing a 'run to withdraw'. Had they held back they would have better assessed the default situation, could have cut off credit to those in trouble or offered payment holidays as appropriate. 'Cutting off credit to those in trouble' - what do you think this means exactly? You can't just demand repayment when a borrower isn't in default. Also, again, this has nothing to do with borrowers being in trouble so repayment holidays are not relevant.New investors happy to risk could have stepped in whilst allowing others to bail out. Yes, this would have been lovely. But it literally didn't happen. That's the whole reason the LE had to be called.2. I can see from my loan book that many are 'under management'. And? These loans keep getting renewed. Yes, but from the borrower's perspective the practical effect is just a continuous line of credit. It's from your side that things change every 30 days. We wouldn't ALL be trying to withdraw ALL our money if they hadn't spooked us by locking us in. We already tried to withdraw more than was possible. Besides I don't accept that we ALL want out, I'd stay in for better rates if 1. my re-lend settings weren't overruled and 2. new investment was allowed. 'All' was me being overly simplified. Replace with 'a very high number'/a higher percentage than there is liquidity for (currently we have about 13% liquidity - do you really think only 13% of funds will be withdrawn if they lift the LE?)3. I think it's unfair that the t&cs clearly didn't allow for this situation so are deficient yet they are being used to lock in investors. Unfair =/= deficient. The terms made this situation very clear, including locking you in. You should have understood that before investing. We should also have foreseen the issue with liquidity - I feel silly for not having done so.4. The platform didn't need to shut down. It could still be running, borrowers are paying, investors could be investing, but the LE stops everything with no way out. I've explained to you why the platform had to enter a liquidity event. I've also explained to you why investment can't be solicited during a liquidity event. So I don't understand why you're still saying this. Of course new investors wont be attracted to this 'locked box' but it didn't need to be like this. Well, it did with the terms as they are. No point wishing we had a different situation. GS up with t&cs that didn't foresee this event and then blindly followed them no way for them not to follow them without an exit strategy, when it could have simply have continued to take new investment and queued withdrawals. No it couldn't - see above.5. But you say there's not an issue with borrowers defaulting so borrowers don't need helping. No, I didn't say borrowers don't need helping. I said that that's not what caused the LE. I also said that GS are doing the things you mention to help borrowers. GS are apparently about to down their platform because they lack liquidity yet they stop new investment - that hardly seems to be best for investors. But, based on the current terms, there was no other possible action.I don't think this can't be solved, I think they need to recognise that their LE is a up and modify their terms to get out of it. Yes, modifying their terms is the only way out. The problem is that this is likely to be pretty dodgy legally. I'm not sure what they'll do about this. The chance of investors getting annoyed and taking action seems quite low (but is a risk); but the FCA also may not like it. We'll have to wait and see.My responses in bold (if I could do them in a different colour, I'd really feel like I was back in the City). Hope this clears up these issues. No I didn't examine all of the terms either. I am not a sophisticated investor so wouldn't have picked up on this anyway and so in hindsight I should probably have not invested but I was sucked in by the marketing blurb. You've agreed their LE and RE process are flawed and have boxed GS into a corner but it seems like you accept them, and their dictated course of action just because they exist. Whereas I wont accept them because I consider them to be unfit for purpose and therefore unfair to investors, so I'd have expected GS to excise a duty of care to their investors and not blindly follow them.
