HSBC - falling apart?
Discussion
deckster said:
RSTurboPaul said:
You trust a bank based in China to do what they say they are doing? lol
HSBC global head office is in London, HSBC UK is a very separate entity to HSBC China, and almost all the board & senior management are Westerners. But don't let that stop you.A solicitor from their UK legal department contacted me after a month or so, including a copy of their trademark and saying the domain name was rightfully theirs, they offered to cover my costs incurred but nothing more. I asked for them to show me how the trademark covered internet domains, it didn't so they didn't make the progress they wanted. I ended up getting a correspondence with hand written Chinese on it. This was 15 years ago so they weren't that separate back then, it seemed like the Chinese were running the show.
You've got to love the irony of a Chinese company giving it the big one over trademarks.
They knew I'd tried to register a few other domain names (McDonalds, Ford, etc) and I'd also run my mouth on a forum (screenshots of these were in their correspondence with Chinese hand writing on them) so it was clear I didn't have legitimate intentions for owning the domain name. If I wanted to dispute it, I'd need to go to court in the country the website was registered in which was China. They just took it back and I didn't do anything about it.
b
ds, I deserved a few quid for the pluck of it. NickCQ said:
ATM said:
The money banks make has absolutely nothing to do with the interest rates on deposits.
? banking is a spread lending business (plus fees and market making revenue)?This is a common misconception. They manufacture money from fresh air then charge you Interest for borrowing it.
https://www.bankofengland.co.uk/knowledgebank/how-...
NickCQ said:
ATM said:
This is a common misconception. They manufacture money from fresh air then charge you Interest for borrowing it
That is well known (it's just equivalent to saying that banks are capital constrained not reserve constrained), but banks still have liquidity costs.Yes, my wife was locked out of her internet banking because of a transfer she was making. That's fine. But the fraud team weren't available until something silly like 8am the next morning, and even then they needed her to go to her local branch "because of covid" to get the account unlocked.
And to the comment above - they're right. I'm often involved in a lot of bureaucracy with banks and the way they plan things for DR and contingency. It's very hard to take them seriously when they pull st like this.
And to the comment above - they're right. I'm often involved in a lot of bureaucracy with banks and the way they plan things for DR and contingency. It's very hard to take them seriously when they pull s
t like this.ATM said:
NickCQ said:
ATM said:
This is a common misconception. They manufacture money from fresh air then charge you Interest for borrowing it
That is well known (it's just equivalent to saying that banks are capital constrained not reserve constrained), but banks still have liquidity costs.Without just posting a link to the BofE website, why not explain to us, as you would to them, how banks "manufacture money from fresh air" and then make money from lending it to us.
SJfW said:
Without just posting a link to the BofE website, why not explain to us, as you would to them, how banks "manufacture money from fresh air" and then make money from lending it to us.
Bank deposits are money.To illustrate, If you and I were both banks and we were to lend each other £100, then we have just created £200 of 'money' on a gross basis.
The £100 you owe me and the £100 I owe you are both 'money', being bank liabilities / deposits.
Of course, we don't make any profit from creating this money, I have just increased the leverage in the system.
That's where the previous poster is getting over-excited - if you look at the P&L of a bank they make money from net interest income not seigniorage.
NickCQ said:
SJfW said:
Without just posting a link to the BofE website, why not explain to us, as you would to them, how banks "manufacture money from fresh air" and then make money from lending it to us.
Bank deposits are money.To illustrate, If you and I were both banks and we were to lend each other £100, then we have just created £200 of 'money' on a gross basis.
The £100 you owe me and the £100 I owe you are both 'money', being bank liabilities / deposits.
Of course, we don't make any profit from creating this money, I have just increased the leverage in the system.
That's where the previous poster is getting over-excited - if you look at the P&L of a bank they make money from net interest income not seigniorage.
That's a long way short of "manufacturing money from thin air," wouldn't you agree?
SJfW said:
Which is merely describing how banks are intermediaries and lend deposits out as loans, within the limits of capital adequacy set out by the regulators. That's a long way short of "manufacturing money from thin air," wouldn't you agree?
I think we are in agreement. There is no magic or secrecy to the nature of money creation by deposit-taking banks.It is technically correct to say that banks 'manufacture money out of thin air' but that is only true on a gross rather than net basis and, as I said, there are no seigniorage profits.
NickCQ said:
SJfW said:
Which is merely describing how banks are intermediaries and lend deposits out as loans, within the limits of capital adequacy set out by the regulators. That's a long way short of "manufacturing money from thin air," wouldn't you agree?
I think we are in agreement. There is no magic or secrecy to the nature of money creation by deposit-taking banks.It is technically correct to say that banks 'manufacture money out of thin air' but that is only true on a gross rather than net basis and, as I said, there are no seigniorage profits.
Simply put most people seem to believe banks need to have the money already before they can lend it out. So people save money and the banks use this for loans. But its a 1 to 1 thing so if you deposit 1000 they can lend 1000 to someone and that's it. This is what most people believe happens in banks. When you try to explain that this is not the case they seem genuinely shocked or presume you're just talking rubbish. The premise that the money did not exist before a loan was made is beyond believable for the general public. That's what I find anyway.
My thin air comment is deliberate because the use of complicated banking terms doesn't resonate with Joe public. Where as the thin air comment makes them go hang on a minute.
When I first found out about this I was genuinely shocked and just could not believe it. It took me a while to come round to the idea. At that time you couldn't find simple statements supporting it on the Bank of England website. As if it was some form of conspiracy theory.
Let's face it if you didn't know this and someone told you then your first reaction would probably be this person is crazy. Banks can just make up money from nothing or nowhere. That's just crazy.
My thin air comment is deliberate because the use of complicated banking terms doesn't resonate with Joe public. Where as the thin air comment makes them go hang on a minute.
When I first found out about this I was genuinely shocked and just could not believe it. It took me a while to come round to the idea. At that time you couldn't find simple statements supporting it on the Bank of England website. As if it was some form of conspiracy theory.
Let's face it if you didn't know this and someone told you then your first reaction would probably be this person is crazy. Banks can just make up money from nothing or nowhere. That's just crazy.
ATM said:
My thin air comment is deliberate because the use of complicated banking terms doesn't resonate with Joe public. Where as the thin air comment makes them go hang on a minute.
But as we have discussed on this thread it's really a trivial point.Your earlier implication that the way banks make money is by creating money and paying it to themselves is misleading.
NickCQ said:
ATM said:
My thin air comment is deliberate because the use of complicated banking terms doesn't resonate with Joe public. Where as the thin air comment makes them go hang on a minute.
But as we have discussed on this thread it's really a trivial point.Your earlier implication that the way banks make money is by creating money and paying it to themselves is misleading.
They manufacture money from fresh air then charge you Interest for borrowing it.
ATM said:
NickCQ said:
ATM said:
My thin air comment is deliberate because the use of complicated banking terms doesn't resonate with Joe public. Where as the thin air comment makes them go hang on a minute.
But as we have discussed on this thread it's really a trivial point.Your earlier implication that the way banks make money is by creating money and paying it to themselves is misleading.
They manufacture money from fresh air then charge you Interest for borrowing it.
The deposits held by banks or lent to it by other banks (for example) are liabilities and the loans it makes are assets. Whilst there is a mismatch in duration, after they are both repaid, the money supply is exactly what it was.
Yes, the bank only needs to hold ~10% of it's balance sheet as reserves, but that doesn't mean the other 90% is created from thin air - it has to come from the bank's liabilities.
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