Northern Rock

**Dr B** · 19th September 2007, 07:50 AM

Am I the only one disgusted at the irresponsible way in which the media reported what has been happening at Northern Rock?

Newsnight and Channel 4 news did a good job (but some errors) - but it was the usual 'crisis' and 'meltdown' headlines from ITV / BBC and the papers were no better.

We will get a full-blown crisis if the media keep banging on about it - just goes to show how much of the markets are down to pure psychology.....

**Julia** · 19th September 2007, 09:28 AM

I couldn't agree more. I walked past the York branch of Northern Rock last week and literally hundreds of customers were standing in line - I've never seen anything like it. I sympathize with investors, but one billion pounds has already been withdrawn and Northern Rock really will be kaput if this continues.

**n8rae** · 19th September 2007, 09:31 AM

When barclays ran out of cash a few weeks ago and got a quick loan to cover the shortfall, no one batted an eyelid.
Yet here the same problem (though on a slightly larger scale) everyone is panicing? I wonder why that is?
Maybe because barclays is one of the big 4 no one can imagine it ever going under but little northern rock up there in the unwashed, uneducated north, anyone can believe that can go under, even if all the sums add up and they have enough cash in the long run to go around.

oh well.

nathan

**Admin** · 19th September 2007, 10:34 AM

Originally Posted by Dr B

We will get a full-blown crisis if the media keep banging on about it - just goes to show how much of the markets are down to pure psychology.....

I found it quite amazing how people react depending on the language used in the media. Words like 'emergency' and 'crisis' had people going into full-blown headless chicken mode.

If the situation had been reported accurately rather than sensationally (like with the Barclays situation) then I doubt that the same reaction would have occurred.

I heard a psychologist talking at Durham Uni a few weeks ago and he was claiming that the media have a far more profound effect on what we think than we realise. This episode backs that up.

I have a mortgage with NR and a lot of money in savings with them. No I didn't join the cues and withdraw any!!

**MRT** · 19th September 2007, 10:42 AM

There was an interview on the radio yesterday with someone who'd queued outside NR since the early hours, despite having heard the assurance that the government would pay up if all else failed. It was fascinating listening to the reasons for still withdrawing the money. Obviously there weren't any that made any sense. It was a bit like waking someone up from a particularly vivid and bizarre dream and listening to them explain how important it was that they throw the elephant out of the window before the evil wizard found them.

**bindeweede** · 19th September 2007, 04:53 PM

Well, I still have the original 500 shares I got when they de-mutualised. Today, they stand at about £2.52. A few months ago, they were £12.50. Don't know whether to rush down to my bank tomorrow at 9am and sell them, or hang on it hope. I didn't pay anything for them, so I suppose thAT IS something, and I have had dividends over the years.

Anyone bold enough to give me advice

According to their site, their profits this year are expected to be between £500 and £540 million, so they aren't exactly on the verge of collapse, but the media do seem to have it in for them.

**bindeweede** · 19th September 2007, 09:46 PM

Is the BoE Governor responsible?

http://www.bbc.co.uk/blogs/thereporters/creditcrunch/

**Dr B** · 20th September 2007, 01:48 PM

Originally Posted by bindeweede

Well, I still have the original 500 shares I got when they de-mutualised. Today, they stand at about £2.52. A few months ago, they were £12.50. Don't know whether to rush down to my bank tomorrow at 9am and sell them, or hang on it hope. I didn't pay anything for them, so I suppose thAT IS something, and I have had dividends over the years.

Anyone bold enough to give me advice

IMO - Stick with them - the best thing that can happen is for NR to be taken over - then the new company will need to make great offers to get custom - then the price will rise

People also have short memories...

**bindeweede** · 20th September 2007, 03:47 PM

Originally Posted by Dr B

IMO - Stick with them - the best thing that can happen is for NR to be taken over - then the new company will need to make great offers to get custom - then the price will rise

People also have short memories...

Well, the shares are now down to £1.77, so hardly worth bothering to sell them - the bank would charge me £45, as well.

Hope you are right about the great offers, etc. I'll just have to wait and see.