Bail us out

January 16, 2009

Probably knocking this on the head

Filed under: Uncategorized — stanleymilgram @ 5:49 pm

Although I’ve been toying with the idea of moving this blog from its intended focus on the bank bailouts to the chronicling of self-serving business rhetoric versus attacks on us ordinary folk – I haven’t got the time to do the subject justice.

As part of a new year “do less but better” drive, I’ll not be posting here. Whether I roll up the entire thing and free the domain name, or leave what there is online as reference, that depends on if anyone else wants to do that or take it over. Let me know.

October 27, 2008

“Another bubble bursting”

As the stock market goes plop again (that big pile of cash to the banks hasn’t fixed anything), and I wonder why, this article catches my eye.

the larger story is that the global economy is fast popping its latest monetary bubble, the one over the last 14 months in commodity prices and non-dollar currencies.

Those bubbles are:

  • housing prices (2002-2007)
  • flooding the market with currency to avert the credit crunch (since August 2007)
  • commodity prices (e.g. the $150/barrel oil and the riot-causing food price hikes)

So there is no “fix,” only delaying the effects. Playing pass the parcel with the nasty consequences of  deregulation and free market absolutism. The banks have won the jackpot with their public funds bailout in return for token gestures of contrition. What other costs are going to be passed onto us to go with our debt, job losses, and higher food prices?

Saw an appropriate slogan the other day:

Capitalism isn’t in crisis, capitalism is crisis.

October 25, 2008

Banks hoarding cash

Filed under: bank bailout, credit crunch — Tags: , , , , — stanleymilgram @ 4:01 pm

the dirty little secret of the banking industry is that it has no intention of using the money to make new loans

This from the New York Times, but the situation is the same in the UK.

Vast amounts of money handed to the banks, claims that this will be used as “leverage” (that word again…) to make the banks restart the economy. And this doesn’t happen. Never mind that “lending at 2007 levels” is just storing up trouble for later.

Call it a Jubilee or call it an Amnesty, it’s time to clear the books and write off everyone’s debts.

October 22, 2008

Satire booming, though

Filed under: real victims of the financial crisis — Tags: , , , , — stanleymilgram @ 8:43 am

So we’re in a recession but some comedians are having a field day. Like Mark Steel here and here.

the issue of compensation when it comes to characters like Fred Goodwin, who’ve been removed from their posts at the bank. The debate about how much these people should pay us for robbing the place dry would keep the country engrossed for years.

And:

I’m not sure what makes it official that the recession’s started, but one way of measuring the start is when the government first insists there ARE lots of vacancies, but the unemployed need to be more flexible, and better at applying for jobs, as Gordon Brown stated this week.(…)

but never a truer word spoken than in jest (or whatever the quote is):

perhaps anyone who finds themselves unemployed, or homeless or otherwise broke as a result of this recession, should march to the House of Commons and announce “I demand to be nationalised. Bail me out for a million and I can carry on, because if I go under, who knows WHAT I might bring down with me.”

October 20, 2008

Anti-bailout protest in Edinburgh this Friday

Filed under: bank bailout, real victims of the financial crisis — Tags: , , , — stanleymilgram @ 11:44 am

I received this in an email:

Economic Crisis Demonstration
Edinburgh Friday 24th. Gather from 5pm.
An act of mass public expression against the deepening economic crisis, dodgy bailout, and the severe lack of economic assistance for ordinary people, is set to happen in Edinburgh City Centre at 5pm on Friday 24th of October.

We are paying £537bn to bail out the banks, 5 times the annual spending on the NHS. Our jobs, homes, wages and public services are all at risk from this economic crisis. People are rightly demanding – “Where is OUR bail-out?
Gather from 5pm: HBOS headquarters, top of the mound, near the High Court.

People can then write down their anger, worries, and *demands*, and deposit them in a large black box. The demonstration will then proceed down the royal mile to parliament, where the box will be delivered.

