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Mervyn King Is Surprised Anger At Bankers Is Not Greater

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http://www.telegraph.co.uk/finance/economics/8354727/Mervyn-King-is-surprised-anger-at-bankers-is-not-greater.html

Mervyn King, the Governor of the Bank of England, said he is surprised that the public is not more angry with bankers as they face a fall in living standards.

He laid the blame for the financial crisis, the bailout and subsequent austerity cuts directly on banks in testimony to the House of Commons Treasury Select Committee on Tuesday.

"Now is the period when the cost is being paid. I'm surprised the real anger hasn't been greater than it has," Mr King said, referring the harsh cuts being introduced by the government to slash the massive debts created by the financial crisis.

The governor and other senior central bank officials were being questioned on financial regulation and the inflation report.

Mr King said the emphasis of future bank regulation would be to allow lenders to fail in such a way that did not jeopardise stability, rather than try to prevent a failure in the first place.

His position is in stark contrast to comments by Hector Sants, who will be the chief executive of the new Prudential Regulation Authority at the Bank, responsible for regulating banks and insurers.

Mr Sants, who will also become a Deputy Governor of the Bank of England, has said that the regulator would have a "low tolerance" to the failure of large institutions.

........

King said the central bank was monitoring inflation expectations closely but there was no clear evidence yet that medium term inflation expectations had risen.

He acknowledged that oil prices had risen much faster than the BoE had assumed in last month's inflation projections but noted that some of the factors driving prices - such as tensions in the Middle East - could drive inflation down as well as up.

"An awful lot will hinge on how far this rise in oil prices persists, whether the situation in the Middle East becomes clarified and it falls back again," he said.

Hasn't Sants been a bit of a failure as head of the FSA?

http://www.fsa.gov.uk/pages/about/who/board/sants.shtml

Hector was appointed FSA Chief Executive at the end of July 2007 and in July 2010 was appointed Deputy Governor Designate of the Bank of England and CEO designate of the Prudential Regulation Authority which will be the subsidiary of the Bank of England responsible for prudential regulation of Banks and Insurers. He is also a member of the interim Financial Policy Committee of the Bank of England.

He joined the FSA in May 2004 as Managing Director, Wholesale and Institutional Markets. As Managing Director, he had responsibility for overseeing regulated markets and related infrastructure along with responsibility for policy and supervision with relation to Wholesale firms.

So this guy it could be argued has completely failed in his role at the FSA and then his reward is to become the Deputy Governor of the BoE and again gets the job of regulating the banks! :blink: Looks like with his track record he might end up being the Governor of the BoE.

Still at least King is saying the medium term inflation expectation of the BoE hasn't altered, looks like he only sees temporary problems for inflation, like it's just been temporary problems for the past couple of years nothing structural.

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Guest UK Debt Slave

I'd like to reassure Merv the Swerve that I wouldn't hesitate to decapitate him and stick his head on a pole outside the Tower of London, together with every member of the Labour Party cabinet during their tenure and the heads of the senior banking cartels too.

There you go Merv

Satisfied now?

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I'd like to reassure Merv the Swerve that I wouldn't hesitate to decapitate him and stick his head on a pole outside the Tower of London, together with every member of the Labour Party cabinet during their tenure and the heads of the senior banking cartels too.

There you go Merv

Satisfied now?

Dont stop there old chap!

What about Camaroon and his pals evading 1.46 Billion £ tax per year. Most of them related to the Banking Cartels!

Bonner

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No one so far has approached me with a questionnaire regarding my anger at bankers. Perhaps he has done a survey that passed me by. I'm angrier with labour politicians, in particular Gordon brown, a man more responsible than most for the untold (and unsurveyed) misery of millions of people today and for some time to come in the future. More than anything I'm saddened by the stupidity of the human race and how the precious gift of life is being squandered by so many on doing all they can to enslave their neighbour for the sake of some more crap they don't need.

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I think Merv is right (for once) there hasent been much anger, but there will be; when the cut bite.

The fact is we just havent felt the pain yet and until people do they wont get angry. The man in the street knows we spent billions bailing out the banks but it hasent really hit him in the back pocket. When it has everyone will be after the banks.

Peple just dont realise how screwed we are

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People, you will regret the day Mervyn leaves - sometime in 2013, I think.

He is the one voice of sanity in the land of the central bankers.

Yeah, "voice."

Says all the right things, while turning the handle as fast as he can on the printer.

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"Now is the period when the cost is being paid. I'm surprised the real anger hasn't been greater than it has," Mr King said, referring the harsh cuts being introduced by the government to slash the massive debts created by the financial crisis.

