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What Would Thatcher Have Done?

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I was watching a rather lightweight program on the '80s last night with Tebbit putting forward the normal arguments about why Thatcher closed the mines. In theory, her ideology should have meant that she'd have let the banks go to the wall afaict.

Any thoughts?

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I was watching a rather lightweight program on the '80s last night with Tebbit putting forward the normal arguments about why Thatcher closed the mines. In theory, her ideology should have meant that she'd have let the banks go to the wall afaict.

Any thoughts?

In my opinion, there is no way on earth that she/they would have let the banks go to the wall. One was a bunch of miners from the north, the other were her buddies in the south.

As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

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As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

Indeed - I'd have probably been a loser, but it would have been really, really interesting to see the outcome...

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Thatcher would probably have done exactly the same. Vince Cable was a lone voice of caution and reason in Parliament during the boom while the Conservatives either said nothing or complained that Labour were not reckless enough. Cameron even appointed Kirsty Allsopp as a housing adviser. Only the Lib Dems might have made some difference to our national fate. Fat lot of good that does us now though.

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I was watching a rather lightweight program on the '80s last night with Tebbit putting forward the normal arguments about why Thatcher closed the mines. In theory, her ideology should have meant that she'd have let the banks go to the wall afaict.

Any thoughts?

Not a chance.

In fact, she did a bank bailout, iirc. I tried to google it but all you get is hand wringing guardianista articles about the current lot.

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In my opinion, there is no way on earth that she/they would have let the banks go to the wall. One was a bunch of miners from the north, the other were her buddies in the south.

As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

Yes I agree that she would have supported the banks but in reality all governments would have. I think the issue with the miners in the 80`s and the banks today are clearly different subjects.

The proof is in the pudding, Look at Blair and Brown. Both up to there necks in the worst financial crisis this country has faced since the 30`s.

I am amazed at the level of continued Maggie Bashing on this forum. She had to make some difficult decisions on a non proft, union backed industry. Many people lost jobs. Yep, she made mistakes.

However the Duo of Brown and Bliar not only bankrupted the UK but led the country into an illegal war, which has cost not jobs but hundreds of thousands of lives.

We are deep in shit street, still at war and at more risk than ever.

We could do with a PM today with balls like Thatcher. I gather the Thatcher haters are those responsible for voting in Blair and in doing so Brown.

Quality :lol:

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Yes I agree that she would have supported the banks but in reality all governments would have. I think the issue with the miners in the 80`s and the banks today are clearly different subjects.

The proof is in the pudding, Look at Blair and Brown. Both up to there necks in the worst financial crisis this country has faced since the 30`s.

I am amazed at the level of continued Maggie Bashing on this forum. She had to make some difficult decisions on a non proft, union backed industry. Many people lost jobs. Yep, she made mistakes.

However the Duo of Brown and Bliar not only bankrupted the UK but led the country into an illegal war, which has cost not jobs but hundreds of thousands of lives.

We are deep in shit street, still at war and at more risk than ever.

We could do with a PM today with balls like Thatcher. I gather the Thatcher haters are those responsible for voting in Blair and in doing so Brown.

Quality :lol:

The miners thing was just political in-fighting. The state grew under thatcher. At one point she nearly managed to slow down it's growth.

But then her security detail went awol and her hotel got blown up, after which she stopped even trying.

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No, she'd not have let the banking system collapse.

I DO think she'd have sweated them a bit more afterwards, and I certainly don't think she'd have frigged the inflation method to force low interest rates. If there's one thing Thatcher is rightly accused of it's firing interest rates up to the sky regardless of effect on economic activity.

EDIT: Actually I'm not totally confident on that interest rate thing. They presided over a credit boom too, although nothing so immense or sustained as the Brown Bloatation.

Edited by bogbrush

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As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

The real winners were the bank bondholders and shareholders, they are supposed to be the first losers in the event that a bank is wound up after becoming insolvent. The government could have sold off the bank's assets for whatever price it could get and used the money to pay back the depositors, making up any shortfall from the insured deposit amount itself. The bondholders and shareholders would have got nothing. None of this would have been arbitrary, it would have been following the rules and contracts as they are written. It would have been a lot cheaper for the taxpayer too.

