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Post by captainconfident on Oct 31, 2014 1:38:31 GMT
One question for you, sterling. Have you been on this forum before using the name twadgerbadger?
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Post by jackpease on Oct 31, 2014 7:07:03 GMT
One question for you, sterling. Have you been on this forum before using the name twadgerbadger? Lol - I am on TB alert too - symptoms of TB are starting threads - lots of them - very long posts and a forum life of about a day. Reckon Sterling's legit! I reckon the one that might leave me uncomfortable is selling the bridging loans (bullet capital repayments at the end) just before they mature. Assetz' experience suggests there is going to be trouble and newbies/autobid will scoop them up giving buyers little interest and all the risk. Jack P
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Post by bracknellboy on Oct 31, 2014 7:28:17 GMT
I reckon the one that might leave me uncomfortable is selling the bridging loans (bullet capital repayments at the end) just before they mature. Assetz' experience suggests there is going to be trouble and newbies/autobid will scoop them up giving buyers little interest and all the risk. Jack P Not sure whether we are talking FC or AC or the generic here. If we are talking AC, then an alternative view would be that you are giving up something which is either going to end cleanly, or more likely to move to a period of significant increased returns, while not necessarily having any reduction in the original security, but a high degree of uncertainty in the exit date. Well, here's hoping that is what the AC experience is going to tell us......The point here being that the 'trouble' is not necessarily for 'little interest' - it could be a degree of trouble for quite a lot of interest as repayment gets deferred. I would like to think that any 'policy led' investment plan such as appears to be upcoming on AC will not do things like sweep up loans which only have a short period remaining of the normal term with all the capital risk still prevailing. That will be for AC to make clear and for lenders to be aware of. If we are talking FC: who knows how this will be handled. I'm not sure that 'default interest rate' FC has written into the short term property contracts either.
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Post by jackpease on Oct 31, 2014 8:30:44 GMT
Sorry - clarify: Assetz's did a load of 6 mth bridging loans and these came to fruition and we see repayments are by no means assured. This forum is littered with comments from investors who are now well aware of how risky bridging loans are with bullet repayments.
Now FC jumped into bridging loans - with a more sensible 12 months term - with capital repayment at the end.
My guess is that FC investors are far less savvy than Assetz investors and many treat it like a bank and autobid will scoop up bridging loan parts albeit in slow time. With the Assetz-gleaned knowledge of bridging loan repayment difficulties, i might choose to put my FC bridging loans up for sale in month 11 for the less-savvy FC types.
That would leave me uncomfortable but i wouldn't go as far as sterling! Not saying i wouldn't do it, just saying I would feel i was behaving much lie the banks who must have known investing in sub-prime was legal but morally dubious
JP
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Post by GSV3MIaC on Oct 31, 2014 9:02:37 GMT
You may have more trouble selling them on the SM than you expect, there may be a lot of them out there, including some from fc solutions! Autobid is basically choked with property loans. I guess that may protect your morals!!
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blender
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Post by blender on Oct 31, 2014 9:20:42 GMT
Sorry - clarify: Assetz's did a load of 6 mth bridging loans and these came to fruition and we see repayments are by no means assured. This forum is littered with comments from investors who are now well aware of how risky bridging loans are with bullet repayments. Now FC jumped into bridging loans - with a more sensible 12 months term - with capital repayment at the end. My guess is that FC investors are far less savvy than Assetz investors and many treat it like a bank and autobid will scoop up bridging loan parts albeit in slow time. With the Assetz-gleaned knowledge of bridging loan repayment difficulties, i might choose to put my FC bridging loans up for sale in month 11 for the less-savvy FC types. That would leave me uncomfortable but i wouldn't go as far as sterling! Not saying i wouldn't do it, just saying I would feel i was behaving much lie the banks who must have known investing in sub-prime was legal but morally dubious JP Yes there are issues here, but really for FC and not the lenders. Firstly we should be clear that FC property loans are in no way sub-prime or packaged to deceive. We are considering good secured lending opportunities honestly presented. The 'moral' problem I agree is the sale of the property loans near the end to Autobidders who have no idea that the risk/reward balance has changed and it is not really worth buying close to the end. With FC you cannot sell a loan part with one repayment remaining from the term and so you cannot sell later than two months one month [error corrected thanks, see jackpease 5 Nov] before the end. Those who flip the property loans, relied upon by FC and induced by the 2% cash back, are really wishing to be sold in the first few months and how long a loan takes to sell depends on the secondary market that FC creates and how long it takes to sell at par or a reasonable discount. If FC is also acting as its own underwriter and selling on the SM parts unsold on the primary market then it is contributing to the potential problem of Autobidders picking up these property loans without the cashback near the end of the term, which savvy lenders would never do. But the loans are good and the security is there. We might consider whether FC should stop interest only loans being traded rather earlier - their decision not ours. Also we might consider if, for example, one of these loans is looking less good during the term - slow development or probable slower sale - how will FC communicate that to the lenders? There will be no defaults in the term because FC holds all the interest money for the term. But we could see Risk Band Removed during the term and that is a bit scary. That is the risk for someone who holds a loan until the last minute to sell to an Autobidder or the less savvy. If the loan is going to have difficulty in repaying on time, then possibly it will be RBR rather sooner.
