How our banks were rescued
The main story of tonight's Panorama is quite how close we came to the collapse of two banks - Royal Bank of Scotland and HBOS - in the second week of October. RBS in particular was alarmingly close to meltdown.
For Royal Bank of Scotland, the owner of NatWest, it was all hands to the pump from Tuesday 7 October until the end of that week.
This giant British bank, which has just under £2000bn of loans and other assets, was having enormous trouble hanging on to vital deposits and loans made by money managers and other financial institutions.
Without these deposits, it would have been insolvent.
The head of RBS's corporate bank, Johnny Cameron - who has now left RBS - was summoned to the Bank of England for crisis talks.
The Bank of England itself contacted Royal Bank's creditors in New York and Tokyo to persuade them to keep faith with the group.
By Friday, RBS was a weekend away from disaster. And the troubles at RBS were being replicated at HBOS, which by 10 October was perceived by the Bank of England and the Financial Services Authority, the City watchdog, to be almost as vulnerable as RBS.
So on Saturday 11 October and Sunday 12 October, crisis talks were held at the Treasury - led by the Chancellor of the Exchequer, Alistair Darling - that forced all our big banks to raise additional capital to strengthen their balance sheets.
And in return for this additional capital, the Treasury and the Bank of England provided banks with £350bn of loans and guarantees from taxpayers.
A trio of banks received a direct investment of capital from taxpayers. Royal Bank of Scotland has received £20bn from the state and is now 58% owned by taxpayers.
There is £17bn of our money that is expected to go into HBOS and Lloyds TSB, with most of it going into HBOS. Lloyds TSB is buying HBOS and taxpayers are likely to emerge with a stake of more than 40% in the newly formed retail superbank.
This rescue package has prevented RBS and HBOS from collapsing and has stabilised the banking system.
This extraordinary story is told on Panorama in interviews with a quartet of the leading actors in this drama: the Chancellor of the Exchequer, Alistair Darling; the deputy governor of the Bank of England, Sir John Gieve; the chief executive of the Financial Services Authority, Hector Sants and the chief executive of Barclays, John Varley [all pdf links].
Here are some of my questions to these four, with their answers from a verbatim transcript. First, Sir John Gieve.
Peston: I was talking to a big bank yesterday actually and they were saying to me it was extraordinary - their department, their treasury department, which you know exists basically to get them the funds they need on a daily basis - I mean every night the sums of money they had to raise just to keep going for the next day got bigger and bigger. The chap I was talking to just said that they'd never experienced anything, anything like it. How many banks do you think in the UK were in this position? Were they broadly all in this position of just seeing the availability of long-term funds just drain away?
Gieve: Well, I mean each bank is, is different and some of the banks were benefiting from this. They were attracting, they were seen as the safe havens and they were getting an inflow of deposits and their problem was: "what do we do with this money we don't need?" And they started looking to deposit it with central banks, in fact. But several of our large banks, and I mean I don't want to go into names, were, were in real difficulty and you know, were having hour-by-hour minute-by-minute to balance the books at the end of the day, and obviously we were talking very closely, but it wasn't just happening here. It was happening in the States, it was happening in Europe...
Peston: I mean, I suppose what I found profoundly shocking at the time was the difficulty that an enormous bank, Royal Bank of Scotland, was having in rolling over its short-term funding. I mean that seemed to me at the time to be momentous.
Gieve: Well absolutely, and you know it, it always rolls a large amount of funding but normally this is routine. You know you've got it arranged pretty much by the middle of the day. There's no panic about it but as I say, it became a nail-biting business right up until the end of the day and obviously we were talking to them on, on a daily basis. So that was one factor, but it wasn't just RBS. I mean, remember what was happening in the States, what was happening in, in Europe as well. You could see that the banks were falling over.
Peston: No, totally - and of course, HBOS was in a very similar position before the merger with - the takeover proposal was announced by Lloyds TSB. Now, you came together with the banks over the weekend to, in a sense, allocate the capital and to negotiate who would get what. Give me a flavour of what those negotiations were like with the treasury, with the FSA, with the banks.
Gieve: Well, we made the announcement of the plan - the availability of capital and so on - on the Wednesday. What became very clear on the Thursday and Friday was that we needed to get on with it. You know, we'd offered the cash. We needed to actually get it out there and RBS quite honestly was the leading candidate but we were also clear that if you just dealt with one, you'd leave the others in a rather exposed position, you know, the caravan would move on and the searchlight would pick out Lloyds and HBOS and even Barclays. And so, really, Friday and Saturday we began to get, and the treasury in the lead on this, but again I think it was a joint effort with the FSA and the Bank, we began to sort of line people up in different rooms on different floors for a series of meetings, and it was an extraordinary, it was an extraordinary weekend. There wasn't that much negotiation because someone described it as more a drive-by shooting.
Peston: Yes - Fred Godwin, the famous phrase, the negotiation was a drive-by shooting.
Gieve: And that, you know it had to be like that. There was very little time. The government was announcing the terms on which it was prepared to come in and the banks had to think about it, but they broadly had to accept it.
Peston: As I understand it, Fred Goodwyn, his famous phrase about the drive-by shooting, what he meant was banks were told [by the FSA] "we've done the sums, this is the capital you need". Is that broadly, you know, how it happened? I mean, that's certainly what he's been saying.
Gieve: Yes, that's right. We had done some sums and between us we'd, we'd come up with what we thought was necessary and really there was only one provider [the taxpayer]. Now, for Barclays they were, they chose a different route. They thought that they were given the number and they, they said "no, we can raise this ourselves on the market," so they took a different route to the other three.
Now, Alistair Darling.
Peston: Now, my recollection of the day and night where you put together the shape of the rescue plan prior to the announcement the following morning, I think you were in, in Brussels I think, in the morning, weren't you? I think there was, I think there was an Ecofin that morning and then I think you then came back and then there was a great sort of working through the night to get, to get a package together. Did you know when you were in, in Ecofin, in Brussels for this European meeting, that you were likely to come back and have to put this thing together very fast?
Darling: During the weekend before that, there had been a lot of speculation about whether or not the banks would be recapitalised and the markets were very very febrile on the Monday morning. I wasn't surprised when I was called early on on the Tuesday that one bank in particular really was in difficulties and I decided that you know whilst there was a bit more work to be done, we needed to get our plans out and so I decided we'd do a statement in the House of Commons on the Wednesday which I did. It was obvious it would always have to be a two-stage process, because you had to announce the principles, then sit down with the banks and of course I then had to go to Washington to the IMF meetings when I took the opportunity of course to speak to my counterparts, to say "look, we're doing this, you know I hope you can do it too". And then the final deal was done on that Sunday night and announced the following Monday.
Peston: I mean that bank in difficulties was the Royal Bank of Scotland, having tremendous difficulty renewing its short term borrowings on wholesale markets. Was this irrational, was there any fundamental reason do you think why Royal Bank was having such difficulty?
Darling: There's lots of things been happening over the last few weeks and months that are you know, on one level you can say they're irrational [I think he meant "rational" here] because as it turned out, RBS needed an awful lot of capital. It's one of the biggest banks in the world and we now own 57% of it. And when people had seen, you know, giant banks in the US collapse, everything that, that's happened, you can say on one level it's irrational. On another, another, the other level you can understand why people began to lose confidence. What we had to do, though, is to say "well never mind that, let's you know really take some decisive action - let's make sure that we can maintain the banking system" - and that's what we did.
Peston: I mean, I found it profoundly shocking, I must admit, at the time. I mean, here was the owner of NatWest, this enormous bank, that one just assumes couldn't possibly fail, having these difficulties raising short-term funds. You announced the structure of the rescue, but then again on the Thursday and the Friday they've still got these difficulties. There's a fear also that it's going to infect other banks like HBOS which was beginning to have difficulties of these sorts. You then come to the Friday of that week. Was it obvious to you again on the Thursday and the Friday that what you were going to have to do was negotiate with all the banks through the weekend to put together the detail of the rescue package, or in a sense did you decide quite late on the Friday that if you're going to do Royal Bank, maybe you should do all of them?
Darling: I was very clear even before the turbulence of that week that whatever we did, we had to do it for the entire banking system. We couldn't get ourselves into a situation where you're simply fixing one problem because the problem was then moved to somebody else and, you know, we just couldn't allow that to carry on happening. We'd seen it in America where they, no sooner had they sorted one bank's problems out than the problems transferred to the next. So on the Wednesday, I announced a general overall plan - the scheme, if you like. Things did get worse during that week because confidence was just draining out of the system and in some ways, that made it easier for us to talk to the banks and say, "look, we're all in this together. No one's got any choice. Everybody's going to have to recapitalise. The only choice we'll give you is you either do it through us or you raise the money on the markets yourselves" - and you know, that's precisely what happened. But on the Monday when we'd done it, it did actually, there was a sense of calm and the fact it then became clear that it wasn't just us. The Americans were going to do something, we had, Gordon Brown had been in Europe on the Sunday before and he'd got agreement, you know, surprisingly quickly right across Europe that central banks, governments would do the same sort of thing...
Peston: Did you get any sleep that weekend [of 11-12 October, when agreement was reached to inject £37bn of taxpayers' money into RBS, HBOS and Lloyds TSB], in fact?
Darling: Yes, I did. I had to go to Washington on the Friday and Saturday and so I came back on the Saturday night overnight and you know, there's a limit to the amount of sleep you can ever get in an aeroplane. Then I had meetings all day on the Sunday and then at ten o'clock on the Sunday night, just when you know everything was agreed as far as I was concerned, inevitably when you deal with a bunch of bankers, they started trying to re-open it. So I said about one o'clock - "okay, re-open it if you want. I'm going to my bed. If you haven't agreed it by five o'clock, then you're on your own". So happily, when I woke up at five o'clock, we'd got an agreement.
Peston: Crikey, and was the agreement very different from the agreement that you'd had at, you know, or where you thought it was going to be when you went to bed?
Darling: Not fundamentally, not at all. If you - look, you're negotiating with people who are running multi-billion pound businesses and who, you know, whose world had changed and of course they had one or two legitimate points that we were ready to talk about and you know, I talked to, to them about it but you know, what I wasn't going to have is someone trying to unpick the deal, basically ask for the bits they wanted and not the bits that I wanted. It had to be an all-encompassing deal. The deal was done you know, and completed, on you know, the early morning of that Monday and it had to be, because we had to make a market announcement when the markets opened at eight o'clock on the Monday morning.
Finally, John Varley.
Varley: What was clear was that confidence in the system was, was suffering very badly [in the week of 6-10 October]. It was, the circumstances were as extreme as anything that I can remember. And if I put it in context, it seemed increasingly likely as the week went on that one or two of the British banks would not be capable of opening for business the following week, and it doesn't get much more extreme than that. And as you know, the government stepped in and took action, and came to a decision about a system-wide remediation that I think was very helpful for the regeneration of confidence. But it was a, it was a surreal week because the markets were extremely skittish, the media was very extreme in its commentary and it was a challenging week for all stakeholders of banks, and indeed the employees of banks.
Peston: I mean, the two banks in question were Royal Bank of Scotland and HBOS. Do you think that their vulnerability was irrational or, you know, were the markets behaving rationally in the way that they were finding it difficult to raise money. Were they actually fundamentally weak?
Varley: Well, I'm not going to make a comment, least of all on Panorama, about our competitors. It wouldn't be appropriate for me to do so. But what is clear is that there was a crisis in the market that week and it had to be addressed because what you couldn't have was any big bank being in a position where it wasn't capable of opening for business. That, the systemic consequences of that, would have been too awful to contemplate. And I think it was, the week was symbolic in the following way which was that up to that point - I mean, over the preceding twelve months, put it like that - a lot of what had gone on in the United Kingdom and elsewhere around the world was what I would think of as national firefighting. Individual bush fires broke out and they were doused by the authorities. What was very clear in that week in October was that something much more system-wide - much more generic - needed to be applied both in the United Kingdom and elsewhere. And market-wide solutions were put in place in that, in that week in October and since then, and I think actually, actually it's been very positive for the world, because it seems to me as though the national firefighting forces have now been overtaken by the international fire brigade. And the international fire brigade I think is doing quite a good job in managing banking systemic risk.
I'm 
© MMIX~RS~q~RS~~RS~z~RS~35~RS~)
CommentsSign in
You need to sign in to contribute to this page. If you're new to BBC Blogs, creating your membership is quick and easy.
The best compliment that was paid to Robert Peston, was to compare his status to that of Madonna!
I have been watching Panaroma since the '60's. and I find it very surprising that an entire show has been devoted to a lightweight such as Peston; but then again, as a lightweight, he's in good company (the CEO's of major banks). I'm obviously getting too old!
Complain about this comment
All their offshore operations were mainly money market deposits
Complain about this comment
Bravo Robert. I have waited for years - my internet information society began in 1995. This blog has certainly bought serious reporting to the web. In some ways it is awful that it had to happen under such circumstances, yet for those who have watched from afar, it is high time that the public are given the immediate truth.... however difficult it may be to stomach. Shame that 12 months in we are all still feeling the pinch..... information rules.
Happy Christmas all.
Complain about this comment
Reducing interest rates punishes savers and rewards borrowers.
Not the most obvious response to a problem caused by too much lending.
Unless you believe that government intervention can overcome pressures for a global recession. Or even mitigate the effects on Britain.
Why not start reporting inflation honestly (rather than understating it) and then it will be clear that interest rates must rise?
Complain about this comment
I've followed your Blog for the past two years and believe that you have called it right time and time again Robert.
I also believe that the reason you are getting so much critism about your reporting, is because you are actually reporting what is going on. For too long business and the Treasury have tried to hide what they were doing, as if economics is hard, or that the world economy should be shrouded in some secret to stop jo average understanding what is actually going on.
Perhaps if the average person was actually informed about what was going on, we as ordinary people, could make a few simple steps to not get into quite so much trouble.
Complain about this comment
Rug pulled out. But this is what the banks do everyday day in day out to businesses or individuals. They say we think you are in a bind, you may well be viable very shortly but you cannot meet your debt today. Computer says NO. Being clever bankers we want to withdraw the line of credit you have been granted before, immediately, forthwith. So the question is - if they are so quick to make this assessemnt on the many accounts they handle why do they not do the same proactively to their own position. It is not as though they do not know the rules that apply. They cannot say they do not understand, that they are not well informed. If it was not for the impact on the economy it would have been the correct decision to let them go. And they still are not playing the game are they. The message should simple - Get on with playing it straight or a move will be made that you will not like but the public will support.
Complain about this comment
Peston takes much glee in assuming the moral high ground when denouncing the restriction of information dissemination to the public that may act against their common good (in this case, the posibility of triggering multiple runs on commercial banks funded predominantly by retail deposits).
He subsequently explains in particularly smug fashion the 2 ways in which banks may ultimately fail - one of which being the rapid and almost immediate withdrawl of primary sources of funding.
Clearly for investment banking institutions these sources will tend to come from a wholesale source. But for the more retail orientated institution, of which the traditional building society is surely one of the best examples, the retail market is a crucial provider of liquidity.
How can Peston claim for one second to defend the rights of retail investors to all information that he deems pertinent to them, when his very actions accelerate the panicky ill-informed over-reaction from the very same investors that would (and did) lead to the collapse of financial institutions serving the retail sector.
He spouts hypocritical , self serving , contradictory nonsene. His contacts are undeniably of the highest quality, and his knowledge and understanding of the economy and financial markets greater than that of most of his peers. But his attempt to intertwine his notion of moral stewardship into his past actions leaves a particularly bitter taste.
Complain about this comment
In the programme the only guy that has had it right all along is Vince Cable who really should become PM as we are fighting an economic war right now.
However, governance is conducted by Government's so the buck must stop there for this utter disaster.
I still trying to find an economic/business editor who has the ability to predict the current economic position of the country had Gordon Brown followed exactly the tax, spend and borrowing and monetary policies of Ken Clarke for the last 12 years. It would be fascinating to learn whether Britain would have been better prepared for Bankrupcy under Ken's policies or Gordons. Robert please can you have a stab at a comparison because the next election is going to be based on more of the same from Gordon or back to the future with Cameron.
Please inform us about the consequences of both economic policies from the Conservatives and Labour as poor old Vince isn't going to get a look in however deservedly he should!
Complain about this comment
So when are Fred the Shred, Adam Applegarth and the rest of the giants brains going to be banged up?
Complain about this comment
After watching Panorama my first impression was how close Robert is to Alistair - good mates at least. One wonders who was the source of many exclusives claimed by the BBC business team.
The next thing that comes over is how non judgemental Robert is regarding who is to blame for the crisis.
Bank bosses certainly admit failings and some even apologise. The FSA did not realise the severity of the situation in our economy and even so did not have the power to affect events.
As regards the government and the role of Gordon over the last eleven years. Little or nothing.
This aspect of BBC reporting is what leads some of us to believe that the BBC is very selective and in awe of the people in power.
Like a team in sport, one can have to much respect for your opponents.
Complain about this comment
Just watched the peston show eeer i mean panorama.
Shows the real power of the web.
But given we now know the powers that be and the big business guys also read this blog, this could end up being a troll magnet.
You should keep a bit of control on it, we don't want to end up like the shame antics on Nick Robinson's blog and thus ruining it's civilised informative rep.
Complain about this comment
I'm a Peston fan. So much so that I'd probably turn on to watch him read the phone book in Albanian. But tonight's Panorama was not good. You just can't squeeze a coherent account of October's meltdown into a half hour, especially when you have interviews with all the very top players. I for one was desperate to hear more from them than the snatched and often anodyne bits of sync we got. To try cramming a biopic of Peston himself on top of all that was absurd. No offence, Robert, but when Alistair Darling and John Varley are telling me how the world nearly ended, I'm afraid I don't want to hear about your father's views on comprehensive education or see pictures of you as a long haired student. And rather than hear your own opinions on the unfairness of the bailout to the thrifty I want to see you put Darling on the spot about it. Also how could you let the very lightweight looking Hector Sants get away with the assertion that last autumn's interventions have restored confidence and banished the thought that banks could now collapse.
The one point where I stood up and cheered was where you defended the journalist's right to publish. It is indeed paternalistic, patronising and dangerous to keep information from the general public that is available to the financial system. You would lose all trust were you ever to allow yourself to be cowed into not reporting a story fully and honestly. I'd be the first to the barricades.
Happy Christmas, Robert. Get some decent rest over Christmas cos I have a feeling we're going to be needing twice as much from you in the New Year.
Complain about this comment
I've just watched Hector Sants on Panorama saying there was nothing that the FSA could have done.
It used to be a golden rule of banking that to lend long and borrow short was the way to perdition. Northern Rock demonstrated that in spades. The FSA is supposed to review bank business plans. Presumably there were no prudent old timers reviewing Northern Rock's plans.
Who is responsible for taking away supervision from the Old Lady? The man who saved the world - has he no sense of responsibility?
Complain about this comment
Tonight's Panorama: 10% serious content, 90% celebrity adoration. What a missed opportunity to provide some serious analysis of this huge crisis - instead we were fed a load of self-serving tripe around the cult of BBC's latest star - young master Peston. No mention of key root causes of this crisis and a clear description of the list of players who colluded to keep this great boom going for almost 20 years, instead a few trivial sound-bite summaries of interviews with some UK players. It seems that the x-factor and the general focus on celebrity seems to removed serious reporting - even from Panorama. Today R4 (where at least Peston is allowed to make some serious points) manages to provide some decent insight. I suggest you might want to read Michael Lewis' (of Liars Poker fame) recent analysis if you want some insight before your 2009 broadcasts. Simon
Complain about this comment
What happened to Panorama this evening?
I tuned in expecting to get a quick dose of current affairs. But it appeared that the programme had been pulled and replaced with a nausea-inducing hagiography of a self-important business reporter who managed to get a scoop.
Was I interested in which school Robert went to? No. Is it important what Robert?s dad did for a living? Nope. Do I care what time Robert rises in the morning? Fascinating as it may be, the answer is no.
The biggest shame about tonight?s Panorama was that there was a half-decent programme fighting to get out there: the inside story into the events leading up to the bank bailout. But instead most of the programme was devoted to a bit-part egotist talking about himself.
Complain about this comment
Great post crash piece. But as to why, there is a big wider point missed. Put simplt - it is the way bankers are paid. Bonuses for how they they did after just one year - with no comeback if anything goes wrong. Unless this is changed - it could possibly happen again. Bonues should reflect what ends up happening to the investments over a longer period of time. We believed too much in capialistism. All things can go too far.
And let's not forget the media played a pretty big part in this. Far from foretelling it as was suggested in this piece with Northern Rock - the reality is that media completely missed it. Yes Northern Rock should have been handled with more sensitivity. The dramatic way it was reported did make the problem worse. with a sudden a massive run on the bank. of course it did. But the real problem is that the media continued to paint the picture of a rosy general economy EVEN AFTER this. As they did before it. This lead to people taking out yet more lones. Everybody - the media, the banks, should have been asking questions much earlier. This point was missed completely. Convienient?
You see, it's not just a matter of having contacts that report something 5 minutes before someone else, and when it is obvious anyway. And then claiming this makes an amazing journalist because that personal got there "first" - literally often by a few minutes, or days, at the most. It's about DOING INVESTIGATION OF WHAT IS GOING ON - HOW BANKS ARE MAKING THEIR MONEY - INVESTIGATING THE SYSTEM AND POINTING OUT THERE MAY BE RISK - OR ERRORS - IN THE SYSTEM. Having your "insiders" and "contacts" look to this instead. Not short term "I got there first" mentality. But proper long term big picture thinking. This is what journalism should be about. Then this may never then had happened. I hope you take this in a mature manor, listen to these points and learn some lessons. It's not just the banks that need to as you pointed out so many times. It's you. Please look to yourself and your system. Don't try and rationalize it. Try and listen. It takes a great person to look at their own faults in a climate where mistakes are pointed out all the time and people condemed. "It's nothing to do with not me, bc.." "I already did the right things, bc.." "This expert says it's their fault (not mine) bc..".
