Saturday, January 17, 2009

Then again, they are doing their best to take us back to the 30’s!

£200bn to save banks from bad debt

In an attempt to restore confidence within the financial sector, the Treasury will tell the banks of its plan on Saturday. It aims to announce details of the rescue package publicly early next week. The bad bank plan has climbed the political agenda in the past couple of weeks as the Government has become aware of the extent of the lenders' bad debts. Sources said that a bad bank would have to take on about £200 billion of toxic assets. That would take the Government's total commitment to solving the banking crisis to almost £1 trillion in taxpayers' money that has either been spent or pledged.

Posted by flintster1994 @ 10:04 AM (1326 views)
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13 thoughts on “Then again, they are doing their best to take us back to the 30’s!

  • stillthinking says:

    I worry that they will collapse the currency in the end. There is a really big difference between the 30s and now, which is basically the world was on a gold standard then, but we aren’t now.

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  • They are certainly testing it ST. Bought some Barlcays close to close on Friday but was still well down by close. With banks shares already down 90% + I don’t think there can be that far to go ie begining to look like value especially as they can’t fail – cert better value than govt debt where the upside is so restricted. The Banks are effetively no less safe than the govt and offering a far better potential return.

    There will be a further downwave in stocks and soon but suspect that will be commoditiy/miming co’s, retailers, industrials, consumer cyclicals who are still way overvalues, and who do not have the tacit protection of govt.

    Barclays closed at 98p it was that price in 1989 and is looking at pretax of 6billion a market cap of £9 billion with the government gonna spend tax payers money on buying its sh!t

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  • inflation is eating my savings says:

    Maybe I’m being overly worried, but it does seem that whenever sterling shows some green shoots vs. the yen, dollar and especially the Euro, news like this comes out to put it back in place. Paranoia/coincidence probably, but convenient certainly.

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  • getting a handle on the size of it ~~~ from a recent interview with Pastor Lindsey Williams ~~~ Details “Economic Calamity” Ahead ~~~ all over the web.

    This year, 2009, the USA will face total financial collapse. The dollar will also collapse in value, and it will take years for the U.S.A. to recover.

    23. “The American people are terrified of Obama.” “The day after the election the gun shops in the USA were emptied by alarmed and frightened citizens.” “Wal Mart reported that the day after the election their sales of ammunition went up by 400%. It was a record for ammunition sales in a twenty four hour period. (My note: this continued for several weeks after the election.) Evidently this behavior caused a great deal of alarm.

    _________________________

    Dear Friends and Family:

    For some years now, I have been saying that the “money changers” and “banksters” in London and New York are setting us up. They’re playing a money game in which all of the marbles are on the table. It seems that this game is now in the bottom of the Ninth inning.

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  • stillthinking says:

    My personal concerns is that the deflation will rapidly turn into high inflation. At the moment the government are -only- guaranteeing the banks. The banks don’t have an excess of defaults yet, they just know that they will.
    So a rather unpleasant scenario would be that the defaults start arriving en masse at the same time that the gilt market collapses, forcing the UK government into quantative easing just to keep the whole shebang afloat.
    i.e. Iceland. For all the talk of deflation, Iceland currently has an inflation rate of 20%. This will slaughter the ability of the UK government to repay debts, and will also kill off all mortgage holders. I think this is the real danger, not deflation and I think that the danger of this is what held back the BoJ.

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  • Why do I keep saying DEPRESSION/HYPERINFLATION.

    What’s that coming over the hill, it’s a MONSTER printing press.

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  • Ah! INFLATION try the Jim Rogers interview instead

    Exclusive Interview with Jim Rogers: Inflation Is Coming

    You’ve said that over the long term, the US dollar is doomed. What are your thoughts on the British Pound?

    Rogers: More doomed. It will disappear sooner. If it weren’t for the North Sea, the British Pound would have already disappeared. It’s more doomed. The UK has been exporting oil for 26 years; within the decade, the UK will be a net importer of oil again, and they have nothing else to sell to the world once the oil dries up.
    http://seekingalpha.com/article/114966-exclusive-interview-with-jim-rogers-inflation-is-coming?source=article_sb_popular

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  • stillthinking says:

    More doomed than doomed…

    According to this, http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article4063575.ece we are only half way through the North Sea oil. So assuming the oil reserve estimates to be correct, which personally I do, there is going to be demand for oil, sorry Sterling, for another twenty years. Maybe that is a key component of the collapse of the pound, from the collapse of the oil price from falling demand. I always tended to think it was because of pure fear about the current administration.
    So with oil, then the pound would be even lower. So selling oil is in fact giving us a dose of the Dutch Disease and not helping our fantastic manufacturing expansion plans.

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  • stillthinking says:

    Sorry, I missed the point. The change from becoming a net importer from net exporter is happening now/happened. So there is no external demand supporting sterling because we use what we have already.

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  • I think the Gas has just about gone.

    The was a bizarre BBC Horizon documentary in 1977 but set in 2002 looking back

    (26th August 1977
    Horizon 2002 (BBC 2)
    Silver jubilee edition of the arts documentary strand, dramatised to become a serious look at 25 years in the future.)

    hosted by Richard Baker which forecast the wasted opportunities of North Sea Oil and Gas, they ‘reported’ it almost gone .

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  • nice one qg

    from comments
    “heuristic ~~~ The metaphor is imperfect: the bankers HAVE a raft while the taxpayers aren’t being rescued at all; they are going down with the plane.”

    actually the taxpayers ARE the raft!

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  • I assess that after a period of stagflation, serious inflation is on the cards. This will be an international policy between the finance ministers. They will not rescue their own currencies but print their way out. This is the only way out (inflate the debt away).

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