Telegraph really getting sloppy. Harsh cuts? More like harsh inflation. Nominal spending is set to rise for each and every year of this parliament, and the debt is due to expand.

Source : ukpublicspending.co.uk

Clearly he is trying to deflect the anger many direct, rightly, at him.

2010-2014 public spending estimates.JPG

post-141-0-56575100-1299000947_thumb.jpg

Edited by Sledgehead

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Weasle words. Anyone else spot that one.

He didn't say "there was no clear evidence yet that medium term inflation had risen"...he's targeting wage inflation and wage inflation alone.

Or rather, he is targeting real falls in the standard of living.

How does one know if medium term inflation has risen until after the event? By definition all we know about the future are what the market expects to happen.

I suspect he's referring to market bond rates on the whole which are hardly screaming hyperinflation are they?

Edit: The lack of anger at the moment seems to be due in large part to the fact that all parties work for the bankers. Dave had an oppotunity to hold an inquiry under oath and instead chose to tell the plebs to move on and get behind Diamond Bob, let him and his chums take the billions and suck it up. Nick Clegg simply lied through his teeth to get elected and Vince is an irrelevancy in office. The only people who ever do protest against the banksters are laballed as pseudo terrorists or actual terrorists by plod and govt. alike. There simply is no other offering.

Edited by Red Karma

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How does one know if medium term inflation has risen until after the event? By definition all we know about the future are what the market expects to happen.

I suspect he's referring to market bond rates on the whole which are hardly screaming hyperinflation are they?

All he's concerned with is expectations - apparently if you jump in the sea but don't expect to drown you develop gills.

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All he's concerned with is expectations - apparently if you jump in the sea but don't expect to drown you develop gills.

That's all there is to be concerned about Injin.

I know you can predict the future with absolute certainty, but Trichet for instance was still tightening as the world fell of a cliff and most people on here were screaming for higher rates in '07/08.

You usually defer to the market - well the market isn't expecting hyperinflation. Sorry.

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All he's concerned with is expectations - apparently if you jump in the sea but don't expect to drown you develop gills.

:D

What on earth makes him so certain that a mild rise in interest will dispell expectations once he has allowed them to sink into wages?

From the August 2010 stats, I make mortgage costs 3.4% of RPI. If a 0.25% rate rise was plumped on top of a mortgage rate of 4% that would push up mortgage payments by 6.25% and RPI by 0.21%, currently totaling an RPI of 5.3%. If Billy-worker is already expecting higher inflation, will be expecting lower inflation at that point?

I suggest allowing the expectations to creep in before the MPC act is a mistake. If they can't make a move before the horse has bolted, what is their purpose? Might as well use a computer of the type used by tracker funds and have done with it. Infact ......... :huh:

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That's all there is to be concerned about Injin.

I know you can predict the future with absolute certainty, but Trichet for instance was still tightening as the world fell of a cliff and most people on here were screaming for higher rates in '07/08.

:)

You usually defer to the market - well the market isn't expecting hyperinflation. Sorry.

The market tells ne about prices and it's always right on that score.

The market doesn't control the printing presses tho, right now it's the bankers. In a little while it'll be the mob.

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Edit: The lack of anger at the moment seems to be due in large part to the fact that all parties work for the bankers. Dave had an oppotunity to hold an inquiry under oath and instead chose to tell the plebs to move on and get behind Diamond Bob, let him and his chums take the billions and suck it up. Nick Clegg simply lied through his teeth to get elected and Vince is an irrelevancy in office. The only people who ever do protest against the banksters are laballed as pseudo terrorists or actual terrorists by plod and govt. alike. There simply is no other offering.

The anger will be caused by hardship. The hardship is being held at bay by state support for mortgage and rent payments, plus lenders holding off their demands for more than token payments on defaulted CC debt.

No idea how long that may continue.

Redundancies in the public sector may tip it over, but I expect they'll be minimised by non-replacement of retirees. Those who might have expected to replace the retirees will never really know what they've missed, so they won't get angry. Just resentful enough to get pissed all the time ... and post on web forums!

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Personally I find his comments extremely insulting. He is not only robbing us, he is rubbing our faces in it.

However he is right to say "now is the period when the cost is being paid"

Once the banks are re-capitalised with our money, they can do what they want.

Including engineering a soft bottom in the housing market.