Complain about this comment
Not the old investigative panorama. Eg Northern Rock not looked at in any detail.Why was Derek Wanlless ,knighted by Gordo not interviewed?He was the author of the Wanless report into National Health.Former CEO Nat west prior takeover by RBS.Responsible as non exec for Risk Management & Remuneration!
LLoyds were invited to run rule over Northern Rock August 2007 when their funding model was known by the Treasury to be flawed. Northern Rock shares went up as LLoyds due diligence became known.Why were shares not suspended as clearly there was a false market.
Will Quick/slow of the yard be looking into Pescod leaks? I doubt it
Complain about this comment
I find you rather weird Robert and how can you be impartial when you are the son of a Labour peer?
Nonetheless, I note you are left handed. Good tennis players!
I still take what you say with a pinch of salt and vote Conservative.
Complain about this comment
I was fascinated to see the DVD "The Crash Course" produced by Chris Martenson.
It explained (inter alia) how the U.S. had 'fudged' inflation figures using a technique called 'hedonics'. This allowed inflation to be understated and so allowed reported 'growth' (the change in GDP adjusted to remove inflation) to remain positive.
Politicians derived some (obscure) pleasure from being able to say there was no depression. Forget the fact that oil production will be falling from 2008 onwards.
Hedonics is the fascinating thing - if you have a flat screen 24" TV that costs £300 this year and it costs £300 next year but also has a faster response time (say) then this technique splits the £300 down into £250 plus the extra 'notional' benefit [not cost] valued at £50 in terms of 'better life experience' of having the new feature.
The 'inflation basket' now contains a TV that has *reduced* in price from £300 to £250.
A Freedom of Information request to ask whether the UK CPI and/or RPI statistics use 'hedonics' (google this word to understand hedonic regression) might be revealing?
Complain about this comment
The thing I find amusing in the blog text is that AD is reported as saying 'irrational' and Peston reports that he thinks AD meant 'rational'. So what is reporting about these days, 'translation', 'correction' of the message without reference. Or reader, take your pick, whichever interpretation suits you sir. And this is the 'standard'.
Complain about this comment
Your critics are in a mess! The market theory to which they have cleaved for nearly 40 years demands perfect information flows, which is what you have been helping along. If they don't understand that they need to go back to school. If they want you to sit on your news, then they essentially don't accept the free operation of the market, and have to reject all they hold dear. Oh isn't it interesting when those who have been making a packet out of manipulating the market cry for mummy when the going gets tough. Despite the results, we need you to keep shining a light, because even worse things will breed in the dark. Hold on to your seats, it's a wild ride and some of those who get hurt thought they led a charmed life. Remember to spend Christmas with your family come what may.
Complain about this comment
The point that you raised at the end of Panorama and left hanging - that essentially we are left with a situation of 'moral hazard' where there is no penalty or cost for unwise or profligate borrowing and no value in saving - is at the heart of the current policy 'solution' to the Credit Crunch - just as the Archbishop of Canterbury indicated.
It is vital to diligently pursue this point. Any 'solution' that does not tackle this problem is NOT a 'solution'. We thus have the policy-makers pursuing a policy agenda that is critically and absolutely false.
I repeat the point that I have been writing about for some time that borrowers must be prepared to pay a fair price and savers must expect to receive a fair recompense. When will this happen - 6 month or a year away - any more and the bubble re-inflates and complete financial collapse is absolutely unavoidable and inevitable. The path we are pursuing is heading towards the total destruction of money. We must turn, and turn soon.
I also want the see all of the men who ran the banks and the regulators dismissed immediately.
I also think that Sir John Gieve knew that the bank should have raised interest rates long ago - his and his colleagues pusillanimous attitude makes them absolutely culpable and should ensure their dismissal!
Complain about this comment
fact is, your 24" flat screen is going to cost 150 quid next year in nominal terms...we are not going to need to rely on hedonics for some time to come...
Complain about this comment
A truly facscinating vignette of the past three months in the City: thank you, Mr Preston and Panorama.
I agree that Mr Cable's observations have been most perceptive: not much surprise in that when he's dealing with economics.
It seems to me that the banks are merely piggy-in-the-middle in this amazing crisis. What has happened, in fact, is a rapid and massive write down -- impairment, to use the more fashionable term -- of property assets, of about £50,000 per property according to one commentator. If so, the absurd UK property bubble has well and truly burst.
The consequence of this impairment has been a correspondingly drastic write down of increasingly illiquid bank assets, which themselves were financed by money market liabilities that were callable short-term. This bad matching of maturities sounds like the worst of all possible banking worlds, for which the banks themselves must take their share of the blame, together with home owners/buyers who were reckless enough to blow the bubble in the first place.
The present lending terms quoted by banks suggest that they have been caught by the property bubble once, but they won't be caught a second time any time soon. Median UK property prices will have to fall a lot further before long overdue sense is knocked into property and credit markets. Short term this is a scary prospect: longer term it's got a lot of promise. Until then, the transition looks like being painful, for too many a wipeout.
Complain about this comment
I watched Panorama and I was horrified at the suggestion that Robert should have kept quiet about some of his scoops so as not to have made worse the situations he was reporting.
As someone who, like many, has lost a lot of his investments by not bailing out of stock market funds earlier because I didn't understand the seriousness of what was going on, I totally disagree that this kind of information should be restricted to insiders.
Thanks to Robert's reports, I now have a much clearer understanding of what is going on in the financial world, which I think all ordinary small savers and investors will need to do if they are not to lose even more before we hit the bottom of this economic cycle.
More power to you, Robert, and a Merry Christmas!
Complain about this comment
#15
I agree - there was more new interesting insight in this blog piece than the whole 30min Panorama. I thought I had switched to the Biography Channel by mistake.
Poor showing expected better.
Complain about this comment
A worrying scenario when none of the major players in this dreadful situation foresaw what what was coming. All they did was to blame someone else. How much were/are these people being paid?
30 minutes was wholly insufficient & the programme should have included penetrating questions to Gordon Brown with a detailed follow up when he had given his normal wishy-washy answer combined with the sickly smile which accompanies every meaningless answer.
Also a shame there was not time for a report on the Madoff affair so we could also have had Nicola Horlick continuing to defend the indefensible.
Complain about this comment
This is such a sad joke, the problems in the financial sector were inevitable. Of course the banks were to blame for reckless lending and excess speculation, but that was inevitable the easy money that was generated by the low global interest rates and the access of cheap funding through the carry trade forced the banks to try and generate more yield. We haven't heard much from Greenspan, lately have we?
The growth in assets for the big banks was far in excess to the growth in deposits so leverage was inevitable, the regulators were clearly asleep at the wheel but not just in this country. The international banks have shown the way that if their domestic regulations make something difficult simply offshore it to a less regulated territory. In America, Sarbanes-Oxley was supposed to avoid a repeat of Enron, instead more banks utilised offshore funding than ever in the form of SIV's just ask Northern Rock with Granite and HBOS with Grampian. The BIS even decided that the banks were best placed to decide their capital requirements under Basle 2 as they had such large investments in IT. Even though the banks have proven time after time that their vaunted risk models have been discredited.
So if the worst of the problem is over, where does that leave us the huge liquidity injected into the markets will create fiscal problems for decades to come. The financial analysts, (why should we take them seriously), seemed confident that the emerging markets could carry the financial baton. Unfortunately all those economies are proving tragically susceptible to the economic crisis. Pointing out that China will have growth of 9% may make for comfortable reading until you realise that the economy needs to grow at 10% just to absorb the millions of new workers each year, including an estimated 11 million graduates next year.
I look forward to Panorama reporting on the effect on small to medium businesses next year. Small businesses such as Chrysler which according to some press has been offered by Cerebrus for nothing or Ssangyong, the smallest Korean car maker which has today said it can no longer pay salaries and asked for a cash injection from its Chinese owners which they rejected, (may you live interesting times)! Bloomberg was today reporting on the $70bn in aid the oligarchs have requested from The Russian government, looks like much of those assets will soon end up back in state hands. And back here in the UK, whilst many people may be happy to see a lot of the banking sector lose their jobs they should consider the financial waterfall effect of losing those high earning jobs. Everyone from teachers in fee-paying schools to workers in the fast growing adult entertainment industry are likely to find pickings slimmer.
Its not all pessimism, perhaps the coordinated liquidity injection will work. It seems that the governments are just printing money in the hope that assets will recover in value, I suspect that even if that plan works we are just increasing the chances of bigger problems in the future. The US treasury had a 2yr note auction today and the yield ended at 0.98% Who would have thought people were so scared that they would pay to lend the US government money.
Complain about this comment
Oh dear Robert I have just watched Panorama and then stopped to reflect before writing.
I had turned on Panorama in the hopes of some insightful words and thoughts from you about the current economic situation, sadly I got a BBC and Robert Peston aren?t we clever programme
Well most of us agree that you and the BBC both are, most of the time, clever talented and insightful but I fear not on this occasions for many, many reasons.
I am sure you can take a deep breath about the transmitted programme and reflect on how people troubled by the recent events may view what they have just seen in the light of what they have personally experienced.
No what I am most upset about is this because it is one of my mothers truisms so please beware she would have said. First is vanity, vanity, vanity - then puff and it is all gone.
I hope not.
We need a BBC and an editor that tells us what is going on, not telling us how good they are at teling us, proof of the pudding is in the eating, that is a truisum from most mothers.
Complain about this comment
All credit to RP, but I'm amazed how boastful and forthcoming Alistair Darling and John Gieve are about their brilliant negotiating abilities and how willing they are to disclose how clever they were.
This is only a couple of months after a near disaster. They talk as if everything is fixed, but they may have to deploy their negotiating prowess again.
Complain about this comment
Robert Peston's much trailed Panorama debut was not a piece of investigative journalism into "The Year Britain's Bubble Burst" as expected, but turned out to be the Robert Peston story
It was all about the singer not the song.
Varley, Gieve, Darling were but bit players in a Robert Peston biography.
On Robert Peston's blog he said, "The main story of tonight's Panorama is quite how close we came to the collapse of two banks .........".
No Robert, the main story was you!
However, Robert Peston has let the cat out of the bag as regards to his political leanings. It is socialist and of an old school, long defunct.
On 25 September 2008 Chelyabinsk asked (perceptively) is Robert Peston the harbinger of the nationalisation of the banks, as he gleefully reported on their difficulties.
Recently Robert Peston advocated the nationalisation of what remains of British industry.
Now we learn from Panorama that Robert Peston's father, Maurice Peston is Lord Peston of Mile End a labour hereditary peer since 24 March 1987.
The BBC prides itself on being an impartial broker and commentator of the news, and that's what we trust it to be.
Robert Peston's comments must now be viewed as slanted and coming from a political agenda.
Complain about this comment
The smart thing to do is get smarter.
Evolve or die!
Complain about this comment
PS to No 22 above
Why is it OK to pre-announce that VAT will go back up to 17.8 or 18.5 percent (or higher) but it is not OK to pre-announce that interest rates will go up to 6 percent in six months or a year's time?
The Bank is not capable of running anything and its senior staff should go, and go now!
Complain about this comment
Enjoyed the prog.
I have to say that I don't think the banks' problems are over - not by a long way.
The natural result of bailouts/defecit spending is ZIRP and the natural result of that is the end of fractional reserve banking..
I expect full nationalisation for most od them some time next year.
Complain about this comment
Seems I'm not the only one tired of RP's constant self-publicity fed by the Beeb's willingness to give airtime to their - perceived - star turn.Good to see Rory Bremner taking the mick on the Andrew Marr Show yesterday morning.Also good to see Vince Cable getting the recognition he deserves.
Complain about this comment
WHY SAY THIS NOW ?
It seems the crisis was every it as serious as some of us have been stating. Even allowing fror the ass covering and PR it seems we were right on the knife edge.
However, we are hardly out of the woods yet. Why are those who are still active in trying to resolve this crisis going on the record to expose how piss poor their management has been ?
I hope against hope that this is some clever strategy to get the public on board for radical changes to the structure of the economy.
Complain about this comment
With all the trailing of the content of tonight's programme - maybe Bob Quick could be invited to investigate such leaks - I wanted to wait to see its real contents first. Some interesting insights but watching extracts on the BBC News at 10 confirmed my earlier conclusion that the real motive was to show the govt had no responsibility for the debacle. What we got was the Chancellor showing how he was the hard man that tamed the Banks and rode to the rescue of the country - a complete whitewash of the govt's role in how we got into this mess. I'd be interested to see if RBS go public as with John Varley that lending won't recover for 2 years or will that be a breach of their bale out?
Complain about this comment
Watch your back Robert! They will try to silent you very soon. Keep it up ;o)
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
#37 distressedone
I suspect you are right
Complain about this comment
So you went to a comprehensive, eh Robert? How very egalitarian! ... but no mention of Oxford - come on, now, don't be bashful.... even though it was only a 'minor' College.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
The banks is just part of the plan. Currency next.
Complain about this comment
Evolutionary Agents
1. Learn to be comfortable with the idea of change
2. Anything that destroys bureaucracy enhances evolution
Complain about this comment
One thought / question:
How much do we understand today of what truly caused the liquidity crisis? How much did the CEOs of these various banks. I fear very little. This would be a more valuable topic for debate and research than the focus on characters.
We need to understand the correlations between differing events and reassess probabilities - simple and boring. This was the foundation of the risk mitigation securitisation sought to bring about and the principle still stands as our best line of defence against risk. We just need better inputs into the models that were used.
We canot afford the delevering that would be needed to bring medium term stability if we revert to 'old fashioned' zero money market banking. The world economy can not withstand this. We need to look creatively at taking the best of financial technology of the past decade and applying this with more prudence and more experience behind us.
Complain about this comment
One of the many questions that remain - WHY DO SO MANY OF THE EXECUTIVE AND NON EXECUTIVE DIRECTORS REMAIN IN PLACE ?
It is due to their accountability or almost complete lack of it.
A typical small business is either owned solely or by a small number of shareholders, either family or a group who will decide together.
If a chief exec or management team are brought in to run the company and successfully run it into the ground, whilst receiving huge rewards for doing so, then they will be swiftly removed by the shareholder(s) or owner manager, assuming the owner manager is not the one at fault.
The problem for HBOS/RBS and the like is that they are owned by a vast number of shareholders with even the largest institutions never holding more than 2-3 percent.
HBOS and RBS are run by the all powerful directors who are not held accountable to the shareholders because the shareholders are a disparate grouping. In addition that disparate grouping is very often other large institutions such as an insurance company investing pension monies, which in turn are run by directors who are owned by large institutions.
They make up their own salaries, their own share options, their own contracts, appoint incompetent non execs and detach themselves with a smug air of superiority from those who own the company and those whose monies they use. There are superficial window dressed independent entities which keep a cursory check on them, but ultimately they do not answer to the individuals (most of the private sector pensions and others) who provide them with a job and entrusted them to use that money responsibly.
This would not happen in an owner managed business where one or one common voice would dictate that feckless and incompetent management must go.
In the large PLC environment, there is no effective shareholder check on the management, short of ensuring some opaque disclosure rules are properly presented in an annual report.
And what's going to change this ?
Complain about this comment
I have for some time thought that Panorama was not the programme it used to be. It's now shallow and sensationalist compared to past decades. Tonight's episode confirmed that view with a vengance. Peston himself is sensationalist and the programme's focus on him and his career brings little credit to the BBC.
Complain about this comment
So we have saved the banks -so what? They are now in a position where they are of no use whatsoever in helping us to ride the coming storm. In fact they will be more of a hinderance as they attempt to shore-up their own positions before even considering that of the rest of the country.
So, sod those who fixate upon MONEY. Let's start focusing upon the other aspects of wealth - natural, educational, production and pure skills. The days of the financiers and their bean-counting familiars calling the shots has to be ended
Complain about this comment
RE BANK stability
Mr Peston
I own a business that trades in the on a Global Basis.
We turnover circa 680 plus million
per annum.
I HAVE NO FAITH IN THE UK BANKING SYSTEM.
I HAVE MOVED ALL SUBSTANTIAL
DEPOSITS FROM THE UK.
I will not accept any assurances from either King Darling Brown
Mandelson or any senior bank executive as to the safety of depositing monies with any UK
Bank.
In my view HBOS should be in administration aswell as RBSNATWEST.
Complain about this comment
MASS SACKINGS & PROSECUTION
are long OVERDUE.
THE "CITY" MUST BE PURGED AND
CLEANED UP.
Complain about this comment
Shame the Panorama programme seemed to be filmed and edited by the Robert Peston Appreciation Society!
Less than 5 minutes of Panorama quality coverage, or perhaps like rest of BBC it's dumbed down
What you failed to get across was that a reporter like yourself could hardly knock out the banks if what you were reporting wasn't true.
Shame you didn't focus more on those of us who are now suffering as a result of drop in interst rates and were being sensible. Fastest way to re-capitalise banks and get them creating profits is to encourage deposits which can only be done by rasing interest rates. Let those businesses that were silly go to the wall and the eceomomy will be more solid much quicker.
Complain about this comment
Many of us have often said that we just cannot trust any politician - as we never believe anything they say.
On the other hand, Banks - in the guise of their CEO's and Directorates have (hitherto) always embraced our absolute trust.
That trust was ever priceless - and the tragedy now is that they never appreciated it nor did they value it. If only they knew it, trust was the best factor outside their Balance Sheet.
By their actions of passed months, the Banks have tossed all this trust to the winds.
Those Executives have shown themselves to be totally inept and unqualified for their posts. Charged with such immense responsibility for their clients' monies, surely the FSA should be looking to the accounting and business abilities of all Bank Executives.
I speak as one lesser mortal - retired after spending 40 years in Branch Banking Management - and I am thoroughly ashamed of our so-called pillars of the Banking Industry.
Excellent program - by the way !!!
geofband
Complain about this comment
Robert
Was I alone in getting the distinct feeling that your scoop re the recapitalisation of the banks was very useful to the Treasury in setting up the banks for the "drive by shooting" ambush, disguised as negotiations ?
I was struck by the comment by Vince Cable during the programme regarding the bad behaviour of the Government in relation to the leaks and their use of the media.
Couldn't help thinking either how interesting that such very serious leaks with such huge impact should pass with no visible leak enquiry by the Government and certainly no arrests.
Complain about this comment
Robert - conned tonight, thought it was going to be a serious piece - but got a BBC/Peston answer to the critics, didn't need the CV thanks or any justification for breaking stories....
Early poster right - 10% useful - 90% useless!!!!
Buck up.....
Complain about this comment
No.45,
perhaps their are some useful aspects of the past valuation models. In the past the banks thought that market risk management was the solution to their problems, and sure enough lots of quants were hired at excessive salaries, hundreds of millions were spent and a whole section of the IT industry was created. Then there was the Asian crisis, followed by the Russan default and the collapse of LTCM. The banks decided that perhaps market risk wasn't the complete answer as their VaR models proved useless and someone remembered that the nobel prize winning Black-Scholes model assumed constant volatility. Suddenly the banks decided to throw money at credit risk, previously the ugly sister of risk management. The banks had some models, but unfortunately the data inputs were limited and once again made rash assumptions. The rating agencies sprinkled their magic dust on the leveraged products and everything seemed fine. All the time the banks increased their usage of unregulated products in order to avoid revealing their lucrative spreads to their clients. Of course, the rating agencies had proved the value they added during the Asian crisis when they downgraded Korea after representatives had summoned the banks to a meeting where they threatened to declare national bankruptcy if the banks didn't maintain their credit lines.
Don't blame some 60 year old board member for not knowing how a synthetic CDO works, a lot of the traders and fund managers who purchased them had to phone the investment banks that sold them for valuations while the highly paid risk management professionals sat in the corner of the trading rooms crouched over their bloomberg terminals.
Complain about this comment
Two people have come out of this sordid mess with their reputations enhanced:
Robert Peston and Vince Cable.
Cable is that most curious of creatures - a respected, popular and trusted politician.
Peston has broken some of the biggest financial stories of all time. Who cares who those sources are; the reports have proved to be spot-on.
There are three bank holidays coming up. Get some rest Robert, I have a hunch you're going to be rather busy in 2009...
Complain about this comment
It makes my blood boil to see these overpaid conceited idiots
brag about how clever they are.
HAVE NO DOUBT WE WILL ALL
PAY A VERY HIGH PRICE FOR
THIS MESS.
Whatever economic growth (so
called) will be swept away by the
contraction of the economy,
the huge losses, job losses
and TAX INCREASES to follow in
the DECADES TO COME.
Complain about this comment
What were you trying to tell us? We were expecting a penetrating expose by Panorama, and you did not deliver. That this is the biggest recession we are about to experience we now know. It was caused by an enormous glut of easy access to money is for sure. Trying to recycle that debt, borrow short and lend long....never a good idea. We know our banks bought the packkkages, no one held a gun to their heads to make them do it, they bought what they not understand. The UK also has its own sub-prime, and we do have massive credit card debt, and we have a government that has borrowed, and borrowed, and borrowed, and borowed. And what is the solution?
To borrow more. Can not really figure that one out. Yes, I get the bit about liquidity, but somewhere there has to be a reconcillation of the books. This is going to get a whole lot messier andit would be nice to have some robust interviewing of the parties involved, including the current government. So far we have had very little offered in that direction rom any part of the BBC.
Complain about this comment
It would have been nice for the programme to focus more on the topic than the journalist. The whole sorry tale of how we got into this mess and details of those responsible needs to be made public. They should never be allowed to work in the markets again. Having said that, it is good to know that there is a journalist with such excellent sources reporting on Finance stories. If we are to avoid a repeat of this crisis then it is vital that those with such an influence on our lives should be subject to effective media scrutiny - obviously no one in Government was bothering!
Complain about this comment
The more i hear and read about
HBOS it is abundantly clear that
I should have proceeded to serve
my Winding Up Petition on their
subsidiary HALIFAX PLC in JAN
2007 there was no doubt as to
their status then.
Complain about this comment
RE BANK DIRECTORS PAY
In recent months i have researched all the listed directors
of the main banks.