Sadly we live in a world where equityholders in banks with no equity expect to get their money back, and bondholders who have lent money to insolvent institutions expect to be repaid 100c on the dollar (plus interest), and governments are too feeble to say no.

Edited by Dorkins

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As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

Why? They will have income producing assets and you don't support the 30K odd guarantee 1 for 1.

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The real winners were the bank bondholders and shareholders, they are supposed to be the first losers in the event that a bank is wound up after becoming insolvent. The government could have sold off the bank's assets for whatever price it could get and used the money to pay back the depositors, making up any shortfall from the insured deposit amount itself. The bondholders and shareholders would have got nothing. None of this would have been arbitrary, it would have been following the rules and contracts as they are written. It would have been a lot cheaper for the taxpayer too.

Sadly we live in a world where equityholders in banks with no equity expect to get their money back, and bondholders who have lent money to insolvent institutions expect to be repaid 100c on the dollar (plus interest), and governments are too feeble to say no.

Bondholders are more senior than depositors in the event of a bankruptcy. But you are right about equity holders they are first in line.

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Bank of cocaine and **** ups international?

Think that's the kiddie, ye.

BCCI failed.

It was Johnson Matthey that was bailed. And a good thing it was too if you ask me ;)

Although it's not a bank anymore. It just does some interesting stuff with precious metals.

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I think Margaret Thatcher would have been quite likely to have done much the same as Gordon Brown. He partially abandoned his nominal 'socialist' principles and ended up robbing the poor to pay the rich, but he did partially nationalise the banks too. For Thatcher, the partial nationalisation would have gone against her principles but robbing the poor to pay the rich wouldn't!

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Bondholders are more senior than depositors in the event of a bankruptcy. But you are right about equity holders they are first in line.

Are you sure that's right?

Liabilities (most senior first)

Deposits

Interbank loans

Tier 2 capital (upper and lower)

Tier 1 capital

Equity capital (part of the tier 1 capital)

Assets

Loans to customers

Mortgages to customers

Interbank loans

http://www.moneyweek.com/investments/bonds-higher-bank-savings-interest-rate-449p08.aspx

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Exactly the same as Brown. Remember much like Nixon and Reagan and all those other acolytes of Milton Friedman, they talked the talk, but didn't walk the walk. Those economic policies are only to be applied to the little people, never the rich and powerful who rely of Keynesian policies if not outright theft.

The miners were traditionally the most powerful group of workers in the, it was the coal that drove our entire economy for many years and allowed us to be a major player on the world stage. However, they could also bring the country to a standstill as they did in the 70's. British coal mines were also becoming less economic as it was costing more money (more energy really) to get the last remaining vestiges out. Quality was also declining as the good stuff (anthracite) had pretty much been dug out.

With North Sea oil and gas starting the come ashore in larger quantities it was time to deal with the miners, and by extension all workers in the Uk. With unions smashed power and wealth could continue to flow entirely towards the owners of capital and the bankers who funded them. Additional jobs were created in the government and finance whilst more traditional industries were gutted.

Governments don't create wealth, they merely transfer it, so those that were dispossesed see Thatcher as the devil incarnate whilst those on the receiving end of the government largesse think she is wonderful. In reality she was lucky, if Brown had the same North Sea windfall and had won his wars then he would still be in power.

They are all the same, the politicians and the bankers are a two headed "hydra" whose sole purpose is to get more rich and powerful at the expense of everyone else. Instead of removing both sets from the levers of power people prefer to discuss and argue over which "scumbag" was "better". There is no difference between Thatcher and Brown and she would have done exactly the same thing, the banks keep politicans in power and when they outlive their usefulness they are binned.

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Exactly the same as Brown. Remember much like Nixon and Reagan and all those other acolytes of Milton Friedman, they talked the talk, but didn't walk the walk. Those economic policies are only to be applied to the little people, never the rich and powerful who rely of Keynesian policies if not outright theft.

The miners were traditionally the most powerful group of workers in the, it was the coal that drove our entire economy for many years and allowed us to be a major player on the world stage. However, they could also bring the country to a standstill as they did in the 70's. British coal mines were also becoming less economic as it was costing more money (more energy really) to get the last remaining vestiges out. Quality was also declining as the good stuff (anthracite) had pretty much been dug out.

