Well, yes, I agree

This time nationalisation has to mean in the public interest

Absolutely so. And given that nationalisation is not in the public interest we shouldn’t do it.

HSBC is staying in Lndon because the quality if UK bail outs is much higher than those available elsewhere.

Sir John Vickers, whose report on UK banking was too timid and allowed action far too late now says British banks are vulnerable again.

And they are. To losses dating back to 2008, still nit recognised. To losses on new loans since then. To losses from QE funded speculation. From exposure to emerging markets. To excess capacity in sectors like shipping. To the London propery market which is vastly over valued and where too much of the wrong type of property is being built. I could go on.

It is entirely plausible that the capital integrity of one or more banks will be tested to breaking point.

This can be corrected: we know now that banks can be recapitalised by governments. But never again must control of the banks impacted stay with bankers. Gordon Brown and Alistair Darling failed the UK badly by letting bankers keep control of banks last time.

Nationalisation must mean nationalisation if it happens again. And for the long term, leading to fundamental reforms of the sector. Surely we can all agree on that?

Ritchie and his mates would run the banking system better than bankers would.


Extra marks will be awarded for quoting that section where Ritchie says that it’s candidly neoliberal sophistry to insist that those who run the Co Op bank need to know anything about banking.

24 thoughts on “Well, yes, I agree”

  1. “Bankers and the markets disagree with me that borrow and spend is a good idea. I am always right. Therefore bankers and the markets are wrong. We must do two things. 1. Intervene in the markets so that they are not allowed to prove me wrong. 2. Replace the bankers with people who agree with me.”

  2. However well the banks may be run and however skill-filled those bankers may be, they are still operating in a state-created poisonous environment loaded with destructive incentives. Bankers have existed in a state-created playgroup for so long now that the skills they have are retrograde to reality–like a bunch of “pilots” who have spent their careers on state-mandated autopilot and have only a modest set of button pushing skills. When the auto-pilot fails and they have to actually try to fly in a wild storm–look out.

    Murphy would be hard-pressed to work his own dick without help let alone run a bank –even the piggy-kind.

  3. “Gordon Brown and Alistair Darling failed the UK badly by letting bankers keep control of banks last time.”

    Well they didn’t. They subscribed for shares in the failed banks and exercised control as majority shareholder. The day to day running was left with bankers because they would still do a better job than your average butcher, baker or candlestick maker.

  4. HSBC was not bailed out. So what is he talking about.
    Sir John’s report was not too timid – the government’s response was more timid that the report.
    Murphy’s memory is not to be relied upon.

  5. So Much For Subtlety

    Incidentally, the Courageous State Latin American Model seems to be in some trouble:


    Venezuela’s opposition legislature has declared a “nutritional emergency,” proclaiming that the country simply does not have enough food to feed its population. The move comes after years of socialist rationing and shortages that forced millions to wait on lines lasting as long as six hours for a pint of milk, a bag of flour, or carton of cooking oil.

    There is much ruin in any country, but at some point you have to wonder how much more ruin people will put up with.

    I regret the collapse of the Chavez Experiment. In fact I think we should prop it up with food aid. So we have somewhere to send all our sociology graduates and other NGO types. Maybe they can learn. Or not come back. Either way.

  6. “they are still operating in a state-created poisonous environment loaded with destructive incentives”: by Ecks he’s right. Reform is necessary, but who’s equipped to do it? Not the Left, who have shit-for-brains as usual. Not the Right, who are conspicuous by their absence. There’s only me, and I’m too old.

  7. A Venezuelan colleague of mine has just returned from the home country. He tells me the place is seriously fucked up, more so than a year or so before. The Chavistas are resisting any reforms to sort out the economy, including a proposal to raise the price of petrol. Currently you can fill your tank up for 30 cents, but the smallest unit of currency is 100 cents. The 30 cents is so little that people just happily hand over 100 cents instead. But according to the Chavistas, the new government cannot raise the price of petrol and save billions in subsidies.

  8. the worst mistake Chavez made was changing out the previous management of PDVSA (pretty damn competent as national oil companies go) and replacing them with Socialist placemen who knew nothing about the business. Even before the oil price fall it went from being just about the best run and most profitable state oil company, up there with Aramco in cash terms, and became just another fucked up basket case run by idiots. It will take ten years to fix it, assuming that it’s even possible

  9. Hmmmm… isn’t this the Right Question asked ass-backwards?

    As far as I can see there is no Right Answer.. Or at least.. one that’s generally applicable while avoiding both greed and bureaucracy.
    Not without a complete overhaul of the whole damned system bottom-first.

  10. Surely not in the Left’s Favourite Place? How could this be? (Apart from neo-liberal bogeymen under the bed, which you have to be mentally ill to believe in). Could it be…socialism? Or is this another case of it not being ‘real socialism’?

  11. Since we know that Murphy has discovered the secret to growing magic money trees it doesn’t matter how the bank is run. Murphy will simply grow more money to ensure the books of the banks his is given to run make a profit. Of course since it is his outstanding leadership that grew the profit he is entitled to keep it all at a tax rate of his choosing.

  12. @LY We already had tha. It was called Blair/Brown, and yes they do think they are entitled to squirrel away their loot from the US lecture circuit without paying any tax.

  13. “the worst mistake Chavez made was changing out the previous management of PDVSA ”

    starting to breathe surely ?

  14. “This time nationalisation has to mean in the public interest.”

    In whose interest was the last one, and how does he intend to prevent the same happening again?

    Or is he doing the usual and mistaking ‘State interest’ for ‘public interest’?

  15. SMFS

    I am hoping that when the Maduro regime collapses then the new government will negotiate with Cameron to extradite Owen Jones and Diane Abbott for assisting in mass murder….

  16. To the Chavistas, political loyalty are far more important than competence. All of those PDVSA that were fired already found job elsewhere abroad where their talent are appreciated and paid for.

  17. Is he making a claim that Brown was not acting in the public interest when he bought Lloyd’s out? Tell Soapy Maugham….not that that tool would be interested.

  18. @ diogenes
    Brown was acting in the interests of the Labour Party in Scotland when he arm-twisted Victor Blank to get Lloyds Bank to rescue Bank of Scotland.

  19. Bloke in Costa Rica

    “the London propery market which is vastly over valued”

    Are houses in London failing to sell? When did that happen?

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