Bankers that is.

Yesterday our glorious government announced that we are going to spend another 32 billion pounds of our money to carry on bailing out Lloyds and RBS and to allow them to be broken up. Why they need money to to that is anyone's guess, but let me say that number again .... 32 billion. That's £2000 for every man, woman and child in the country apparently.

And this is just a couple of weeks after claiming that in a time of war, and for the want of 20 million, TA training had to be suspended for half a year because there was no money.

To put it into perspective, and keeping the proportions the same, it's exactly the same as someone who owes you £20 which you now desperately need, telling you to sod off and die, and then two weeks later spending £32,000 on a car. And not just any car, but one that has already been scrapped.

Labour .... still playing at grown-ups with our money.

*ankers.

I feel better now.

When you put it like that it makes me want to stick my head in a vice. Technically what they are saying is that they could have afforded to double the defence budget. Instead they chose to try and shave £20 million off it.

Without wanting to defend *ankers, the £32 Bn number is not anywhere close to being an accurate reflection of the risk the Gov't is underwriting. They didn't write RBS/Lloyds a cheque.

Media dumbing it down again.

OK, fire away.

Originally Posted by Banker

Without wanting to defend *ankers, the £32 Bn number is not anywhere close to being an accurate reflection of the risk the Gov't is underwriting. They didn't write RBS/Lloyds a cheque.

Media dumbing it down again.

OK, fire away.

Okay, here's a radical thought. Instead of throwing money at them regardless of the cost, and especially if there is a risk in doing so, why not just close the bloody things down?

Can you imagine James Dyson getting 32,000,000,000 when times get tough? And that is just one of the payments they've received.

They didn't throw money at them regardless of the cost, they bought "assets" at current prices. If the asset prices fall, the banks cover the first X% of losses (first loss tranche). If the asset values rise, the Gov't keeps the upside.

Reason for this is that the "assets" are volatile. The greater the volatility they have, the more capital the bank has to set aside to allow for said changes in price. Gov't doesn't want capital allocated to crap assets, they want it used for crap loans to business.

So, the Gov't actually just bought £32bn of assets.........which will be funded via the issue of debt. The interest on the debt will be paid by the banks via a "participation fee". So, Gov't [more or less] whole in economic terms.........but capital freed up for wider economic lending.

These are, however, two very, very badly run banks.

Originally Posted by Banker

They didn't throw money at them regardless of the cost, they bought "assets" at current prices. If the asset prices fall, the banks cover the first X% of losses (first loss tranche). If the asset values rise, the Gov't keeps the upside.

Reason for this is that the "assets" are volatile. The greater the volatility they have, the more capital the bank has to set aside to allow for said changes in price. Gov't doesn't want capital allocated to crap assets, they want it used for crap loans to business.

So, the Gov't actually just bought £32bn of assets.........which will be funded via the issue of debt. The interest on the debt will be paid by the banks via a "participation fee". So, Gov't [more or less] whole in economic terms.........but capital freed up for wider economic lending.

These are, however, two very, very badly run banks.

Point taken, but the fact remains that the govt chose to buy those 'assets' at a time they were pleading poverty. And it doesn't explain why they didn't say 'F* off', let the banks go bust, and let the free market pick up the assets. It's special treatment whichever way you look at it.

I believe that folks have a rather distorted view of the whole affair with the b(w)ankers and such. These are the people (along with various national and international companies) who effectively run the country (any country, in fact) for their own personal enrichment. They thus went to the UK gobment and said: "We've totally fücked up in our greed, and now we need you (the gobment) to convince the UK taxpayers that they have to pump money into our failed and clumsy attempts at getting obscenely rich, otherwise the whole economy will fall. If you don't do this, we'll make yon public aware of all the money we've passed to you to secure our share of the pie.

The UK gobment is bankrolled by these wasters, and so it came to pass. That's what passes as *cough* "democracy". What was that you were saying about; a gobment ob da pieple, for da pieple? Solly, hope you velly happi fella.

MsG

Fuck off Bugsy.

Well, RBS are being forced to divest a bunch of businesses in order to reduce the risk on their balance sheet (thereby increasing their capital ratio)........so I guess the Gov't and EU are getting them to the same place but without letting the bank go under. Their commodities JV with Sempra is one example.........which will cost them a heap of dough to exit and buyers will be few given it's a prop-trading business (very capital intensive).

If it was an investment bank I'd agree with you, let if fold. Problem is, it's a UK clearer (remember, it owns NatWest too) that thinks it's an investment bank ..........or at least it did under the erstwhile not-so-Goodwin. That's ma and pa money in current accounts.

Bigger problem is that anyone who was remotely smart at that shop has long since departed.......they're in a mess.

Originally Posted by Awol

Fuck off Bugsy.

What he said.........