Rebirth of England.

Chapter 613 Richard

"Frankly speaking, I think the government needs to come up with funds to support domestic subprime mortgages. The United States has already done so, mainly targeting ordinary people with a certain repayment capacity. It has come up with more than $1000 billion to ensure that they have paid their mortgages for quite some time and will not have their homes repossessed due to temporary difficulties."

As mentioned before, the financial policy of the British government is still mainly based on liberalism with minimal intervention. This policy will make the financial system more dynamic under normal circumstances, but when faced with serious damage such as the subprime mortgage crisis, it can easily lead to a chain of catastrophic consequences in the financial system.

This time, Barron's meeting with Finance Minister Darling was to persuade the other party to agree to provide assistance to ordinary people who are having difficulty repaying their mortgages, so that Britain can launch a rescue plan similar to the previous "lifeline" plan of the United States.

"The rescue I'm talking about is not for the relevant banks, but for those who are normally able to repay their mortgages but are temporarily in difficulty due to the subprime mortgage crisis. These groups are the backbone of our society and we need to ensure that they can survive this crisis and keep the properties they purchased."

Barron did not lie to Darin. Such rescue measures were indeed very necessary. If the purpose was purely for real estate investment and speculation in the form of leverage, then there was no need for the government to provide rescue.

However, there are still many people who need to buy a house and have sufficient repayment ability, but are affected by the subprime mortgage crisis - or suffer losses in other investments, or because the company they work for suddenly goes bankrupt, or they are laid off... and other unexpected reasons.

If it were normal times, the government could still maintain a "free economy", but in the current situation, it must suppress panic and give the "middle class" some support to help them get through the crisis safely.

Of course, Barron and others are already aware of the attitude of the British government.

Therefore, last month, the four major listed banks in the UK - HSBC Holdings, Royal Bank of Scotland, Standard Chartered Bank and Barclays Bank - jointly established a crisis response fund of up to 500 billion pounds to provide guarantees for some non-performing assets of some British banks affected by the subprime mortgage crisis.

Naturally, the objects guaranteed by this fund also need to be reviewed by a temporary agency composed of four banks.

This time, the government's rescue plan is being promoted not only by Barron, but also by senior executives of other banks.

After all, these banks are all involved in housing mortgage loans to a greater or lesser extent, and they certainly hope that the government can provide assistance to some users with better qualifications in order to reduce the proportion of their non-performing assets - even if they can recover the mortgaged properties when facing customer defaults, they are banks, not real estate sales companies, and they simply don't want to spend too much energy dealing with these properties.

Moreover, since last year, the real estate market in the UK has continued to decline, and the market value of almost all mortgaged properties is lower than the mortgage loans they provide...

Among them, Standard Chartered Bank's situation is still the best, because after being acquired by Barron's, Standard Chartered Bank has strictly controlled the issuance of housing mortgage loans, especially those extremely risky subprime mortgages, and their operating scale only accounts for a very low proportion.

This type of non-performing assets of Standard Chartered Bank mainly comes from the related businesses of Northern Rock Bank that they acquired.

If these businesses of Northern Rock Bank account for a high proportion for the bank, then they are not too high when compared with the scale of Standard Chartered Bank.

Moreover, before Standard Chartered Bank acquired Northern Rock Bank, these non-performing assets had already been written down by a considerable proportion of Northern Rock Bank's market value.

Then just recently, the Cavendish Trust injected 100 billion euros of the profits it made through the DS Group in this short-selling into the Cavendish Asset Management Company under the trust fund, and through the Cavendish Asset Management Company, it purchased assets worth 100 billion euros from Standard Chartered Bank.

These assets are all from the non-performing assets of Northern Rock Bank acquired by Standard Chartered Bank - some properties that were reclaimed because of mortgage loan defaults. After purchasing these properties, Cavendish Asset Management will simply organize and renovate these properties and rent them out temporarily - after the British house prices rise again, even if the rent is not counted, it can still get a satisfactory return.

Standard Chartered Bank also recovered funds by selling these assets, greatly reducing its non-performing asset ratio, and was also able to repay a considerable portion of Northern Rock Bank's previous short-term high-interest foreign debt.

It can be said that this is a win-win situation. At present, it seems that Cavendish Asset Management will suffer a slight loss - although they acquired these properties in a package at a price slightly lower than the current market price, the real estate in Britain is still continuing to fall, and the market is not optimistic about this. The latter transaction may soon show a loss on the books.

But Barron understood that the real estate market in Britain, especially in London, would pick up again in the next few years and be higher than previous prices. As a long-term investment, this transaction by Cavendish Asset Management would at least be satisfactory in terms of returns.

……

On September 9, Bonnie Cavendish began to respond three days before her due date.

That night, in the best obstetrics and gynecology hospital in London, Bonnie gave birth to their second son as Barron waited anxiously.

"Thank you for your hard work, baby."

Barron held Bonnie's hand, looked at her weak appearance, and kissed her on the forehead.

"I want to see our child..."

"He was just taken out to be cleaned up. I believe he will be back soon."

Of course, as Barron's descendant, after the child is born, there will be someone accompanying the nurse throughout the process to ensure the baby's safety.

Just as Barron finished his words, the nurse brought the baby in.

"Look, he's so cute, just like George when he was little..."

Barron took the child, placed it in front of Bonnie, and spoke to her softly.

Their child, who was second in line to the title of Duke of Devonshire, was named Richard Cavendish by Barron.

(End of this chapter)