Gold as collateral

[dicker]

Hi All

I wanted to recount an amusing experience that may make you smile. 
 

Six months ago, I needed to borrow 30 k from my bank for a few weeks. I didn’t want to cash out of any investments so a loan seemed sane and at current rates cheap.  Borrowing meant I would save a lot of cash in the long term.

Made an appointment and rocked up and asked to borrow 30k.  The bank said no.  So I said not a problem at all, I will handover 30k in gold as collateral.  The bank said no, it does not work like that...Thanks a million!
 

Roll forward to COVID and bounce back loans from the government. I was in branch and needed to transfer money from my business account and the bank employee told me that I could have 50k if I needed it tomorrow would only take 5 mins to fill in the form and no collateral needed. 
 

I didn’t need it and didn’t take it despite it being free.....created by the governments money printing machine … the government provide the liquidity not the bank  

Moral of the story retail banks are terrible at helping customers whatever they claim.  
 

 Best

Dicker

[Movefaster]

I have tried to borrow in Canada using the same idea as you. Even after it was announced as a Tier One asset by the banking system. They smiled and said we don't want gold.

 

They also advised me to sell all metals for stocks, "let the Pro's" invest your money....

[dicker]

My bank won’t lend me money despite being what you might call a good customer with assets.  They are however very very keen to try and sell me products I don’t want. 
 

I have always worked for investment banks and just despair when trying to do anything with a retail bank.  Very hard, inflexible, not business friendly wheatever they say. 
 

Best

Dicker

[dicker]

It was even in the vault in the same building!

[DarkChameleon]

26 minutes ago, Movefaster said:

I have tried to borrow in Canada using the same idea as you. Even after it was announced as a Tier One asset by the banking system. They smiled and said we don't want gold.

 

They also advised me to sell all metals for stocks, "let the Pro's" invest your money....

Cos right now the pro's have nade our investments in stock outperform our gold and silver stacks....lol

[dicker]

Well they can do...less likely if you buy products from a high street bank of course.  

[motorbikez]

Lol I've had similar experiences with retail banks. I gave up with them 20 odd years ago, every time I went in with what I consider a simple enquiry the staff including bank manager could not answer my questions. Example in 2000 I wanted to buy a new Golf GTD from Ireland as they were £3000 cheaper than in the UK (Ireland was in the punt then) I asked if I could hedge some cash forward, f--k me what a performance the manager was clueless eventually I was referred to someone in Manchester who knew what I was talking about & to fair sorted it for me. That was HSBC but I've had similar trials & tribulations with Nationwide & Lloyds.

I don't engage with banks at all now other than current account.

All retail banks can do is sell you stuff you don't want or need if you are gullible enough to take their advice.

[Guybrush]

Its a joke, when I took out my mortgage my partner had a CCJ, applying with my partner we was declined so I had to apply on my own.  Needless to say with only one person to come after in case of default they was happy to lend.  But with two they would not provide the mortgage!

Go figure, these people are 1st class prize idiots.

[dicker]

@motorbikez Bang on

[Happypanda88]

Ah, it is a barbarous relic did you not know ! 

Even the Bank Of Canada sold off all its gold reserves back in 2016 !

So it can't be worth anything !! 😄

[KRO]

For retail banks, it all went wrong years ago. when computers 

took over from Branch Managers, who knew their local customers, in decision making.

My first job in 1965 was as a securities clerk at Barclays. The manager interviewed loan applicants and made a lending decision based on his knowledge of the customer, upto the sum of £5,000. Above that huge amount the decision went up to the Local Head Office 

 

In those days we took land and property, commercial property and stocks and shares as security. I don't ever recall a loan against Gold in the branch I worked at

[Xander]

Was the manager's name Wonger by any chance, you know, £30K Gold this week, worth only £3K next week.🤑

[dicker]

I have had my bank lose two cheques in two years payable to me. 
 

I keep the stubs and they are useless.  One cheque was completely lost, the other was paid back into the account from which it was written. 
 

They told me on the second lost cheque that “you should encourage your customers to pay electronically”. Clearly some sort of excuse for not being able to clear a cheque.   

[DarkChameleon]

Wait three weeks then your collateral will buy the property outright...lol.

[DarkChameleon]

18 minutes ago, KRO said:

For retail banks, it all went wrong years ago. when computers 

took over from Branch Managers, who knew their local customers, in decision making.

My first job in 1965 was as a securities clerk at Barclays. The manager interviewed loan applicants and made a lending decision based on his knowledge of the customer, upto the sum of £5,000. Above that huge amount the decision went up to the Local Head Office 

 

In those days we took land and property, commercial property and stocks and shares as security. I don't ever recall a loan against Gold in the branch I worked at

And yet whole countries do that with each other.

[DarkChameleon]

22 minutes ago, Guybrush said:

Its a joke, when I took out my mortgage my partner had a CCJ, applying with my partner we was declined so I had to apply on my own.  Needless to say with only one person to come after in case of default they was happy to lend.  But with two they would not provide the mortgage!

Go figure, these people are 1st class prize idiots.

Both buy smaller properties then use them, the bank would be happy with paid off properties...lol.

[Martlet]

1 hour ago, dicker said:

I didn’t need it and didn’t take it despite it being free.....created by the governments money printing machine … the government provide the liquidity not the bank  

Moral of the story retail banks are terrible at helping customers whatever they claim.  
 

Though governments are helping?  

I'd like to make the pedantic technical point this isnt printed, its borrowed. We're all going to be paying this back over the next decade, take it if you can. 

[dicker]

@Martlet Point well made and I agree. 
 

Best

Dicker

[DarkChameleon]

2 minutes ago, Martlet said:

Though governments are helping?  

I'd like to make the pedantic technical point this isnt printed, its borrowed. We're all going to be paying this back over the next decade, take it if you can. 

When the whole world is a debtor to everyone else who in reality owes and who is owed?, its hard to find a country not around 80% or higher debt to gdp....unless some aluen speCV ies comes calling in reality were only in debt to whatever we feel we are...the banks can come calling but unless we have stakes in the ground theres nothing ti take, you cant jail the whole planet, goner threaten atom bombs if you dont pay?...there has to be a renogotiation at some point or well just be 20 billion people who one day stand upmand say now more debt slavery and call the world banks bluff.

[Clockpuncher]

Sad reality is there is just no service in retail banks as it’s not commercially viable. The drive is towards automation, self service and scalability.

I work in a bank and we do lend against physical and paper gold at decent LTVs (70%ish), plus for good rates (1% margin over base type area) but you need to have a fair few mil liquid with us to get in the door so it’s not for the average punter

[MancunianStacker]

1 hour ago, motorbikez said:

Lol I've had similar experiences with retail banks. I gave up with them 20 odd years ago, every time I went in with what I consider a simple enquiry the staff including bank manager could not answer my questions. Example in 2000 I wanted to buy a new Golf GTD from Ireland as they were £3000 cheaper than in the UK (Ireland was in the punt then) I asked if I could hedge some cash forward, f--k me what a performance the manager was clueless eventually I was referred to someone in Manchester who knew what I was talking about & to fair sorted it for me. That was HSBC but I've had similar trials & tribulations with Nationwide & Lloyds.

I don't engage with banks at all now other than current account.

All retail banks can do is sell you stuff you don't want or need if you are gullible enough to take their advice.

Us Mancs aren’t that bad after all 👍🏻