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blender
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Post by blender on Oct 31, 2014 10:43:42 GMT
... Sorry I gave the impression I was arguing for free speech. I'm arguing for property rights (and lol @ socialist). ... A very badgery post. If you are not His Twadgeryness, you would agree on much. I have to remove socialist from Christian Socialist who hates Mammon if you take socialist to mean the removal of property rights. That was not intended and not really implied in current politics. It is a really valid and relevant debate as to whether capitalist financial markets should have an integral moral or charitable dimension, or whether regulation - by bodies accountable to the public - is the appropriate way to control the behaviour of property and rights holders in a democratic age. Personally I think that it is best to assume that Mammon is the presiding genius of financial markets, including FC, and to act accordingly. I expect that FC has a Compliance Officer but probably not a business ethics department or still less a Chaplain. (Even the England cricket team lost its chaplain a few years ago.) But on the other hand democratic man's instinct for regulation and mob control of others, taking no personal responsiblity for consequences of secret voting, can be just as bad. Do people vote for the common good or self interest and prejudice? Do you hanker after the old monastic property ownership before the dissolution, with the moral and charitable obligations? Carlyle's Past and Present is a good read on the transition to capitalism and the obligations of the new captains of industry.
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Post by oldnick on Oct 31, 2014 10:50:00 GMT
Edit: still can't get the quote system to work. Quote was "Despite your energetic support for free speech in another thread I am bound to say that your last paragraph is unnecessarily disparaging of people (rather than their actions) who are contributing to this forum. Do you get into many pub fights?" Sorry I gave the impression I was arguing for free speech. I'm arguing for property rights (and lol @ socialist). If you as a moderator (or a fortiori a site owner) don't like a particular post, your right to remove it is absolute unless the terms of use contract specifically limits that right. The exact same thing applies to banning people of course. Equally, since the secondary market system is generally operated as a relatively free market, there is no rule preventing anyone from deliberately trying to sell someone a microloan they believe will go into default shortly thereafter, and neither should there be. Nevertheless, when it comes to morality, I struggle to see the controversy in holding such behaviour in contempt. I stand by what I said before: government interference has crippled people's ability to tell the difference between legality and morality. With regard to the difference between a bad person and a person who does bad things, feel free to explore what that difference actually consists in. It always strikes me as something a probation officer might say to an offender in order not to hurt their feelings. @pub fights: hatred of Mammon is right, not for Christian reasons but just because pubs are dangerous, unclean places to be and riddled of course with not only harmful regulations (too depressing for a 'fun night out') but also hideous levels of taxation. There is no controversy in holding in contempt behaviour that offends your moral code - that is not the issue for the mods. Your private thoughts are your own to have, and even write out on a piece of paper if you so choose. The issue here is in sharing those strongly felt private thoughts on this forum in a way that offends others. It must be possible for you to lay out your moral code for public inspection and discussion without, as a corollary, rudely denouncing anyone who doesn't follow it. Food for thought?
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Post by Deleted on Oct 31, 2014 17:19:20 GMT
You think morality's just a matter of personal preference?
I think it's objectively immoral to offload a microloan to someone else when you believe (rightly or wrongly) they're likely to get burnt by it. It's different if you warn them and openly sell it as being for the more risk-thirsty investor, but if you just keep the information to yourself so that someone else gets screwed instead of you, that's pretty low.
Not really sure there's any way to phrase these things in such a way that immoral people don't get their feelings hurt though, but offer an example if you like. Why is it you want to protect the feels of immoral people anyway, just out of curiosity? Have we really come so far that it's 'racist' to point out that there's a difference between good and evil?
By the way: mushrooms. Just saying. Was reading on a certain platform's controversial discussions boards... 3-out-of-4 late following one successful payment. Same as a certain support service and a certain digital publisher.
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blender
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Post by blender on Oct 31, 2014 17:33:51 GMT
Is not morality a human cultural construct, Sterling? And evil is surely a religious construct. What on earth is evil in the context of trading loan parts?
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Post by oldnick on Oct 31, 2014 17:56:52 GMT
Not really sure there's any way to phrase these things in such a way that immoral people don't get their feelings hurt though, but offer an example if you like. I think this would do as an example: I think it's objectively immoral to offload a microloan to someone else when you believe (rightly or wrongly) they're likely to get burnt by it. It's different if you warn them and openly sell it as being for the more risk-thirsty investor, but if you just keep the information to yourself so that someone else gets screwed instead of you, that's pretty low.
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sl125
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Post by sl125 on Oct 31, 2014 18:23:45 GMT
Sterling
What you are missing is the fundamental ammoral (rather than immoral) nature of markets.
Put simply: In any market, whether it be for bonds, equities, forex or whatever, a seller is selling at a given price because he believes the price will fall; whereas a buyer will buy from him if he believes the price will rise. Buyers are matched with sellers at an equilibrium market price.
what, therefore, is immoral about selling something in the belief it may (note: may) default to a buyer who believes it may not?
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Post by GSV3MIaC on Oct 31, 2014 18:37:24 GMT
I have more of an issue selling to autobid users who believe that is a safe / simple option. Bots and maual buyers can caveat emptor.
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Post by yorkshireman on Oct 31, 2014 18:51:38 GMT
what, therefore, is immoral about selling something in the belief it may (note: may) default to a buyer who believes it may not? Nothing immoral at all about that and if anyone is daft enough to use autobid and in doing so, picks up a dud loan, then tough.
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adrianc
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Post by adrianc on Oct 31, 2014 19:35:52 GMT
Are people REALLY unsure about our friend, TwerlingSterling?
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