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Smack smack - we're dead

Robert Peston | 09:05 UK time, Thursday, 2 October 2008

If the patient is the financial economy, here's a smattering of the latest worrying symptoms.

1) National Savings has been overwhelmed by calls from anxious savers wanting to lend their money to HM Treasury rather than keep it in a high street bank. And there's also been such a rush to place deposits in taxpayer-owned Northern Rock that it's had to suspend its more attractive products and is turning money away.

Bank of Ireland2) There's been a flight by some British savers to the safety of Irish banks, where deposits are 100% protected by a government guarantee. And here's an odd thing. Yesterday Ulster Bank, a subsidiary of Royal Bank of Scotland, was given 100% deposit protection by the Irish government, on the same basis as the independent Irish banks. So it's now safer for both wholesale and retail depositors to put their money into Ulster Bank than into RBS's NatWest subsidiary in the UK.

3) Austrian, South African and US mints are working 24/7 but still unable to press enough gold coins to meet soaring demand.

4) As I disclosed on the Ten O'Clock News last night, British banks urged the chancellor and the governor of the Bank of England at a hastily arranged meeting on Tuesday to please please let them swap their car loans, their loans to companies, their commercial property loans for cash from the Bank of England - because of their deep concern that wholesale funds are draining from the system. The banks felt they received a sympathetic hearing from the chancellor and a relatively hostile one from the governor. The banks fear, perhaps guiltily, that Mervyn King's understandable desire to see them spanked for their past sins and deterred from repeating their errors could turn out to be a capital punishment (smack! - no more banks).

5) Those same banks told the chancellor that their real vulnerability isn't the instability of retail savings, or the fear that the likes of you and me will move our modest amounts of cash. What really worries them is that huge wholesale deposits made by professional money managers are harder and harder to retain. And what the banks warned is that the Treasury may find itself having to follow the example of the Irish by guaranteeing retail and wholesale deposits (though the Treasury is reluctant to do this, because of how it would automatically lead to a ballooning of the national debt).

And now for the complicated and scary stuff. Today is the beginning of "auction season", when the International Swaps and Derivatives Association starts a series of auctions to settle who pays what to whom on a plethora of credit derivative contracts relating to businesses that have gone into default.

It's settlement time on those humungous insurance policies for corporate debt, called credit default swaps, which I've mentioned to you as being another potentially lethal flaw in the financial economy.

Lehman Brothers building, New YorkIn the coming three weeks, payouts of hundreds of billions of dollars may be made - or at least demanded - to cover losses arising from the defaults on the debt of Fannie Mae, Freddie Mac, Lehman and Washington Mutual.

Sandy Chen, the analyst at Panmure who's been a smart predictor of credit-crunch accidents, estimates that payments on Lehman's battered bonds could be as much as $350bn.

Now the problem here is that for every beneficiary of these payments, there's an underwriter - those who provided the CDS insurance - which has to find the cash. And, as I've pointed out, this was a largely unregulated market, so the great fear in markets is that some underwriters have insufficient capital and will simply collapse when the claims are made.

That in turn would hurt financial institutions expecting to be paid out on their CDS contracts and damage others with separate exposure to the collapsed businesses. The shock to the system could be very severe.

To compound the current anxiety about all this, the CDS market is so opaque that it's impossible to know right now who is holding the radioactive baby.

This gigantic CDS mess has contributed to the seizing up of money markets in recent weeks, the tendency of all banks and financial institutions to hoard cash - because no-one knows who or what may be vulnerable during the CDS auction season.

That, as if you needed telling, is just one more reason why the US $700bn bank bail-out is no panacea, even if we should be relieved that it has passed its first Congressional hurdle.

The financial weather ahead remains stormy and unpredictable.

PS. The most significant British corporate announcement today was that Marks & Spencer is slashing capital spending, It was planning to spend up to £900m this year on improving stores, its supply chain and computer systems. That's being reduced to £700m - and next year it'll be slashed to £400m.

In other words, M&S will be placing far fewer orders than planned with other businesses - which will have a damaging impact on their profits and on the prospects for their employees.

That's a graphic illustration of how the horrors of the financial economy are infecting the real economy.


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  • Comment number 1.

    Ah, such positive news to start the day.

    Didn't realise about the CDS auctions, that could be very scary. And I was starting to think we might have seen the worst of this now.

  • Comment number 2.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 3.

    Robert - If we come out of this with the Hornbys and Goodwins still in place and still earning their massive salaries then most people will be furious.

    Punishing the banks isn't sensible. Punishing those that got us into this situation would be. In fact it is perhaps an indication of how little honour there is in the financial services sector that the CEOs and boards of the banks haven't already resigned and publically apologised!!

  • Comment number 4.

    Well a massive recession is a given. For me the only question left is:

    Deflation or hyperinflation?

    Will we just destroy money left right and centre, or do we have to print it 24/7 to get out of this?

    It may well be deflation THEN hyperinflation.

  • Comment number 5.

    This is just small fry

    Its when the governments start to go bust that it all caves in

    Government UK has not got that long with whats coming so putting your cash in the treasury in not a good idea either.

  • Comment number 6.

    I can't help thinking that what we are seeing are just the visible symptoms (although sometimes they are not as visible as they might be!) of major shifts in the global economic landscape.

    The shifts are happening (they started years ago and are continuing) and our economies have to make uncomfortable adjustments to new realities.

    The most that governments can do, I suspect, is to make the process of adjustment less painful. A bit like a surgeon chopping of a diseased limb before the contagion infects the patient's whole body.

    For some good news check out last night's football results!

  • Comment number 7.

    Pharmaceutical stocks are usually a safer haven in troubled times.

    BUT this time they have problems of their own as I explain on my blog.

    My mattress is a bit lumpy at the moment, given all the gold coins I'm sleeping on.

  • Comment number 8.

    Robert at what point do countries start failing?

    The numbers in this crisis are so huge - did the fat cats really earn all this in bonuses ... where has it all gone.

  • Comment number 9.

    To all who are about to read and post to this blog…..


    Go research ‘money as debt’ and find out about the greatest hoax of all time. Don’t be a slave to debt for the rest of your lives.

  • Comment number 10.

    How is a bankrupt western economy with its love of welfare and bureaucracy going to compete with the far east economies?
    It really is a wake up call to western governments. We can no longer afford your grandiose ideas.

  • Comment number 11.

