Skip to content

More bank nationalisation

Seamus says we should really take them over so that:

They could then become the core of a newly accountable and publicly controlled banking sector able to channel investment where it\’s needed, rather than into reckless speculation in debt and housing bubbles.

So, who decides where investment is needed then? Got to be chummy with a politico to get funds perhaps? I suppose that\’s one way of destroying any vestige of honesty there might be in politics.

Would certainly solve the problems of party political funding though.

7 thoughts on “More bank nationalisation”

  1. However, the logic of the system you (and I) support is that ‘private’ participants take their own decisions and bear the consequences. It’s not clear to me that some of those people are bearing the full consequences now the taxpayer is providing significant support.

    Shouldn’t we have taken the ‘Kaupthing approach’ (where Singer & Friedlander goes bust) and let RBS/HBOS go bust and transfer all deposits to better capitalised banks?

  2. Don’t worry lusakajoe there is plenty of time for RBS/HBOS to go bust.
    Lehman’s positions will unwind tomorrow so we will find out who is holding the toxic babies.

  3. Surely this is an ideal time for enterprising people to start news banks and building societies, free from over leveraging. Give a reasonable interest rate and the security of not having any toxic debt on your books and people would flood in, wouldn’t they?

    Perhaps it would be money better spent for the taxpayer to sow a few acorns in the banking system rather than supporting rotten oaks. A fire can make for fertile ground if a few big banks went under and their assets were purchased for a pittance.(Though how would you stop the other big banks from hoovering up the assets?)

  4. Gareth:

    The basic instability isn’t in the investments, whatever they are; they’re deeper down—in the money itself.

    Others on the site will recognize my main rant, whether they find it excusable or not.

    As long as government has the power to mislead the market as to the quantity of money (which they do regularly to influence the rate of interest from that it would otherwise take toward one more suitable to their interests—usually, but not always, to lower it and render the appearance that business and investment are
    good), instability will accumulate over time and eventually create some sort of crisis. No matter in what the present “fix” eventually happens to consist, the same process will, after time, simply create another, most likely larger, in some other
    fashion. This is the true application for figurative expressions such as those about lipstick on a pig or silk purses and sows’ ears.

    There’s nothing that can be done about it–it’s the system that virtually the entire world has chosen to live under. It might not be so bad, were it not for the fact that the same mechanism is also a main contributor to eventually intract-able hostilities between nations.

  5. Good idea Gareth. We could call them Building Societies, and make them mutually owned by their members. Require them to practice prudent lending, and careful management. (Such as making mortgages conditional on a proven track record of regular saving, absence of CCJs, 10% downpayment, evidence of single party earnings etc.)

    But the likes of Seaumas Milne would villify them as discriminatory against the “working class”. (The real working class would be good customers and major beneficiaries, but when lefties say working class they mean welfare class.)

    All Seaumas Milne wants is the money. All of it. And the power to unilaterally determine where it is “needed”.

  6. You’re right: Labour abolished the building societies because Seamus Milne and Polly Toynbee said they were against the interests of the welfare class.

    (what’s that, Skippy? “building society demutualisation happened under Thatcher and Major to benefit the middle class, and actually fucked over working class savers completely”? Shut up, you class-hating Commie kangaroo…)

Leave a Reply

Your email address will not be published. Required fields are marked *