BBC Blog Network

User Profile

JayPee28bpr

Listed below are comments made by JayPee28bpr between Monday, 8th June 2009 and Thursday, 26th November 2009.

«Newer
Older»

Banks: The world is weary of the past, but boy, was it exciting! 12:14pm on 26 Nov 2009 A further point in respect of the emergency funding is that, had HBOS and/or RBS collapsed, it would not have stopped there. We would have seen contagion across all the banks, meaning the entire banking system would have closed down. I doubt anyone banking at, say, Barclays would have sat smugly at home thinking "this doesn't affect me". Everyone would have been out on the streets trying to get their cash.

Even if people were smug, they would soon have been jolted into action if RBS had collapsed, as RBS has a massive transaction processing business. Over one-third of all financial transactions in the UK passes across RBS's systems, so even something that appears to have no RBS involvement may actually require RBS for it to be completed. It would not just have been ATM networks that failed. It would have become impossible to pay for anything using debit or credit cards as well. Even if they were usable, a high proportion of everyones salaries would not have been paid at end-October, again because of the involvement of RBS in all aspects of money transmission. So everyone would have been short of cash. And remember the good old days when credit card companies just bumped up your credit limit for no reason? Well we would have had the opposite: immediate cancellation of credit, withdrawal of overdraft facilities etc. Financial life as we know it would have ceased. Cash would be king, but impossible to get hold of for how long? A day? A week? Experience elsewhere suggests a short period of no cash availability, followed by an extended period of "rationing", making routine cash management much more challenging than we are used to. In short, individuals would have experienced a very similar liquidity crunch to that of the banks.

Paul is not far wrong in saying the riot police would have been "part of the solution". I was in Argentina is 2002 when their currency crisis resulted in all the banks closing. I was there when they had reopened, but locals were still restricted as to how much money they could withdraw, and there were armed police outside every bank branch. It was clearly a very challenging environment even well after the original crisis time had passed. The kind of day-to-day cash management we take for granted totally breaks down in the absence of a functioning money transmission infrastructure.
Banks: The world is weary of the past, but boy, was it exciting! 11:41am on 26 Nov 2009 Paul,

In the febrile atmosphere of October 2008, keeping this emergency funding secret was undoubtedly the right thing to do. Had BoE publicised it, the actual collapse of RBS in particular would have become a self-fulfilling prophecy. It would have resulted in even more banks cutting their credit lines with RBS, thus requiring even more emergency funding to keep the ATMs functioning.

Lloyds is different, given it was seeking to acquire HBOS. Had the emergency funding been known about, it would have impacted the share price of HBOS, and would have impacted that of Lloyds (negatively) if acquisition of HBOS had been seen as likely. Consequently, Lloyds shareholders would have been less likely to agree to the acquisition.

There is also the issue of who knew of the secret funding within Lloyds and HBOS. I find it inconceivable that the Directors of HBOS would not have known about it, and this is significant. They recommended acceptance of the Lloyds offer, and I assume took up the offerin resepct of their own shareholdings. In effect Lloyds overpaid for the HBOS shares as a result of material price sensitive information being withheld from the offer documentation. Put another way, HBOS shareholders received more Lloyds shares for their HBOS shares than they would if the information had been public. That is insider dealing and, unlike competition law, there are no circumstances in which the Secretary of State can override the provisions "in the national interest". I am sure the HBOS Board must have taken legal advice at the time, and I think the HoC Treasury Committee, and journos such as you etc, should be asking HBOS and individual Directors to put this advice into the public domain. HBOS' behaviour would also appear to constitute market abuse under FSA rules, and misrepresentation generally. I suspect we will hear a lot more about this, and not just from disgruntled Lloyds shareholders.