With North Sea oil and gas starting the come ashore in larger quantities it was time to deal with the miners, and by extension all workers in the Uk. With unions smashed power and wealth could continue to flow entirely towards the owners of capital and the bankers who funded them. Additional jobs were created in the government and finance whilst more traditional industries were gutted.

Governments don't create wealth, they merely transfer it, so those that were dispossesed see Thatcher as the devil incarnate whilst those on the receiving end of the government largesse think she is wonderful. In reality she was lucky, if Brown had the same North Sea windfall and had won his wars then he would still be in power.

They are all the same, the politicians and the bankers are a two headed "hydra" whose sole purpose is to get more rich and powerful at the expense of everyone else. Instead of removing both sets from the levers of power people prefer to discuss and argue over which "scumbag" was "better". There is no difference between Thatcher and Brown and she would have done exactly the same thing, the banks keep politicans in power and when they outlive their usefulness they are binned.

QED

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If she cared enough about housing she would have put interest rates through the roof. They weren't afraid to do that when defending party policy.

Whether party policy in an alternative universe Noughties would have included affordable housing and a repudiation of debtalism, I have no idea.

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In my opinion, there is no way on earth that she/they would have let the banks go to the wall. One was a bunch of miners from the north, the other were her buddies in the south.

As an aside, it always makes me laugh when people say the banks should have been allowed to fail, but depositors should have been protected. The irony seems to be lost on them.

There is no irony there. Bank failure does not mean collapse, it means all share holders loose everything.

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No, she'd not have let the banking system collapse.

I DO think she'd have sweated them a bit more afterwards, and I certainly don't think she'd have frigged the inflation method to force low interest rates. If there's one thing Thatcher is rightly accused of it's firing interest rates up to the sky regardless of effect on economic activity.

EDIT: Actually I'm not totally confident on that interest rate thing. They presided over a credit boom too, although nothing so immense or sustained as the Brown Bloatation.

Erm, exactly. The credit boom remained much smaller precisely because interest rates were kept much higher. So modest boom, modest bust, not NuLab's whoppers.

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The real winners were the bank bondholders and shareholders, they are supposed to be the first losers in the event that a bank is wound up after becoming insolvent. The government could have sold off the bank's assets for whatever price it could get and used the money to pay back the depositors, making up any shortfall from the insured deposit amount itself. The bondholders and shareholders would have got nothing. None of this would have been arbitrary, it would have been following the rules and contracts as they are written. It would have been a lot cheaper for the taxpayer too.

Sadly we live in a world where equityholders in banks with no equity expect to get their money back, and bondholders who have lent money to insolvent institutions expect to be repaid 100c on the dollar (plus interest), and governments are too feeble to say no.

Up to a point. Bank shareholders lost most of their money (all of it in some cases). That includes Lloyds, who weren't bust before the HBOS thingey[1].

And it's not the government that sells off assets - it's the receivers. As has been happening in the past week or so with KPMG selling on Connaught's assets to Morgan Sindall and Mears. Among banks it happened with Lehmans (Barclays got some assets on the cheap there), and it should have happened with others including Northern Rock and HBOS.

Oh, and we no longer live in NuLab's world of economic meddling. I hope that if another bank goes bust now, it'll happen as cleanly as Connaught is happening now. Or as real-life bust banks (BCCI) were handled in Thatcher's time.

[1] can't think of an appropriate word for that deal :huh:

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The banks run the country. Thatcher would have done what they told her to do just like Brown did.

OK Thatcher took some "difficult" decisions but she suffered from "short-terminism" as well. She was a politician who would cling to power at all costs. Closing the mines? Maybe some but coal should have been part of an overall energy policy for this country (when north sea oil was running freely) but it never was. On that she gets nil out of ten. Council house sales? Another fat zero. She "banked" our overall economic strength on the "City":, Big Bang etc. and f@ck the North and the rest of the industrial heartland. I was there, I saw it first hand. I don't remember it with any particular fondness. At least Wilson was funny.

Don't make her out to be Joan of Arc.

Edited by tomwatkins

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  • 238 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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