Reply to: For a moment I thought we were doomed ...

[RSoles]

Doomed

This will make thing much, much worse.
And all to buy Labour votes in the North-East.

Where were they when we (Equitable Life investors) needed help?

This support for NR only rewards poor industry practice and can at best be a temporary stop-gap. The others now know they can get away with reckless lending and not be held to account.

Reminiscent of ASBOs really.

RS

[bored]

The problem with artificially propping the bank is that instead of a market correction today the underlying problem will remain hidden until it gets to a state where no amount of propping will hold it back and there will be a painful crash. Same reason why artificially supporting a currency never works...

[Bagpuss]

How so?

FSA?

Only the 1st £2K is 100% underwritten you muppet. And then it can take months and sometimes years for the FSA to actually payout.

Why do you only get half the story right (or rathe post half of it?)

It protects 100% of the first £2,000 in any bank account and 90% of the next £33,000 - giving a maximum payout of £31,700 if a bank did go bust

Now most savers with the NR will be under that amount, making the governments guarantee only a very small part of the money that would have to be paid out.

Now get those mirrors covered up before you get angry again!

[Old Greg]

The savers' money was already underwritten before the government offered to step in.

Some of it was. If you had 100k, getting back 30k wouldn't be much consolation.

[King Cnvt]

The savers' money was already underwritten before the government offered to step in.

How so?

FSA?

Only the 1st £2K is 100% underwritten you muppet. And then it can take months and sometimes years for the FSA to actually payout.

[Bagpuss]

The savers' money was already underwritten before the government offered to step in.

[Old Greg]

Oh Dear ™

Nationalisation is seen as 'a bad thing' because it is 'socialism' and therefore 'bad'. But that's not an analysis of whether or not nationalisation would be good in this case.

The state has taken on the risk because of a failure of the business model of a private sector organisation. Why should public money be used in this way. If the organisation has failed and cannot be allowed to go to the wall, then take it into public ownership so that any assets transfer along with risks.

I am sure there are other analyses which would offer a different viewpoint, but dismissing it because it's 'socialism' is not one of those analyses.

[Bagpuss]

Imagine using taxpayers money to defend sterling at a ridiculously (artificially) high level.

Bloody Socialists, or was that the Conservatives?

[King Cnvt]

I don't think the government has said it will nationalise (i.e. take into ownership) - they've saud they will prop up the private owners of the bank.

IMO, nationalisation would be a good thing - this is a situation where we could do with a little bit of socialism.

Oh Dear ™

[Old Greg]

Hence Noddy's use of !=
What I meant is that Labour have said they will nationalise NR rather than let it fall. That is socialism

I don't think the government has said it will nationalise (i.e. take into ownership) - they've saud they will prop up the private owners of the bank.

IMO, nationalisation would be a good thing - this is a situation where we could do with a little bit of socialism.

[Old Greg]

!= means "not equal" in dialect.

Thanks - I have learnt something today.

[Chugnut]

I think that's what Noddy is saying.

!= means "not equal" in dialect.

[sasguru]

Capitalism is not necessarily free market. China is an example of a non-free market capitalist economy. Capitalism describes the ownership of production (and in a modern economy other ways of making money such as finance and services) and the ability to make money from the investment of capital rather than purely from selling your labour. This model can exist alongside various levels of market freedom and government interference

Hence Noddy's use of !=
What I meant is that Labour have said they will nationalise NR rather than let it fall. That is socialism

[Old Greg]

Capitalism != free market

Capitalism is not necessarily free market. China is an example of a non-free market capitalist economy. Capitalism describes the ownership of production (and in a modern economy other ways of making money such as finance and services) and the ability to make money from the investment of capital rather than purely from selling your labour. This model can exist alongside various levels of market freedom and government interference

[NoddY]

It makes me laugh how people here complain about NL and socialism. NL is not a socailist party. The dropping of Clause 4 confirmed this. Socialism is about public ownership, not about subsidising private companies. A socialist response would be to nationalise and transfer the assets and obligations into the public ownership. All they've done here is transfer the risk to the public purse. This is NL the friend of big business, not NL the socialist party.

OldGreg is right. This is blatant capitalism. When everything is going fine, the free market must not be interfered with, but when the market turns, as it has, suddenly we require the intervention of the State.

Capitalism != free market

Capitalism is the concentration of the means of production is the hands of the few, who then charge economic rent for access licences to it.

New Labour are not socialists. They have presided over the biggest decrease in the value of labour for generations. Once a family would be supported by one persons labour, now it requires two+more+debt.