Incidentally, Lloyds could face the same issues as HBOS, but that depends if they knew of the secret funding of HBOS. There have been constant comments about Lloyds not having performed full due diligence before acquiring HBOS. Did this lack of due diligence extend to asking HBOS if they had drawn down funds under the BoE's emergency funding facilities? If they were aware of it, then they are also appear guilty of market abuse and misrepresentation, though probably not insider dealing (a profit has to result for it to be insider dealing and Lloyds shareholders clearly did not profit from this). If Lloyds did not seek (and test) such representations from HBOS, then the Loyds Directors were negligent. I suspect that would be the least of their worries given the possible alternatives.
Is all publicity good publicity? 5:49pm on 22 Oct 2009 I forgot to mention in my earlier post about the BBC's coverage of the Euro election results. That night Dimbleby worked up a veritable steam of mock rage at the racism of the BNP's winning candidate in Yorkshire (I think). However, the irony of the situation seemed totally lost on him. There he was, denouncing the BNP for not allowing non-white people in to the party, yet not one solitary guest on Dimbleby's programme was anything other than pure white. Perhaps the BBC should look to its own racial bias before judging others. Didn't Greg Dyke, when DG I think, describe the BBC as "hideously white"?
Is all publicity good publicity? 11:06am on 22 Oct 2009 The whole issue of BNP participation on Question Time (or anything else) says more about political correctness at the BBC than it does about the BNP. The BNP has been deemed an organisation of "bad people" by the BBC PC Police, and all BBC staff now need to try and outdo each other in how shrill they can get in denouncing them.
Let's add a bit of perspective. Firstly, think back to Euro election night. David Dimbleby got the ball rolling when interviewing the first BNP candidate to win election. Incidentally, he's so memorable I can't even remember his name. Dimbleby set a very high horse level indeed for his colleagues to beat in terms of mounting thereof. We were treated to the guy's history of political activism, including dragging up memberships of other groups/parties in his past.
Now let's fast forward to 2010. Isn't Pope Benedict due to visit Britain? Will Dimbleby interview him? I hope so, and I trust his line of questioning will start with asking the Pontiff to justify his membership of the Nazi Youth, will then go on to ask why he is so keen to rehabilitate Pope Pius XII (who signed a deal with Fascists in the 1930s), and then go on to ask why he readmitted a Holocaust-denying former bishop to the Catholic Church. That would seem to be a logical interview if based on the treatment of the BNP since the Euro elections.
Perhaps a more interesting approach to the BNP would actually be simply to be a bit more challenging towards the main parties. It ought to be a matter of immense embarrassment to the lot of them that an overtly racist party with totally barking mad economic policies is preferred to the "grown ups" all the way across from Labour to Conservative. The BNP can also point to at least one very clear success, namely the recent acknowledgement of the white underclass and specific targeting of white, economically and socially disadvantaged groups across the cointry. The Commission for the Equalities actually noted this problem several years ago, but only BNP electoral success (Labour defeats to be more exact) has spurred the government into action.
There is a very simple solution to the problem of the BNP: promote decent, honest, committed individuals into the mainstream parties. Ensure they have a real empathy with their constituents. In particular, ensure they do not treat their disadvantaged constituents as something nasty on the bottom of their shoe. That's all that's needed to put the BNP back in its box. Few people support the nonsense they spout. They vote for them out of a sense of hopelessness: that nobody else cares about them or is willing even to engage with them. Tackle such people's real but often very basic problems (petty crime, inadequate housing services such as basic maintenance of fabric and services, anti-social behaviour) and the BNP will have no constituency. The whole "should we give the BNP a platform" debate simply suggests a degree of importance and relevance that they just do not have. It also allows the BNP to strengthen their position with anyone who feels "society" is "against them". The BNP can then suggest they suffer something very similar.
So, treat the BNP as any other party. Challenge their policies, none of which stand up to any kind of rigourous scrutiny. Ignore the racist bit. Proper analysis of the BNP's overall platfrom will simply leave them looking ridiculous.
Briatore bows out in unsavoury style 00:11am on 17 Sep 2009 This is the worst, of many very bad, scandals to affect F1 over the last few years. It should, I think, be used as a catalyst to rethink the sport completely: to start with the proverbial "blank sheet of paper".

My suggestion is very simple. FIA should, as now, publish regulations for each season. Teams should respond by detailing, in sealed envelopes before each "race", precisely how they would break those rules were the "race" actually to be held. The FIA/stewards would then meet to decide the places. This is effectively how the sport runs now anyway. Virtually every race includes some incident to be reviewed after the race, such as Hamilton lying to the stewards in Australia. We've had Mclaren stripped of all points, grid penalties for crashes etc.

So why doesn't F1 make a real contribution to climate change, and simply stop travelling all round the world to hold meaningless "races", the results of which are then changed because they don't suit the marketing decisions of the corproations taking part? Just let the FIA tell us the results every 2-3 weeks and save everyone the travel expense.