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Post by bikeman on May 22, 2020 14:27:45 GMT
bikeman I'm personally of the view that calling the Liquidity Event was overall a positive thing - maybe not in the short term but in the long term it's a protective measure to help keep the platform churning for longer. If they simply ignored the liquidity issue, as you suggested, then things would of gotten nasty real quick and who know's where the numbers would of ended up - the investors that weren't "spooked" would be pretty much tied up indefinitely. As for allowing new investors - this is simply not possible due to FCA regulations. And as Chris mentioned, even if it were feasible, there would have to be a new set of terms to really highlight to new investors that your locking your money away indefinitely, with no protection on capital and for a variable interest rate. Those characteristics would be largely unattractive to any new investors, not to mention potentially immoral - which goes back to FCA regulations. Though I do recognise what your saying - simply calling the Liquidity Event and freezing everyones money and starting a ticking time bomb with the Resolution Event doesn't really provide much confidence in the platform. If GS aren't able to sell the loan book, then I honestly think the best next thing to do is play the waiting game - implement a queued withdrawals system that REQUIRES liquidity in order to withdraw your money, limit amount of your porfolio that you can withdraw in any given month and call off the LE. Though there seems to be a period where they cannot change their terms regarding withdrawals for at least 14 days - so whether there has been a big enough built up buffer of funds to safely cover that period before the queued system kicks in is a bit of an unknown. Is there a possibility they could still be technically abiding by their terms by allowing withdrawals but only interest (a bit like AC are doing at the moment?) - GS terms are pretty left open for interpretation so I would imagine with a good legal perspective on it they could find some wriggle room. There wouldn't be a liquidity issue had they managed a withdrawal queue. If the platform wasn't in LE new investors could still be attracted by better rates or other incentive. They could cut borrowers credit and feed their repayments back to investors. Locking investors in so they can continue a line of credit must be immoral. As has been said borrowers in default is not an issue yet so the loan book has value, so they should be able to make this work. Having a fire sale of the loan book is neither necessary nor in the investors interest. The terms of the LE and RE seem to be flawed. Quite why GS must religiously stick to the terms of something they know wont work is beyond me. Freezing the platform doesn't resolve anything, all it's done is line everyone up for a rush to the door.. It's frustrating that so many of you are taking the line 'the t&cs are flawed but it's there in black and white, nothing can be done'. That is bollocks.
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Post by bikeman on May 22, 2020 11:05:17 GMT
Sounds like this is a problem of their own making - an unforeseen event not allowed for - calls into question their competence? I really don't understand why they are being so inflexible: surely they can chase defaults? Offer payment holidays? Maybe even call in the loans? If these are rolling 30 day loans why are defaulters still being lent to? Why aren't payments received being used to help liquidity?T&Cs aren't cast in stone, they can be changed and challenged if unfair. Even if this was the case, why close to new investments? There's always those ready to take on riskier investments. By closing off new investments they caused this problem themselves. It's as if they want to preserve their customer base at all costs and the investors. There's a conflict of interest here and the inflexible t&cs are just an excuse to hide behind. 1) They are doing all the things you mention - but they're not especially relevant here. The LE hasn't been caused by particular problems with the loanbook; it's been caused by all of us freaking out and wanting to withdraw our money because of the global economic situation. 2) These are only rolling 30 days loans from our perspective, in practice. The borrowers don't have to repay every month, and then get the money back. Also, who are the defaulters you think are being lent to? Again, this situation hasn't been caused by defaults... Interest payments and re-financing are helping to increase the cash buffer (this has been discussed countless times in this thread); but that doesn't help us much if we all try to withdraw all our money. 3) Yes T&C can be challenged if unfair from the consumer's perspective. But how would that work here? What do you think is 'unfair' in them that we could challenge that would be helpful? 4) As has been explained before countless times, there would almost certainly be significant regulatory issues with taking on new investments while the platform is essentially shut down. Even if it were possible, a whole new set of T&C would need to be drafted for these lenders and they would likely need to be offered far higher interest rates to throw their money into a locked box like this. 5) I think it's pretty clear they want to help both their borrowers and their investors. Both are crucial for them to be able to continue to operate. As I've said many times before, there is one essential thing that GS overlooked: requiring liquidity for withdrawals in its T&C. If they had included this, the LE would never have needed to have been called. And without it it can't be solved. 1. So if I accept that the issue is not caused by defaulting borrowers, after all the LE was declared very early on when presumably there wasn't too many defaults. GS declaring a LE as soon as a few lenders wanted to withdraw is counter productive 1. they prevent new investments compounding liquidity and 2. they spook investors causing a 'run to withdraw'. Had they held back they would have better assessed the default situation, could have cut off credit to those in trouble or offered payment holidays as appropriate. New investors happy to risk could have stepped in whilst allowing others to bail out. 2. I can see from my loan book that many are 'under management'. These loans keep getting renewed. We wouldn't ALL be trying to withdraw ALL our money if they hadn't spooked us by locking us in. Besides I don't accept that we ALL want out, I'd stay in for better rates if 1. my re-lend settings weren't overruled and 2. new investment was allowed. 3. I think it's unfair that the t&cs clearly didn't allow for this situation so are deficient yet they are being used to lock in investors. 4. The platform didn't need to shut down. It could still be running, borrowers are paying, investors could be investing, but the LE stops everything with no way out. Of course new investors wont be attracted to this 'locked box' but it didn't need to be like this. GS up with t&cs that didn't foresee this event and then blindly followed them without an exit strategy, when it could have simply have continued to take new investment and queued withdrawals. 5. But you say there's not an issue with borrowers defaulting so borrowers don't need helping. GS are apparently about to down their platform because they lack liquidity yet they stop new investment - that hardly seems to be best for investors. I don't think this can't be solved, I think they need to recognise that their LE is a up and modify their terms to get out of it.