    So the main street banks have been at their work again,little wonder when computer freaks ate running these major institutions and as long as they can create the most complex financial model to come up with some complex product which no one understands not even the computer nerd this is what the chief executives of banks run on,the add for the nat west is not so silly this is what really happens albeit nat west are one of the worse offenders until we get back to old fashioined lending where the local manager knew who he was lending to and what was going on the community this practice will continue,also there is strong argument that retail banks should be prohibited from doing commercial lending.There is no doubt that one of the major banks has a black hole on its books ammounting to approx 15 to 20 billion,what gordon brown should be doing is giving the banks 24 hours to come clean about the size of their black holes if they dont then when it comes out the executives should face 20 years in Prision or 20 years on the dole and executive who have been involved in dreaming these mickey house financial models should be barred from working in an financial institution for te rest of their lives,what has gone on in these banks makes Nick Lesson look like the uriah heep,i tell you how can two different branches of the same bank two miles apart encourage developers to bid against each other to drive up ther price of land only a numskull wouldnt realise the long term consequences of this stupid system of banking and as long as these banks were growing business either god or bad so that they could look good in the beauty parade of the city and off course cream off large false payments its a disgrace.The old saying is a sale is not a sale until its paid for should be drummed into fat cat bankers that all loans are dodgy until they are repaid

  • Comment number 12.

    Oh yes... credit default swaps. These little toxic gems have been widely regarded as the elephant in the room for quite some time, since atleast last November infact.

    Mr P. omits to mention that these 'insurances' where traded in much the same way as all those CDO's and MBS's where. A bank or hedge fund that had been thinking that so far they had got away with maybe about to find that "oh no they haven't!"

    And as for that daylight robbery masquerading as a rescue, the Poulson Plan, it will do nothing...absolutely nothing to address the CDS problem. Neither Poulson or 'Big' Ben have referred to it once in recent weeks. All they are going to do is print money for banks who will then go speculating on the commodity exchanges..OIL and GOLD inparticular and rack up the profits for themselves and misery for the rest of us.

  • Comment number 13.

    Time to invest in Gold (even shares in a gold mining group) may be a good bet - all the prices are low at the moment. Alternatively the banks (along with the bank of England AND the present government) should fix interest rates low (5%) for every £1 borrowed - force ALL money lenders (private and corporate) to do the same and freeze all charges on tax, be it corporation or council etc.

    The sooner our "financial gurus" stick their necks out and do something Pro-active and not Re-active the better for the country and every "honest hardworking (not work shy) citizen"

  • Comment number 14.

    Ah, so now we have the reason why Paulson was on his knees. CDS's are going to fail big time eh ?

    I think your point earlier hit the mark spot on. Smack... No more banks.

    I hope this is true. I think all of the current banks need to fail, they've failed to be banks and turned into sales companies for insurance, credit cards and other dodgy financial instruments. That's why I will never, ever use a bank again. And no I don't have a credit card, nor a mortgage. I saved my money and what I cannot afford I don't have.

  • Comment number 15.

    Great news for first time buyers!!

    Sale now on!!

    Hi ho silver lining?

  • Comment number 16.

    Austrian mints eh?

    On the CDS auctions, isn't this effectively just moving around the losses already announced, albeit in an unpredictable and therefore unsettling way?

  • Comment number 17.


    The UK Government going bust? Not to put too fine a point on it, but I don't think so!

    The UK Government is has the longest continuous credit record in the world, and has NEVER even DEFAULTED on any loan payment. That's why Gilts are regarded as so safe.

    The UK Government has survived every economic disaster without so much as a blemish on its credit record - the Wall Street Crash, World War II, Black Wednesday...

    It'd take something considerably more serious than this to cause the UK Government to collapse. You're talking about the entire country going bankrupt!

    It's this kind of scaremongering that contributes to the problem.

  • Comment number 18.

    Most of the ills caused by shifting money in the retail sector can be fixed by three moves.

    Firstly: the one Gordon Brown got WRONG yesterday - the UK must issue the same guarantee as the Irish government, as must all other European central banks.

    Secondly: Give a Tax benefit for keeping savings in a single institution for more than (say) 3 months at a time.

    Thirdly: Put UP interest rates to reflect the inter-bank rate i.e. to at least 6 percent NOW. If this is not done rate-'tarts' will rush to the highest interest rate. Most of the people moving the small sums of money will be living on their savings and will be under extreme pressure to get the best deal.

  • Comment number 19.

    Thanks ... scary stuff indeed especially if, as you say, the CDS market is largely unregulated.
    Can anyone give an estimate of the billions (or trillions) of CDS contracts up for settlement ... just to add perspective to the UDS 700bn proposed bailout!
    Who are the major CDS players? Can we start naming names or do we have to wait until the Serious Fraud Squad wakes up?
    More info please!

  • Comment number 20.

    Why worry if countries start failing, the Chinese and middle-eastern sovereign wealth funds will happily buy them out at bargain prices...

  • Comment number 21.

    As the biographer of Gordon Brown (and a reporter who is certainly less critical of the government than he could be), does Ropbert Peston stop getting all these scoops when Labour lose the next election?

    Is his future inextricably linked to GB? I can't remember hearing of him before GB became PM and he started getting high level info, first. Now he's a media superstar -

    I can't help wondering if it all goes away when Gordon does...

  • Comment number 22.


    Fat cat bonuses don't get anywhere near these numbers. Not remotely. But they will get the blame because: they are visible; we are envious; and we don't want to blame ourselves.

    The primary problem is that the public have borrowed vast sums against houses whose values have now slumped (and are in many instances virtually impossible to sell). This is where the real value chasm lies.

    Second, our over-indulgence on imported energy has sucked trillions of dollars of liquity out of the system as oil prices soared from $25 to $100/b.

  • Comment number 23.

    Once again it seems that Mervyn King is weeks behind the curve. Sure, the bank's have fouled up, we all know that. Everybody is guilty: consumer greed, our buy now pay never mind set; banker's arrogance, hubris and misaligned interests that create clear conflicts of interest; regulators' and policy makers' incompetence or ineptitude. However, can't Mervyn see the nuclear winter descending? The banks need liquidity and re-capitalisaton urgently. We can now see quasi protectionism descending via the Irish governments naive move. None of us can afford to revert to the days of wholesale trade barriers.