Its interesting to see how many have purchased properies over the last 5 years at prices between
2 million pounds up to 11 milion
with what appears to be OUR
MONEY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Complain about this comment
svrsig Re: Hedonics.
No need to Google, search the term on the National Statistics site and you will find that this measurement was introduced for a limited range of products a few years ago.
http://www.statistics.gov.uk/CCI/article.asp?ID=290
Complain about this comment
Good programme but as someone else said I felt that the Darling/Preston relationship seemed a little too cosy for my liking.
I've never trusted Darling since he told the FT that he didn't believe in Economic Patriotism.
Complain about this comment
Robert's plain speaking reporting style has been an invaluable resource to many of us worried at the emerging financial crisis over the past year. In my view he rightly earned respect for cutting through vested interest spin and exposing financiers and politicians for the self serving parasites that they of course always have been. It was therefore all the more disappointing to discover that this evening's Panorama was really just a programme about Robert, and therefore for the most part simply egotistical self centred nonsense. I really don't want to know that his Dad was a 'Lord' or indeed how he looked at various stages since early childhood. You do a great job Robert, it is really appreciated, but please, you aren't Richard Dimbleby just yet.
Complain about this comment
Very interesting programme tonight. There is a much more alarming picture underneath the financial shenanigans.
Put bluntly, the failure of the UK banking system is too awful to contemplate. THe UK as we know it would have been severely damaged, to the point of potential insurrection. Our whole economy is built on trust and "word is my bond" ethics over hundreds of years, like the stock exchanges worldwide. A failed banking system would create a "vote of no confidence in UK plc", potential for default on UK Gilts, and then...
No Government would be able to face its citizens with any sort of mandate with that outcome.
As a taxpayer it really upsets me to have to bail out a privately owned company, at the expense of my children's future, jobs, pensions etc, etc. It is morally and policitcally bankrupt.
Interestingly, the small businesses and thirfty hard working indivuduals who have been trampled on by the unholy mess of "our leaders" in this latest crisis is beginning to show through. Perhaps, we as a country should now strike home with this advantage and press harder for what we want.
I read a quote from Thomas Jefferson, which I think says something along the lines of:-
"If people fear Government, this is tyranny, If Government fear people, this is liberty".
A good maxim for our leaders to take heed of!
Complain about this comment
At last Mr Peston ...at last... you now seem to be asking raw questions. Thanks. Perhaps now you could also ask for
some raw solutions.
Eva Hoffman in her book 'Shtetl' ,subtitled, in part, 'The History of an Extinguished World' has a
n illustration of a 16C drawing of 'The Death of Credit' ...opposite p48 in my edition.
Trust has been destroyed now as it had been then. It is TRUST that has been turned to ashes Mr Peston..is it not ?
Through the BBC, please encourage Mr Darling to spend any of the little public money left in building new Debtors' Prisons and new Workhouses . The Govt, BoE, FSA, Parl Committees, Auditors, Accountants, Bankers (sic), Institutional Investors, and the Media would provide many able candidates to fill the available places
There are buildings off and in Parliament Square..and others in upper Regent Street and Marylebone High Street which would make marvellous conversions.
I did not vote at the last general election and most politicians of all the Parties sicken me to death and beyond.
Irony and contempt are not wonderful virtues to have...but I am ashamed to say they are all this blogger seem to have left.
Anlgo Saxon expletives are not enough. I just wish they were.
Froeliche Weinachten
Complain about this comment
it seems to me after months of struggling the BOE / government are pushing a version of events which is being swallowed now byyour good self and other commentators and that is that the fundemental problem wasn't US and UK monetary and fiscal mismanagement or a failure of regulators but it was all the fault of the Chinese and Saudis investing their excess cash into our financial markets.However, the questions that remains is that in fact the highly leveraged derivitive markets swamp the chinese inflows.
The government and BOE in opting for the CPI measure of inflation excluded house price inflation from their calculations.at the same time as inflation was bouncing around 2 to 3 % the M3 money supply was accelerating to 15% per annum. so the asset price bubble was nothing to do with this or Hank Paulsen as chairman of Goldman Sachs was lobbying from 2000- 2004 congress and the SEC to relax the rulers on disclosure and to protect directors from law suits by shareholders for withholding information which may affect the share price which we seemed to go along with including the exclusion of derivitive traders from regulation and the repeal of glass Stegal act. Not sure how you explain these away Robert but the creation of a myth that excuses the treasury,BOE and the FSA because its really all down to China is really not helpful.
Complain about this comment
Like most people I am appalled and shaken by the systematic inadequecies underpinning the banks collapse. However, while the focus remains on the banks the conseqences to 'real' people are generally unattended to.
Questions out here (the real world) include:-
What pay back will taxpayers have when the banks again start declaring 'rude' profits and how will government ensure that they are better regulated and less trusted in the future?
How come the government is not approaching banks to reduce their interest on credit cards, this would help a lot of consumers who the banks have encouraged into dept out? (This is something that MUST be discussed as banks are again being allowed to make ridiculous profits)?
How will consumers manage when banks reduce or call in overdrafts? Is the government taking steps to ensure limitations on their ability to do this with good customers?
Similarily, is the governement taking steps to ensure credit card companies can not suddenly reduce credit limits to good customers with a good track record and still in employment?
Answers to these questions, or at least attention to them night increase consumer confidence and have a positive effect on the economy.
Complain about this comment
Welcome to America
It's one Global World
Complain about this comment
Any expanding going concern faced with a sudden unforeseen setback is bound to have problems .....but that's life .....like a bicycle,you are either moving forwards or you stop; and if you cannot put your feet on the ground, you fall over.
But they were doing so well before the crash that they deserve lots of support ,not our blame, because when this disaster turns round ,these very same nightmares are the very people who will produce the profits that will increase the value of the government's holdings in these banks by a factor of 10. Think about it.....the percentage margin on a mortgage is now on average 3% above base when it used to be nearly on a par....that is one hell of a profit even after a one percent Libor premium.
Credit cards are much dearer, and the high riskers are no longer being offered loans.Savings rates are rotten compared to what mortgages are being charged at.
And which bank had to turn customers away as it was attracting too many....another ex-basketcase, Northern Rock, now criticised for charging too much interest and being too risk-averse.
Things are already moving on.The current price of the bank shares already takes all of these downsides into account,but why are the experts predicting a 225% increase in nationalised bank share prices in the coming year? Strikes me that those in the know are not telling us the good news because there is big money to be made out of the doomthinking of share sellers and pundits.
The big story is really about the way that people's expectations change cyclically,and how those who succeed are those who saw ahead and sold their shares in HBOS at £12 or bought their dollars at 2 to the pound when all the commentaries were predicting the further decline of the dollar.
Now all we read about is the crash of the pound.
But life is strangely countercyclical .
The next big thing will probably be the relative crash of the Euro which is going to fall to E1.5 to the pound. But who is brave enough to take out a Euro motgage?
Complain about this comment
comment 21 / no way out said "If they want you to sit on your news, then they essentially don't accept the free operation of the market, and have to reject all they hold dear."
That's not even the point, just the criticism they mentioned on the show. To see real critics in action read the comments here. My comment no. 16 for example, I did not even make this point, but had serious issues to point out. Read it, and the others, please.
Complain about this comment
"How our banks were rescued"
What a smug headline.
They have NOT been rescued! They are being temporarily held together with a few peices of frayed string and old sellotape. Who is this mythical 'tax payer' who has so kindly underwritten' the banks to the tune of £350 BILLION?
Not those shortly to leave Woolies or Jugular (owned by Tata Motors). Presumably not those whose retail bosses are currently offering massive pre-Christmas sales. Unemployment now at 1.8 million and rising (rapidly). It certainly won't be those smug b***ds greedy and selfish enough to keep their money in offshore tax havens.
If the participents in this Panorama programme were on fire, I would certainly NOT bother p***ing on them.
The rest of my feelings at their collective, self-congratulatory, back-slapping smugness can only be expressed in Anglo Saxon.
To paraphrase Queensbury : "Bankers, politicians (and sycophantant journalists), I believe I once trod in some"
#48 ForeDeckDave - one of the few sensible comments here. Well said.
Old Groucho
Complain about this comment
Hello, Mr. Peston, and thanks for these excerpts.
Any possibility the programme could be made available to the American audience via the web or BBC America? Perhaps arrange to have it aired on a business channel here?
Complain about this comment
Saw the program and Robert is a great reporter of our time, yes, but I also think for him to get the people he did get to talk on the program, he must have sold it to them as a bit of an opportunity to say how great they were in ''saving the day"
I mean surely other noticed just how Mr Darling seemed to be so pleased to tell us all about how he was so cool in last emergency negotiations with the heads of the big banks?
Brown likes to do that too, remember his Freudian slip about 'saving the world' last week?
Anyway that's all a side show, Brown, Darling, the Bankers etc are all just the latest in a long line of puppets, who, when the boom was going on, had to dance to flute played by big banks, big business and IMF (by extension, the US).
I'm no raving socialist, but I believe the rot started 30 years ago when the whole movement toward Neo-conservative doctrines started in earnest, started by the Mrs T Continued on by "New Labour" in the UK
With Mrs T in the UK and Reagan in the US, oh yes i'm going way back, a new age was born, basically policies of weakening union power, reducing worker rights, running down the manufacturing base (because it was a base for union power).
Most important, pumping up of and deregulation of the the financial sector. This made the neo-cons and his/her friends in high places / big business very, very, very rich.
But made the economies of , the UK and US especially, so ridiculously over reliant on (deregulated) banks and financial industry.
Now we see the result. More financial scams, more fraud, more bubbles, more instability.
The 'financial industry tale is wagging the whole economy dog'. Now the financial industry has become our master not our servant.
Again, I'm not a raving socialist, but I say all this from a centrist viewpoint. I believe that any imbalance or doctrine driven policy, on the left or right, will always lead to disaster.
This has been proven over and over in history. Whether its the failure of communism and total stat control. Or the failure of totally free market, unregulated capitalism.
It is a historical and present day fact, that all these extremes have been tried over the last 100 years, and none of them worked!
The evidence has shown that the only systems that have stood the test of time and remained relativity stable, are the countries that have pursued , centrist, mixed economy style systems. (science and technology driven, mostly secular states, but that's another subject)
Such countries are post ww11 Japan. Germany, France (just) , Canada, the Nordic Countries. I could name more. Oh. and the UK in the 1960's well before Thatcher came in.
Sorry to sound so boring and and non-idealistic, but the evidence is there!
I think this is maybe what Peston really means by a 'New Capitalism', he maybe means just getting back to a more centrist, less extreme, less ideologically driven (on the left or right) type of capitalism?
Capitalism is dead, long live Capitalism!
Complain about this comment
Robert,
The New Capitalism will be be "State (authoritarian ) Capitalism.
This new economy will be driven by a blend of communist and and capitalist ideology - a half-way compromise between the two.
This new capitalism will be regulated by genuine businessmen and not bureaucrats or politicianswho have never arranged a business loan or done business in their lives.
Sharks must be supervised by sharks. Gamblers (entrepreneurs) must be supervised by gamblers.
The regulators must be answerable to the State which will have ultimate control of virtually every facet of the macroeconomy.
This is the only realistic way forward!
Complain about this comment
The financial system needs a clear out......investigation by fraud squad.....blood on carpet......back to old values where the bank manager actually knows his customer(remember that?...pre late 70's).....restart manufacturing by Britain for Britain.....more export/less import.....keep military for defence of the country as opposed to occupiers of other countries.....and finally overthrow this government and elect a cross party government without Brown or Darling or Mandyson!
Complain about this comment
# 61 alexandercurzon
Alexander, don't take this the wrong way, but perhaps you need to get out more?
Complain about this comment
"There is £17bn of our money that is expected to go into HBOS and Lloyds TSB, with most of it going into HBOS."
And there were the Scot Nats shouting about the new financial centre is to be situated in Scotland !! I wonder how deep into their sporrans they will have to dig if the rest of Britain didn't have to stump up for the bailout of these two "truly Scottish" banks !!
"Well, I mean each bank is, is different and some of the banks were benefiting from this. They were attracting, they were seen as the safe havens and they were getting an inflow of deposits and their problem was: "what do we do with this money we don't need?" And they started looking to deposit it with central banks, in fact. But several of our large banks, and I mean I don't want to go into names, were, were in real difficulty and you know, were having hour-by-hour minute-by-minute to balance the books at the end of the day, and obviously we were talking very closely, but it wasn't just happening here."
There is still an irrational ignorance on the part of some people that the government bailed out *ALL* the banks !!
As stated above, there were some banks that didn't need the government bailout, either because they got better commercial terms, and/or lack of politically motivated ones, from elsewhere (ask John Varley) or they just didn't need it because, again as stated above, *They were attracting, they were seen as the safe havens and they were getting an inflow of deposits and their problem was: "what do we do with this money we don't need?"* (a bank with a strange Far Eastern sounding name comes to mind) !!
"Yes, that's right. We had done some sums and between us we'd, we'd come up with what we thought was necessary and really there was only one provider [the taxpayer]. Now, for Barclays they were, they chose a different route. They thought that they were given the number and they, they said "no, we can raise this ourselves on the market," so they took a different route to the other three."
They probably took one look at the political agenda and they said "forget it, we want to survive into the 22nd Century" and they are right !! It is now expected that NR and B&B will not survive as viable *commercial* banks and they will just be some political football to be kicked around by their political masters and trotted out as the scapegoat at need !!
#28 "Small businesses such as Chrysler which according to some press has been offered by Cerebrus for nothing or Ssangyong, the smallest Korean car maker which has today said it can no longer pay salaries and asked for a cash injection from its Chinese owners which they rejected, (may you live interesting times)! Bloomberg was today reporting on the $70bn in aid the oligarchs have requested from The Russian government, looks like much of those assets will soon end up back in state hands."
More shameless attempts to obtain money with menace by the car makers !! Firstly, Ssangyong is *NOT* owned by the Chinese !! They are a totally Korean company !! They do have a joint venture operation in China with some Chinese partners. For them to demand money from their Chinese partners while withholding cash in their main empire is akin to Tata demanding money from the government while withholding their cash within their empire !! Perhaps if they did not repatriate so much money out of China to their parent empire, they might have some left locally to pay the salaries !!
Chrysler is a busted flush and they are dragging a venerable name, Daimler, down into the muck with them !! I shed no tears for them when they have square mile upon square mile of unsold vehicles gently rusting away !! And they want more money to produce unsalable vehicles ?? Why ??
Would it not be more profitable to support those companies that are *still* selling than to support producers of unsalable products ?? Is it better to support a few thousand employees of failed car makers or a few million employees of still profitable SMEs ??
#48 "So we have saved the banks -so what? They are now in a position where they are of no use whatsoever in helping us to ride the coming storm."
Not *ALL* banks were "saved" by the government (see comment above). Some are still doing business and are blithely ignoring the government dictats that they lend money at commercially suicidal terms !!
Finally, the Panaroma programme last night seemed to be produced by the biography department, not the economics department of the BBC !!
Complain about this comment
Looks like people on here are not very happy ROBERT.... but its not hard to understand why. Many people are going to lose there jobs and homes savings,while A.D sits smiling away on tv.You said you believed in freedom of speech, And yet the very people you work for do not. The day the BBC attacked the people that pay there wages is the day democracy once again started to live in our great nation.
THE SAYING GOES NEVER BITE THE HAND THAT FEEDS YOU. BUT THE BBC DID.
Complain about this comment
Interesting programme. It was good to see important people acknowledging all the cock-ups and peek inside the corridors of power. Darling came across well. It was particularly good to see you saying on prime-time TV that the wrong people are being punished, but how are those that were responsible for this fiasco going to go about putting that right for me. As I didn't have any debt and the problem was not of my making, I expect to be compensated for my losses....
The other thing that occurred to me was that if Journalists (in general) hadn't reported Northern Rock, the mis-management that caused the problem would probably have been covered up and it would have continued. Anybody questioning the numbers would continue to being portrayed as cynical/naive doom-mongers by those in the positions of power. Things would have collapsed eventually, but would the situation have been retrievable if it occurred in 5 or 10 years time ?
So it was actually a very important piece of journalism, even if it has cost me money.
That piece of reporting has identified an important issue that the regulators and politicians had failed to address, that they either couldn't or wouldn't address because of the inertia that prevents such changes when people in positions of power (i.e. Businessmen) are making lots of money for themselves and political parties are dependent upon those businessmen for funding....
Without it all coming out into the open, we'd probably never have had a chance to put things right...
Bob Peston O.B.E in the New Years Honours list .... ?
Last but not least. I haven't been tearing my hair out over this. There's none left after worrying about paying my mortgage 20 years ago, at the much higher interest rates that prevailed at the time...
But by not having flash cars, all the latest gadgets and expensive holidays I did manage to clear that mortgage. I've managed to save a bit for my retirement since then, but what happens now. Just when I should have been in a position to do all the nice things I see a complete reverse. I see 0% interest rates just when I wouldn't mind them being at the levels they were at 20 years ago...
Stability and confidence is what the economy needs, instead of greed, arrogance and stupidity.
We might be able to plan our lives a bit more effectively then...
Complain about this comment
I fist became aware of the impending credit crunch through Robert Preston's blog and since then I have read all his subsequent articles, on the unfolding problems in the money markets, with a great deal of interest and fascination.
Robert Preston was ahead of most other reporters (and bankers) in his assessment that the finacial crisis that first affected the USA and UK finacial markets would develop into a truely global problem that would seriously affect every economy around the world.
Some people claim that his early revelations about the problems confronting a number of large UK financial institutions and about what was being discussed at very senior levels to try and resolve those problems were alarmist and simply helped to fulfil some of his prohersies. others say that he is little more than a reckless and lightweight reporter out to make a name for himself.
Having read his articles and listened and watched him on television I believe he is neither receless, alarmist or senationalist when it comes to reporting what he knows and hears is happening in the financial markets. His revelations and assessments on the credit crunch have been surprisingly candid and accurate and that suggests his sources have been well briefed and are well informed.
He is quite right when he says his job is to inform the Beeb's readers and viewers of the facts as they unfold and this information should not be solely for the rich and powerful. Most ordinary citizens are just as capable, as the rich and powerful, when it comes to digesting information that affects their lives.
Well done Robert I take my hat off to you and your reporting style and let me sign of by wishing you and all the other bogger's A Merry Christmas and A Happy New Year
Complain about this comment
Perhaps this years CHristmas no 1 should have been;
Last Christmas, I gave you my cash
But the very next day, you gave it away ....
Perhaps 2008 will prove to be our last Christmas
If the predications for 2009 are right, nobody will be able to afford it nexxt year....
Complain about this comment
"inevitably when you deal with a bunch of bankers, they started trying to re-open it."
Are you sure AD really said "bankers"? :-)
The points I take from this are that obviously some people in the civil servcie knew just how bad things were going to get when they set the new capitalisation standards. At the time they were strongly criticised but have been borne out. Why weren't these people given more decision making power earlier?
The other is the complete lack of any inclination from any side that the people who got us into this mess should actually take some responsibility and resign/be kicked out.
Also, there was never a single mention of HSBC, or did I miss it?
Complain about this comment
Robert
I suppose a degree of post-rationalisation is inevitable in a situation like this and it was certainly evident in last night's piece - not least from Alistair Darling, aided and abetted by you.
It would have been interesting, and I think appropriate, has those interviewed included the then CEOs of RBS and HBOS.
Also interesting would have been a questions to Darling on his views on the leaks and his response to Vince Cable's assertion that the Government had sneered at and swept aside his warnings in 2003.
Complain about this comment
Nicely done Robert. Not too deep, not too shallow.
You know you are doing well when people in high places start spinning your role.
Apparently, and by their own admission, they are powerless and you are powerful. A mover and a shaker. A deal maker and breaker. Billions made and lost on your word.
I bet you never thought that shining a light when all around want darkness would cause such a fuss.
It has been a pleasure to read and listen to your take on the world of finance and robbery, but please do remember that they will came at you when you least expect it.
Bravo Robert, Barvo.
Complain about this comment
Re: 83
Actually, I don't want sackings/resignations.
We'd just get a set of fresh faces without the benefit of this experience who would go on to make other mistakes or contrive to make the same mistake again...
What's important is that the people reponsible, recognise ALL their reponsibilities and failings and do their jobs properly in future. They should not moan about regulation or try to undermine/circumvent it all the time, but embrace it, adhere to it and be willing to extend the regulations where new risks are identified...
We've seen what can happen and can't afford to repeat the same mistakes again...
Complain about this comment
The major untruth that is at the heart of the problem
INFLATION
Why was asset price inflation (house price inflation) left out of the inflation indices?
Sir John Gieve said words to the effect, that we (the Bank) couldn't raise interest rates when inflation was so low and stable even through we wanted to, as the country would not have understood.
The key to this folly was to keep asset price inflation out of the indices - here is the huge and utterly predictable cause of the credit bubble. (They also relied on imported deflation from China to keep the indices low.)
1. Who did this? (Ans. The National Statistical Office)
2. Who kept quiet about this? (Ans. The Bank and the Treasury)
They all need sacking for incompetence. We pay these people for professional competence - they plainly failed and they should go.
I leave out the politicians who presided over this folly - as they are amateurs who rely on the advice of the professionals and it is these 'professionals' who have messed up through a deadly combination of cowardice (see Sir John Gieve's remarks above) and ignorance.
However what must happen now is a return to a stable and sustainable monetary management regime where money regains it value. (See my previous arguments about the value of money.)
Otherwise, if this does not happen PDQ (within the year) there is a huge and definite risk that the whole system of money will be damaged if not destroyed and this CANNOT be allowed to occur.
We need new people with a sound economic understanding and guts to insist on correct policies, - not these people who gave us the credit bubble.
Complain about this comment
living in france i was unable to watch the peston programme, but i do have a pertinent question. Why were the banks "saved"? All the government had to do was guarantee deposits (which they have done anyway) then let the banks and their army of mismanagers go to the wall. As it is the banks are not functioning and the directors are still drawing huge salaries basically propped up by the taxpayer....the world is truly insane!
