Archive for October, 2008

A part-nationalisation! How does that help?

The UK Government today announced that it would make £50bn available to take stakes in UK banks. It also committed a further £350 in support of liquidity and lending in the money markets to free up the “plumbing of the banking system”.

Total cost £400bn.

I am very supportive of a wholesale nationalisation of the banking system however only as a last resort and for all banks.

By “a last resort” this means only when Read the rest of this entry »

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The banking plumbing is bunged up! For banks yes! Let them fail!

I am sorry but I just do not buy in to the Governments reaction today and its justification.

Everyone fears a recession – of course. After years of debauched consumerism financed by mad levels of lending and debt, consumers have had enough and now moving to cost cutting and savings. They do NOT want to borrow and should definitely not be encouraged to do so.

The Director-General of the CBI, Richard Lambert, said on BBC News this evening Read the rest of this entry »

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Monetarism is back after a decade or more but too late to save the day!

For more than a decade monetarism has largerly been ignored. US broad money supply (M2) has doubled in a decade and credit fuelled massive increases in household debt and asset prices.

Now the pyramid game has come to an end and monetarism seems to be making a come back  – “Governments must reduce interest rates and support the banking system otherwsie we will end up repeating the mistakes of policy makers following the 1929 crash!”.

This is wishful thinking and it is way too late Read the rest of this entry »

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Easy ways to save money when times are hard

Here are some easy ways to save money – it makes a real difference in a short time and means that you can still ski and holiday in the sun despite the downturn: Read the rest of this entry »

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Bail-out bill through – so why is the stock market not reacting postively?

Well of course the argument is that if it hadn’t passed things would have been even worse. This is patently not true. At its first pass, when voted out, markets fell to the level they are at now. This was before there was any hope of the bill being resubmitted. Read the rest of this entry »

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The ripple effect OR bail out the banks otherwise you will all suffer!

The ripple effect has been used very effectively to rally support for the banking bail-out in the US. The argument goes as follows, “bail-out the banks now otherwise the financial sector, the very heart of capitalism, will fail and doom will befall all that walk the earth!”. This argument is entirely false and here is why. Read the rest of this entry »

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