    The time for reckoning, correcton, punishment and a return to basic (did someone say Victorian?) values will come. Now is the time to act boldly. Get on with the immediate imperatives Mervyn, Gordon and Alistair. Extend the Special Liquidity Scheme to at least March 2010, include the rest of the trashed assets (credit card debts et al), get the inter bank market working. Hang the consequences for the PSBR; as with the US £700 bn this would not be direct spending, most of it should be recovered - eventually. Otherwise we will all hang together. Happy Christmas anyone?

  • Comment number 24.

    re my post @ 2 - the bbc moderators really do suck!

    this crisis is going to get a lot lot worse. anyone interested to know more should google "veneroso second wave" and read the first two results.

  • Comment number 25.



    The only logical way ahead is to cut the welfare and bureaucratic overhead. I have been saying for a long time that bureaucracy has become an unaffordable waste of resources.

    But don't expect logic to rule here. The likeliest thing that politicians and bureaucrats - and voters - will try to do is to keep the system going by imposing ever-higher taxes on the private sector.

    The goose may get strangled in the chase after ever fewer golden eggs.

  • Comment number 26.

    Hopefully there will be a revolution and the people will overthrow the privately owned central banks (the Fed, the ECB and IMF) for creating this illusion of wealth.

    Then perhaps we will all start to listen to the Austrian School Economists!

    Note to Robert:
    Please make some contacts at the Mises institute, they have predicted this mess for years and years and nobody listened. It is high time that the financial press took note!

    You can get in touch with Lew Rockwell:

    I'm sure he would make time for you!

    Then perhaps you can talk about the bill to end the Federal reserve:
    "Congressman Ron Paul introduces HR2755 - Abolition of the Federal Reserve Board and repeal of Federal Reserve Act of 1913"

    Instead of covering the smoke an mirrors of this flawed and ineffective bailout plan.

    The US and UK economies of consumption, and fictional wealth generated by the banks is coming to an abrupt end. It is high time we restart our economies to produce more and consume less, with a sound monetary system.

  • Comment number 27.

    just goes to show that the 'sub prime' housing market which is being blamed for absolutely everything is only a bit player in this whole debacle

  • Comment number 28.

    Anyone on here think its Ironic that the safest place for money is in property? Bricks and mortar cement (excuse the pun) your place on the greasy pole.

  • Comment number 29.

    The following questions have been raised several times but NO ANSWER.

    1. Why can't Wholesale market simply be bypassed. BOE lend money to retail Banks on proviso a fair proportion is lent to House purchasers and businesses. There is then no need for this lack of confidence between banks rubbish.

    2. Why don't 'strong' banks simply publish their current assets / liabilities and exposure to risky loans? They would then be very safe, the dodgy ones wouldn't publish, so everyone would know who they are and they might go to wall or be subject to takeover.

    A big problem is that people in Wall st, The Stock Exchange, Banking and Government and major investors KNOW the situation. This is kept from smaller shareholders who can lose everything. Any Executive who says BANK is SAFE (Bradford and Bingley / HBOS?) should be jailed for false utterances as they clearly knew the bank was NOT safe.

  • Comment number 30.

    Dear Robert
    The fact is this is the first honest remark he has made, where are the life boats, a true fact is, when America passes this bill,NO MONEY will be leaving its shores, so we'll all be in the same boat, whose going to bail us out then Britain is already Bankrupt under Labour, and PFI is begining to bite into local authorities fianace

  • Comment number 31.


    Brilliant post. I hope RP passes this on to GB!

  • Comment number 32.

    Further to my earlier post, isn't it actually the monolines who will cop it for the Bond defaults? And if the resulting payouts damage the monolines' own credit ratings, this could undermine the remainder of the Bonds market

  • Comment number 33.

    Good points Robert, we won't know the true extent of the mess until the end of October.

  • Comment number 34.

    A question for RP and other bloggers: Rather than an unfair bailout, wouldn't it be better to get financial institutions to renegotiate their mortgages with 'subprimers'? Then repayments continue and people don't lose their houses. This is what usually happens when countries can't pay their debts.

  • Comment number 35.

    Hands up who thinks this so-called crisis is hilarious? ME! I care not a jot about losses to investors who have made money on trading money, or the City lackeys who grow fat on selling money to each other. I feel sorry for hard working people who may be thrown out of work because of banker's incompetence, but that's it. As for the bankers and dealers who hopefully have lost their jobs - good. Get a proper job instead. I recall when Thatcher threw out of work tens of thousands from inductries like steel and coal - and the City investors welcomed it as clearing out dead wood. Well, now we are clearing out the financial sector dead wood, and investors losing money are learning the meaning of the fine print - the value of investmenst may go down as well as up. It's sickening so many come carping to the Govt DEMANDING a handout. Typical selfish, greedy capitalists.

  • Comment number 36.


    And what would have happened in the 70's if the IMF told us to bugger off?

    We are already bankrupt, your about to find out too.

    Labour spent the lot.

  • Comment number 37.

    #17 - you are right, tere is zilch chance of the UK Govt going 'bust' - or US. they have been known to inflate their way out of the odd problem though, that has much the same effect for a Bond holder

  • Comment number 38.

    Sounds like were in for a bumpy ride. You make some good points Robert, all this hoohaa about the US bailout is just a side issue. Somewhere along the line 'reality' will enter the market, and this means letting those companies that have screwed-up go to the wall. These CDSs are pretty weird 'products'. I don't pretend to fully understand these financial 'products', but hey! that just means I know about as much about them as the bankers who invented them. We truly are in a mess.

  • Comment number 39.


    I cannot comment of Mervyn Kings performance simply because I don't know the full details.

    I think it a bit rash for people to keep critising the Bank of England unless they have the full details of all sides.

    My guess is there is a hell of a lot more to Mr King being cautious than meets speculation or casual critcism.

  • Comment number 40.

    It is great to have someone like Robert Peston who makes the facts and the situation so clear.
    Thanks Robert for a great blogg.

  • Comment number 41.

    RE: 17 jdennis_99

    "The UK Government is has the longest continuous credit record in the world, and has NEVER even DEFAULTED on any loan payment. That's why Gilts are regarded as so safe."

    Are you sure about that? My understanding is that the USA extended huge loans to the UK towards the end of the First World War and the UK subsequently defaulted on the repayments. That had consequences in the early part of the Second World War when the USA required cash-on-delivery precisely because of the UK's previous failure to pay it's debts.

  • Comment number 42.