Complain about this comment
Another poor piece of journalism, used as yet another soap box for Peston. Why we needed his CV and the 'Day in the life of' format for what was meant to be an informative programme is beyond me.
Years of good programming from Panorama was lost last night. A very sad evening
Complain about this comment
Re: 89
Yes, I had the same though at various stages when I was watching the programme.
But in view of the criticism levied at Robert, I took the view that this was an integral part of the story and it was therefore reasonable, if somewhat unusual, to do that...
So long as Panorama doesn't make a habit of it....
Complain about this comment
#80 "I see 0% interest rates just when I wouldn't mind them being at the levels they were at 20 years ago..."
Don't worry !! Interest rates *WILL* return to the level 20 years ago when the rest of the world stops lending money to Britain and the pound goes through the floor and the government will have to raise interest rates simply to attract more money to pay the interest on their borrowings, let alone their debts !!
It happened 20 years ago when Labour bankrupted Britain and it will happen soon because Flash Gordon bankrupted Britain *AGAIN* !!
Complain about this comment
#83 "Also, there was never a single mention of HSBC, or did I miss it? "
No, you didn't but why spoil a good spin with a few inconvenient facts ?? Of course, Gieve sort of "hinted" at *banks that attracted the cash as safe havens* without naming the guilty !! :-)
By implication, he "hinted" at the fact that the others were perceived to be "unsafe" havens for our cash !!
Why, oh why, didn't the government take up the offer of those 2 tartan knights and dump that mess on their laps without wasting good taxpayers' money trying to bail HBOS out ??
Complain about this comment
Re:91
Yes. You're right. I'm fully expecting to see hyper-inflation, which is why we might get an election early in 2009.
But by the time interest rates are high again, I won't have any capital left as I will have been forced to live off it. And then I'll be in the situation of borrowing money again - at the higher rates. I reckon I must be one of life's losers...
What was that famous Christmas film called, "It's a wonderful life ...!"
I'll probably have to watch that every day of the festive period this year, just to make sure that I get as far as 2009....!
Complain about this comment
#88 "Why were the banks "saved"?"
Politics, old chap !! Purely and simply politics !! I would think that if those unsound banks went to the wall, the other sounder banks will pick up the pieces at fire sale prices and carry on as normal !!
Complain about this comment
If the Bank of England had acted properly as lender of last resort, many Pension Funds would be far better off now.
And several UK Banks would still be independant.
Complain about this comment
The programme told us nothing the public did not already know apart from an insight into Roberts Pestons background.
The BBC should have journalists who present the news as news. Sensationalism and scoops should be left to commercial news gathering organisations.
The BBC should be mindful of their privileged position in opinion forming in the UK.
RP did not cause this financial crisis but he has not helped mitigating it in the UK.
It would be very useful given RP's impact however to give an in depth account of how banks drove up commodity prices by speculation which I believe is the root of this crisis.
All major commodities are now at least 50% off their peaks this cannot be due to an equivalent fall in demand.
Complain about this comment
Of course the leaks and mishandling of the situation has damaged Britains reputation as a safe haven for money.
This is one reason why the Euro Pound exchnage rate has fallen so far.
It has also shown up the Accounting Profession.
The Regulators have clearly not been allowed to do their jobs.
And the Ratings Agencies are clearly a waste of time.
Complain about this comment
#94
"#88 "Why were the banks "saved"?"
Politics, old chap !! Purely and simply politics !! I would think that if those unsound banks went to the wall, the other sounder banks will pick up the pieces at fire sale prices and carry on as normal !!"
Not only politics but also because of the idiotic, herd mentality of most of the UK population - if one bank had been actually allowed to go under everyone would have pulled their money from all banks (to hide under the bed) and all of the high-street banks would of gone under one by one.
The public is too easily panicked and not discerning enough to decide between a good and a bad bank.
Complain about this comment
#86
Are you really suggesting that you couldn't find someone who recognises that massive long term lending on over appreciated assets funded by short term borrowing is bound to blow up eventually?
It was clear for years that the UK was too deep in debt based upon haouse prices which were unsustainable. And for chief executives to condone loosening the requirements to borrow even more under these circumstances is at best short termist and at worst negligent. In either case such behaviour shows that these people are NOT the people to have in charge of a major bank. The fact that they now know how to negotiate a bailout doesn't inspire me with confidence - they should never have got themselves into the situation where it was needed.
Complain about this comment
It is worth noting the Banks weren't saved.
Millions of small shareholders and pensioners have lost out, and thousands of ordinary jobs in Banking will be lost.
Competition in the High Street will reduce, as the number of Banks (and soon enough their Branches) reduce.
Of course the long term policy of keeping Wage rises below the real rate of Inflation has led to a collapse in consumer demand.
So who in their right mind would invest in any British business relying on selling to a weak consumer market ?
If the Govt lends money to Tata it should be under the same harsh, shareholder fleecing terms it used on the Banks.
But perhaps they fear an Indian Billionaire more than British Pension Funds.
Complain about this comment
It's quite scary that we weere that close to financial meltdown.
But surprised.....NO
House inflation was rampant at 15% for several years and the market able to keep up by the following slight of hand tricks that were able to confuse the B of E.
Leveraged loans
125% loans
Earnings ration to earning to 7x
It was a disaster waiting top happen and the excuse given last night was that the
B of E did not want to appear to stifle growth and slow down the economy.
Now we are all paying for there non-action.
Heads should roll
Complain about this comment
So which Companies will be Nationalised next ?
Will we see the Housebuilders brought to their knees before the PM?
Will he rescue/Nationalise them under the same destructive terms as he applied to the Banks?
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
87:
There is some encouragement on Inflation, for me at least my own rate is now at eight and one half percent.
That does not include property prices, or flat screen TV's.
Of course with the doubling or more of National Debt and the contraction of economic activity, a very very large lump of Inflation is on the horizon.
Its just a matter of when and where it bursts thro.
Meanwhile, in a few months we may see one pound equal to eighty euro cents.
Complain about this comment
I see that there is now a campaign for savings interest to be tax free for say the first £5K.
Why not allow saving inbterest to be included in CGT allowances.
This will give everyone the same allowance and not cost any more than if everyone held shares, property etc
Complain about this comment
Oh deary me people when you going to wake up............ i was on about the bubble 6 years ago.
Complain about this comment
The banks celebrating a 'successful' bailout is rather like the nation celebrating Dunkirk as a victory. The years of hard struggle are still to come.
Complain about this comment
And little mention has been made of the Nationalised Belgium Bank whose Shareholders have recently been compensated for their Govt's actions.
Complain about this comment
Top stuff from Mr Peston.
David Cameron is so right....a lot of these criminally negligent bankers should be in jail.
And all those who knock R.P. and say he makes matters worse need their head examined...how can he do any worse than these greedy failures? If R.P. shuts up, how are we ever going to learn, and stop them doing it again?
Complain about this comment
Missed the Paranoia program, as watching a decent economic program called 'The Ascent of Money' on C4. Most interesting series to a layman.
From what I read above, the FSA, BoE and AD all deny seeing the bubble could burst. They got sucked in too didn't they.
They got blinded by the lights, because the Corporate Tax take, added to the Personal Tax take on the over-paid numpties running the banks (even with a good acocountant and a modicum of tax avoidance) was to answer to all their questions.
They may have seen the iceberg, but the huge tax take from sector was simply irresistable. It massively dwarfed the £13bn we have invested so far in banks, and was paid to GB EVERY year!!
Barcalys £8bn "record profit" = at least £2bn PER YEAR Tax. The others banks were not far behind. Correct me if I am wrong??
Greed blinded their judgement. Just like the bosses at the banks - a psychological state of ignorance, leading to arrogance and finally a sense of immortality, led to casino banking by the Treasury.
Complain about this comment
When the journalist becomes the story... beware. Like J B Priestley prior to the 1945 election, Mr Peston's tendentious reporting is a massive mistake... particularly for the BBC. Sir Michael Lyons should be very concerned about this. And the 'story' on the !0.00 pm news was nothing short of a party political broadcast on behalf of the Labour Party.
Complain about this comment
Robert
I see you were still wearing that ghastly tie in the early part of the programme but it had gone by the end and good riddance.
I must confess that Alastair Darling came across as a very pleasant individual. What on earth is a decent man like that doing in this ghastly government?
The programme did not tell me anything I did not know beforehand but I trust it helped to illuminate others.
The moral to this tale is that all the banks bailed out by the taxpayer had done exotic dances during the good years rather than attend to their balance sheets.
We really do need to bring the Old Testament back into our schools along with Aesop's Fables. They might provide some backbone and bottom to the future commercial leaders of our country.
The current lot have been weighed in the balance and found wanting. Wanting my hard-earned and tax-paid deposits and that is unforgiveable.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
Aint no hustler on the street could do a whole community
This is how deep shh..it can get
Complain about this comment
We've got 5 million ways to kill a CEO
Slap him up and shake him up and then you know
Let him off the flow then bait him with the dough
You can do it funk or do it disco you know how this go
Complain about this comment
"98. At 09:02am on 23 Dec 2008, scouseflyer wrote:
The public is too easily panicked and not discerning enough to decide between a good and a bad bank."
All banks use the same lending model. The only difference between them is your perception. Your money is NOT in your bank.
Complain about this comment
It ain't Indonesia, China White
Purple-Haired Thai, Big H Delight
Take my stuff we gon' have to fight
I'm always rollin' dirty so be actin' right
Complain about this comment
Enjoyed the programme, but would like to see a follow up in which people were asked to comment on the way forward.
Why have we not seen reductions in Government spending? This year, for example, we gave away £55.8billion to the new EU Members. That would raise eyebrows even if we were cash rich, but we are borrowing the money. Thats like getting a loan from the Bank and then giving it to a charity.
The Government wastes £billions on non-productive expenditure. Even the NHS could shed £millions without making the slightest difference to front line services. Why, for example, do NHS Trusts need Marketing Directors, Managers, staff and marketing budgets?
If we still need to borrow after eliminating the waste, why not offer our own people a decent savings rate instead of paying out to some international fund?
Complain about this comment
104:
Oops, I should have said a few weeks time not months.
My Bad!
Complain about this comment
If this ain't straight you think you wanna sit down and negotiate
You better have a crew to help you shutdown his estate
Don't get frustrated, discombobulated
Don't stand and debate it, get a mob and take it!
More strikes than teaching staff's fight for pay hikes
Made the ruling class hate us more than child support payments
Complain about this comment
We have been naive!
In my previous posts I said Bank of England members are the supposed to be the "best brains" in this matter.
Looking at the wikipedia page of some of the BoE members, it looks more like a political position than an independent position!
Jesus! Robert would do a better job than these guys on the MPC (Rate Setting Committee), and he would be more independent believe it or not. See Sir John Gieve's CV:
http://en.wikipedia.org/wiki/John_Gieve
Complain about this comment
Great Panorama - pity it clashed with Ascent of Money - thank goodness for BBC iPlayer.
One small worry - where were the women? Is there not one sensible woman in the banks, Treasury, or financial institutions of this country who could have given an opinion?
How did we get in this mess? I rest my case -
Men love to gamble, take risks, live on the edge - that's why we love them.
Women think about the family, the consequences of actions, future security, where the next meal is coming from and who is going to clear up the mess and keep things going.
Complain about this comment
I see there is a lot criticism of Robert, which is a shame because, generally his journalism has been informative and well written. I think it is good that Robert is not a 'grey' journalist, but one who can take a point and create sensible and lucid debate. The comments on the blog are often more revealing this his own piece. Of course we don't always agree with him but it would silly not recognise this kind of Journalism as part fact and part opinion.
I do get the impression that alot of Robert's critics have a vested interest in supporting a banking system that has become corrupt. I am sure that many people in the business will be able to justify large bonuses despite failure.
I was always surprised by the bonus system in the banks and it is clear that it is driven by greed and corrupt manipulation of fact and ignorance of substance. I work in an industry that also handles billions of dollars, where even as a junior engineer you can make multi million dollar decisions. However our bonus system is much more conservative, and the price of failure is no bonus, or even the sack. That's becuase we understand that our primary purpose is to protect the value of the company over the long-term (i.e. our project have a life span of 25 to 50 years) and protect the interest of our shareholders. How can banks ever justify the size of bonus they pay, particulalrly in the face of failure. It is a system that simply to tempting for the greedy and corruption is all too easy. If we fail, there is no one to bail us out, we simply lose our jobs. Clearly the managers of the banks were and are incompetent and there should be consequences.
OK, so before reminds me of the Shell Debacle over reserves, at least they were still profitable and people were fired, and bonus payments were witheld! Bottom line is they were never in any danger of becomming insolvent. The banks were virtually insolvemeny
So stop whinging about Robert and sort out your own business first!
As for Panorama, I have to agree this is not serious current affairs program any-more. It has been significantly dumbed down from what it used to be. I blame the BBC for producing such lightweight tripe and not Robert, who probably had a remit from his editors and had to keep it light. I have to say it is utter Rubbish, but so have been the last 10 Panoramas. It is almost turned its self into a tabloid news program!
Complain about this comment
So, at 1am AD went off to his bed and left them to get on with it. I guess that just about sums it all up !!
Complain about this comment
I really don't see how the BofE can be to blame for this asset bubble. I seem to remember the Governor making many speeches over the last 6 years warning of the increase in the value of housing. The blame must surely lie with the banks themselves, the FSA for its apparent negligence in monitoring the banks and last but not least a Government that was addicted to spin and the self glorification of its economic policy that was based on taxing the middle classes anyway it could with the ever increasing stamp duty receipts latterly providing a major source of tax revenue.
The problem we now have is that people were quite prepared to pay £50,000 in stamp duty on a million pound house that was going up at 15% a year. They are not going to pay it for a house that could go down or is unlikely to rise in value for the next 10 years. That alone will consign the house market to the doldrums until the government changes this iniquitous tax on the already overtaxed middle classes.
When I read of doctors earning £300,000 on NHS work I am beginning to realise where my tax has gone, an its not on improved services anywhere in the UK. The sort of salaries and pensions now earned in the public sector is a disgrace.
Complain about this comment
Sad Gordon says "we must have more transparency".
We, the public, already have our transparency...it's called Robert Peston.
Much as the City and Wall St love to hide behind a veil of secrecy, this disaster is too big and the media is exposing them for what they are...greedy and negligent.
Complain about this comment
Message 118 johnspal
There are cuts in government spending going on, only the government doesn't want you to know about it.
The reason is that they want to blame the Tories for any cuts.
For example; anyone heard of our two new aircraft carriers lately? The steel required would help Corus no end.
There will be no end to deceit.
Complain about this comment
Little was made of the activities of the short sellers who could be on the prowl again in January.
Fundamental errors were made by Brown/Darling in the first few hours of the Northern Rock episode which set the pattern for the wobble in the entire system later .
If the decisions were based on rationale and not votes in the North East then the Bank of England would have raised interest rates to attract funds
Short sharp medicine which could have created a slow down but with no debt hangover
Pity we are in the hands of people grubbing around for votes
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
I decided to not watch the programme as I suspect Mandelson spin will have been inserted at editorial level by now.
The biggest shocks for me are the fact that RBS was more at risk than HBOS and yet the news at the time suggested the other way round and,
The post midnight "re-opener". Anyone wondering why the banks aren't currently seen to be towing the line on lending after being rescued now has an explanation.
In other words even at the height of the crisis, Darling decided to fall asleep on the job.
Oh dear oh dear oh dear..it just gets worse....
Complain about this comment
I was not able to see Panorama last night but by all accounts, it was (no surprise) dedicated to glorifying Robert Peston.
#7 - Totally agree - we don't all need to know everything. There are some things I would rather not know - I guess it's fair to say that, had Northern Rock been Chinese, it may well have survived (not that I am suggesting censorship go quite that far)!
It's interesting that all this criticism is directed at "greedy bankers" when the media is just as guilty. Capital issues - fine - responsibility of banks but liquidity is a whole different matter. Still, I do accept that it's not easy to say quite where you draw the line in terms of what should and what shouldn't be reported.
#28 - the banks are not allowed to decide how much capital they hold. They are allowed to calculate their own risk weighted assets provided the FSA thinks their models are good enough but the % capital they have to hold is proscribed and pillar 2 provides scope for a "supervisory overlay".
#68 - "when (if) the banks start making rude profits again", the tax payer will see a massive capital gain in their investment and receive dividend payments in addition to the massive 12% coupon they are receiving on the preference shares!
#94 - agree with 98 - if one bank falls, people lose faith in the whole industry.
ALEXANDERCURZON, what's THIS
STRANGE obsession with RANDOM
CAPs and short LINES WITH extra
SPacES IN bEtWeEn?
Complain about this comment
New Capitalism? Just copy Norway.
There's a nation which is intensely industrially patriotic and whose banks/financial institutions, industry and Govt actually work together.
Consequence is that they are now much bigger players in the global oil/gas sector than we are, they have two companies building electric cars, own the largest builder of hydrogen electrolysers hardware, have a huge solar energy company and a tidal turbine company that's just done a big deal with Scottish (Spanish) Power.
Complain about this comment
I think last night's programme was just BBC's way of patting Peston on the back for a job well done. They had access to some of the top people involved in the financial crisis some speaking quite openly and instead they filled the 30min slot with items like where Peston went to school and other items about how great Peston is. There was a shot of him signing books at the LSE with a girl taking a picture of him on her phone, which was so blatantly self-inflating it was a joke.
I think this was nearly a good programme, but was let down by the homage to Peston. Yes He is a good reporter, but not when he believes that he is more of a story than the story!
Disappointed in the BBC
Complain about this comment
I think the bigger picture has been missed totally!
As you all know the Americans are now beholden to the Chinese, now who on here thinks this will last?
As has been pointed out, many times in history financial crisis often leads to war. Don?t believe me? Do your research!
Complain about this comment
The bottom line to bank bail-out is pretty simple. Without it, Christmas carols would have been replaced with Christmas chaos and a huge amount of blood on the streets. I fear the latter could still come. Perhaps the UK banks can stagger on with taxpayer support, but the domino effect will come when a bank on mainland Europe collapses. I strongly suspect that will happen, and so does Darling. Nationalisation of the banking system under emergency powers is perhaps the only alternative. Brutal, but it might work.
Complain about this comment
I couldn't be bothered to watch the programme live. I reckoned all we would see was turkeys preening their feathers, and refusing to vote for Christmas.
Who is going to cull these nincumpoops (.. is that a word...)
The market is king we are told, so stuff the previous obsession with world banking markets, break the banks up into tiny self-contained units (say nobody with more than 5% market share) and let's see the survival of the fittest. That would soon remove the idiots in banking.
As for the politicians, I am sure the media could work a lot harder and shine a heavy searchlight on their incompetence. The media used to be able to destroy a politician in 2 week-ends just for wearing frilly knickers. It is patently obvious to everyone who runs a business that Brown and his govt. have to go -and quick. Why on earth do you think Alastair Campbell & Mandy were brought back in by Brown, if not to manipulate the message and save his giblets.
Since very few in the House of Commons seem to have the stomach for a vote of confidence or a no-holds barred debate, there is no hope of change there. Davey-boy and little George just seem to be paddling about in shallow water and Vince Cable's boss ain't got the gravitas to seize the ground.
C'mon Pesto, bring out your big guns and start talking straight to these guys. You have now set yourself up as a figurehead, -better start walking the walk.
Complain about this comment
Oh Dear Robert, I fear your true colours are now transparent for all to see after last nights Panorama. Try to stay impartial and objective. However I think I see more clearly where all this is going which gives me some hope for the future. To BBC editors, stop trying to make the news and just report the facts or your well respected reputation may suffer. Having said that I agree there is no gain without pain and we will all just have to accept the pain. It has to be as fairly distributed as possible however and extremely well managed if we are to avoid mass casualties in the process.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
I've read a lot of calls for sackings, but one sensible blogger said 'no' the fresh faced replacements would just repeat the mistakes.
Rather let's see all those at the top (PM, Chancellor, Bank Heads, other regulators) show that they mean 'sorry' by donating this and the next 2 year's income to charity (they can afford it).
Then they can get on with proving that they truly are capable of delivering against the rhetoric.
Of course if they don't....... it may not just be jobs at stake; there are a lot of very angry people out there
Complain about this comment
For those of you who have attacked the release of those scoops, I wouldn't worry too much. There'll soon be a bill rushed through to label this behaviour as a threat to national security, possibly even a terrorist threat.
Complain about this comment
For the big picture I recommend this:
http://home.earthlink.net/~lrgoldner/october.html
Complain about this comment
Look at the fall in the £. Why hasnt the bbc reported what many of our foreign creditors are saying? (its obvious) that the uk is a giant ICELAND.
Look at the criticism when the tories pointed out the risks to £ only weeks ago.
Why dont the bbc do some better reporting rather than Panorama "lets revisit robert peston's great moment when he got some tip from somewhere "
The bbc rarley interviews people who predicted the credit bubble had to burst - why? Why are so many lightweights amongst their interviewees?
If the media had dug deeper and been less superficial and challenged governments and regulators the bubble would not have got so massive
Complain about this comment
31,
I wonder where Peston get his scoops from?
Complain about this comment
#122 - Try Angela Knight, or Helen Weir to name but a couple.
Complain about this comment
Mr Preston you commented that you only had 30 minutes to tell a complex tale, which left important comments left on the cutting room floor. Also the Panorama programme was promoted by you as how close we came to economic collapse.
Imagine then my disappointment when I watched to find out the main story of the piece was you! Other journalists I am sure would kill ? almost literally ? for the access you have to people like Darling, Sants, Varley and so on. To give them around one and a half minutes each and yourself 20 minutes is just appalling. After all do I need an extended sequence of you writing your blog? Every second of snippets of you winning awards or fluffing your audition tape was less time spent with minor players like the Chancellor.
Is this the level Panorama ? a hard news programme, let us not forget ? has descended to?
Complain about this comment
Is it just me?
I got the impression when watching last nights program that everything is fixed / resolved. I wonder what the first quarter in 2009 will bring????.
