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d2tod4

Listed below are comments made by d2tod4 between Tuesday, 9th September 2008 and Monday, 29th September 2008.

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B&B: end of an era 08:18am on 29 Sep 2008 The ending of the Mutual building societies was another of the events that, while ostensibly a financially driven decision, had greater, but initially invisible effects.

A number of these kind of events which may make sense in themselves have accumulated over a number of years until we have the mess that we now have.

The original reasons for setting up Mutual Building societies were better than the reasons for ending them.

But they are just one aspect of the dissolving effect on society of single decisions taken ostensibly for purely business reasons.

One other example, outside the purely Banking and Financial services sector is the shameful way large companies in telecommunications and Power (to name the two worst) are able to indulge in confusion pricing whose main (possibly only) aim is to cheat the customer.

"Cheat";being a word that somehow went out of fashion over the last 30-40 years.. along with "lie"
British banks shorted 1:54pm on 24 Sep 2008 I think I have gone too far to be rescued now as paranoia completely sets in.

With all the mates-rates setting going on over Bank takeovers, and a "turning point" a day maybe the US have just wheeled out just about the last credible icon who can be portrayed as reassuring.

The heads of the Banks can't be wheeled out anymore..and even the Fed are making it up as they go along...so the straw chewing, stolid, old fashioned Sage of Omaha steps up and has a punt.

I also have to say on Sunday night when watching a portly Belgium detective I was struck how the ad breaks seemed to be full of Halifax;s singing staff and an ethereal Bradford and Bingley ad---- more to convince us by their apperance, I felt, that it is all safe, solid business as usual out their in Money land; as for any chance of getting anyone to actually put any money in the accounts.

As long as I don't start hearing the band strike up Abide with Me inside my head everything might still be alright!
Bye bye bulge-bracket 3:48pm on 22 Sep 2008 Maybe the biggest effect of this whole thing (and it's had and will have some pretty big effects) is a complete change in the way the Banks, Bank Managers and the self-styled Masters of the Universe are viewed.

In the same way as the first world war revealed the fact that one's "betters" weren't at all really---- and started a process of undermining the long established automatic deference to inherited position in the UK; with the move to respect and authority having to be earned rather than assumed or granted.

I feel the anipathy and shock being registered by odinary people about the underlying 'principles' and mechanisms of Banks is of a similar order.

And the effects are likely will play out for decades and not years

.
The American way to fail 4:38pm on 19 Sep 2008 So HBOS and more importantly historic company presence in Edinburgh and Halifax, and even more importantly the tens of thousands of jobs involved have all gone....and yet another bonus-fest no doubt triggered for a swathe of Lloyds TSB executives and Directors in a few years------because of less than 24 hours in deciding to put a temporary halt to short selling???

As #2 highlighted.....the seems the most utterly bonkers episode of the lot recently.
Bank spanked - who weeps? 5:07pm on 15 Sep 2008 I see the argument about Fmae and Fmac causing financial turmoil if allowed to fail----but I still think Northern Rock wasn't a financial decision as a political one...and it hasn't really been saved, so much has had the inevitable postponed at great cost.

But the moral hazard rebalancing will only have been acheived when over powerful executives have been forced to accept the same terms as the shareholders....ie they don't get to lose their jobs with the aggregated proceeds of the years spent creating the disaster safely banked.

The best idea I have heard so far (which is so simple that it must be flawed) is to retain all (or some portions) of executive bonuses and options until the true effects of decisions are seen.... say 5 or even 10 years for total payouts to be completed.

Then if they are delivering "real shareholder value" and want some reward now.... they can even buy some in the market and share in the dividends.

Finally re the "We have to pay what the market rate is for top talent." justificatory argument----surely that now means, as top talent from Merrill Lynch, Lehman, NR, Bear Sterns...maybe AIG etc are getting zero (or soon will be) the Remuneration committees of the big banks will be shaping the current pay and bonus awards accordingly...?
Meltdown Monday 1:33pm on 15 Sep 2008 Re POst #30......" i have long believed that a large part of this problem has been the media feeding frenzy "The only news worth reporting is bad news"- ......