    Rather than an unfair bailout, wouldn't it be better to get financial institutions to renegotiate their mortgages with 'subprimers'? Then repayments continue and people don't lose their houses. This is what usually happens when countries can't pay their debts.

  • Comment number 43.

    Here's a little snippet of info that helps show just how stupidly optomistic (insane as Mr P. put it yesterday) the markets are at the moment. JP Morgan have put out a note regarding the next wave of asset writedowns this autumn. In no particular order:

    Lloyds £4.5billion
    Deutsche £3.6billion
    UBS £2.1billion
    Barclays £2.9billion
    Soc. Gen. £2.1billion

    The intresting one there is ofcourse Lloyds. Just how are they going to afford that HBOS take-over if they keep taking hits like that? Borrow the money?

  • Comment number 44.

    This is now the real crisis. CDOs caused all the mess up till now - CDS - about $54 trillion of them are why there is no chance of getting the banks to loan to each other. It is human nature to want to do something to fix a problem but when the problem is not fully understood there is no chance of fixing it. CDSs now account for the equivilent of the whole world's Gross Domestic Product - they were unheard of 10 years ago - this looks like a bubble to dwarf the housing bubble that it was built upon. Not only will our children live their lives in serfdom, but also our grandchildren and great-grandchildren - the money still exists, it hasn't disappeared - it sits in the pockets of the very wealthy bankers who like whores sit crying on our shoulders asking for expensive gifts and trinkets to make them feel better. Let us not give it to them. Let us rather shake the money out of their purses and give it back to the system that needs it to save the futures of our kin folk!!

  • Comment number 45.


    You raise some extremely pertinent questions, and the lack of answers is worrying.

    The sub-prime bomb detonated more than a year ago now, so one would think that there has been sufficient time in which to identify the scale, nature and location of the toxic assets.

    It is interesting to contrast, against the general slump in the bank sector, the robust share price performances of a small number of super-robust banks. The BBC website pointed this out this morning.

    It may be, of course, that Paulson, et al, do know this information, and have calibrated the rescue plan accordingly?

  • Comment number 46.

    #9 BankRSlicker

    Googling 'Money As Debt' threw up some very interesting links.

    Here's a good article discussing the issues raised.

    We may well be all doomed!

  • Comment number 47.

    It was apparent with the first push for a so called bail-out bill in the US they were desperate to get if thru before the end of quarter. You go home at the weekend if you can. Target missed, in part it would seem due to Nancy Pelosi showboating and Bush not keeping the troops in line, next stage entered. The second attempt looks as if it will go thru now but too late to save carnage which could have been avoided. Not that there will not be carnage anyway, but some could have been avoided.

    Fear remains the driving force alround in this. The US bill was never meant to sort everything, it was keeping the boat afloat and get to habour. For those who say let the boat sink the problem is insufficient lifeboats. The longer it goes on the higher the fear has to get. It is very very simple.

    It is interesting that MandS are already feeling it. They usually do, they did at the start of the nineties. They are an early warning.

    For those who do not understand, and many still do not seem to understand, what happens to a private sector business when credit dries up in the system - it is very simple. Business is based on trust and without trust business does not occur. When somebody asks you to do or supply something for them and then does not pay, or pays so late it damages you, then you stop or reduce dealing with them. This situation also leads to a demand for payment up front which takes yet more money out of the supply system reducing the efficiency of the economy. Many supply chains in practice rely on the end of the chain being funded by the links. Those at the end of the chain therefore do not have the funds to pay pro forma, such capability having been reduced by the competition model to the benefit of consumers.

    Far from learning from the events that resulted in New Labour being elected in the nineties Brown seems to be heading for a yet more perfect storm which can only damage the economy. The Brown experience will be highly unpalatable. Consumers had better get used to paying more for almost everything.

  • Comment number 48.

    I think CDS losses may lead to a crisis in the hedge fund industry (which used CDS to take highly leveraged net long credit positions).

    I don't think the CDS losses will lead directly to major problems at the banks (but a collapse in one or two hedge funds would cause real problems for some banks, per LTCM). Although the banks do write the vast bulk of these contracts, they are very careful to maintain almost zero net exposure to the underlying credit risk, and their counterparty exposures are fully cash collateralised on a daily mark-to-market basis.

    However, if hedge funds are faced with big payouts (and, equally importantly, big margin calls) on these CDS contracts, they will suffer a liquidity crisis. Hedge funds are also heavily leveraged (like banks, but without the deposit guarantee), so a run on them has to be a big risk now.

  • Comment number 49.

    RE #17

    "The UK Government is has the longest continuous credit record in the world, and has NEVER even DEFAULTED on any loan payment. That's why Gilts are regarded as so safe."

    SO READ THIS on the state of the western worlds finances.......

    "That possibility is still deemed to be quite low. But the ultimate financial question – until recently, unthinkable – is now being asked. Yes siree, the mighty US government could default. That’s how much the world has changed. (Daily Telegraph 20th Sept)"

    Now If it is now possible for the might US please dont be Niave enough to belief that our small economy could ride it out.

    Scaremongering no - fact yes - western world government debt is out of control and now we're just about to add trillions too it

  • Comment number 50.

    Guarantee all deposits. This is becoming a competition between economies. Once one country (Ireland) sets itself up as a safe haven, it draws in liquidity from everyone else, but in this case particularly the UK. By doing the same, UK will not only reverse the flow to Ireland, but draw in liquidity from other countries. The only logical outcome is that most countries will end up doing the same. The risk then shifts back to credit, where it belongs. The CDS market may be a time bomb, but transferring risk to depositors will simply accelerate the withdrawal of liquidity and set it off sooner.

  • Comment number 51.

    #34 - there are umpteen other ways they could use the money - by investing in the Banks in return for new shares - as many have pointed out - by buying existing shares, buying repossessed or unsold houses, thus addressing the original source of the problem, loaning the money to productive companies, capitalising a new 'good' bank(s) etc etc

  • Comment number 52.

    If fraudsters nick money and commit fraud and go and live on the 'Costa del Crime', their bank accounts can be frozen and the assets recovered.

    Maybe we should go after the Stan O'Neals of this world and hoover up the millions from their bank accounts to help pay for some of this clean up....

  • Comment number 53.

    I am Irish, but have lived in Scotland most of my life.I have my money in the RBS and I don't think I'll move it. Am I being stereotypically stupid?

  • Comment number 54.

    Is this Gordon Brown that is worried about the competitive implications of the Irish bank guarantee.....