Complain about this comment
No 97. Well done for asking about the accounting profession. I am an FCA and would ask one simple question. What on earth is the point of audit firms if they all missed the fact that the whole banking industry was bust?
When is someone going to ask Sants whether he was still receiving pay from CSFB AFTER he was at the FSA?
Complain about this comment
Your say that "The head of RBS's corporate bank, Johnny Cameron - () has now left RBS - "
Johnny Cameron has not left. He is still Chairman of Global Banking & Markets.
He merely stepped down from the board of RBS.
Complain about this comment
And please Robert, can we have an expose on the biggest robbery in history.....how, over the course of the last 7 years, 50% of the private wealth in this country has ended up in the hands of 1% of the population, mostly financial staff.
These people are not risk-taking entrepreneurs like Alan Sugar or Richard Branson, who deserve all they get in life.
As far as the public is concerned, these financial staff have simply "helped themselves" to our money and broken the economy whilst doing so.
Gigantic robbery...Mr Peston please expose it.
Complain about this comment
Panorama nearly decended into "This is Your Life"
Fortunately there was a little substance for the serious viewer to appreciate. There must of been a helluva lot of good stuff on the cutting room floor.
I too was concerned by Robert palling with AD (Is he "Deep Throat"?)
Looking forward to Wednesday night programme, but I really hope the BBC desists from broadcasting the stock skyline views of The City. The one of the phallic symbols of the doomed financial houses penetrating the clouds, or can the BBC photoshop the clouds into a murkier grey to suit the mood!
Complain about this comment
Is the Johnny Cameron, chairman of global markets at RBS, the same one that was at kleinwort Benson twenty years ago? If he is, I know him and heaven help us if he is in charge of anything.
Complain about this comment
Once again you managed to get the guest on Panorama talking honestly about the situation rather than the spin that usually comes out. (Or did those bits die on the editing room floor?)
I must echo #5 that any criticism must be because there is a perception in HMG that the public are too uneducated in money matter to deserve the truth. I was shocked to here one reporter (was he from the Guardian?) implying that he would massage the facts to keep the public in the dark if it helped the financial markets. Can he be real??
Thanks again - but are you one person or the name of a team? I just can't believe that you can maintain this amount of output on the blog and still have time to do TV. When I have to do a report/essay (not very often) - a week is about the minimum (and that's for a pretty badly written one!
Complain about this comment
A widget maker goes to the bank and says I have found a new machine that makes widgets 3 times as fast, lend me the money to buy it and I can pay you back with interest from the increased profits. The bank and the borrower both know what is going to be done with the loan and how it will be repaid.
Instead of this, the modern style is for the bank to lend money to a hedge fund so that it can invest (gamble) on the stock market. The market goes up because there are lots of hedge funds doing this and we have a stock market bubble to compliment the housing bubble. When this bubble pops all the hedge funds have to sell and what went up like a rocket comes down like a stick. Everyone then starts getting very nervous about how, if at all, the banks will get their money back. Where is the widget maker, the only productive player, in all of this? The widget maker is closing plant and laying off workers because financial folks would rather invest in phantoms of instant wealth than in graft and productivity,
Yours Aye,
Graucho
Complain about this comment
FAT CATS
BIGGER FISH
keep STRAIGHT
NEGOTIATE
(shutdown ESTATE?)
Don't get FRUSTRATED DISCOMBOBULATED
Don't stand and DEBATE it
get a MOB and TAKE it!
(ruling CLASS HATE us
more than
CHILD SUPPORT payments)
((STRIKES! TEACHING staff
FIGHT for
PAY hikes))
Complain about this comment
Just a quick question
Is the US Treasury running a Ponzi scheme with its T-Bill auctions ??
i.e. what happens when no-one wants to buy anymore ten year notes at 2%
Complain about this comment
#140 said - "For those of you who have attacked the release of those scoops, I wouldn't worry too much. There'll soon be a bill rushed through to label this behaviour as a threat to national security, possibly even a terrorist threat."
Rather depends on the source of the leak. don't you think? Perhaps it is a coincidence that this leak pressured and embarrassed the banks more then the Government. Perhaps not.
We didn't get to hear Darlings view as on the leaks and associated media behaviour etc as, unlike Cable, he wasn't asked. Interestingly, Cable was more critical of the Government than the media on the issue and I doubt if he is expecting legislation any time soon - or even arrests of the kind we've seen recently under existing law.
Complain about this comment
With all that has gone on why on earth do bank directors get paid the rates of pay they are.
Over and above the sheer incompetence and mismanagement of the FSA the Bank of England now looks also to have been run by muppets.
Darling comments about going to bed were brilliant and after that he should tell number 10 to shut it and let him run the show.
We will see as per number 10 everyone seeking to blame everyone else but the true madness of this whole wrethched mess is that the same people who screwed up are still running the show.
If that is a sign that things are on the mend then we can all now walk on water!!
Complain about this comment
I am not sure that blame is very important in this crisis but for what it's worth:-
The banks were to blame for not capitalising themselves properly via equity or retained profits.
Borrow short and lend long too much at your peril.
Companies were to blame for borrowing instead of raising capital via equity as above.
Hedge funds were to blame for using cheap borrowed money to buy out profitable companies
All of us with excessive mortgages are to blame for being greedy.
HMG is too blame for not seeing that we had an excess credit bubble. But then it liked the tax revenue too much.
The banks have been recapitalised by the taxpayer and that is probably right given the pivotal part they play in the economy.
There can be no case for HMG recapitalising companies like Jaguar who can go to the City for equity capital if they wish.
Complain about this comment
No business can pay all its debts 'now' especially if that includes debts that would normally be paid off at some time in the future and that rule particularly applies to banks- that is why there is a whole raft of regulation about capital adequacy and solvency. Having said that they just became too big and behaved in utterly stupid ways. RBS had assets and liabilities of £2000bn and a market cap at its height of £60bn but equity in its balance sheet of £20bn- so 1% fall in asset prices and they are stuffed- also if the margin on their lending is squeezed they are also stuffed. The business model looks fundamentally flawed unless they value assets very conservatively and stay away from risky assets like investments in hedge funds and the like and operate on sensible margins- ir do not pay the profits away in silly bonuses.
If the banks are now stable it is the time of reckoning- wholesale changes at the top and the break up of these unweildly institutions- seperating out banking that you and I can place our money with- and dodgy investment schemes that can be left with the super rich and the chancers who like risk.
It is also the time to look at accounting- mark to market is stupid as it assumes a free market will mark to the right price but as we can see governments interfere and industries squel if the free market is allowed to take its toll- and to make matters even worse they now want us to save the polluting industries- where were the calls to save 250,000 jobs in the pits twenty years ago.
Amongst all this madness, the one clear thing is that 2009 will be a rather interesting year- in fact although many of us will lose jobs, be poorer and generally have to struggle- at least it will not be boring.
Complain about this comment
No.78,
Ssangyong is 51% owned by the Chinese company SAIC, which makes them the majority owners. Daimler owns less than 20% of Chrysler after spinning the company off as Chrysler LLC and after assuming the majority of the debt from the former DaimlerChryler announced that its stake has zero value.
The point is that The Chinese are unlikely to come to the aid of foreign subsidiaries in the event of it being required. Anyone who dealt with the Chinese government over the default of Guangdong Enterprises will tell you how hard it is to deal with them. And as for the majority owners of Chrysler, Cerebrus, isn't it becoming more apparant that the private equity industry isn't any kind of financial saviour but is actually a modern take on the greenmailers and corporate raiders of the 80's, helped of course by easy credit and dubious financing.
Complain about this comment
Robert - I didn't see the Panorama program and haven't read the blog entry, but it seems we were closer to econimic disaster than even *you* realised and yet we have come through it unscathed.
It seems that this is the turning point, and it coincides nicely with Xmas - well done for seeing us through it.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
Robert.
I am one of your greatest admirers and I am hoping that you will be a beacon to educate us middle of the road types. We want to uderstand but all we usually get is bullshit from a closed shop incompetent profession.
I have to say however I was dissapointed in last nights Panorama.
When the BBC realise they are on to something good they milk it to the bone. They seem now to be trying to dramatise you to give jobs to all the dead beat media study type employees. Please tell them to get st...ed and get on with doing what you have been doing so well.
If you have trouble, start your own website. I think you would be suprised how much support you would get.
Complain about this comment
"it may not just be jobs at stake; there are a lot of very angry people out there" - p45builder
I've yet to see any evidence of that. The government is up in the opinion polls; and there have been no demos, no riots, no occupations to protect jobs, no tax strikes, no stones through bank windows, nothing. Of course that may well change as the slump deepens, but so far, your claim looks like empty bluster.
Complain about this comment
top executives at rbs did nothing to help three employees who got caught up in the enron scandal who went on to serve time in an american jail. the sums involved were paltry compared to the huge losses we now see. yet they get to walk away scott free their millions still intact where is the justice.
Complain about this comment
"We didnt see."
"We didnt know"
"We were not aware"
"We did not understand"
ANSWER
YOU SHOULD ALL RESIGN.
Complain about this comment
Please don't let them take my breathing apparatus. My bills are colossal, creditors are following me like apostles are now they want assassinate me.
Complain about this comment
"we have a stock market bubble to compliment the housing bubble." - Graucho-Meldrew
How does that go then: "Oh what a pretty housing bubble you are! Would you like to come up and see my etchings?"?
Complain about this comment
The Repo Man sings for you
It's the Repo Man! Reposession is my occupation
It's not my fault you facing foreclosure,
I told you I'm just an agent, workin for the man
and his manuscript say you owe him for this land
Don't cry to me, and don't lie to me
Actin like you ain't home, faking on the phone
Complain about this comment
Well done, Robert. You have done a great job. Thank you for your insight and your clarity.
I think what has happened is 'a good thing'. We now have an opportunity to design 'The New Capitalism' ...I hope you will be on 'your guard' for the 'old guard' who will want everything to return to what it was before - with only minor modifications. We must have real reform of the financial system - we are paying too high a price for it not to happen.
Here's to the future!
Complain about this comment
we should all share our toys this christmas
Complain about this comment
Re my Bank Director housing
research total purchases
by UK registered Directors 2002
to 2007 749 million sterling in
house transactions.
BEEN BUSY SPENDING OTHER
PEOPLES MONEY.
Complain about this comment
An amazing story of total incompetence at the top of the British government.
The alarm clock sounds with Northern Rock and a year later they are still in deep slumber.
In hindsight it would appear that they had never realised that looking after banks was part of their job.
Complain about this comment
This is for my folks who got bills overdue
This is for my folks who never lived like a hog
Me and you, I got love for the underdog
I raise this glass for the ones who die meaninglessly
If this was fiction, it'd be easier to write this
Some folks try to front like they so above you
Complain about this comment
#17 says '....why was Sir Derek Wanless, knighted by Gordo', not interviewed ?....the former CEO of NatWest...and Non-Exec. at Northern Rock responsible for Risk Management, Audit & remuneration.... !' Well - so say all of us. Wanless' failed strategy at NatWest led to the takeover by the tiny (then) RBS. The Treasury Select Committee lambasted Wanless for his culpability in the Northern Rock crisis. Unlike the USA, we still fawn over our failed Corporate Barons. Wanless remains as Chairman of Northumbria Water Group (a FTSE250) and also remains on the Board for Actuarial Standards, which dishes out prudent actuarial advice on behalf of the Government. Honestly - I am not making this up. Fact, it appears, really is stranger than fiction !
Complain about this comment
I found last night's episode of "Strictly Come Financing" entertaining but superficial. It described what happened, but not why, and I suspect the reason for that is that no-one actually knows, including RP himself. The Darling/Peston tango was evidence of the quality of the latter's contacts book, but the cordial dialogue undermined a proper sense of journalistic objectivity, and gave the whiff of a government-controlled damage-limitation PR job. How can Darling even find the time to appear in a TV show as the economy crumbles to dust ? It was as if the programme was describing events that took place 30 years ago rather than right now. I was also unimpressed by the way in which blame/responsibility was apportioned according to who was being interviewed - government, the banks, the regulators etc.
If there is no concensus as to who or what is to blame, then how can we be sure that the right measures will even be taken to address the crisis ?
Complain about this comment
164,
1. The tories are well ahead in the polls,
2. When the excrement really hits the fan next year, you may get your wish (re civil unrest)
Complain about this comment
Re comment 19 from svrsig, I would like to endorse how useful the Chris Mortenson "Crash Course"is. It has certainly clarified for me many of the issues which will affect not just the banking system, but its interaction with world energy resources, world population and, indeed, the future of mankind, which are all intimately related.
He demonstrates that any system based on continuous year on year growth is cleary unsustainable, whether it be GDP, or population, or use of natural resources. The only conclusion from this is that, sooner or later, the human race needs to accept this and learn how to live in a steady state balance. Otherwise we will outgrow the Earth we live on. This is not conjecture, but a natural consequence of exponential growth curves.
We already see signs that these effects are beginning to bite with respect to energy. We may already have used half of the potential oil reserves in the world and the second half will be much more difficult and expensive to deliver. The same is true of coal reserves, and even uranium which would be the basis of a nuclear low carbon future.
Chris is based in the USA and if you look at his website you will see a lively debate in progress between people who accept his analysis and those who can't face up to its consequences. The new Preident-elect has just appointed as his Chief Scientific Advisor a Phusics professor who apparently believes that energy supplies on this Earth are limitless. This is very worrying.
I only hope that our leaders don't swallow this implausable suggestion and press on regardless with a steadily growing GDP as its holy grail.
Please can we have an outbrake of common sense amongst all our political leaders. This is an issue whose importance goes far beyond the next election. Corrective action will require a great deal of will and wisdom and may take many tens of years to bear fruit.
Turning a blind eye should not be an option!
Complain about this comment
168,
Humans live in houses not equities.
Complain about this comment
!!BBC Breaking News!!
How the Celebs spend their Xmas!!
Other top stories this Xmas Tuesday lunchtime!
Nigella's new Xmas recipe!
Xmas sport completely unaffected by downturn!
Sheffield Xmas mum has twins!
Poor men gathering wood!
Another soldier killed in Iraq (his family have been informed)
Xmas repossessions up 12% and nobody came
GC
Complain about this comment
Re 141: duvinrouge: Thanks for the link. Not had time to read it all yet but it seems to confirm my instinctual feelings about the basis of Capitalism. Re the future I am reading 'Dreams from my Father' by Barack Obama and not liking what I am feeling as I read it. History may come back and bite us on the **** Hope I am wrong.
Complain about this comment
Very interesting, in a gruesome sort of way.
Where does the buck or rather pound stop?
At the door of 'UK plc' it would seem.
How do we comprehend the true effect of this?
Ten million pounds worth of gilts could be insured against the UK Government defaulting for just ten thousand pounds a few months back.
Now, it will costs one hundred thousand pounds to insure the same ten million pounds worth of gilts.
In other words, the UK Governments' credit-worthiness has decreased by an order of magnitude of these past few months.*
'May you live in interesting times'?
I'd rather not, thank you.
* With acknowledgements to Prof. Andrew Clare - Cass Business School.
Complain about this comment
Robert,
I would like your view on todays news that GM has gone to junk status and analysts believe that the company will not be able to stay afloat even with government funding. As a redundant credit derivative operations manager the exposure that the company has within this market is high. How do you believe that this will effect the banking sector who have traded heavily in this market. Around 50% of trades have GM within their portfolio as this was seen as an untouchable stock.
Complain about this comment
As much as i respect Robert Peston last night felt like more of of a biography of the man rather than focusing on the subject matter of "The Year Britain's bubble burst".
If i remember correctly you said in your blog yesterday that many comments you wanted to keep in the show had to be cut due to lack of time. Maybe less of the self promotion would have allowed these comments to be kept in.
Why is it everyone now wants to be recognised as a celebrity rather than focusing on the job in hand?
Maybe the show should have been called "Robert Peston's Year" or something similar.
I feel a stint on "I'm a celebrity..." coming on.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
181,
If he turns out to be as useless as bush, he will be shot imho
Complain about this comment
Robert, having watched last's night's program I now realize where you get your on screen persona from. You are the Economic Time Lord version of David Tennant's Doctor Who.
Consider the typical storyline: a tyrant terrorises the local population with his hench aliens (Daleks, Cybermen) who through their backward nature are unable fight back. In steps the technologically advanced Doctor who uses his superior knowledge to bring down the tyranny finally confronting the Arch Villain
Now compare.
An ignorant population is terrorised by Financial demons, the BoE, the Banks and the Hedge Funds. They are unable to act until the Economically savvy Peston steps from the Blogdis. As of now he has cuts down the BoE, humbled the banks and bankrupted the Hedge Funds. All that remains is for him to become the Nemesis of the Alien Mastermind who is pulling all the strings. (Kiddies, Can you guess who?)
Down to your new quiff, and your tight fitting always buttoned 2-piece suit, the BBC's great Christmas mystery is solved: you are the next Doctor!
Complain about this comment
Robert, no one can give an answer to why housing costs are not included in inflation figures. The answer lies in the US because the UK have followed the US model. I have written to MPs and can not get an answer, and I know others have tried to get an answer to this as well.
The asset bubble would have been prevented if housing costs were included in inflation because interest rates would have had to increase, reducing borrowing.
Personnally, I think the US allowed the asset bubble to inflate...the reasons behind this are unknown, but a few people have made a lot of money out of it.
The B of E say they need a "sharper tool" to deal with inflation and the economy...They should look at their instruments not their tools...Inflation figures are flawed massively..
Complain about this comment
Our PERFECT GOVERNMENT
Has allowed a similar situation
to occur with ENERGY which will
no doubt unleash even more
CHAOS in the next few years.
Complain about this comment
This stinks - from the wretched and pungent putrifaction of those in power to the rest of us at the bottom, all covered in sh!t
Merry Christmas good folks. Perhaps we can divert the Thames in the New Year and purge the stables
Perhaps we'll just get pooped on once more however...
Complain about this comment
"The tories are well ahead in the polls" - JavaMan1984
They are ahead, but take a look at http://ukpollingreport.co.uk/blog/
and you'll see a clear trend: a falling Tory lead over the past two months. The leads they are now getting would mostly produce a hung Parliament. (I said hung not hanged, those of you I can hear cheering!)
Complain about this comment
I've been censored for pointing out that no-one, you know...Peston included, can speak in proper, you,...I mean... sentences!
Ha ha - you are wasting all of our time and our money
Complain about this comment
Who is this Peston I read about in comments above who asks tough questions, and gets to the heart of the matter?
He sounds like this fella Robert I know, only different
Complain about this comment
An interesting article from Spiegel Online for those of you who read german:
[Unsuitable/Broken URL removed by Moderator]
For those who don't it tells how the Hypo Real Estate bank is being sued as it misled the financial markets, persued a high risk investment strategy, even after the financial crisis became apparent and in this way the senior management were guilty of misappropriating funds.
Also the bank has fired senior management and is investigating if they have acted criminally in failing to secure the banks capital reserves once the financial crisis began.
Apparently there have even been police raids on the banks offices.
Complain about this comment
Is the opening sentence an unashamed plug!?
Complain about this comment
188,
The reason house prices were removed from the cpi was that every time you raise interest rate you automatically increase inflation ;-)
i.e there is a negative feedback loop in operation (Still I think the prices themselves should be included as opposed to the mortgage payment itself)
Complain about this comment
191,
I was cheering :-), there was a poll done today had the tories @ 49% and Lab @ 32
Anyway, I'll be doing my bit to sort the % out, not in favour of GB I may add (and I'm scottish)
Complain about this comment
178.
Love it:
" if you look at his website you will see a lively debate in progress between people who accept his analysis and those who can't face up to its consequences."
So there is no doubt that the peak oil/money as debt/pseudo scientific doomsayers will be wrong? Not much chance of a debate there. Anyone who doesn't agree is just burying their heads in the sand.
Complain about this comment
It appears I have been moderated for trying to include a link to the web page of a german language magazine :-(
The article was a report on how the German Hypo Real Estate bank is facing compensation claims because of it's reckless behaviour. The article says the case is based upon the banks alleged high risk investment strategy and the boards failure to change it to protect the banks capital reserves once the financial crisis became apparent. The board also allegedly misinformed the financial markets.
Also several of the senior executives have been fired and are being investigated by the police to see if their behaviour was illegal under the terms of the german banking laws which require responsible and careful behaviour fitting seniour management.
I thought this made a nice comparison to what is happening here in the UK.
Complain about this comment
Perhaps we could have a post called 'Why were the* banks rescued?
It might be subtitled - and was there a cheaper alternative?
* not 'our'
Complain about this comment
50. alexandercurzon
MASS SACKINGS PROSECUTION
are long OVERDUE. THE "CITY" MUST BE PURGED AND
CLEANED UP.-
Nice idea, great concept, but unless there is serious public disorder, it will never happen. The establishment don?t let their friends take the fall. Ever. Prison is for poor people. Not the rich.
Reminds me of a quote from the IT Crowd. Where the boss of the company says in shock and disgust.
"Conrad Black; the first rich person to go to prison in 300 years."
Complain about this comment
Bodgitt in post 188 was perfectly right in his analysis as far as it went when he wrote "The asset bubble would have been prevented if housing costs were included in inflation because interest rates would have had to increase, reducing borrowing".
Bodgitt failed to mention other measures that the B oF E, the FSA and the Govt could have taken. They could have curtailed the massive inflow of short term funding from the USA of £650 billion between 2002 and 2007 by (a) requiring lenders using foreign funding to increase their capital ratios, so reducing the amount they could lend and sharply reducing the profits they could make and (b) outlawing mortgages that offered say more than 90% of the sale price of the home.
These measures would have reduced the size of the credit boom and, as a result, the increase in interest rates necessary to curtail the credit boom would have been significantly less or avoided altogether. In other words, the credit boom could have been curtailed between 2002 and 2007 by a mixture of far better regulation and small interest rate rises, if better regulation to reduce credit demand was not enough on its own.
Complain about this comment
Has anyone else noticed that in this interview all the participants talk about the symptoms and not the cause of the problem?
it's this type of seperation from the problem which allows bankers like John Varley and the others to sleep at night.