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Post by bikeman on May 22, 2020 9:16:50 GMT
I really hope GS can find a way round the current T&Cs to allow interest and repayments to be restricted at the start of normal times, the other option could be a resolution event which I believe will be worse for lenders. They did mention about limiting withdrawals around 2 weeks ago, but that was merely a response to the many suggestions they've been receiving about it. I'm pretty skeptical at this point they have any intention of limiting withdrawals/implementing a queued system - the impression I got from their most recent communication is that they are mostly putting all their eggs in one basket by primarily exploring selling all or part of the loan book. As you mentioned, selling off the loan book would likely be only attractive to the best loans and leave the bad loans for rest of investors. It's just so unfortunate they are bound by their very inflexible terms which may ultimately harm investors. On a personal level, I would much rather lock my money up for longer without a haircut to capital than wind things down quickly as possible with a haircut. But that's not a choice I can make, even if the majority of investors were given a vote for such a scenario they would still likely be bound by their terms. 😐 Maybe I'm mistaken and they can find a way to do it though. Sounds like this is a problem of their own making - an unforeseen event not allowed for - calls into question their competence? I really don't understand why they are being so inflexible: surely they can chase defaults? Offer payment holidays? Maybe even call in the loans? If these are rolling 30 day loans why are defaulters still being lent to? Why aren't payments received being used to help liquidity?T&Cs aren't cast in stone, they can be changed and challenged if unfair. Even if this was the case, why close to new investments? There's always those ready to take on riskier investments. By closing off new investments they caused this problem themselves. It's as if they want to preserve their customer base at all costs and the investors. There's a conflict of interest here and the inflexible t&cs are just an excuse to hide behind.
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Post by bikeman on May 21, 2020 19:56:14 GMT
I notice my defaults have not gone up in last 20 days, is that because all loans are in forebearance? if so, a lot of bad debt is being stored up! The govt is spending so much to help individuals and businesses, I'm not convinced that we will see large scale defaults. Rather the cancelling of DDs last month was a holding strategy for borrowers while they assessed their position. Many think they can take a payment holiday. Many individuals will now be furloughed and will restart payments. Businesses will be using the govt loans and not about to throw in the towel quite as readily as the pessimists here believe. I'm disappointed that most of the P2P platforms have reacted so badly, locking in their investors and not accepting new investment - with interest rates so low, there would be others who see this as an opportunity.
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Post by bikeman on May 21, 2020 19:46:41 GMT
I've got a recovery that will take 126 years... I'm thinking of taking out a FC loan to recover my investment losses - they're so fkin useless at recovery I'd probably get away with it.
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Post by bikeman on May 21, 2020 19:29:42 GMT
Today I received an email from GS which apart from promising a higher interest rate (really?), seemed to be more around their commitment to keeping a credit line for their borrowers than returning capital to their investors. Have I bought into an open ended credit line from which I can never escape?
Can someone enlighten me - what exactly are GS doing to 'fix' liquidity (apart from selling off their loan book and walking away) if they are not accepting new investment?
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