    Not the same Gordon Brown that

    1. nationalised Northern Rock and allowed it to hoover up deposits at competitive rates from its branch in Dublin with a 100% guarantee from the UK taxpayer


  • Comment number 55.

    Is this Gordon Brown that is worried about the competitive implications of the Irish bank guarantee.....

    not the same Gordon Brown that

    1. nationalised Northern Rock and allowed it to hoover up deposits at competitive rates from its branch in Dublin with a 100% guarantee from the UK taxpayer

    2. oversaw a bank run across the Irish Sea that provided a powerful demonstration effect for Irish savers.

    Ho Hum. Hypocrisy doesnt begin to describe it.

  • Comment number 56.


    While I appreciate your point - the State has needed help along the way - we're still a long way from bankruptcy.

    Of course, Labour have hardly done anything to ease the situation - they've been spending money like it's going out of fashion, and now we don't have anything left. The easiest way to get out of this mess would be to ease fiscal policy as well as monetary, but there's no free cash - thanks to Gordon.

    My point is, the State has endured greater trials than this, and it will endure this. Yes, we might need some help. Things may not be the same afterwards. But talk about doom and gloom and the sky falling in won't help to restore confidence in the system - and it is that loss of confidence which is damaging it more than anything else.

  • Comment number 57.

    Credit Default Swaps aren't the elephant in the room. They are the monkeys in the parlour. The elephant in the room is our current financial system, fractional reserve banking, or whatever you would like to call it.

    Soon the monkeys are coming into the room where the elephant is.

    We are in totally uncharted territory and nobody can begin to imagine what will really be the outcome.

    It is helpful to discuss the possible scenarios here though. Thank you Robert. Shame you don't read any of the comments!

    P.S. I think you said "of" when you meant "or" in line two of worrying symptom 5. I like that. It shows you are human like the rest of us.

  • Comment number 58.

    #41 - I believe the repayments were 'renegotiated'. We missed a month or two on our repayment of the 1946/47 US Loan too - the final installment was made last year I recall.

  • Comment number 59.

    It is not only the financial institutions and large corporations who are suffering because the banks are sitting on cash. One bank has been sitting on £1000 destined for my account for several days while the sale of a buy-to-let property I own has been delayed for two weeks to date because the bank providing my purchaser's mortgage has also been sitting on its hands. The cost to me and my purchaser has been considerable. My solicitor tells me that he has seen several examples, where house sales are being held up for this reason. My purchaser tells me that the bank is now refusing to answer her phone calls enquiring after progress and insisting that she visits the bank in person. As she has a busy job, this is extremely difficult!

  • Comment number 60.


    what makes you think everyone wants the interbank working again?

    Under no circumstances should we try and continue the facade that has engulfed us in the last 15 years, or even 60 years.

    You mention Victorian values - newsflash but not everyone has a new car, owns a house, eats out 3 times a week - in fact a lot of people are used to living in their means, which is frugally, and that number is becoming greater by the day.

    Let the false debt lifestyle die. It's about time people returned to an even footing, no matter how painful that may be.

  • Comment number 61.

    What I see as being really scary is the sheer inability of the U.S economy to sort itself out.
    $700 Billion of new government debt at a time when the U.S government is already so overwhelmingly endebted was not enough.
    Now we have tax payer tax cuts and other tax concessions for small buisnesses.
    So, at a time of increasing the demand on the tax payers, they are actually reducing their demands on the tax payers. It seems the solution to a debt bubble is ... more debt.

    It is clear that the U.S Government has no idea how on Earth it is going to repay this debt. It has no idea when it will repay this debt, in short it can only be concluded it does not plan to repay this debt.

    With this debt and all these toxic assets carefully stuffed into the naughty corner, they are going to inflate it away.

    This will panick international holders of these debt obligations and their will be a run on the U.S dollar.

    The linkage between U.S dollar and Oil will be lost because of devaluation, and from that point on the U.S dollar will be lost.

  • Comment number 62.

    Why the change to the title of the blog?

    I'm sure it was orginally 'Where Might The Next Problem Come From' (or very similar) - was that not quite scaremongering enough so we've changed to 'Smack Smack - We're Dead' just in case anyone didn't get the point???

  • Comment number 63.

    Only the banks themselves know what exposure they have to toxic CDS such as Lehman's.
    And if they are not forthcoming with that information should Mervyn King be blamed for not being warm hearted? Of course not.

  • Comment number 64.


    Glad you pointed out the way in which banks match their positions. So many commentators use gross numbers - which make for nice scary headlines - and forget that netting-off is huge. This calculation is key to the calibration of the Paulson plan, I think.

    Put simply, I owe you some money that I can't repay; you owe me a similar sum that you can't repay either; we agree to write both off. Net result nil, or maybe a small loss if one owed more than the other.

    You are quite right about hedge funds. I think private equity is in deep trouble as well. (It always amounted to buying companies with their own money, and abritraging the post-tax interest/divided spread in a market that underpriced risk and liked leverage. I've long argued for either (a) giving tax relief on dividends, or (b) removing it from interest, in order to create a level playing field and removing a structural incentive to leverage).

    What we are seeing is the crash of all models that are at the 'not-netted-off', imbalanced end of the debt bubble. Hedge funds, private equity and, in the housing market, BTL - these are the most indebted areas on a netted-off basis. It won't be nice, but I don't think it's the end of the world as we know it.

    Some banks may even emerge stronger from this process.

  • Comment number 65.

    The buck will have to stop soon!

    The CDS quagmire is going to be the final precipitating factor in the downfall of many banks, people, societies and economies.

    Just google for plenty of commentators predictions abut this crisis that stems from CDS and derivatives. I have been reading them for at least 3 years!!!

    They are not wrong! The whole world is leveraged against these things and it's going to be a hard, horrible. 'hairy' fall!!

    The Army will be on the streets!

  • Comment number 66.

    The banks, the banks are on fire,
    We don't need no banks,
    Let the {rude words} burn,
    Burn {rude words}, Burn {rude words}

    We all need to learn to live within our means.

    Always remember this saying: "Let me issue and control a nation's money supply and I care not who makes its laws." -- Mayer Amschel Rothschild, Founder of Rothschild

    Educate yourselves. Knowledge is power.

  • Comment number 67.