"But, for the avoidance of doubt, this firm is not bust nor seems in imminent danger of collapse".

Oh dear Mr Peston - perhaps your degree in hindsight is not a first class one after all!"

You can't have it both ways...either the problem is the reporting causing things to happen....or it isn't...How come Peston's report collapsed the Northern Rock but failed to hold up Lehman???

And just a note from the real economy...I am heading out right now with some fellow executives here to start loooking at possible new offices....already this morning one agent quoted the rate per sq ft/ price to buy and immediately went on to say .."but it's all negotiatble"...

From the posting name you'll guess I play a little chess....but I have never met an opponent whose first move in a game ----was 'Resigns'!!
Meltdown Monday 07:52am on 15 Sep 2008 I imagine that this blog will be one place where this ongoing unravelling of the global finance system isn't a complete surprise.

Unlike various official commentators who have repeatedly called the "bottom" of the crunch, the market, the downturn or whatever aspect they are talking about.

It will be interesting to see if the commentators proposing October to be the bottom of the Equity market ( quite a few newspapers had this identical line over the weekend) and end 2009 being the nadir of the property market are correct in their predictions
Lehman on critical list 2:14pm on 12 Sep 2008 The "It's the media what did it!" party should explain how the share price in both Northern Rock and Lehman Bros fell BEFORE the stories were printed.

Presumably for them when they see massive, out of alignment, share price falls this is not really due to the fact that the company is really and truly in trouble ?? ....

No way, that's just the market ... being .... er..... well... pointlessly nasty to the company??

No worries! ----or at least La-La-La! I can't hear them!!

The boy in the story of the Emperor's new clothes obviously grew up to be a journalist---- But I suppose these days instead of simply getting away with pointing out the obvious, that the Emporer HAS no clothes--- he would be arrested and charged with nicking the non-existent garments.
Why banks won't lend 2:31pm on 11 Sep 2008 Alongside the various and many financial aspects of the enormous problem of "The Credit Crunch" being well aired in this blog--- and across many others---- is a kind of shadow issue relating to "Character"

The Government is now busily unpacking a set of ideas about "character" as a newly discovered part of what employers may be looking for in possible employees, over and above paper qualifications (now they are very widely seen as a devalued yardstick of value).

As with most of these ideas the Government seems to latch onto they are either totally crackpot...or simply re-stating the blindingly obvious in a convoluted way..

But in reality it wasn't a disembodied entity called "The Banks" that caused this debacle.

It was real people in Senior management and on the Boards that actually made those decisions, and created the climate in the Financial "services" sector in which those decisions were rewarded.

As they now slope off dragging their suitcases of compensation cash while loudly blaming anyone and everyone but themselves------ I think that indicates where a (large) part of the problem lay---just old-fashioned, lack of any moral or ethical framework----in other words;a lot of people in important positions with poor characters.
'House prices to fall a quarter' 6:28pm on 09 Sep 2008 Two points.... one is that Graham Beale and Nationwide are provding a haven for the two Building socities therby preventing the chance of any Northern Rock style fiasco....

Doing deals in private and then announcing the fait accompli.....was what many people (though not me) said was the way NR should have been handled

Which leads on to the people who keep banging on that somehow Robert Peston is to blame and we are all talking up a recession that wouldn't otherwise happen....

So Merril Lynch, Citibank, UBS and God knows how many more have sacked their bosses because of what people were saying ?, Northern Rock, Bear Sterns and possibly Lehman Brothers have toppled because of reporters chit chat??

Trillions of dollars of mortgaes have been nationalised by the US Government because of carefully worded articles???

Talk about confusing cause and effect.... I blame the weather forecasters for all this rain and a riubbish summer...every night there they are rabbitting on about rain and next day...sure enough....its pouring down..... we talked ourselves into a miserable summer and now we are talking ourselves into a miserable autumn as well...

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