Monday, September 17, 2007

Why should savers have to bail the banks out?

Why should savers have to bail investment banks out?

The Northern Rock crisis has brought home the reality of Labour's 'economic miracle' and everyone's looking for a scapegoat. But don't blame the Bank of England for refusing to pump even more money into the system...

Posted by mary @ 10:54 AM (1130 views)
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2 thoughts on “Why should savers have to bail the banks out?

  • In fact, the BoE has bailed out all of the banks as the money withdrawn from Northern Rock (and replaced by BoE funds) will go into the other 4 banks as deposits, thereby providing liquidity. Given that potentially 20 billion to be redistributed looks like a bit of a winner, unless you are a Northern Rock shareholder of course.

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  • “The plain truth is that financial markets and financial institutions have indulged in a mad wave of greed-driven, purblind, herd behaviour. In the process they banked their millions. Now that the consequences are being laid bare it ill becomes them, from their plush temples to mammon, to be calling for a disguised form of state aid. You can imagine what they would have said in reaction to the idea of bailouts for car manufacturers, shipbuilders or miners. Now that the pain is close to home they whinge with a tone of righteous indignation.”

    “These events have finally burst the mad credit bubble of the last few years. I suspect when the full consequences come home to roost, not only will many fortunes shrink, but several high-flown investment ideas will bite the dust and many reputations will have been irreparably damaged.”

    I’m Loving it!

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