Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
In theory you're right, Ross, but if a bank went bankrupt, the people who have money in that bank will lose it!
That includes the companies that have money with the bank, they'd all lose their money, and millions of people could go bankrupt overnight, and lose their job too.
Hence, the best idea is for the State to have a strict regulation on banks, to make sure they do not overstep the mark, and to reduce the "almighty" sheen of the top-bankers, starting with their binuses.
Ross Miller
- Location: London Road, Dover
- Registered: 17 Sep 2008
- Posts: 3,706
No Alex - the answer in a capitalist system is to have some form of compensation scheme funded from a small profits levy on banks and/or some form of transaction tax that would then compensate depositors if a bank were to fail, this could even be state backed.
"Dream as if you'll live forever. Live as if you'll die today." - James Dean
"Being deeply loved by someone gives you strength,
While loving someone deeply gives you courage" - Laozi
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Ross, if one bank fell, that system you mention could work.
But in 2008, many banks in many countries were falling simultaneously. Britain was only hours away from having empty cash machines.
No compensation scheme could have prevented the total collapse of the economy that threatened half the world in that year.
One of Britain's biggest economic errors was, and to an extent still is, being the world banker, and lending money out all over the world.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Reg - #39, come off it. You really are living in a dream world if you believe that.
The banks were not responsible for any of the following:
... Brown's profligate spending over 9 of the 13 years they were in power leading to a structural deficit spend from 2005 - the main and direct cause of the need for spending cuts.
... Setting the inflation brief for the Bank of England that led to interest rates being held down lower for longer than they should have done causing the housing and debt bubble.
... Changing banking regulation and in so doing reduced the level of oversight and, Brown himself, encouraging the banks to expand in the USA and elsewhere exposing them to massive credit risk. May I remind you that not all banks did what Brown urged and those did not, did not need a bail-out, except LLoyds who again on Brown's urging took over HBOS exposing themselves to that risk resulting in their bail-out.
... De-incentivising the savings market that has been a disaster for people combined with low interest rates it made the public more vulnerable in the downturn with higher borrowing.
... Robbing pension funds of £5bn a year and as a result encouraging more Buy to Let investing adding further pressure to the housing bubble.
I could go on further with this list of Brown cock-ups, gold etc...
The simple fact is that Gordon Brown was a disaster for the UK economy. The man claimed he had banned boom and bust (a bit like Canute claiming he could stop the tide from coming in) - the result, he ran the economy as if he really had and now we are paying for his errors.
Take off your blinkers Reg - your loyalty to the Labour brand is admirable, or at least it would be if you actually acknowledged the problems caused by Brown and tried to answer the specifics. For Labour to even be able to start to re-build credibility they must acknowledge their errors.
Guest 716- Registered: 9 Jun 2011
- Posts: 4,010
The World and his brother know the Banks,Investment Johnnies,Financial gamblers are responsible for the Global Finance crisis.
These people are not `Philanthropists` Self-gratification drives these people.
The US Government are sueing them purely for that reason.
The Bank Reform Bill is an attempt to control these gamblers
Twelve Percent off Bank Shares today.
This crisis has disrupted millions of livelyhoods.
To defend these parasites is difficult to understand.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Reg - nothing to say then about Brown's and the Labour Party's part in causing this crisis?
So carry on blaming the bankers, no-one is fooled. Perhaps you thought Brown has banned boom and bust too!!!
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Barry, if Brown, also known as Gordon on official documents, introduced something really silly, as you suggest, then many top bankers must have done a very silly thing by taking advantage of it.
They would have been wise to inform Mr G. Brown, even the larger cabinet, the Parliament, and the local press if need be, of any blatantly wrong regulation introduced by the said G. Brown, if they were not so silly, that is, rather than foolishly taking advantage of it and sending half the world banking system K.O.
Still, Barry, Mr. Brown's regulations might explain why bankers in the UK did silly things, but that still doesn't expkain why banks in so many other countries went bankrupt at the same time as many British banks did in 2008.
Surely, the saga goes beyond the sole G. Brown! He can't be solely responsible for what top bankers did.
Guest 645- Registered: 12 Mar 2008
- Posts: 4,463
Did Brown cause the banking crisis in the US and lead to Eire,Greece and Spains financial crisis? If so he wielded more influence than I thought possible by a British Chancellor.
Well done Gordon showing that Britain is still great
Marek
I think therefore I am (not a Tory supporter)
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Barry, I think your argumentation is falling apart, that bit about always using Brown to explain the banking crisis.
Brian Dixon
- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
marek,i like that one.you little devil you.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Alexander.... Marek...
Explain which of the issues I listed in #44 is incorrect.
The answer is none, all are perfectly factual. If you cannot appreciate the way those matters together created the depth and scope of the UK financial crisis then at fault is your understanding of economics and the English language.
What we have is a problem of a cyclical recession turned into a crisis by fiscal policies over 13 years and a foolish monetary policy all determined by Brown. Added to that is Brown's Mansion House speech encouraging the banks to take risks and the regulatory changes he introduced resulting in some banks being over exposed to a banking crisis as well, we really had this disaster of his making.
I do not blame Brown for the sovereign debt problems of some European countries or the USA, but his was part of that same idiotic spend, spend mentality.