The whole structure of capitalism is that the 'worker' is encouraged to improve his own productivity and skills for fear of the unemployed masses replacing him should he not constantly improve.
So why is John Varley still in his job? He has clearly failed in his responsibility to manage the banks affairs, as have all the others. Where is their improvement - where is their fear of the dole queue.
Paid too much, this is why they have no fear of the dole, which is also why they are all complacent and half asleep.
Strangley the rules of capitalism seem to be applied unevenly across this society.
This whole episode was corporate blackmail - save us or we'll bring the house down.
The reality is the Darling interview - even though these banks were effectively begging to be saved, even though there weren't any options left - except a tax payer bailout - they were still trying to squeeze and advantage out of the situation.
Well done Alistair - you saved the sharks from extinction - NOW ARE YOU GOING TO SAVE US FROM THE SHARKS?
Didn't think so - so I'll be seeing you in about 12 months when the food riots are at the door of Westminster and the people are clambering for your head. We shall show no mercy to those who betrayed the people.
Complain about this comment
Robert,
I watched Panorama and read your blog frequently. I think your journalist instincts drive you to finding a scoop. I thought the interviews that you obtained last night gave a good insight. However my concern is that you elect to be sensationalist by which I mean you do hype your stories and I do not think that is helpful. I do think that the person who drew a comparison with war reporters got it right. At the margin your words are very influential and it is at the margin that economic decisions are made. Keep up the good work but be responsible rather than sensational.
St. Ubbo
Complain about this comment
post 201
Bearing in mind the CASH POINTS
were close to NOT OPERATING IN
OCTOBER!
CIVIL UNREST IS GETTING CLOSE.
Complain about this comment
198.
I'm curious to know what the arguments against peak oil actually are other than the exact timing. It seems very simple and logical to me.
On earth we have finite sources of energy that will eventually run out. We are rapidly going through our reserves of cheap energy and will have to start looking at the more expensive kind. This will have a huge, unprecedented and downward effect on our economy which was built and is maintanined by the availaibilty of cheap oil, and the fact that much of our industrial infrastructure is heavily dependant on oil and natural gas. (plastics, chemicals, roads, fertilisers etc. The list is endless)
That much is obvious.
What are the arguments against other than the timing?
There was someone on here the other day saying that we don't have to worry about peak oil because there was a new and amazing radioactive source of energy that we're going to be mining on the moon soon, so that's ok then. I forget the name.
But he didn't seem to address the issue that mining minerals on the moon might be a tad more expensive than pumping oil out of the ground here on earth. What scared me was that I think he was genuinely serious.
can anyone enlighten me as to what the arguments against peak oil are please. I'm dying to know.
Complain about this comment
"there was a poll done today had the tories @ 49% and Lab @ 32" JavaMan1984
One poll means little. If others come in with similar gaps, that will be significant.
Complain about this comment
Re: 205.
thats what I keep trying to say, they are more hated than child support payments and the teachers may go on a pay hike strike.
Complain about this comment
205. alexandercurzon
203. TheresOnly1Soupey
I'd always hoped it would never come to all that. But now I'm of the belief that's the only chance we?ll see justice, or true democracy, in our lifetimes.
Complain about this comment
I am just a simple Joe - so could someone -please explain how all these power banks got the auditors to sign off their accounts ? Did they really follow guidlines to sign off overleveraged accounts - can we all be subject to these auditing conditions ?
Very confused.
Complain about this comment
"On earth we have finite sources of energy that will eventually run out." - maroon3
You're right about oil, and about energy sources being finite, but not about energy sources in general running out. All those derived from the sun's rays (solar, wind, wave, hydro, biomass, biofuel), gravitation (tides) or the Earth's internal heat (geothermal) will be available, in finite quantities, for as long as the Earth is habitable at all.
Complain about this comment
We are all doomed and the job centre is running an investigation about a joke e-mail!!!
http://news.bbc.co.uk/1/hi/england/merseyside/7796063.stm
I wish people would spend time making rules that actualy police the serious things instead of putting up signs to warn about signs and suspending people for having a laugh!!!
Lets start with imorral iresponsible lending and use of the worlds resources!!!!!!
Complain about this comment
A report that does not offer the other side of the coin where Brown and Darling drove the Kaupthing IOM bank into oblivion by their actions in early October. Several thousand depositors lost millions of pounds through these actions, many of whom relied on these savings for life support and are now destitute. 557 million of IOM deposits was (and still is) locked into KSF UK by the treasury causing the IOM bank to fail. Despite letters from a large number of MPs Darling has yet to explain his actions (and even respond to the letters. This is not a democracy if those in power can not be held accountable for their actions; although I'm sure they will be at the next election. Hopefully this will not be too late for those penniless ex-pat pensioners and the like now destitute in foreign lands - even though they are British citizens.
Complain about this comment
A little THOUGHT??
How about registering a
"CAUTION AGAINST DEALINGS" at
the Land Registry
on each BANK DIRECTOR'S HOUSE
WHOSE BANK IS RECEIVING
STATE SUPPORT.
Complain about this comment
post 210
It is called being DISHONEST.
Complain about this comment
My feelings are that the media surely influence public at large. Companies pay £billions in TV and media ads with just that aim in mind and after 50+ years if it was money completely wasted they'd have stopped years ago.
Banks have skated close to disaster on and off for a long time. Unless someone leaks to the media the public never know, PRECISELY because banks know that their success depends entirely on confidence.
I was with a bank in the early 1990s that very nearly went under. It's whizzkids had to get a large amount of cash together very quickly 'just in case'. But the thing that terrified the top guys more than a run was the media finding out. They didn't and the catastrophe never happened.
So regardless of what Mr Peston has reported he is decidedly guilty of a cardinal sin: helping to undermine the confidence on which the entire financial system depends.
Complain about this comment
Looks like you've become something of a celebrity Robert.
I'll look out for the spread in O K magazine.
I just hope your wardrobe and soft furnishings are up to it.
Complain about this comment
The Panarama programme only had time to provide a snapshot of what will go down in history.
I hope all those bits on the cutting room floor were rescued.
When the big enquiry does come and it has to sometime in the future it will provide a fascinating insight into the fall of capitalism as we knew it.
Merry Christmas everyone.
Complain about this comment
Watched Panorama, and Sky plussed "Ascent of Money". Came to conclusion that ascent of money gave a great history of what lead to the crisis, projections of future global events, the intrinsic link between the cash flow from China to USA and all round top show.
Panorama was the RP show with some bits about the crisis :)
GW
Complain about this comment
How our banks were rescued? surely a little too soon to be presuming it a rescue
Gives me the feeling that if we'd had television at time of the Titanic then Panorama would have been interviewing the crew regarding their miraculous escape from a 'close call with a tug boat' just as the iceberg loomed into view...
Complain about this comment
*206
*201
Is solar energy could consider as a potential green energy?
The fabrication processes of solar panel need the use of a gas 17000 times more harmful than the carbon dioxide (NF3). Following recent scientific studies, the concentration of NF3 in thee atmosphere is increasing by the rate 0f 11% per year. This gas emission is not supervised by the Kyoto protocol.
Complain about this comment
211. You're right about oil, and about energy sources being finite, but not about energy sources in general running out. All those derived from the sun's rays (solar, wind, wave, hydro, biomass, biofuel), gravitation (tides) or the Earth's internal heat (geothermal) will be available, in finite quantities, for as long as the Earth is habitable at all.-
I completely agree. But the point i think is, we rely on cheap sources of energy. Those that you mention aren't that cheap or easy to utilise otherwise we'd be using them already. In some ways oil has been a godsend because its so cheap. But now it seems like a curse because all of our infrastructure is set up, and relies so heavily upon it. And what I don't see is any one really, seriously trying to wean us off it and onto the other renewable sources.
that doesn't even take into consideration the other many chemical, industrial and myriad uses we have with oil and natural gas. You can't tarmac your roads with wind farms, or brush your teeth with solar energy, or fertilise your crops with plutonium.
Complain about this comment
222. correction. Should have said: Those that you mention aren't that cheap or easy to utilise otherwise we'd be using them on mass already.
Complain about this comment
#213 wrote re IOM icelandic bank subsidiary
"Hopefully this will not be too late for those penniless ex-pat pensioners and the like now destitute in foreign lands - even though they are British citizens."
These were people who chose to invest in an offshore bank to avoid paying tax - even though they are British citizens. Why should the British taxpayer help out when it was their own greed that led them to invest their cash in a tax haven.
Complain about this comment
Here's some food for thought for you
On this day...
Christmas shopping?
One year ago RBS paid $100bn for ABN Amro.
For this amount it could now buy:
1. Citibank $22.5bn
2. Morgan Stanley $10.5bn
3. Goldman Sachs $21bn
4. Merrill Lynch $12.3bn
5. Deutsche Bank $13bn
6. Barclays $12.7bn
And still have $8bn change......with which you should be able to pick up
1. GM,
2. Ford,
3. Chrysler and the
4. Honda F1 Team.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
Peston, you put it all in the past, as if the crash were over.
It isn't.
And we ain't seen nothing yet.
Just wait till Obama is installed to see what these bankers will pull next.
There are too many people in the financial system who think a good slump will do us all good.
Think about Thatcher's 5 million unemployed, the way oil price and money of OPEC was fought, the way the Asean Tiger competition (and before that Japan's) was crushed, the way the Soviet economies were ravished.
There are too many who think India and China and oil should be put firmly in their place, not to mention the 'sub-prime scroungers' at home.
Complain about this comment
#212 We are all doomed and the job centre is running an investigation about a joke e-mail!!!
You couldn't make it up !! Next they will be holding an enquiry into something trivial like the Iraq war.
But hang on - here's the latest from BBC News website :
Families warned of gravy dangers
Ministers are warning about the dangers of gravy "exploding" in microwaves as they seek to cut the 80,000 accidents which happen in homes each Christmas.
A safety leaflet also warns of "tipsy guests crashing to the floor when they miss their seat at the dinner table".
About 150,000 of the Advent calendar-style leaflets are being handed out.
Unreal.
Complain about this comment
228,
Thats what happens when Labour are in power, utterly incompetent useless numpties!
Complain about this comment
#225 Even at the time the price that RBS paid for ABN Anbro seemed like madness. Clearly, the egos of the CEOs of Barclays and RBS were far bigger than their judgements. And wasn't there anyone who could tell RBS management that the price was excessive when there was plenty of comment in the press along those lines?
#227 I don't think that there are any bankers who want a recession, but I do belive there are plenty of bankers who want to game the US/UK treasuries for their own personal benefit. The bankers who are urging Alasdair Darling to hose ever more obscene quantities of taxpayers' money at the banking sector are not doing so because they think it will protect employment in the wider economy, they want:
1. Their bonuses and personal wealth to be protected
2. (But very far behind in priority) Their shareholders and profits to be protected.
Complain about this comment
Cargo and ship destroyed. I should reach the frontier in about 6 weeks.
With a little luck, the network will pick me up. This is Ripley, last
survivor of The Nostromo, signing off.
Complain about this comment
"Thats what happens when Labour are in power, utterly incompetent useless numpties!"
I don't belive for a second that the other lot wouldn't have been any better.
They would have been bullied by the banks into allowing the gread and incompatence that has now nearly destroyed our country and enjoyed every minuite of the thrill of pumping more and more air into the ballon like an extatic child waiting for it to pop.
We need a political party with morals and one that tells us how it is to get this country back in shape.
Complain about this comment
Maroon 3
The timing toward a conversion of another type of energy to sustain the development of the human race if very difficult to forecast. The cost might be horrendous (but what is Trillion ?Zimbabwe or ?American? Dollars will mean in 10 or 15 years).
As a society we are passing through incremental change (I know people have recently lost their entire pension etc?)
A drastic change such as portrait in Sci-fi movies happen only every X million year.
Within the very near future, we will all try to conserve the maximum of energy due to price shooting through the roof and use some friendly renewable energy.
Taking the view of hydrogen based society with all his projected benefice, one point is still remaining under huge constraint and this is the primary supply of energy.
To sustain the hydrogen based society, all finite resources from earth and transformed into energy will never being able to sustain this type of society. The only way to generate enough of supply energy to develop this hydrogen based society is to mine Helium 3 from the moon which owns an abundance of this material able to sustain the development of any civilization on earth for at least 10000 years.
Complain about this comment
232,
Did Cameron not say last night on the program that he wanted the bankers held to account?
Seems more reasonable than the appraoch taken by labour to date.............
Complain about this comment
232,
Agree with the final point.
Complain about this comment
"a political party with morals and one that tells us how it is"
Sorry that was an absurd oxymoron. What was I thinking.
Complain about this comment
Robert
Loved the Panorama show last night. Your stock has soared during this crisis. Bravo. Your the man at the Beeb now. You have access to all the movers and shakers.
Just goes to prove that there are always winners in every disaster and the greater the number that perish the more that the survivors inherit. No need for the doom and gloom and rage when you are up.
The Assent of Money was class though. The contrast and comparison between George Soros and his instinct driven gambling versus the LTCM quant driven scientific certainty, not gambling, was brilliant.
No surprise though that the Nobel prize winning Ivy League egg heads wound up bankrupt and the self made immigrant is still worth billions. Intellectual arrogance and the unfounded certainty of ones own ideas is often deadly. A bit like the bubble investors and property experts blaming the banks for forcing them to borrow and spend stupid amounts of dosh. Now they have overpriced assets falling in value and large debts.
As far as i was aware no depositor has lost a penny so far and have been free to switch currency at any time if they do not like the rate of interest that they get at their bank. Perhaps savers here should take a leaf out of the experience of the Japanese and get themselves a slice of the now, rapidly forming, Sterling Carry Trade if they resent the prospect of negative real returns.
Keep it coming Robert. You often hint at what becomes a policy announcement 2 days ahead of it being made. You are single man democritising insider trading.
Thank you.
Complain about this comment
"Did Cameron not say last night on the program that he wanted the bankers held to account?"
Any fool can make claims when not in power. I doubt they would have done anything different. We will see if he holds the bankers to account when they get voted in.
Not trying to support Labour or be anti Conservative. I just think we have been taken for a ride for far too long by both parties and it is time for radical change.
Complain about this comment
You know, it's a bit disturbing how many posters to this site seem to be positively slavering at the bit for social, breakdown, chaos, disorder and 'blood on the streets'.
As for 'locking them all up' - I am yet to see anyone make a cogent case (Note: any attempt to do so using CAPITAL LETTERS for no readilly apparant reason will be automatically disqualified on the grounds of insanity) that any British Bank boss did anything against the Law - incompetancy is not (yet) a Capitol Offense!
However, lets suspend habeas corpus shall we and lock up people simply because we want to - but it might make it difficult for the more spectacularly morally outraged posters to maintain their position.
Those Chief Execs and Directors who have clearly (note that word) been at fault have already gone. For those that are left - Varley et al - it is only right and proper that we wait until the year end results are out in February (remember, the entire Barclays Board, including Varley and Agius, have offerred themselves up for re-election at that time).
Complain about this comment
#232
I think you'll find that JavaMan was talking about enquiries into joke emails and warnings about missing ones chair when sitting down at the Christmas table.
Re your comment - "We need a political party with morals and one that tells us how it is to get this country back in shape."
We should be so lucky.
By the way, are you describing one party or two ie (i) one with morals and (ii) another one that tells us how to get back in shape - or even better actually does it rather than just talk about it.
Complain about this comment
#31, check your facts - Peston's dad is a life peer, not hereditary: http://www.thepeerage.com/p19170.htm
Complain about this comment
238,
Agree 100% RebuildBritain2010
Complain about this comment
233., glowingHorizon:
Yep. There you go. Mining for moon rocks again. If anything that?s an argument that supports the theory of peak oil. If we?re so desperate to sustain our standard and way of life that we have to resort to putting all our time and effort into mining the moon for rocks, then Peak Oil must indeed be a threat.
I?m looking for arguments against Peak Oil. One that says, yep, no problem, we have just found an accessible, easy to exploit source of energy that is as cheap as oil, that can replace all the industrial, chemical and manufacturing aspects of oil, and that won?t cause a painful transitional period (famine, population reduction and economic collapse) while we convert to it.
I?m by no means a hardcore Peak Oil advocate. It?s just that no-one?s been able to convince me that it won?t be a huge problem for our civilization when we reach it.
Simply saying that scientists will come up with something soon isn?t enough. Or our leaders will do something, is a bit like saying: put your trust in Gordon Brown during this current economical unrest. Put your trust in the bankers. They know what they?re doing.
When clearly they don?t.
Complain about this comment
239. , Feohme
incompetancy is not (yet) a Capitol Offense!
No it's not. But I believe that treason is.
Complain about this comment
240
Very true, applogies to JavaMan but it got alot of my chest :-)
239
It?s all probably just immoral rather than illegal. Although paying bonus's from public bailout money to people who have essentially failed to perform should be illegal!
Complain about this comment
re 244
Treason is no longer a capital crime which is handy for some.
I note however, that according to the Times, Labour are proposing to give Baliffs the right to use force to gain entry and physically restrain alleged debtors whilst their assets are seized.
Even handier.
Complain about this comment
"incompetancy is not (yet) a Capitol Offense!" - Feohme
Nor is illiteracy - fortunately for you and many others commenting here: it's "incompetence", "capital", and "offence"; and neither "capital" nor "offence" needs an upper-case first letter.
Complain about this comment
maroon3@222,223,
Yes, I don't disagree with your basic point. The era of cheap oil is ending, despite the recent price crash. As soon as the global economy picks up again (if it does), prices will rise again.
Complain about this comment
Feohme
ARE YOU THE STYLE POLICE?
So what if a few posters make spelling mistakes.
Or USE CAPITALS!!!!
Complain about this comment
Maroon3
As far as I am informed the Peak Oil is definitively a threat, at which level of a threat is it? I can not answer.
I wish I could offer you some argument against the Peak Oil, I do not have any.
I have been advocating ?solar panel technology? until I discovered that to manufacture them with the maximum efficiency, we use NF3.
So far as the argumentation of putting trusts into Brown and cronies (bankers included) I was born in a system call democracy and have been conditioned (educated) to follow the rule of representation. (I never advocate this gvt as well as previous one but I had to conform to the electoral verdict)
And to quote Gustav Le Bon: The masses have never thirsted after truth. They turn aside from evidence that is not to their taste, preferring to deify error, if error seduces them. Whoever can supply them with illusions is easily their master; whoever attempts to destroy their illusions is always their victim." Gustave Le Bon's book The Crowd 1895
Complain about this comment
FeoHME
Check youR SPELLING you appear to have a proBLEM
OR Two. HA HA!
Complain about this comment
The Panorama programme was poor to say the least, idolising another wannabe celebrity is ok for the X Factor...but on Panorama?
A serious journo type would surely have seen a credibilty issue creeping in here.
The lines are now open.
Dial 012345678 for ALLY D
Dial 012345678 for Robby P
Remember no votes will actually be counted this week, they may or may not be carried over to the next show.
And whats with all this repeat stuff here in todays blog, start of the Xmas repeat season I suppose.
A disappointed viewer.
Complain about this comment
211 - ah yes but in order to access these new infinite technologies we need to use oil (to manufacture plastics etc)
The problem being that rather than the oil being used primarily for this purpose, it's being used to drive useless city fat cats from long lunch to long lunch.
When they realise what they SHOULD have been using it for - it will be too late. The Arab world have been overstating the amount of oil in reserve for years in order to keep price stability.
In fact, in order to speed the process the good old bananas in power have been using EVEN MORE OIL TO FIGHT WARS OVER OIL.
I'm off to my local primary school tomorrow because I will get more sense out of a 6 year old than I get from Western Government policy.
Complain about this comment
Scientists have discovered a black hole at the centre of our galaxy. All the suckers are being drawn into it and others are skimming its periphery. Have a nice Christmas and read a book or two.
Complain about this comment
239. Feohme
You find it disturbing that so many posters are clamouring for some justice in this fiasco? If you can?t understand the public outrage I?m going to suggest that you?ve been living on the moon for the past year or you work in financial services.
In a situation where the entire economy has been ruined, and was allowed to be ruined, by people who claimed to have not seen it coming. (Where clearly it was obvious what was going to happen.) Certainly the IMF and other notable bodies had commented for years that there was a problem.
This situation was then allowed to develop where the taxpayers were lumbered with a future tax bill for many hundreds of billions of pounds, in order to bail out privately run businesses, (where at these privately run businesses the directors and executives were paid handsomely, of course, year after year, in bonuses themselves amounting to billions).
And yet, the taxpayer is aware, whilst he?s struggling to pay rapidly rising food bills, and wondering whether he?s going to be able to afford to heat his house this winter, or keep his job, that not one of these executives has been investigated, by the police, fraud squad, nor has any enquiry been set up, or a single bonus returned.
The taxpayer has also become aware that within the city and the institutions that should be investigated, some of the highest earners pay a smaller percentage of tax, than probably even their cleaners, or are even in the habit of paying no tax at all, on their massive earnings.
And you can?t understand the sense of outrage?
I believe sir you'll find that the French aristocracy were equally naïve. Just prior to the revolution.
Complain about this comment
Absolute rubbish just a a puff piece for Peston
Complain about this comment
I have to concur with the general mood of retribution to be meated out to the BIG BOYS of the City. However, before we concentrate solely upon that we should be turning our attention to the question of how and in what state we will survive the next 2-3 years.
We are currently in a Christmas Bubble and the real bad news will not start to appear until January. When it does hit and the jobless total rises exponentially, what will happen then?
I doubt that the World can avoid the slump that is to come. The implications for our society will be immense. Do we really think that people will behave as they did in the 1930s? I predict riots rather than hunger marches and soup kitchens. The omens are that the very nature of our country could be changed. If civil unrest does become common, our inner-cities go up in flames, then a dramtic lurch to the far right could well be the response.
This crisis is far more serious than an argument about economics.
Complain about this comment
The Panorama programme, although short, illustrated an important issue about Robert Peston's job as an investigative journalist.