    A CDS is like an insurance contract, a potential liability, not an existing one until the underlying credit is in default or similar. A rapid escalation in eg. bond defaults means a large number of CDS contracts need to be paid out, sometimes the amount is larger than the value of the underlying credit itself. However, they are a zero sum game. Hence, if the CDS contracts are "spread evenly" then you would expect the impact of defaults to be dampened as the pain is spread more widely. However, if there are concentrations (and no one knows where they are), what starts as defaults in credit sets of more bombs left right and centre, as CDS insurers suddenly incur a big liability that they may not be able to pay out, they themselves default, and on and on it goes.

    The only thing worse than this scenario, is an acceleration of defaults due to further withdrawal of liquidity as everyone rushes to put their money into Bank of Ireland. I think Bernanke once talked about dropping money from helicopters to prevent a liquidity crisis. Well this is the time to do it, tuck all depositors back into bed with a nice cushy guarantee, crank up that rotor and get started. I want to hear some Wagner.

  • Comment number 68.

    Re 48

    It has been very interesting from the word go. Perhaps interesting is the wrong word, there is a chinese curse - to live in interesting times - nevertheless, interesting. The Paulson crew behavior is very telling from the start. They let LB go when it could have been propped. It told you it was small beer. LB small beer. Stepped in for AIG because of damage seepage but there was no real gameplan revealed, AIG intervention seemed almost casual, buy a bit more time. Looked as though someting bigger was underway. Then up pops the 700 billion dollar plan. Now if that is a firebreak attempt in aforest fire it tells you it is one mother of all fires and it is still going.

  • Comment number 69.

    It seems we have slipped into the pit of madness. No-one cares anymore.
    I saw a quote on the ITV news last night from a House of Representatives member who was explaining his voters opinions - encapsulated in this phrase.
    "I don't mind being in a bread line - as long as there are tycoons and bankers alongside me"
    I completely agree.

    See you all on the breadline folks

  • Comment number 70.

    What in the hell is happening: International Swaps and Derivatives Association (ISDA) is now the auctioneer or the de-facto adjudicator of the values of the toxic assets?

    ISDA's greatest achievement is establishment of the the ISDA standard agreement between counterparties of a swap deal. Thus permitting a whole gaggle of supposedly educated and informed but definetly clueless banks to engage in derivatives trading. Then these banks turn around and produced another agreement a more onerous one for their retail customers.

    I think the pawn dealers auction in my country is a more transparent and efficient one. There is something wrong with a country that abdicates its duty of maintaining financial probity to an association whose primary interest to promote the derivatives market. The market that cause us so much mess.

  • Comment number 71.

    "PS. The most significant British corporate announcement today was that Marks and Spencer is slashing capital spending, It was planning to spend up to £900m this year on improving stores, its supply chain and computer systems. That's being reduced to £700m - and next year it'll be slashed to £400m.

    In other words, M and S will be placing far fewer orders than planned with other businesses - which will have a damaging impact on their profits and on the prospects for their employees.

    That's a graphic illustration of how the horrors of the financial economy are infecting the real economy.

    In my view, this is a muddle-headed way of looking at things. How wrong is the concept that the last few years has seen the real economy adapting to changing circumstances independently of the developments in the financial sector? It's completely wrong.

    A great part of the structure of the real economy has been determined by what has been happening in the financial markets. The bubble of unearned prosperity has been the stimulus for the creation and expansion of entire industries - industries for whose products there is minimal demand other than in a bubble. How can this distortion of demand be eradicated without causing major dislocation in the industries that supplied it?

    So I'd say it's ridiculous to present the idea that Main Street is in a state of sustainable equilibrium, and that there is a way that this can be left largely untroubled if the right measures are taken to deal with the problems of the financial sector.

  • Comment number 72.

    Another reason the $700m bailout could be a poisoned chalice.

    Certain banks have been wildly optimistic in writing down their toxic assets. When they come to sell them to the US Treasury they will no doubt receive far less cash than the book value stated on the balance sheet.

    This bring to light further massive losses that some of our most venerable banks would rather keep hidden

  • Comment number 73.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 74.

    Has anybody noticed that while the Stock Exchanges throughout the world have fallen during the last 2 days, the LSE has continued to make gains. Who says there is no confidence in Gordon Brown and Alastair Darling's handling of this crisis. It's about keeping your head whilst all around are losing theirs, and being men, not chickens.

  • Comment number 75.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 76.

    I could not disagree more. You cannot keep throwing money at a heroin addict and expect him to quietly go along to rehab all on his own.

  • Comment number 77.


    As I understand it, the UK Government has never defaulted on a loan payment. It has occasionally changed the terms of the repayment, but it has never actually defaulted.


    So, there's a chance that we *might* default on a loan payment? Yes, there is. But there's a big difference between defaulting on a payment and going bankrupt!

    Bankruptcy is the worst case scenario - it is total economic collapse resulting in total anarchy. Zimbabwe has inflation in excess of 1,000,000% a year, but the country hasn't bankrupted itself! Ours is running at about 4.5%, so I reckon we've got a fair way to go.

    The State is not going to collapse in on itself - we might end up with high taxes, cuts in public spending, high inflation, high interest rates, wage freezes and high unemployment, though.

  • Comment number 78.

    Here is an explanation of where it all went wrong.
    The media hype about the city being full of intelligent and clever people is COMPLETELY WRONG.
    I heard Boris Johnson saying recently that we shouldn't tax the city because we will 'drive away the talent'.
    Well having worked here for 5 years now, I can assure you that this talent does not exist. There are a handful of extremely clever people, the strategists and mathemeticians - but these are surrounded by hordes of incompetents who cannot do simple maths and whose knowledge of the markets is limited to pressing a button when the screen turns red.

  • Comment number 79.

    I suggest the House of Representatives make one more change to the $750bn rescue package. All applications need to made in person to a new facility to a toxic loan readjustment facility, based in newly decorated Guantanamo Bay.

    Explain something to me.

    So big broke bank (BB) was due to pay $xxxm on a CDS due to sub prime losses.

    One assumes the not yet broke bank (NYBB) not only was owed this, but was also due to pay $xxxm to the broke bank, a CDS on some other set of bad loans.

    I guess these will be netted off and NYBB could end up with what exactly? It is not covered on one CDS contract but does not have to pay the other. It reinsures itself but the does not have to pay the BB CDS.

    If I am owed $1tr of toxic loans and I owe a $1tr of toxic loans, why not just tear them both up?