I will credit him for doing one thing right - keeping us out of the Euro. Not bad for 13 years in the driving seat, one sensible thing done (or should that be one crazy thing avoided...)
Guest 645- Registered: 12 Mar 2008
- Posts: 4,463
Barry
I did not refer to your post 44# other than Brown causing the UKs current or past banking crisis ,which I did not challenge.
My knowledge of the English language and literature is fine ,thanks. A level and degree.
My knowledge of Economics is very limited although I do possess an ONC (Hons) in Economics, which I studied whilst in the service to make me better informed on the subject.
You have answered my question in post 48# in that Brown was NOT responsible for other EU members financial crisis or the one being experienced by the USA.
You should endeavour to read the posts more carefully before launching into an unmitigated attack on another forumites ability. Making assumptions is not good practice.
Keep to the known facts old chap.
Marek
I think therefore I am (not a Tory supporter)
Guest 698- Registered: 28 May 2010
- Posts: 8,664
Barry it would have taken a positive initiative to get us into the euro. You are crediting him with failure to do a positive.
I'm an optimist. But I'm an optimist who takes my raincoat - Harold Wilson
Guest 653- Registered: 13 Mar 2008
- Posts: 10,540
Not sure we would call it a positive - getting us into the Euro Peter.
Roger
Guest 698- Registered: 28 May 2010
- Posts: 8,664
Yes quite. What I meant was that it would have required positive action to bring it about. Thank goodness he sat on his hands.
I'm an optimist. But I'm an optimist who takes my raincoat - Harold Wilson
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
Barry, you may have misread my post 47, rather than not understanding my use of English, and economics for that matter.
If Gordon Brown, to use his full name, had introduced regulations in Britain that were disastrous for the British banking system, then those bankers who followed these regulations, or encouragements, if you like, must have been pretty reckless to do so.
As bankers, with knowledge in banking (and economics), they should have known better.
It's pretty pointless taking it out on another forumite's ability to perceive reality and express himself, as if I have to take the shame for the reckless policies of super-paid bankers who were too busy following what you describe as Mr. Brown's "profigate spending over 9 of the 13 years they were in power".
One can't just take everything sitting, you know!
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Now now Marek - that was not an attack on you as such, but on what you said. The fact remains that Brown was an unmitigated disaster for the UK over 13 years and the depth and length of the crisis as it affects the UK is entirely of his making. I have always made it clear where his responsibilities and many errors lay that created this situation.
Alexander - Some, repeat some, bankers did take Brown at his word and exploited the 1997 regulatory changes he introduced and it is correct to say that certain Chief Execs overstretched the resources of their bank and in so doing left them vulnerable when the cyclical turndown came along. But, regulation in financial services is there for a good reason because it stops banks, that are not 'normal' businesses from acting as 'normal businesses'. The removal of that regulation and the urging on of Brown was reckless to say the least. I have said before that I have a friend who was a bank Chief Exec who retired not long after Brown's regulatory changes came into force. He told me that every 3 months he had to take his top management team to the Bank of England to be grilled on every aspect of their bank's activities. The BoE had draconian powers over their activities at the time. After Brown changed the rules that all stopped overnight. No wonder the banking system went to hell in a handcart. Another important point he told me as well, he said that bank chief execs were increasingly being drafted in from business, rather than banking, so while they understood business they did not properly understand the banking
The banking crisis, however, is only a small part of the story of the current financial crisis. The sovereign debt issue is the real elephant in the room caused by spendthrift governments.
Keith Sansum1
- Location: london
- Registered: 25 Aug 2010
- Posts: 23,942
REG/MAREK/ALEXANDER
Clearly baz is still in the rose tinted glasses,
whilst no one would question brown's (gordon) whilst in control could have done more, but to give an assumption that the banking crisis had nowt to do with the banks is without doubt a strange observation to come to.
I don't think any posters that disagree with baz are saying or indeed campaigning for jelousy of banks and the chief execs pay or the way they made so many errors, but more to do with the banks as ross says in post 40
if they work within a privatised system, then don 't expect me and u to bail them out when they get it wrong.
and rosseven suggested schemes they could involve themselves in to avoid this.
im sorry reg/alxander/marek that although you all have enriched views and some even a lot of expertese baz attempts to decry your view and attempt to give the impression of your lack of knowledge.
thankyou marek again for highlighting just some of the degree's etc you have on these subjects as iv said before the forum is so rich in opinions. and expertese
and we should be proud of you all
well done dover forum
and all you posters
(even the ones i may disagree with)
ALL POSTS ARE MY OWN PERSONAL VIEWS
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Good god Keith - you really do not grasp what I am saying at all do you or perhaps do not want to.
Try reading and understanding what I am saying and take off your rose (red!) tinted specs. I have explained exactly what Brown was responsible for without ignoring the banks own responsibilities. The economic crisis is and was a lot more than just a banking one, in fact the depth and length of the economic crisis happened for reasons that started with Brown's poor judgement over the years since 1997. The bank crisis is/was a small part of the overall financial problems that grip this country and again, it was the regulatory misjudgements of Brown that, to a large degree, allowed our banks to get into a position that they were so heavily exposed.
Guest 653- Registered: 13 Mar 2008
- Posts: 10,540
Keith won't want to see what you are saying Barry - it doesn't suit his views.
Roger