Monday, Feb 18, 2008
The numbers get bigger and bigger!
Telegraph: Northern Rock deal could cost us each £3,500
The cost of the Northern Rock crisis has reached the equivalent of £3,500 for every taxpayer as experts warned that the nationalisation rescue of the bank was bound to fail. Fears are also growing that other banks may be in trouble after the Treasury unveiled 'draconian' plans to allow the Government to take any financial institution into public ownership over the next year.
Posted by enuii @ 11:11 PM (485 views) Add Comment
8 Comments
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1. uncle tom said...
The government made the decision to allow banks to trade with minimal regulation. Whilst this policy had some sound theory behind it, it also presented the prospect that from time to time, a bank would fail. You can't have roses without thorns.
Now a bank has failed, and the government has waded in with vast amount of taxpayers cash in a ham-fisted attempt to salvage something from the wreckage.
Northern Rock should have gone into receivership last September, and the government should only be concerned now about the possibility of doing something for savers who lost their deposits - a far cheaper alternative to what they are now doing.
2. quiet guy said...
@uncle tom
Well said.
Did anybody notice this bit of the article:
'Fears grew that other banks may be in trouble after the Treasury unveiled plans to allow the Government to take any financial institution into public ownership over the next year in a move described as "draconian".'
Can they be serious? Nationalise another failing bank?
3. Sinewaveboy said...
Watch that word "TEMPORARY" as in "temporary period of nationalisation".
That will bite the gov't in the ass, and their smug "rate themselves" smiles yesterday were possibly their single biggest misjudgement yet.
4. cornishman said...
"The newly-installed chairman has been forced to admit that the bank may remain in public hands for "years""
- on a salary of over £1,000,000/year I'm sure he will keep the gravy train going as long as he can. Disgraceful.
5. Safe As A Crash said...
why dont they just take all our money and everybody gets a loaf of bread each day... no doubt whe will only be entitled to a couple of slices soon after...
6. stillthinking said...
The government couldn't and can't take that cavalier attitude to savers because none of the banks have their deposits to hand, savers can't get their money out of any of them. The problem wasn't NR, but a crisis in confidence.
7. Fed Up said...
Whatever one thinks about Rover Group, the viability of its business or the quality of its products, it manufactured goods for the purpose of earning wealth for the country. Although the Torygraph is sounding the nationalisation of Northern Rock as a return to 'Old' Labour, it misses the point: 'Old' Labour would have bailed out manufacturing as it did during the 70s, 'New' Labour couldn't give a toss about anything but its friends in the banking sector and has been happy to let what was left of this country's manufacturing sector to rot.
8. Crashwatcher said...
1.4 million people have accounts WITH MONEY IN in Northern Rock (according to the Daily Telegraph http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/09/15/cnrock715.xml). Had the bank gone into receivership and these 1.4 million people not been able to get any money out - that would have been something for the history books. Although I dont like my tax payers money put into failed businesses sometimes dealing with the affects of the alternatives would cost far more.