    As long as the 'risk department' ensured they sold as much bad debt as they bought they just need to get in a room with their peers and start shredding, an equal amount of what they have bought and sold.

    I guess Netting toxic loans results in the $750bn hole. There is not one radioactive baby but lots of them but they cancel each other out hence the small amount!

    It is a good bet that once you get hold of these CDS docs, we will get to see our heroes buying and selling these toxic loans to one another.

    Robert - thank you for the service

  • Comment number 80.

    25 quoted "The only logical way ahead is to cut the welfare and bureaucratic overhead. I have been saying for a long time that bureaucracy has become an unaffordable waste of resources."

    great, just when we are about to dump thousands more people on to the dole, we stop giving them benefits to live on. CONSEQUENCE - IMMEDIATE RISE IN CRIME of just about every kind! No doubt you'll be okay in your fortress with your armed guards and two years supply of food and water, or perhaps you dont think that starving freezing people will try to anywat at all to live!

    This is a big problem and I dont know what the answer is, but I'm sure it isn't to let people starve.

  • Comment number 81.

    ...and, in other news, the stock market continued to rise today (up 1.5% at 12pm on 2nd October)!

    Yes, we currently live in volatile times. But, let's not get carried away with the scare-mongering, Robert!

    Also, interesting to see how the stock market snap-shot information is no longer posted on the front page of the BBC website, as it has been temporarily over the past few days. Presumably "boring" news such as a stock market rise in the current climate doesn't fit with the agenda of crisis that our oh-so-impartial journalists are perpetuating?

    Cynical? Moi?

  • Comment number 82.

    So basically Mr Peston, you are saying because of the panic being generated, the "general public" whoever they are, are moving their money around because of fear and greed amounting to an exacerbation of the problem. Your analysis that some analysts are good at prediction, well some are and most aren't. Bears and Bulls and Capitalism unleashed tell you that. On the stock market there is a general trend down but it's easing off, so this CDS business will just be the little push down to the bottom, reached maybe summer next year. You mentioned some warnings and that is true there have been mini crises over the last few years. Those who have mentioned Asian economies I assume you refer to China and India as Japan and S Korea probably will suffer too. The problem is we can talk ourselves into problems. Generally if you panic (a lot of it is going round) you don't think clearly and get yourself into a muddle. More people need to stay calm and then may be ok. I think Mr King is right not to be sympathetic. It's not like we haven't seen this kind of underestimation of risk and profiteering before now is it.

  • Comment number 83.

    Now is the time to shout "Don't Panic".

    If you have less than £35,000 in any British Bank then you are fully protected. IF the small investors realise that, and most of the deposits are less than £35,000, then the potential flight to Ireland/Northern Rock/NSI is pointless.

    It is rather like running to the fire escape when there is no fire. People get unnecessarily hurt in the rush.

  • Comment number 84.

    please could someone explain what is likely to happen to holders of HBOS preference shares if the takeover goes ahead.Help !

  • Comment number 85.

    On the ''bail-out'', there will definitely be more concessions to be wrung out. Some might think $700 billion is cheap, but certainly it's no the time for the politicians to bow to peer pressure.
    Indeed, it was interesting to see in B Obama's address, when he mentioned this, the audience started chanting, ''No NO!!''.
    then, when he said he was supporting the bill, they quickly went quiet.

    I suppose that's what one would expect from sheep.

    Another game of bluff and turn, on the HOR(ROR)(Rescue or Riot) show, anyone??
    The fact is, that although the markets dived, they have somewhat rebounded.

    Clearly showing that there is plenty of money around. Ask Warren Buffet.Hardly the end of the world.

  • Comment number 86.

    I can only give a real life example of how the "Crunch" is moving down to " Main St" here in Manchester. My local, open all hours corner shop, is down about £300 a day on turnover.

    Add to that the fact that all building projects have been frozen in a City which has been virtually rebuilt over the last ten years.( and is full of builders looking for work)

    The CDS auction may look scary for the future but there are other real world things that look as scary and they are here now.

  • Comment number 87.

    The time has surely come to separate the retail and wholesale banking sectors. The ordinary man on the Clapham omnibus needs a bank account, and so that becomes something he ought to have for free, separated from all risk. As the banks have behaved disgracefully, taking his safe, secure cash and putting it on the banking equivalent of the 2.30 at Cheltenham, and now want to charge him heavily for the privilege into the bargain, simply to keep themselves in the style of bonuses to which, like pigs in clover, they have become accustomed, so it becomes total nonsense to talk about guarantees, competition, and the like.
    It's become evident to the world and his wife that if the banks don't trust each other, why should they, and so they've have given up on the lot them and are voting with their feet, headed to NR and NSI, and all the better for it. It's time HMG blew time on the retail sector and gave everyone a free account with basic facilities such as debit cards, cheques and cheque guarantee cards. No overdraft, no complicated facilities, 100% guarantee, base rate, just the basic - but it would show proactivity and deliver a very strong message to the banks that they've got a baseline to compete against.

  • Comment number 88.

    i think supporters of the "fractional reserve banking" thesis are barking up the wrong tree.

    firstly, why is gold any more intrinsically valuable than e.g. the us dollar? the value of money is the public's confidence in it as a widely accepted unit of value. that confidence stems from its scarcity value. gold's scarcity is ensured by mother nature (though it is interesting to note the great gold inflation of the 17th century fuelled by the conquistadors). the dollar's scarcity value is ensured by a central bank making a credible vow to minimise inflation.

    the fractional reserve banking argument focuses on reserve ratios, but i think the real issue is capital adequacy. consider a simplified bank balance sheet:


    loans: 91
    cash: 9


    deposits: 81
    equity: 19

    the reserve ratio is deposits / cash. it basically measures the bank's ability to deal with withdrawals. loans cannot be liquidated in a hurry, which is why a run on a bank is so catastrophic. but bank runs are a symptom of the loss of confidence, not the cause. provided a bank behaves sensibly and retains confidence, there is no reason why it should retain all deposits in cash balances and not lend any of it out.

    the capital adequacy ratio is loans / equity. in this equation "equity" means the book value (the sum of original equity investments + retained earnings) not the current market cap of the bank. it measures the ability of the bank to take losses while still meeting its debts (i.e. depositor claims).

