Am I correct in assuming that, in contrast to what I was told in my youth that I should open an account with the Halifax Building Society (as was) to ensure that when it came to wanting a mortgage they’d look on me favourably because I already saved with them (how quaint!), that building societies now also create money out of thin air? And if so, I wonder was this a consequence of the financial bailout or had it always been going on?

Reply
Richard Murphy says:
March 7 2016 at 5:28 pm
Building Socities are not banks. They are financial intermediaries and so in fact what you were told – and what I was told long ago – was right then

But there are very few building socitities left.

The usual definition of banking, OK not a formal one but a good one, is that anyone who borrows short and lends long is a bank, anyone who does not do this is not a bank. Building societies most definitely do (and therefore also create money, or as I call it credit) and are therefore banks.

12 thoughts on “Hmm”

  1. Bloke in North Dorset

    A Building Society just a bank that’s mutually owned by the members aka borrowers and savers.

    As to saving with them before you get a mortgage, that wasn’t quaint, it was the whole point.

  2. Ok Richard, I started saving with Yorkshire BANK when I was 8 years old so that I could get a mortgage from Yorkshire BANK when I was in my 20s.

  3. Surreptitious Evil

    Personally, I saved with a then building society but got my mortgage from them not because of that but because one of my father’s ex-students was the local branch manager.

    Branch managers don’t have anything like that influence nowadays.

  4. As to saving with them before you get a mortgage, that wasn’t quaint, it was the whole point.

    Quite. Not quaint.

  5. Branch managers don’t have anything like that influence nowadays.

    Branch managers are cut from the same cloth as the wide-boys trying to flog you a warranty on a computer at PC World, only decked out in a flammable, ill-fitting suit of the type commonly seen outside Manchester Crown Court.

  6. Branch managers are cut from the same cloth as the wide-boys trying to flog you a warranty on a computer at PC World, only decked out in a flammable, ill-fitting suit of the type commonly seen outside Manchester Crown Court.

    Quite so. And I won’t get started on their haircuts. My parents used to invite the local bank manager, headmaster, vicar and farmer for drinks. Now, the bank manager would be some greasy spiv, the headteacher some bleeding heart pinko, the vicar some femiloon halfwit….Probably only the farmer wouldn’t have changed much.

  7. My stepfather was a branch bank manager and exactly the sort of sober professional you might imagine. He also had a lot o autonomy and authority over what – in his small part of the world – the bank did.

    The personal banking people I have dealt with in the UK are exactly as Tim N states. Had to deal with small business types twice in the past 5 years or so for setting up accounts for new companies and they were just depressingly stupid and useless.

    Still, progress eh?

  8. Henry – that is via the bbc. Otherwis farming is like engineering fishing or soldiering. Real stuff and no room for cunts or fantasists, new labour twats or neo cons.

  9. MC
    Yes, we thought we were being clever laughing at Captain Mainwaring, ha ha ha. Now the joke is on the other foot.

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