If we do not have people like him with his knowledge and understanding of specific issues (such as the present financial shambles) politicians, (particularly the Government) quangos (FSA) and other so called leaders in our society (bankers) would not have any serious challenge to what they say, or what they are doing or pretending to do.
Knowing that there are people in the public domain who can scrutinise with knowledge and authority what is happening, forces these people to justify their actions or inaction.
As more details emerge of what has been happening the complacency and ineptitude of our leading financiers whether in Government or in the institutions is quite revealing. The Panorama programme began to touch on these issues. I am sure more is to come one way or another.
The British Government led by the Prime Minister seems to now be trying to blame it all on America or anyone else but them (him). It is at times like this that we need well supported robust investigative analysis that can unearth something near the truth so that :
1.this kind of scenario can be avoided in the future
2.so that we can judge who of our leaders is telling us the truth and consequently we might have some confidence in their judgements and actions for the future.
For me the second is more important than the first although I notice our leaders want us to focus on the first. I wonder why?
Complain about this comment
I was also disappointed by the self-glorification aspect of the program. Panorama is supposed to be about reports not reporters.
And the analysis was rather shallow. Look here for a more in depth exploration of the reasons for our various crises: www.transitionnc.org/?q=node/73
Complain about this comment
A Question
Given "Flash Gordon's" VAT rebate of £12.5bn to induce conspicuous consumption, consider this.
If the UK government sent each and every one of us a £300 Tax Rebate........As was done in the USA recently.......
If we spend it at Asda (owned by Wal-Mart in the US) or any large supermarket, the money will go to China.
If we spend it on petrol, the money will go to the Arabs.
If we purchase a computer it will go to India or Taiwan or China.
If we buy clothes it goes anywhere but the UK
If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala, several Caribbean or African countries (not so bad and a fairer distribution of wealth one could argue).
If we purchase a good car, it will go to Japan or Germany.
If we purchase other useless crap it will go to several Asian countries, including China, Taiwan, Vietnam and Indonesia and none of it will help the British economy.
The banks and government have lent us copious amounts of debt to buy this stuff and we have all bought some.
Why bother saving? Why bother repaying debt?
To counteract the reduced amount of credit in the future and the fact that such a tax rebate is futile, is the only way to keep the money here at home is to spend it on Whisky, Beer, and Pharmaceutcials, since these seem to be the main consumptive products still produced in the UK?
I'm backing Britain. Thank you for your help and please support your country!
Complain about this comment
Perhaps a little off-topic, but every time I take a look at the currency markets (http://tinyurl.com/xsnp ), vis-a-vis sterling, the 'Change' column is red; has been for days.
Are we not witnessing a slow-motion run on the pound here? Why isn't this making the news?
Complain about this comment
the reasons behind some of the posters talking about public insurrection are actually well-founded. It may be that the long-suffering british public will tolerate huge discomfort and distress before eventually taking to the streets, but think on this:
The banking crisis is collossal, and the facts are being downplayed by everyone responsible. The crisis is destroying all UK share values.
In March '07 RBS shares were sitting at £7:00, they now can't hold at 50p. Doesn't that tell anyone how precarious the banking sector is right now, and how it affects everything else. No borrowing for nobody in the near future.
Therefore, in 2009 -if not already-
your job is no longer secure (particularly construction, service & public sectors);
your pension is being vapourised;
your savings will attract no interest;
inflation is coming, so your capital is going to shrink in spending power;
With higher unemployment, there will be wage restraint -no pay rises to offset inflation;
When Govt. raises (stealth) taxes to pay for the bail-outs on top of all the other mis-spending to date......
then a significant proportion of the population is going to get very pissed off.
We pride ourselves on how civilised a society we are, however that attitude was formed in the days when we thought we could trust our elders & betters and elected officials. The Blair decade destroyed all of that, and the public now assume all Govt. statements are 100% spin. At some point, platitudes won't do,and without any recognisable dampening mechanism to affect public mood, I wouldn't be surprised to see trouble on the streets in the Spring. A public's mood can turn in days.
Furthermore, if OPEC cut oil production and the speculators can then trigger an oil price rise like they did in the past year, and if the conversion of world food crops into bio-fuels has continued apace, I would guarantee a long hot summer. Food, employment, energy bills, inflation, pensions. savings, an untrustworthy government and no respect for the law -sounds like a recipe for trouble to me.
Complain about this comment
allmyfault
And on top of OPEC:
Putin says 'cheap gas era' ending
http://news.bbc.co.uk/1/hi/world/europe/7796806.stm
Complain about this comment
"I'm backing Britain." - PrisonerNumber6
Do we have a time-traveller here? That campaign was launched - and flopped - in 1968.
Complain about this comment
It was such a shame to see Panorama, a usually informative and enlightening BBC programme, being used to stroke Peston's ego! Great scoop indeed; however, it would have been good to show some modesty given the affect of the credit crunch on so many people's lives. Instead we got to see Peston signing autographs.
Complain about this comment
# 262 allmyfault and # 263 glowinghorizon
Yes, we really do face social unrest as you suggest. There's no question now that our economy is shredded; virtually every indicator that you care to observe is saying that the UK is heading for basket case status, and some. No politician (in power anyway) is ever going to admit this. It's shameful really, because it means that as a nation we're not planning properly for the future reality.
If that wasn't bad enough in itself, the politicians (and most commentators and virtually every citizen) are failing dismally to plan for the next oil shock.
Read this to understand what comes next and how soon: http://tinyurl.com/1w56
Complain about this comment
264,
He's got a point though, some conspicuous consumption, or even panic buying before the next tax hike, on beer and whisky?
'Tis the sesaon to be jolly!
And our brewers are owned by??
Complain about this comment
Re 241
Correct, Robert Peston's dad, a Maurice Peston, is a labour life peer.
Which means, of course, that Robert Peston will never inherit the title and be known as Lord Peston.
Peston's dad was ennobled on 24 March 1987.
Peston was, as predicted on 25 September 2008 the harbinger of the nationalisation of UK banks.
He advocated the nationalisation of the remains of British industry on this website.
It seems that Robert Peston has a particular political point of view when making his comments of which the viewer should be aware.
Complain about this comment
I had a sinking feeling when Robert Peston and Panorama were mentioned in the same breath, but I watched in the hope that the BBC would rise to the occasion for once.
Thanks, Robert, for keeping a level playing field for us mugs and reporting what's being said behind closed doors, but we want you to stay sober in the mad crush of stampeding egos you mix with.
Oh for Louis Theroux to get access to just one of the alpha males paraded on this programme!
Anyone who actually wanted to understand the current situation was given no clue about anything.
Complain about this comment
#numerous - alexandercurzon
Dear Alexander, please let us all in on the name of this global trading operation you run.
I just want to make sure that I'm not exposed to a firm run by a hysterical reactionary who spends his days posting ad nauseam on this blog ;-)
MERRY
Christmas
TO all.
Complain about this comment
206.
When you say "I'm curious to know what the arguments against peak oil actually are other than the exact timing", do you mean Peak Production, Peak Supply, Peak Discovery or Peak Demand? We may have reached the peak of all four, but if we have reached Peak Demand and not Peak Production then the overall equation might look quite different. (Not that we shouldn't plan ahead, as reaching the peak of all these is, as you say, just a matter of time).
Complain about this comment
Wish I had time to post at 09-00am , 11-00am, etc but I work in manufacturing! Crap isn't it?
Complain about this comment
The main story of the broadcast on 22 December was Mr Robert Peston himself as everyone now knows!
I quite agree with the 89th post and various posts which express surprise at the featuring of Mr Peston, his cv, his father, his life, his lecturing, his audition, and his book, in a programme which was sub-titled "the year Britain's bubble burst".
The programme broadcast on 22 December was evidently meant to be a more light-hearted than normal Panorama - a "stocking filler" reflecting on the past year.
I generally though like to see an unsuperficial and/or what's called a serious current-affairs documentary series. The sort of thing they do more of over at Channel 4.
Complain about this comment
#264 Nick-Gotts
You've missed the point though the historic observation is good.
What does the UK make? 3m manufacturing jobs - 25% of their levels in 1968. The UK has historically been a manufacturing and trading nation. Reduce manufacturing and trading is affected. Financial services masked the trading issue for decades. Now the chickens are coming home to roost.
2009 will be hard for many people. Remember your history to learn from past mistakes and evolve in the future, my friend!
#267 CelticAce 18
Our smaller brewers are still UK owned (we will welcome the Irish for Guinness) and the largest drinks firm in the world is Diageo (not Annheiser Busch), and our best distilleries remain UK owned (except Whyte and Mackay which is now owned by an Anglophile Indian). The headache pills and cold remedies are made by UK owned giants like GSK. So we can get drunk over Yuletide and sort our our hangovers after.
Then what? That was my question. What does the Uk actually make?
Methinks you will struggle to answer that.
Complain about this comment
#270
just Google him but do it in your own time because he hates people who spend all day on the internet.
#196
I think you meant positive feedback
Complain about this comment
#17 & #175
You state that Sir Derek Wanless
(ex ousted CEO of NatWest, and ex Non-Exec. Head of Risk at Northern Rock) sits on the Board for Actuarial Standards. Can this be correct ? The Commons Select MP's were scathing of Northern Rock's 'reckless and risk laden business model'. Wanless must have given his full approval to this failed business model ? Northern Rock were the very antithesis of prudence. Prudencial judgement should run through an actuary like lettering through Blackpool rock. IS IT JUST ME ? Surely, having Wanless sitting on the Government's Board for Actuarial Standards is a sick joke in the face of taxpayers who have stumped up £billions to rectify his imprudent judgement ?
Complain about this comment
I agree with Beejay1948 but will be more straight forward here - From the title, I expected the programme to provide insight into and debates regarding the various events and their under current. It turned out to be a poorly made, self-promoting and back-patting exercise of Robert Peston. I had to turn off after 5 minutes. Why are we the license payers having to fund programmes like this that do nothing but promoting the journalists themselves and their colleagues, which in turn boosts their earnings and consequently the costs to the public?
Complain about this comment
Watched the program on line and thought, nothing I did not already know or suspect. Again lots of on the brink, and we had to step in to save the banks and the economy, the country, the world. I have still not had one explanation as to why. What would have been the effect of letting the weak banks go to the wall and the strong survive?. Terrible effects on the economy, take a look around. If you live by the free market economy and the strong survive at the expence of the weak, then dont wimp out when it is your turn to die. Those that are powerful and weald great influence over the rest of us, the weak, change the rules or move the goal posts when it is their turn for the chop. As a very wealthy client of mine quoted yesterday `All thats happend is a lot of very wealthy people have lost everything to a lot of other very wealthy people`. The fall out from all this is that us, the weak, pay the price in job losses and financial ruin, until the new rich kids on the block take control.
Complain about this comment
274, PrisonerNumber6
I agree with that sentiment entirely, we have for whatever reason allowed our skills and technical know how to be wasted in search, I fear, of a quick, easy quid.
Heaven help us.
Merry Christmas to all. May this season of goodwill produce some uplifting economic news.
Complain about this comment
beeyay1948 regards Robert P as a 'lightweight' but, at least he has the courage of his convictions and debates in a straightforward manner
Coastalhallie
Complain about this comment
post 278 subscriber10
Your exposure is most likely on your back feet legs backside or on
your head:
Clothing we make it. . .
I tend to post here when i am sat at airports waiting to catch a flight.
Complain about this comment
#220
Solar energy probably only viable via nano technology. UK unis doing some really good work here - need to be supported by UK sources before patents go west. Fancy solar panels nano painted on to paper?
Re: Panorama (in general) hardly cutting edge analysis these days so not disappointed by the ersatz production. Ascent of Money much better on the situation. For real expose (in general) Channel 4 Despatches much better researched and rarely dumbed down.
Complain about this comment
Sorry - should have been #221
Complain about this comment
Can we please look for some sensible answers.
I do not care if Robert P is Marx's nephew, at least he generates some debate. Can we not be constructive rather than rant on like that questionable singularity AC.
Anyway here is one I did earlier.
Now we know Gordon Brown is going to cut taxes. He has been in charge since 1997 and every year he has found a new way to tax us more than the year before and now he is going to do an about face and start cutting. Wow!
David C and Cleggy are up for it as well, whatever next.
The trouble is they will not do it properly. Gordon will give it away to everyone who might vote for him and it will just get wasted.
David C will give it to companies and business. Cuts in corporation tax are no good if you are loosing shed loads of money.Mind you it might stop some of them relocating.
Cleggy will take from the rich and give to the poor. The snag is the rich will leave.
Of course tax cuts are necessary but they have to have an objective.It is no good cutting taxes if all it does is send everyone off to Bluewater for a spend up.
We need to do two things.
1)Encourage saving.
2)Invest in usefull and revenue producing projects.
The first can be achieved by producing, easy to invest, tax free,inflation beating savings products for the man in the street.Do not lock him in past his visual horizon. Give the option of withdrawal any time after a year. Let the public help produce the loans that we need to survive.
The second should be directed at the most obvious target there is, fossil energy replacement.Give EVERYONE the incentive to invest in renewable technology to allow us to replace as much fossil fuel as possible.
This will mean that the uptake will be quick, tax breaks for solar panels,feed in tarrifs for heat and power,easy to access capital grants for infrastructure.
Make it simple.Currently you need a degree in accounting to fill in the forms. HMG do not really want you to have the money, they just want to be able to say it is there.
Do this and you will create a crusade that everyone can get behind and be part of.Give money to large corporations and you will just be giving a present to overseas shareholders and cause resentment at home.
Manufacturing for these products will be encouraged,fossil fuel imports will be reduced and tax benefits will feed into the economy.
You will make the environmentalists happy, the individuals happy,the bankers happy and you will reduce your dependence on dubious overseas institutions. What more do you want!
Remember that a billion grains of sand make a sand dune.Blow on it gently and you can move mountains.
Complain about this comment
Re: Peston as a celebrity: there's a brilliant cartoon of him on P27 of the Christmas Private Eye. I emailed and asked them to post it online.
Dear Robert, Thanks for taking the trouble with all these posts, explanations etc - I'm sure some of your colleagues do rather less for their salaries. Also, thanks for providing a forum for us to discuss things, and for stirring up the pot every now and then As you are a self-confessed curmudgeon, may I cordially wish you
HAPPY HUMBUG! ;-)
Re PUNISHMENT OF THE GUILTY
I do not wish for a breakdown in law and order. Nor do I wish for executions or murders. But if this is to be avoided, the bankers and spivs who created this mess should lose every penny of their ill-gotten gains, and be reduced to the same level of penury as the poor buggers who are likely to be unemployed and repossessed in the new year. The only legal way to do this would be by impeachments and Acts of Attainder passed by Parliament.
Also, limited liability for chief executives of public companies must be seriously curtailed if it can be proven that "financial negligence" has taken place. Their shirt must be at risk. If this legislation were retrospective, there would be no need for Acts of Attainder.
Finally, after the next election there must be a PARLIAMENTARY Inquiry into the principles of the banking system and how it has contributed to this mess. Even a fulsome apology is not adequate if the lessons remain unlearned.
Complain about this comment
Friendly bottom, please come soon ...
Presumably Brown knows that we have to hit bottom before we can move into recovery. Until assets have fallen to real value no-one's going to buy. The politics of it all is disgraceful.
Government mortgage bail-outs and absurd payments to firms that should have gone to the wall years ago are just prolonging the agony.
The horrendous sums poured into the banks are now seen to be merely ballast not fuel for lending.
At the same time the banks are being told by the government put their house in order (rein in lending) AND lend to people they'd rather not (give it away). How sensible is that?
The long term cost of repaying this huge debt is going to be a significant brake on ANY recovery.
Government action should focus on hitting bottom FAST. That means cutting spending.
It is going to be a very difficult time for everyone. Tough.
Complain about this comment
I should have finished with, lets support and prop up the very thing that has failed completly,banks. The victims of this failure, Woolworths, MFI, Car industry?, and far more to come, well they are expendable. We all, as tax payers have a 40% or 50% stake in failures, still run by the same people that failed, supported by people who failed to see the failures, regulated by those who failed to regulate against such failure. Can we see where this comedy of errors may end up ?. Robert Peston interviewing a bunch of failures on prime time TV, all sitting comfortably in their plush surroundings pontificating about how wonderful they dealt with the situation, truth is they failed to grasp the bull by the horns and do the honest thing. All that has been acomplished is failure in the future, be it near or far.
Complain about this comment
*264
I seem to remember the slogan was
BACK BRITAIN, BUY BRITISH.
If only we had!
Complain about this comment
post 281
Yes would rather be exposed to the elements than the banks, exposure to the banks will result in the loss of the shirt from your back. I have suffered at the hands of banks to the point of bankruptcy and the loss of my home, I was lucky and saw the light before all this mess came to light. The one thing I learnt was, if you dance with the devil you will get burnt.
Not so long ago record profits for banks, huge payouts to shareholders and top employees. Not just banks, many businesses did the same. It was more lucrative to pay high dividens to share holders to push up their share price, and then borrow cheaply to fund the next years business. Until the proverbial hit the fan, the banks call in the loan and bingo no money to pay the bill. Moral of this story, huge ponzi scheme. Use your profit to fund the business before paying dividens to shareholders. If you are a good viable business you will atract investment.
I do not want to see businesses go to the wall along with their banks, what I do want to see is a change of attitude. Trust is something that is earned not paid for, profit is earned through hard work not at someone elses expence, normaly the hard working people of the world.
Complain about this comment
One would imagine the person in the position of being the BBC Business Editor would have a much greater understanding of the causes that have created the current economic crisis than the present holder of the post, - Robert Peston.
The BBC, Mr Peston, the politicians and the bankers like to give the impression that this situation could not have been foreseen, - so how come many other people were warning about exactly this happening these last three or four years?, and why were their warnings ignored?.
The BBC gives more coverage to "come dancing" and other pathetic nonsense than it does to serious world affairs.
Complain about this comment
Dear Mr Darling,
I am writing to you regarding your complaints regarding our product and our ongoing investigations into the faults which have developed.
The Economy(tm) (UK capitalist version) is our premium product and was from our records in perfect working order when delivered to you. Our QC inspector Mr Brown personally noted it was proof against boom and bust and significantly improved over our previous versions.
In your previous letter you indicated that you believed that the problem was due to a design fault in our power supply system as you claimed the problem started whilst using the product in the US. I can assure you that the small (very small now) difference in the voltage in the US has no significant bearing on the matter. That your friends model has developed a similar fault is entirely coincidental.
In October you further wrote to us claiming that the unit was on the verge of failing. On this occasion we pointed out that you had used very poor quality oil to lubricate the system and that it had become blocked as a result.
Clearly had you cleaned out the system and refilled using the correct specification oil as detailed on page 32 of our operatoions manual then your Economy(tm) would have continued to function to specification.
Upon a further visit from our engineers in November they discovered that the blockage had not been removed and that in fact there was now no oil in the reservoir (we understand new oil was provided but was sold to a third party).
It clearly stated in the manual that running the product without lubrication would result in severe damage.
We noted that some effort appeared to have been made to refill the sump however as the drain valve was left open the oil just poured uselessly onto the floor.
Your many recent calls noting defects in the operation of the Economy(tm) are entirely related to the poor maintainence of the product and failure to read the operating manual which, from our many phone calls, it
is clear you have not. This has significantly reduced the value of your product and reduced the functionality severly.
Please note that several of the non-functioning parts are not customer serviceable however our engineer reports that the covers have been tampered with and an attempt at repairs has been made. This voids your warranty on those parts (primary motor and outpt systems) and you are advise not to tamper with other parts in case the product stops working completely.
Some essential control mechanisms have been bypassed or switched off, these could have corrected the problems automatically had this not been done.
If you continue to use the product incorrectly it may require replacement
Whilst writing to you our Credit control manager has asked me to point out your account appears to be in arrears and the level of arrears is increasing rapidly.
May I remind you we hold a charge against your Economy(tm) and we are seriously considering sending our debt collection agency A Thug and Co to repossess your economy(tm), due to recent legislation you are advised not to resist as they may restrain you during the process.
If you are experiencing temporary financial difficulties we may be able to help with a bridging loan to cover the current funding gap. Please not that this will require a binding service contract for your Economy(tm) with us and severely restrict certain functions which you may value.
yours sincerely,
Mr G.T.Hell
Ilford Macroeconomic Fixtures Ltd.
Complain about this comment
Peston is a champion for the ordinary person in the street like me, we need that voice !
In my opinion, Greedy city bankers,milk the system, create stupid bonus structures, aiming for obscene bonus payments, then manage to break the banks and still get paid more bonus money than I could earn in a lifetime,
would I do a worse job than them, Ha...
Biggest slap in the face is that my Tax payments will bail these Morons out,
They retire with Fat Cat handouts and life of Riley for failing their jobs , while the honest worker fights to keep their Job and home.
Come on Preston
Name and shame the biggest offenders..... Bet they are the biggest risk taking greedy Fat Cats.............. How do they sleep at night..... they should be made bankrupt....
Complain about this comment
#270
re our famous poster alexandercurzon .............http://www.linkedin.com/pub/dir/alexander/curzon
Complain about this comment
#225 - I don't mean to be pedantic or defend RBS, but RBS didn't pay anywhere near $100 Billion for ABN.
RBS's share was ~£10 Billion. At the time ~$20 Billion. So they could only buy another couple of huge banks for the same money...... or not
Just thought I would mention it as it seems a lot of people have the misconception that they bought the whole thing
Complain about this comment
I wanted to ask this question for a very long time. For all the mess that we are in how much are the ?Big 4 Audit? companies responsible for it or are they. They are the ones who look at the companies financial statements and they approve that the numbers are correct and the business is on the right track.
I don?t know how much of an important topic this is (maybe it?s my university lectures going in my mind). Would you be able to reply to this?
Complain about this comment
I was a bit peturbed at this Panorama. As far as I could see it did nothing but advertise a member of the BBC's own staff and told me nothing I didnt already know. Arguably it was a disgracefull bit of self advertising by the BBC/Mr Peston
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
Trivia:
Much of the dialogue was developed through improvisation.
