Friday, 26 September 2008

Bradford & Bingley - teetering on the brink

Good old B&B, the gentlemen with the bowler hats, although these days they prefer a cute chick in the bowler, they teeter on the brink. This time last year their share price was over £3 and today you could buy one for less than 20p. Will they go bust or will they not?

Amazingly, despite clinging to the cliff by their fingernails, they are still all over the TV screens offering 6.5% for your savings; while HSBC would begrudge you more than 5.5%. This is called the "risk premium", ie, it's a special bonus because you might not see your money again. Avoid!

Meanwhile, as widely predicted, not least by me in previous posts, Washington Mutual, the "big one", has just folded gracefully into the arms of JP Morgan where they will nestle with Bear Sterns. Truly in these times Cash Is King and if you're holding the folding there are bargains to be had.

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