Incidentally, what is the BBC justification for spending licence money on this farce? F1 has ceased to have any sporting relevance. It's a bit like athletics. In F1, the contest is all about who can break the technical rules and has the best lawyers to defend them when they get caught. In athletics it's all about who has the best pharmacologists to provide performance enhancing drugs and then masking agents to hide them. There are far more virtuous activities to spend the licence money on. BBC (and other broadcasters) should drop F1. Nobody will miss it.
My take on seven days of Labour crisis 2:37pm on 12 Jun 2009 Just a few points on all the anti-EU stuff here. Just because anti-EU/Lisbon parties appear to have won more votes last week does not translate to there being an overall desire to leave the EU. It just means, for whatever reason pro-EU voters saw no value in voting. The real story is the clear message of unpopularity sent out to Labour. The BNP vote is a cry for help from those who feel marginalised. Only the BNP engage with this white underclass. Whilst their solution is both distateful and just plain bonkers frankly, at least they engage with those who feel unwanted by the Expensed Classes at Westminster (both politicians and media).

Fiddling with the voting system has not, I suggest, done a great deal to re-energise those who didn't vote because they feel left out of the current one. But then it's a bit hard to have a grown up debate with how we re-connect the excluded when it was Gordon Brown who uttered the immortal words "British jobs for British workers", not Nick Griffin. I've noted it elsewhere, but Griffin is not the first person to identify the white underclass as a phenomenon that needed addressing (or exploiting depending on your point of view). Trevor Phillips, Chair of the Commission for the Equalities (or whatever it's now called), raised the issue a couple of years ago. Trevor is, of course, not qualified to join the BNP. Yet his analysis of the problems is very like the BNP's. He just would probably like to see some different solutions proposed. It won't be easy to counter the BNP's populist message given the obsession with trivia at Westminster. I would put electoral reform in this category right now. The middle of the worst economic crisis for at least 25 years, and probably 60, ought to be focussing debate on economic renewal, in particualr protection of society's weakest. Griffin and the BNP are doing this, and the Expensed Classes have simply left the entire debating arena and agenda to them. Very depressing. More depressing than the systematic thieving that's been going on at Westminster.

A further point on EU membership/Lisbon etc. There seems to be a feeling in the UK that leaving the EU and being able to keep out all the undesirables from eastern Europe (which, of course, starts at Calais in most little Englander's eyes), would suddenly reverse the pressure on housing, healthcare, jobs etc. It might be worth keeping in mind that withdrawal from the EU would result in UK citizens in other EU states having to leave there and return to the UK. So, think of how ever many hundreds of thousands of Brits in Spain will all be on planes home, needing houses, wanting to be on doctors' lists, maybe even wanting jobs in some cases. There are definitely plenty more of us in countries such as Ireland (ie me!) who would be after jobs in the UK if we weren't working abroad. So the idea that EU withdrawal would be a one-way bet for Britain just is not true, I'm afraid. Again, we need the Expensed Classes to start articulating this stuff, and pointing out just some of the benefits of EU memberhsip, preferably in words we all understand rather than the legalistic dross of the Lisbon Treaty.

Here's a few ideas. Do we want clearer, more informative food labelling? All the evidence is we do. Well the EU provided them, consistently, across the EU. Do people think they get ripped off by mobile phone providers when they call home off holiday? Yes? Well the EU has already forced them to cut once and is looking at them again. Yet, O2 and Vodafone get credit for cutting them not the EU. How about seeing big corporations punished for anti-competitive behaviour? Well there's the 1 billion Euro fine that Intel have just had from the EU. How about help with necessary infrastructure investment to assist in high unemployment areas? Well wasn't Manchester's tram system 50% funded by the EU?

There is a ton of stuff to highlight, but the Expensed Classes just don't "do" small stuff like this. It doesn't involve a photoshoot of them all at a jolly somewhere nice, or the need for 25,000 police to keep them all safe. Nick Griffin & Co do "do the small stuff", and they got a deserved electoral reward for it, distateful though that may be for many of us.
Osborne and a corporate tax revolution 1:21pm on 12 Jun 2009 83. yeah_whatever,

I think my final point maybe wasn't clear. I'm saying I think Obama will change some of his tax plans so that they don't encourage further offshoring. There's a lot more to offshoring that just tax anyway. The key drivers are overall costs, and market access. For MS etc, a key driver would have been access to the EU, thus ensuring avoidance of any EU import duties. Most of the offshoring to China is simply down to wage rates being about 95% lower than in the US/Europe etc.

