The end of the world as we know it?

[beorhthelm]

heres some logic which might be going unnoticed and is where the Republicans (and Democrates i think you'll find) opposed to the deal are coming from:

why should the state intervene using tax payers money to prop up private companies? if you abandon the principles of the market, why not support the actual tax payers themselves directly? the bailout goes against everything that America has stood for economically and the fix doesnt even help the actual voters/taxpayers but the banks.

or put another way, why doesnt the government simply give everyone a rebate so they can afford to meet their payments? They are actually standing up for their core beliefs here, somewhat admirable in todays politics.

 

[Lush]

Have to say that the Bush appeal just came across as a plea to bail out his rich mates.

 

[Dick Knights Mumm]

These boys undoubtedly have the talent to run a Bank,

I understood this bloke to have come from Asda.

 

[Lokki 7]

or put another way, why doesnt the government simply give everyone a rebate so they can afford to meet their payments? They are actually standing up for their core beliefs here, somewhat admirable in todays politics.

Basically, governments don't have enough cash. Read an interesting article outlining this yesterday, here is a snippet if you care;


The crucial problem on this side of the Atlantic is that the largest European banks have become not only too big to fail, but also too big to be saved. For example, the total liabilities of Deutsche Bank (leverage ratio over 50!) amount to about €2,000bn (more than Fannie Mae) or more than 80 per cent of the gross domestic product of Germany. This is simply too much for the Bundesbank or even the German state, given that the German budget is bound by the rules of the European Union’s stability pact and the German government cannot order (unlike the US Treasury) its central bank to issue more currency. Similarly, the total liabilities of Barclays of around £1,300bn (leverage ratio 60!) are roughly equivalent to the GDP of the UK.

 

[Don Tmatter]

I saw the look on Gordon Browns face the other day when he was on this topic. He was angry and with gritted teeth.
After the dust has settled he will be after the city boys that nearly wrecked the country.

And thats why he deserves another term in office

 

[London Calling]

FUNNY THIS.

once this would have brought a government down, possibly led to revolution, were the citizens of france, germany even america in the 20's idealists, ignorant or are we today complacent or realists?

 

[Dick Knights Mumm]

I saw the look on Gordon Browns face the other day when he was on this topic. He was angry and with gritted teeth.
After the dust has settled he will be after the city boys that nearly wrecked the country.

unless they put a large wad of cash into empty party coffers to run an election campaign - isn't that how it works ?

 

[London Calling]

The whole point of banks is to ensure that money CIRCULATES. They don't actually have any of their own. "Their" money belongs to other people, who want to see it work.

If the banks can't make the money that they hold work properly, they need to be forced to do better. The government (which is "of the People and by the People") is perfectly entitled to intervene.

The interests of the banks' shareholders come quite a long way down the pecking order of importance. The interests of overpaid, incompetent bank executives come NOWHERE.

so is there actually more money out there circulating doing nothing than there should be?

 

[Herr Tubthumper]

Free market forces - why should taxpayers bail them out?

Is this a genuine question or are you being ironic?

 

[Dick Knights Mumm]

lokki - what is leveraged ratio ? and what are bank liabilities - is that what the banks have loaned out and is owed to them ?

 

[London Calling]

Again - from the outside - there must be a question mark against that statement. These firms cosey up to governments to get less regulation - with the threat that they will up sticks and go elsewhere. It seems that someone somewhere is always saying further regulation will sort whatever problem out. But the regulators always seem to be two steps behind.

you're right only recently in the Govt Autumn budget statement - the city was saying it will cost jobs as they will fly off to less regulated countries - US?

 

[El Presidente]

There will be greater regulation in future.

It's a piece of piss to bypass.

 

[El Presidente]

Have to say that the Bush appeal just came across as a plea to bail out his rich mates.

If I have a Bush appeal will you contribute please KAY

 

[Dick Knights Mumm]

to bail out

correct use of bail .............. I thought about it and opted for "bale out" as in boat.

 

[timco]

My mortgage is with a subsidiary of Lehman's and have not seen any government rushing to help me or others in the same boat. We shall get sold the the jackall that will pay the highest for the loan book and if we can't get remortgaged elsewhere at some point we are basiclly screwed.

So I have little sympathy elsewhere in the markets although I understand the reasons for it.

As to the bankers getting hauled over the coals, I doubt it very much. There might be one scapegoat or another but even Applegarth of NR is still being paid millions by the governmentt because it was in his contract to be paid millions.

So what chance of any of Gordon's other friends being had up?

 

[Barrel of Fun]

I am sure Fidel will be feeling warm inside (assuming he has not died).

 

[El Presidente]

If only Al Qu'eada had known that all they had to do was to borrow a few $$ for a conservatory to add to their cave, and then default on it, they could have avoided all those suicide missions and still been successful in bringing down capitalism.

 

[Easy 10]

Or flown their planes into Wall Street.

 

[Lokki 7]

lokki - what is leveraged ratio ? and what are bank liabilities - is that what the banks have loaned out and is owed to them ?

Basically it is the ratio of debt to assets. A higher value indicates a higher ratio of debt, or a riskier business strategy if you like. Liability, (nicked from wikipedia) is defined as an obligation of an entity arising from past transactions or events, the settlement of which may result in the transfer or use of assets, provision of services or other yielding of economic benefits in the future. So basically yes, you are right. These institutions have mind bogglingly huge liabilities which is why they cannot be allowed to fail, because they are too big to be rescued.

 

[Dick Knights Mumm]

It all seems odd to me. For a business if you are owed money - it is an asset.

Any how do they manage to loan out more money than they have as asset. The people receiving the load must see cash at some point ?

I can see why I am not in the city.