Edited by Dan1

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http://www.telegraph.co.uk/finance/economics/8354727/Mervyn-King-is-surprised-anger-at-bankers-is-not-greater.html

Hasn't Sants been a bit of a failure as head of the FSA?

http://www.fsa.gov.uk/pages/about/who/board/sants.shtml

So this guy it could be argued has completely failed in his role at the FSA and then his reward is to become the Deputy Governor of the BoE and again gets the job of regulating the banks! :blink: Looks like with his track record he might end up being the Governor of the BoE.

Still at least King is saying the medium term inflation expectation of the BoE hasn't altered, looks like he only sees temporary problems for inflation, like it's just been temporary problems for the past couple of years nothing structural.

...people like the devious King who are up to their necks in common blame should be charged with incitement to cause riots for such statements which are uttered to direct trouble away from himself..... :rolleyes:

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Dont stop there old chap!

What about Camaroon ...

...do you have a link...?....especially as Brown the Clown hid behind Kings ineptitude, created the not fit for purpose FSA ...and was friends to all the Bankers.... :rolleyes:

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http://www.independent.co.uk/news/business/news/economy-picking-up-says-mervyn-king-2229327.html

Economy 'picking up', says Mervyn King

The Governor of the Bank of England today told MPs the economy appears to have rebounded at the start of 2011 and inflation pressures are still likely to wane as the year progresses.

Mervyn King told the Treasury Select Committee that the shock decline in the UK economy in the final three months of 2010 was one reason why he and his colleagues were reluctant to raise interest rates at the Bank's February meeting.

Mr King, who played down prospects of a rate hike following the publication of the Bank's quarterly inflation report, added there was still uncertainty over the impact of surging oil prices, in the wake of political turmoil in North Africa and the Middle East.

The Bank of England is faced with a complicated scenario - as surging inflation combines with a fragile recovery - and its nine-strong Monetary Policy Committee (MPC) has been divided over how best to respond.

Mr King told the committee: "Surveys that we have for the beginning of this year suggest that activity did pick up in the first part of this year.

"The nature of the recovery with the rebalancing going on means that it is quite likely that this recovery will be, in the phrase I used some months ago, choppy."

The Indy appears very happy clappy about it.

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In everyday life people are quite comfortable with expectations. For example people will talk about their car's MPG being good while it is parked up doing 0 MPG. You couldn't get any worse than 0 MPG, yet in their minds the expectation of 60 MPG on the motorway is the current MPG of the car. However, when we come to economics the same person will get all confused.

The value of a car is based on its expected MPG (amongst many other factors). The value of money is based on its expected inflation (amongst many other factors). Merv is talking up expectations for sterling, to keep rates now down. As far as I am concerned he is doing a good job of creating more confidence than sterling is worth. We all know there are going to be problems, but it is better for us that others don't know for now until we're shot of the broken down old car.

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In everyday life people are quite comfortable with expectations. For example people will talk about their car's MPG being good while it is parked up doing 0 MPG. You couldn't get any worse than 0 MPG, yet in their minds the expectation of 60 MPG on the motorway is the current MPG of the car. However, when we come to economics the same person will get all confused.

The value of a car is based on its expected MPG (amongst many other factors). The value of money is based on its expected inflation (amongst many other factors). Merv is talking up expectations for sterling, to keep rates now down. As far as I am concerned he is doing a good job of creating more confidence than sterling is worth. We all know there are going to be problems, but it is better for us that others don't know for now until we're shot of the broken down old car.

The major factor how much money is worth being how much of it there is.

Supply and demand, that old fashioned thing.

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Yeah, "voice."

Says all the right things, while turning the handle as fast as he can on the printer.

What would you like him to do?

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How on earth does he know how angry we are? Did he hold a referendum I don't know about?

Our opinions are whatever the papers decide they are for that week. The papers had no mandate from us about mp's expenses, but went batsh*t crazy about them, and so it was perceived that we were furious too. And once they'd set the agenda, any public opinion after that point (Question Time or radio phone-ins, for example), appeared to confirm they were indeed speaking for us

We have no platform for our opinions, they just sometimes coincide with what the news outlets are expressing on our behalf

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Id like to see the couple of million people who are priced out, on the streets with rocks and firebombs.

What else can we do?

It's 'they who are at fault. Not us.

Deep down none of us can believe that this theft will be allowed to go unpunished.

It was so blatant.

We know they did it. We saw your hand in the till.

It's so anti 'Fair Play' we assume, that somehow, someone will rectify it.

Because that's the 'British way', isnt it? Fair play and all that?

If the two million priced out of housing,ever do 'wake up' and get as sick of it as we are. The government will be facing a sh1tstorm that will make the miners strikes look like a kiddies tea party.

The people with even a rudimentary understanding of what has happened are furious. There just arent enough of us.........YET.

Edited by Dan1

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