Just one further point on tax. I don't agree that Obama cutting (or not increasing) corporate taxes automatically means others pay more. If he were to cut such taxes, it may encourage US firms to repatriate work to the US. The Irish experience of lowering corporate taxes has certainly been a win-win. For instance, an entire new industry was built on the basis of low tax (mutual fund administration). It employs about 25,000 people here (or almost 1 per cent of the entire workforce). Pre-crash Ireland had seen inward migration of over 400,000 people (10 per cent of the populaion) in the previous 10 years. These people (I'm one of them) were needed to fill vacancies arising from the economic boom. Whilst much of it (too much) was nothing more than a wild property bubble, there have been a huge number of new economy jobs created as well (MS, EBay, Google, Yahoo etc etc). So, firms are attracted by low corporate tax, creating more jobs whose workers then pay income tax and social welfare levies on their income, VAT on most things they purchase, very high stamp duty on house purchases etc. The amount we each have to pay is not higher because of lower corporate taxes because there are more of us to share the overall burden. In fact, Ireland's corporation tax revenue has itself been higher since the rates were cut to 12.5%, as more companies have located here. So, if anything, we're paying less in income tax, VAT etc than we otherwise would.
Osborne and a corporate tax revolution 5:25pm on 11 Jun 2009 72. yeah_whatever wrote:

"Recently Steve Ballmer told Obama that his attempt to stop corporate tax dodging would mean that he would move Microsoft out of the US. Where to, and whether he'd go there too wasn't said."

Taxation of multi-nationals, especially those dealing in intellectual properties such as software, is fraught with challenges for all governments. We can be pretty sure that Ballmer is not bluffing though. Microsoft already does a great deal of development work outside the US, a lot of it in Ireland where MS has about 1,700 workers. Similar organisations (EBay, Google, Yahoo) also have their European HQ's in Ireland. What does Ireland have? Low headline rate corporation tax (12.5%), no rules on controlled foreign corporations (ie don't try and tax non-Irish revenues), no transfer pricing rules, together with attractive tax rules for intellectual property rights, and generous R&D tax rules. It would not be hard for MS and similar firms to make their operations here into the global HQs and run all the HQ functions from here. These functions do not require large numbers of people to run, but they can significantly shift the tax jurisdictions in which tax is paid across the overall group.

Closer to home, the UK government has tried to make non-UK profits of UK-headquartered groups subject to UK corporation tax. Result? A host of companies announcing that they're moving their HQ to Ireland. The list includes Shire (FTSE250 pharmaceutical group), Henderson (fund management group), Charter (FTSE250 engineering group), all of which have now sheltered their non-UK profits so that they are not remitted into the UK and cannot be taxed there. Even Vodafone has threatened to do something along these lines. So there are a range of businesses that will move their headquarters if their current tax regime becomes unwelcoming.

As for whether Ballmer personally would move offshore, he doesn't need to. So long as the formal management of MS was fully offshore, eg Board meetings held offshore, he would avoid any tax legislation that the US could possibly pass. Let's say MS relocates to Ireland. Ballmer might like to visit to have a couple of meetings, play a bit of golf etc. He'd have client meetings in Europe anyway. However, he wouldn't have to come over if he didn't want. Worst case he needs to attend the Board from outside the US, which would mean a one hour drive away from MS's current HQ in Washington State into Canada.

It's easy for "new economy" businesses to avoid tax if they feel the need to do so. Obama isn't stupid. He'll backtrack on his plans where they will encourage offshoring. In fact, he'll probably come up with a regime that encourages everyone to move there!!!
Osborne and a corporate tax revolution 4:53pm on 11 Jun 2009 This looks like a bit of a tease. Not sure whether it's GO or RP (or both) doing the teasing. I can think of a few questions raised straight off by GO's quasi-proposal.

1. Will the same rules apply to public sector debt? Will the government tax itself? This might sound a bit academic, but if the same rationale were adopted in the public sector it would raise the effective cost of capital for public sector projects by the tax rate (as all public sector projects are debt-financed). Would the additional costs form part of departmental expenditures, and result in those departments having to find compensating cost reductions to keep their overall spending in line with existing spending forecasts?