    the problem in the current crisis is excessive lending, i.e. insufficient capital adequacy. total credit in the usa has ballooned to 350% of gdp. banks made very risky loans and classified them as less risky. loans were repackaged and taken "off balance sheet" via spvs, only to be brought back on balance sheet when those spvs ran into funding difficulties. and a lot of entities, especially hedge fudns, have acted as proxy banks, adding to systemic leverage.

    the result is that the losses in the sub-prime sector, losses that should normally be manageable, have led to a serious depletion of bank capital and have sparked off a potentially catastrophic deleveraging process due to loss of confidence by lenders as to where the losses will crystalise. what is urgently needed to stop this crisis is a recapitalisation of banks by the state (something that the paulson plan only makes a half-hearted effort at).

    the "money-as-debt" thesis makes two claims:

    (1) debt is needed in society to "create" money. without debt, there is a collapse in the money supply. put simply, if i deposit £100 with my bank, and the bank then onlends this to someone else who then deposits it with their bank, both i and that borrower thinks they own £100, so the money supply has doubled to £200. but what are we really saying here? only that banks have increased the money supply to meet the need of the economy. if that borrower repays his debt, and nobody else wants to borrow that money, the supply reduces back to £100 again. so what? on the other hand, if the bank were prohibitted from lending out the £100, then there really would be a shortage in the money supply.

    (2) debt incurs interest, but there is not enough money supply to meet the interest repayments. this is simply not true. the base money supply (i.e. the printing press at the bank of england) is used to increase the money supply in line with the growing needs of the economy. this point regarding interest rates is a good argument for taking a currency off the gold standard. because the gold supply is limited, it would only be possible to maintain parity of a currency with gold if the currency experienced negative inflation that offset the growing demand for money in the economy. as keynes pointed out, negative inflation is a very bad thing. so the solution is to scrap the gold standard and have a credible central bank committed to minimising inflation.

  • Comment number 89.

    Once the cAAAndyfloss economic system colapses the stick holder will decide matters buy putting a new taeser rated loan on the end of it .

    BZZZZT .....BZZZZT I'LL PAY ,I''LL PAY,How about a pound of flesh as deposit

    Once the ponzi sceme based on the dollar colapses power will drift to the East and as a new dawn comes from the East so shall the son of man

  • Comment number 90.

    Well, nothing lasts forever. Are we witnessing the beginning of the end of globalisation as we know it? I truly believe so.

  • Comment number 91.

    Everday the unexpected happens and the chaos grows. These are the classic circumstances that normally precede a catastrophic occurence. Without real leadership it is hard to turn these events around, someone really needs to take on that mantle soon. Cautiously worded half statements by Mr Brown on Guarantees is not showing leadership, not vote winning habits. We need good news to build confidence on and GB gauranteeing deposits is inevitable now, so why not come out and say it?

    Great update today Robert...thanks

  • Comment number 92.

    How ironic!

    I have just realised I was listening to 'I predict a Riot' from the Employment album by the Kaiser Chiefs as I have been reading this!

    Hmmm.....there will be one, not much of the other and the latter have got us into this!!!

  • Comment number 93.

    Here goes Peston again-the master of doom and gloom!, get rid of this clown now before he talks all of us into slashing our wrists.
    Were doooomed i tell ye.

  • Comment number 94.

    A free market solution;

    Let those institutions that have lent and borrowed recklessly go under.

    The current troubles are surely fertile territory for many small building societies and banks to start up,. Begin with a concrete business model that doesn't include mark to market valuations and complicated financial deals that no one can understand, that is designed from the outset to withstand a poor economy rather than just make off like bandits in the good times.

    From many little acorns a few mighty oaks might one day grow through sound business sense and normal consolidations.

  • Comment number 95.

    Re 64

    hello freindlycard

    To me it is not about whether the system stays and mutates to a new level or if it is repalced by another system. It is all about management of the transition. It looks like a binge patient who needs a stomach pump at the moment. If you do nothing the patient dies of toxic load. Intervene, detox, re educate, ASBO, make the patient pay for the hospital bill and party etc, get him out working for you. Easier than starting from the Stone Age again which some seem to be what some want. The biggest problem is political, the percentage who do not want intervention and who have to let the fear message build, its an inbuilt overshoot. Emotions are dangerous when mixed with money.

  • Comment number 96.


    Very good article once again.
    You mention the Rep of Ireland pledging to guarantee all deposits and loans of the 6 largest Irish Banks. What a desperate gamble that government has taken with a 400 Euros backed by an economy of half that size !
    At least one major credit rating agency is looking to downgrade that credit level of the Republic following that huge national gamble.
    People should be now careful not only about which bank they should their money with but also which government!
    I am afraid that there are a number of small countries with overly large banks which could bankrupt their governments. It is not a question of too big to fail but too big too save !!

  • Comment number 97.

    excellent comment from ExcellenceFirst @ 71, as usual

  • Comment number 98.


    I would like to see less drama nd more balance in your reporting both live and in this blog.

    You do the BBC harm by 'playing up' events, no matter how serious they are.

  • Comment number 99.

    #48 You are correct - up to a point. The big problem with bank failures is that whilst internally they may be hedged on their trading of derivatives (i.e. Bank A enters into a forward purchase at $1 with Bank B, and a forward sale at $1.02 with Bank C), once Bank A collapses, the hedging is irrelevant. The contracts, whilst they are economically linked, are not legally linked, so Bank A's profit on one contract will not pay for the loss on the other. It goes into a big pot marked 'secured creditors'. And whilst margin payments may be made with regularity, there can be huge uncollateralised obligations out there. Its often forgotten that Leeson made margin payments of hundreds of millions of dollars prior to Barings collapsing.

    Therefore, the big question is 'whose profit is derived from a trade with a bank that is collapsing', and so who might have to make up that profit, and pay money to their hedging transaction, out of their own pockets?

  • Comment number 100.

    Mr you ever consider for a moment what escalating your language does? I have now made a conscious decision not to read your screaming, slightly hysterical headlines
    There is no balance, just more 'shock horror'......yep there is a credit is going to be very hard...but guess what? People got through the great war and rebuilt, they got through 1929, 1945, the 1970's and 87 and even 9/11. Eventually, just to preserve sanity , your readers and followers will have had enough...I have. I do not pay my licence fee to have you being the voice of doom for over half the news broadcast. For self preservation the mind switches out. Perhaps you should consider a 'how we will get through this' approach and I might read and watch you again. Till then my finger will be on the off button when you appear on my screen because you are not telling me anything I don't already know and really don't want to hear again and again.


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