Three alien chancellors were made: a model and two suits.
The letters that slowly reveal the title of the movie at the beginning start out as hash marks, one for each crewmember that is killed.
According to a quote from A. Darling in a film magazine, in the scene where the bankers tail wraps around his legs, they are actually Nichola Horlicks legs, in a shot originally filmed for another scene entirely.
Complain about this comment
Re: 113 117 120 154 162 226
please arrange a meeting to discuss asap
Complain about this comment
I sometimes wonder if the BBC has any idea about its impact on the UK economy. Invariably the glorification of doom and gloom in pursuit of viewing figures will cost it dearly and it rubs off on viewers.
BBC, for goodness sake lighten up and teach society new ways to cope and be positive. Is that not part of your corporate responsibility as a public service broadcaster? Let's move on and be positive.
By way of an example Varley (Barclays Bank CEO) said 12 - 18 months before it improves. You tell the world Doom and Gloom for at least the next 2 years and more! Another wedge off my meager savings, just like when you reported on your Blog that Barclays Bank went cap in hand to Downing Street, when it had not.
Go and show the world that ALL people in the UK are still in the top 8% of society globally and most people will go to sleep tonight and wake up tomorrow - unlike the million around the world who god bless them will not.
Indeed its tough, but compared to the rest of the world were actually infinitely better off - put that in your pipe and broadcast it instead!
Complain about this comment
What i want to know is why were not focused on making sure the credit crisis does not happen again. Pure shareholder greed and inept compliance were the primary causes.
The BBC could let Mr.P , a real established financial expert, be appointed as Darlings underling to sort out this sorry mess.
At least that way we would not have the doom and gloom on the BBC. He could focus on real value added activity, you know the stuff which makes a difference.
Complain about this comment
We seemed to find out more about Bobby Pesto in this documentary which, although mildly interesting, was not entirely what I was expecting from "Panorama: The year that Britain's bubble burst"!
I'll echo previous comments... The documentary seems to have let the Government off extremely lightly and supports the illusion that this is somehow the fault of everyone else (i.e. the FSA, the BoE and the banks themselves). (Will it get to the point where we, the public, are to blame because we can't afford to borrow more money to keep the scam going!?)
As Vince Cable pointed out, they (the Govt) were warned as far back as 2003 that the housing market and levels of borrowing in the UK were not sustainable.
And when this came home to roost LAST YEAR, the Government spent too long worrying about their popularity rather than what the real problem was going to be - a collapsing banking system and extremely deep recession.
Did Northern Rock not set alarm bells ringing? Where was the foresight after this? For how long were we told that the UK was well placed to deal with the "global downturn" (implying there wouldn't be one in the UK)? How handy was it that cabinet meeting notes were accidentally photographed, painting a not too pessimistic view of the housing market, it's outlook, and how much the government will help homeowners? Why were we repeatedly lied to by Gordon Brown and Alistair Darling about nationalised banks being forced to lend, when in reality the bailout money simply filled a big black hole to stop said banks from collapsing?
What is shocking is how the Government are managing to spin their way out of the firing line, when the foundations for the UK bubble, it's inevitable implosion and the current recession have all happened on their watch.
Come on Bobby, don't let them get away with it!
Complain about this comment
What brits should do is help yanks design a 'corruption free' banking system. (I hope I don't sound like Gordon Brown or I am gibbering again).
Complain about this comment
wellcaught 284
Constructive comment?
We have an administration that
has placed the UK in a similar
financial position to how things
were after the Second World War.
The most constructive thing to do
is to get rid of the administration
and all the hangers on,have an investigation/prosecution and
punish accordingly.
Unless this current government
is removed what Clegg Cameron
etc may do is entirely useless.
As an individual i have prepared my business to stand the financial storm, that plan was decided on nearly three years ago.
Perhaps all the clever BANK
DIRECTORS could have thought
beyond their NEXT BONUS?
WHO ARE YOU ANYWAY?????
Complain about this comment
Just been invited by the conservative party
You are invited to the Conservative Party Keep Britain Working Event to be held on Tuesday 6th January 2009 in Ipswich.
The aim of the event is to share with you the latest thinking from the Conservative Party about the current economic downturn and to hear your views about measures that could be taken to alleviate the challenges we face.
The forum will be led by Andrew Lansley MP and will include business representative groups and businesses, local authority representatives, voluntary sector organisations working with business, the self employed and unemployed.
Solutions to alleviate the challenges we face has already been exposed and debated since Jimmy Carter. I am afraid that the future under the so called leadership of the conservative party looks as bleak as the actual present ruling party.
?Where there is no vision, people perish?
As president, Carter created two new cabinet-level departments: the Department of Energy and the Department of Education. He established a national energy policy that included conservation, price control, and new technology. Foreign oil imports were reduced by 50% from 1977 to 1982.
Complain about this comment
re. #293 & #270
everyone has the right to say whatever they feel, just skim past one if you dont like the sentiments.
The honourable Curzon is allowed to use capital letters and too many carriage returns if he wants, and who he is doesn't make any difference. (I thought he was Mr Angry from the Steve Wright 1980's show). If he has managed to build successful businesses in spite of government interference, respect to him. If he employs loads of people in UK, then he is an asset. It takes all sorts to make a nation.
by the way -to get a pound sterling sign
I thought you code paste an ascii code (old MSDos)
£
did it work?
Who wrote this software Mr BBC?
Complain about this comment
#196 - Measurement of inflation.
You, and others, are spot on with this, but I think that the measure of inflation should always include both asset prices and the cost of finance - no doubt some top statistician could tell us how the blended figure would work. The point about higher interest rates automatically fuelling inflation would be tempered by the dampening effect that higher rates would have on general prices. Any adjustment of rates by the MPC would take this effect into account - they must be clever enough to do that, surely?
On the same subject , in the Panorama Sir John Gieve seemed to suggest that asset prices aren't included for fear of being ostracised for subduing the whole economy. This sounds a pathetic excuse to me - a politician's reason rather than a serious argument for doing the right thing.
Merry Christmas everyone.
PS - Re a J Cameron previously at Kleinworts - bloggers who have noted his name here are right in that he did move to RBS, and yes there is some evidence to suggest that we are in trouble if he's in charge of anything at all. Lovely chap though, and I'm sure not the only person to blame for the whole fiasco we've seen.
Complain about this comment
I finally watched the Peston Panorama Show; awww Robert, why did you let them do this to you? I hope you went straight back upstairs when you saw the finished programme and demanded a re-make; this time a serious expose on the people behind this mess.
Maybe Darling is going to grow into the job, and has just been a yes-man to his boss for the first 6 months or so, but all the rest of these smug gits, you should be giving it to them with both barrels.
If your bosses are too scared to pick a fight with Brown, we want to know.
Why don't you try and get some of the men now with time on thier hands -Fred the Shred & Andy Hornby for two- and grill them on our behakf.
Complain about this comment
What are the diferences between Royal Bank of Scotland/HBOS/BB/Northern rock etc and Madoff?
Complain about this comment
Banks need to be allowed to quietly get on with their task, of recovery.Too much media attention focussed on them is very disruptive to this process.
We all need to let things hibernate and allow things to improve.
Turn the spotlight off, Robert, as it is like pickking at a sore.
Complain about this comment
puzzlin post 309
LIQUIDATION is my view.
Complain about this comment
Re the following comment by Mr. Darling...
"Q: And how bad is 2009 going to be?
DARLING: It?s going to be difficult but you know I am confident that we?ll get
through it. If you ? and looking ahead, you know the World Bank
estimates that the world economy is going to double in the next
twenty years. And you know I think people, yes we?ve got to look
at the problems we need to deal with today, next week and so on,
next month but let?s look ahead too because there are very good
reasons to be confident that as we get through this, there are
tremendous opportunities for us, for other countries too and you
know we?ll get them."....
Surely simple arithmetic would show that doubling in twenty years means that consumption in the next twenty years would exceed all the consumption up to now...He must be joking because there is not enough oil left...The brakes must be on the world economy because there is not enough resources to double the economy in the next centuies never mind the 20years...No much wonder the economy is in a state if the the chancellor/ economists don't understand simple arithmetic...
Complain about this comment
There are to many banks those that dun wrong should of been left to fail and the bailout money only put into the strong banks who could use to help people with financial problems.
Complain about this comment
Tigerjayj, which party for you to join? It'd need to be one where you stand a chance of getting into government/office/cabinet/ PM?
I go along with your choice of Chancellor and I reckon for home affairs minister the person that suggested the government started using all the money it's thinking of using to bail out the car firms( surely not!?) / banks to build housing thus keeping the building trade and all the firms that back that in the various ways, bricks, plaster etc etc. Great idea to my mind.
Please don't call the Gord person GB.. GB is Great Britain and he most surely is not that.
I'm not happy about the idea of supporting the car firms, sorry to those that work in that industry, 'cos they were sold off for way less than their original value and the billionaire owners should/ would(?) have formatted all financial possibilities before buying in?
Complain about this comment
310 #Banks need to be allowed to quietly get on with their task, of recovery.
No way...they can't be trusted. They were left to get on with their task and look at the mess they've made of the world economy.
Complain about this comment
315
But we still need them to recover and to prosper, and to start lending again.
An economy based only on savings and thrift simply cannot deliver the growth and benefits of a healthy mixture of informed risk-taking and a sound analysis of strengths,weaknesses,opportunities and threats and investment opportunities.
And nobody has a worse record of staying in business than not-for-profit credit unions.
And as for the mutuals, who is meaner than Nationwide, ( let's Boycott'em for not passing on the rate cuts! )and who was worse than Equitable Life.
No. sorry, gimme back the banks.
To think that the future is us all growing our own brussel sprouts, catching the bus (yuck!) and refusing to borrow or lend money is cloud cuckoo land.
There is not going to be a new dawn, Capitalism is really the only game in town and thank goodness for that.
The Russians and the Chinese know that!
Complain about this comment
So the Halifax says that house prices have fallen by 16 per cent and we are back to the levels not seen since 2004. What a load of rubbish, just try reversing that statistic and its the same as saying that between 2004 and 2007 house prices only increased by 16 per cent which is nonsence. With figures like this its no wonder the banking system is in the mess its in. House prices would have to fall at 16 per cent for the next 3 years for things to get to that stage.
Complain about this comment
This comment was removed because the moderators found it broke the House Rules.
Saved?
Spare a thought for the 8000 british depositors who have lost their life savings in Kaupthing singer and Freidlander Isle of Man
( Formally customers of the Derbyshire Building Society who sold them down the river last year)
by the actions of Alistair Darling.
Ordinary people ruined.
Mostly people who are retired or nearing retirement
Their life savings gone in the most vulnerable
years of their life.
Not only have their savings gone but they have been treated with contempt and silence by HMG and labeled 'fat cat tax dodgers'
Wrong Mr Darling
Thats the bankers we are just the poor saps who were prudent worked hard and paid tax and saved all our lives, and made the mega mistake of putting it into a bank .
What do we do now you have ruined us?
Complain about this comment
I am a British expatriate who has seen his life savings disappear as a result of the UK government action on the 8th of October 2008. The government may have saved the Banking industry on the UK mainland but they have done it at the expense of Iceland and thousands of expatriate British savers who are not allowed to open bank accounts on the mainland. The use of anti terror legislation against Kaupthing Singer Friedlander UK (KSF UK) and other Icelandic Banks. At that time KSF Isle of Man (KSFIOM) itself had a substantial deposit with KSF UK. This seizure caused the collapse of KSFIOM as it was now no longer able to meet its obligations to depositors and its banking licence was withdrawn.
Many members of parliament have written to the minister in responsible on behalf of those affected. The relevant minister has not, to my knowledge responded to any MP.
The government also seems to be confused about the tax statuses of Crown Dependencies. In the country where I live I am liable for tax on income arising anywhere in the world, I imagine this is the case in many other countries. On the Directgov website on the 'Tax on foreign savings and investment income' page it states quite clearly that ?Income counts as 'overseas income' if it comes from outside England, Scotland, Wales and Northern Ireland. So income from the Channel Islands and the Isle of Man counts as overseas income too.? In fact the UK itself is a tax haven. Many very wealthy foreign individuals have been attracted London recently precisely because the UK tax regime has been structured so they can avoid paying tax.
There is one report on BBC video nation, and a comment in the BBC radio 4 ipm from people who have been made destitute as a result of the UK government's action.
If the depositors of KSFIOM get 100% of their deposits back it will in spite of UK government action not because of it, unlike other British savers.
Complain about this comment
When will Robert Peston finally tackle this issue fairly and honestly for the ordinary people of the UK ?
The simple questions remain unanswered. Just a few months ago nobody (and I mean nobody) in the British media (not even Robert Peston) were talking of any 'credit crunch'. Certainly not of a 'recession' and certainly not a 'depression'. (The same is true of the USA). With each week that has passed since then this amazing situation has worsened, to the point now where the hole in the finances and the crisis itself is so deep nobody can tell us its scale, its depth or its value. Is THIS not the truth ? So, how did THAT happen ?
My next question is simple. With large and small companies crashing all around us how has the 'bailout' described by Peston not 'sorted the credit problem' ????? I mean, the whole point of the 'bailout' was to fix the problem. Right ? So what IS the problem if the 'bailout' has already been arranged ? Any answers Mr Peston ?
Finally, will Mr Peston tell us WHERE the bailout money/credit for the banks actually came from since the UK taxpayer has to pay it back. Can we know, exactly, where this came from ? Or are we to expect yet another vague answer about 'the taxpayer bailed out the banks' when, in fact, the taxpayer has provided banks (so far) with nothing at all.
Thanks
Complain about this comment
This is the reality small business owners have to face:
Ther 2% VAT cut is meaningless. Most tiny companes, employing one or two people, have to have a turnover of £65-67k p.a simply to pay the bills. The extra 2% saving in VAT increases Corporate tax liability - so you will end up payng corporation tax of 20%..nobody wins. Would it not have been better for everyone ( not just business people) to have raised the threshold ? This would mean small business owner could, instead of paying everything they have to the VAT man ( and this includes tryng to take a £450.00 monthly salary) could afford to employ one young person - and in doing so, relieve the benefit burden.
On Employment:
We have been advertising for a young person for well over three months - no aspplicants...why not ? Well, it seems that 17 year olds want more than £5.73 p.m and having training paid for, as well as car parking fees, free lunch and hairdressing ...what more can we offer ?
The applicants we have had have made comments such as ' I don't really want the job, but I have to come for the interview to keep my Job seekers allowance' and 'will I lose my benefit if I work' ?
On Banks:
GRR. They charge small businesses for paying cash into the bank. How mad is that ? They want the cash, but prohibit small businesses paying it in because of thier exhorbitant charges.
Further, in these 'crunch-times' they are charging 18 - 10% interest on overdrafts ( personal) when base rate is low - is this profiteering ?
Training:
Why are colleges of Further Education paid on results...this means students taking NVQ's all pass assessments, irrespective of thier comptency. Colleges should be paid on students who, after completing a probation period with employers, gain full-time permanent employment.
Thank you for reading this , maybe I should change my name to ' Mona'
Complain about this comment
I think these banks have suffered through greed and poor quality and risk management heads should roll at the FSA
Complain about this comment
I work in a Bank with a portfolio of business customers. We are told to continue to lend and sell lots of other products. However, criteria has changed - its a lot stricter both for the customer and internally ie we are not allowed to make any errors.It strikes me from my lowly position the difficulties we all face are the result of the lack of confidence the banks have in lending to each other as a consequence of easy credit on cheap terms not necessarily to the type of customers I deal with but to the Private Equity Funds. Incidently it appears that the sme's are having to pay for these indescretions ie increased interest margins, fees and lack of credit for working capital.THe Banks needed to have liquidity injections back in October but this has only been a short term answer with, no doubt, further requests being made from March/April onwards. Instead of trying to attempt to stimulate the economy to spend by introducing a 2.5% reduction in vat ( a bit pointless when all retailers seem to be having sales offering reductions of upto 70%) all efforts should have been made to get the Banks to lend to each other. Addressing a lack of confidence here should have been the priority.Alternatively, perhaps the £12bn its costing to reduce vat to 15% should have been used to invest in building houses on a grand scale. What is the annual shortage of housing stock in this country. There are lots of building sites where house building projects have been stopped by companies. Should the govt be investigating schemes whereby they effectively subsidise the buillding of houses, insist on a max sale price and specific tax measures for any capital gains on these properties. Gains will be made from the expenditure on spin off businesses (ie carpets, furniture, electrical goods etc) and subsequent tax income plus continued employment for the vendors of such goods. Furthermore, associated building business from builders, carpenters, scaffolders to transport companies and conveyancers will remain active. Their employees will stay employed, pay tax and NI as well as purchase products on the High Street. Being unemployed means
Complain about this comment
I have a friend who works in a Bank with a portfolio of business customers. Over the years she has received bonus payments for hitting and exceeding targets but consequently the pressures to succeed from her superiors means she has seen colleagues make short cuts, mistakes are made and dare I say it cheating occurs. It has no doubt been an increaing spiral of pressure to achieve and earn bonuses. Short term gain and profits has been the goal. Consequently old fashioned principles of banking have been swept under the carpet but now we are all paying the price these indescretion. She is told to continue to lend and sell lots of other products. However, criteria has changed - its a lot stricter both for the customer & for her to sanction.From where I stand the difficulties we all now face are the result of the lack of confidence the banks have in lending to each other as a consequence of cheap credit on easy terms not necessarily to the type of customers I deal with but to the Private Equity Funds. Banks are unable to repackage and sell the loans they have made because of the uncertainty and fall in confidence. Incidently it appears that the sme's are having to pay for these indescretions ie increased interest margins, fees and lack of credit for working capital.THe Banks needed to have liquidity injections back in October but this has only been a short term answer with, no doubt, further requests being made from March/April onwards. Instead of trying to attempt to stimulate the economy to spend by introducing a 2.5% reduction in vat ( a bit pointless when all retailers seem to be having sales offering reductions of upto 70%) all efforts should have been made to get the Banks to lend to each other. Addressing a lack of confidence here should have been the priority.Alternatively, perhaps the £12bn its costing to reduce vat to 15% should have been used to invest in building houses on a grand scale. What is the annual shortage of housing stock in this country? How many houses need to be built each year? There are lots of building sites where house building projects have been stopped by companies. What about brown field sites. Should regulations be eased on green field sites and for planning applications.Should the govt be investigating schemes whereby they effectively subsidise the buillding of houses, insist on a max sale price and specific tax measures for any capital gains on these properties. Gains will be made from the expenditure on spin off businesses (ie carpets, furniture, electrical goods etc) and subsequent tax income plus continued employment for the vendors of such goods. Furthermore, associated building business from builders, carpenters, scaffolders to transport companies and conveyancers will remain active. Their workers will stay employed, pay tax and NI as well as purchase products on the High Street. Increased unemployment results in an increased benefit burden to the govt and taxpayer. Families lose their homes, end up in rented accommodation with rents often greater than their mortgage commitments which are then subsidised further with housing benefits. Society and family life is falling apart do we want it to deteriorate further because of the greedy actions of bankers and Private Equity Funds and the wrong action that has been taken by govt and Banks now.For sure, when we come out of this recession, fortunes will be made and remade by those who will be able to get their hand on cheap finance in the future. Nothing seems to have been learnt from previous recessions. People will always be motivated by greed and filling their own pockets because at heart we are all capitalists. The Private Equity Fund owner/investors will be protected by the Banks as they will be the ones who do the larger deals, borrow more money and allow the bankers to hit targets and achieve vast bonuses. A blip for them at the moment but they will bounce back. In the meantime you, me and the sme's will be paying the cost of 20 years of increasing indescretions by the government and Banks. We will also see more well known retailers disappear from the High Street. The power will shift further into the hands of the likes of Tesco and Asda who can supply practically everything you need at a relatively low cost. Regulations will be improved but loopholes allowed and found providing opportunities for these companies and the PEF's.The last 12 years of govt by New Labour has helped cause the problem we have. I'm not convinced at all they now know what they are doing either. My allegience to them has diminished but not yet disappeared because I don't like the alternative. The Conservatives don't look like they know any better. Vince Cable says some interesting things but he's in The Lib Dems and they will never get voted into govt. We are not alone as this problem is global and as such will those in Russia, China, India and eastern Europe, whose lifestyles have benefitted from the west's investments, sit back and allow their new found wealth recede. Look at Russia/Ukraine and the gas. Look where Barclays had to go to raise liquidity. Does China still hold the purse strings for the world. We could be held to ransom in many ways in the future. And then there is global warming to worry about when this recession is over.
Complain about this comment
I want to know why the government dont give every working family a tax wind fall and give them the chance to spend money within the fields the government say they want us to tick on for ie new cars, mortgages,new things for our homes. This would boost the economy and give those working in the private sector a boost also.
It would have been better than bailing out bankers who earn fortunes, buisness men who sit on millions whilst they shut factories and ask for cash handouts from those of us who cant afford it. Surely this is an option but then again it would be helping the working families and we are unimportant to the government.
Anywhere between £75,000 and £250,000 to each family would have had a major impact on the way the economy works and our spending.
Complain about this comment
While bans are not looking to lend much to those in need, we are implementing a section on our site where first time commercial property buyers can pick up premises cheap.
It's especially handy for those who are looking at relocation and expansion opportunities.
Have a look at http://www.commercialroute.com/hot-deals andyou'll see what I mean. With the recession projected to alst the whole year, many people seem to be wanting to risk going alone rather than work in jobs, as there are just too many redundancies being made at the moment.
Complain about this comment
Surely it would have cost the government (taxpayers) less money if they had guaranteed all the savings of everybody who had accounts with the troubled banks. They could then have written off all bad debts created by the banks and all the companies and individuals who owed money would be clear of the crippling cost of the debt. Part of the banking system would then be nationalised - a good thing because it would be more responsive to public pressure (FSA is ineffective) e.g. bank charges & excessive interest rates. It would still leave private banks for those who wished to use them knowing that they are a higher risk. It would have led to less unemployment and hardship for families.
Complain about this comment
View these comments in RSS