2. How will interest income be taxed in the hands of the recipient? If interest payments are no longer allowable deductions against tax, then fairness would suggest that interest income ought to be non-taxable for the recipient. This is the case anyway for many investors in debt instuments (eg pension funds, ISAs invested in bonds). However, adopting this policy would be a neat way of attracting the "grey" vote, ie pensioners who have seen income reduced as a result of very low interest rates. Tax-free income on highly-rated corporate bonds suddenly look very attractive versus other forms of saving. I also seem to remember that the Conservatives briefly flew the kite of how to provide greater savings incentives generally. Making interest income on corporate bonds non-taxable would help do this. It would also guide savings to a relatively conservative (lower risk) asset class.

3. What impact would GO's suggestion have on mutual organisations that everyone seems to regard (for no good reason in my view) as somehow "superior" business structures to limited companies. Mutuals do not issue equity, meaning potentially all payments related to their capital base would not be tax deductible. That would put them at a competitive disadvantage to organisations that can issue equity.

4. Actually, GO's suggestion would cause major problems if applied universally. It would make banks' interest expense non-tax allowable for instance, resulting in less credit available (not all bad but could easily be if the amount of credit available is below the optimum level for the economy), and would require interest income (ie the rates charged on loans to customers) to be higher.

I suspect 4 could be handled by specifically exempting certain business from the interest taxation regime. Some entities caught by 3 could also be covered this way, eg building societies. However, others would be badly hit for no good reason, eg the Co-Op would possibly be caught by GO's proposal. We just can't tell from RP's teaser, and it would be nice to know more precisely where GO intends to apply his proposals.
Fewer votes for BNP 10:57am on 08 Jun 2009 Nick,

You're support for Labour is getting the point of being ludicrous and not just comical. The idea that Gordon's travails are all because 100% postal voting was abolished for this election is breathtaking in its condescension towards a large chunk of the electorate. You clearly think that the lumpenproletariat would have duly delivered their votes to Labour if only they hadn't been required to make an arduous stroll to a polling station. They would not. Had they been required/allowed to postal vote, they'd just have thrown their ballot paper in the bin.

You're actually part of a much bigger BBC problem, namely the notion that you're somehow superior to BNP representatives and their supporters. I find the BNP's racial policies as distateful as anyone. However, nobody can deny the fact that the BNP has engaged with significant numbers of electors. I found Dimbleby's interview of Griffin on BBC News last night almost embarrassing. Tripping out the usual mantra of BNP polices (eg "why don't you allow black people into your party?") just trivialises the BNP's success in certain areas. It was done with an attitude of "I'm superior to you because I don't have a problem with black people". The BBC (and others) ought to be concentrating on the BNP's analysis and how this translates into engagement with their target demographic. Griffin's points about large numbers of white people feeling disenfranchised ought not to be simply dismissed. What he said to Dimbleby about this was not that far removed from very similar points made by Trevor Phillips about the growth of a white underclass. I doubt Dimbleby would be as dismissive of Phillips as he was of Griffin.

The fact is ALL mainstream parties have failed to address the growth of an underclass in the UK (white and non-white). They have no policies to deal with it. Griffin has confronted it but, unfortunately, has a very undesirable solution: one that wouldn't solve the issue if he ever got the chance to implement it anyway. However, if the BBC and mainstream politicians continue to concentrate on the BNP's solution rather than its analysis of the problems faced by a considerable number (though undoubtedly a minority) of the electorate, then the BNP will continue to attract support. What is really needed is to address why the BNP "worries the little stuff" for people (eg gets the drains fixed; challenges the police about anti-social behaviour etc), whilst the main parties treat people subject to these types of challenge in certain areas like they are something nasty on the sole of a shoe.

I can understand why politicians aren't doing anything about this. The expenses affair has shown just how mercenary, self-interested, and cynically indifferent to the electorate they all are. However, I'm surprised that nobody at the BBC has picked up on how close Griffin and Phillips' analyses of the white underclass are, and then challenged mainstream politicians as to why they haven't come up with a better solution than the BNP. Indeed, why they don't appear to be engaging with the people involved at all.

«Newer
Older»

^ Back to top

BBC MMVI

The BBC is not responsible for the content of external internet sites

BBC.co.uk

BBC Blog Network

Find and talk to the BBC's bloggers.

User Profile

JayPee28bpr