More: http://scotland.indymedia.org/node/11396

October 17, 2008

More evidence that the money is going to the wrong place

Filed under: bank bailout, greedy bankers — Tags: , , , , , — stanleymilgram @ 4:29 pm

Provided by BBC’s Robert Peston, whom I was amused to discover is being blamed for some of the world’s economic woes (since everything is fine n dandy with the banks and anyone who says otherwise is a terrorist).

Since [the bank of England's rate cut], the LIBOR interest rate charged by banks for lending to each other over three months has barely moved.

And that matters, because banks set their prices for credit provided to households and businesses off that so-called interbank rate.

Or to put it another way, banks aren’t passing on to us the full cut in the interest rate which the Bank of England thinks is necessary to prevent a deflationary recession.

This fits a pattern, that I haven’t had time to fully blog yet, of actions being taken by banks and shareholders to reinforce their positions at our expense. See, for example, the complaints about non-payment of share dividends.

In this case, an action (with an implicit cost to the public) made for a purpose, to “unbung” the apparently-vital system of lending between banks, is instead being used to shore up the security of individual banks. Public funds, selfish use.

Any actions taken in this direction will face the same problem: the banks and their shareholders do not care about the public good, like measures to prevent job losses. They want their dividends, bonuses and expense accounts back, the rest of us can go hang.

What if we took action that bypassed the banks. Let them go to hell. They aren’t the economy, we are. If people need money to access what they need, then let us get it from elsewhere, an institution that we control and that we can trust. (No, the government doesn’t fit the bill either…)

October 15, 2008

The real victims of the credit crunch

Filed under: real victims of the financial crisis — Tags: , , — stanleymilgram @ 10:00 am

…are the ordinary people who stand to lose their jobs in the recoil from the banks’ cowboy behaviour. People like David Salt featured here.

Sat alone at home with, by his own admission, not much to do, Salt believes that banks offering unrealistic credit are ultimately responsible for his job loss.

That makes the bail-out even more painful, he says.

“The government is pumping all these billions into financial institutions so they can lend us money again. Can’t they give me a few hundred quid so I can retrain on a computer course?”

The bailout of banks might mean that they don’t go to the wall but they are experts in making others suffer for their mistakes. The more that they carry on business as usual after this debacle, the bigger the next crisis will be. Pumping in more credit to the system isn’t going to solve underlying economic problems.

October 14, 2008

Same situation in the US

Filed under: bank bailout — Tags: , , , , , , — stanleymilgram @ 11:49 pm

Historian Howard Zinn has a piece in US liberal mag The Nation on this idea: Spend the Bailout on the middle class (if you think that’s an awful title, remember that when an American says “middle class” they mean “working class,”).

A simple and powerful alternative would be to take that huge sum of money, $700 billion, and give it directly to the people who need it. Let the government declare a moratorium on foreclosures and help homeowners pay off their mortgages. Create a federal jobs program to guarantee work to people who want and need jobs.

Government jobs programmes? Not so sure, for me it conjures up images of Victorian workhouses. The thing about foreclosures works though. If the banks are choking on “toxic debt,” then paying off mortgages seems to be the Heimlich manoeuvre people need. By contrast, putting more money in the hands of bankers must be the equivalent of blowing air down the throat of our choking victim.

Might work a while, but how long from choke to croak?

I also like this paragraph, which shows how long this kind of corporate dole scrounging has been going on for.

In his 1931 Harper’s essay “The Myth of Rugged American Individualism,” historian Charles Beard carefully cataloged fifteen instances of the government intervening in the economy for the benefit of big business. Beard wrote, “For forty years or more there has not been a President, Republican or Democrat, who has not talked against government interference and then supported measures adding more interference to the huge collection already accumulated.”

“Some contrition” but bigger pensions

Filed under: bank bailout, greedy bankers — Tags: , , , , , , , , , — stanleymilgram @ 10:08 am

Never mind the “no bonuses” posturing, look at the figures.

Just in case anyone thinks that Sir Fred Whatshisface of RBS and Andy Hornbyrailway of HBOS have been punished in some way:

Sir Fred said he would waive his right to a £1.2m payoff when he leaves, but he will be entitled to an annual pension £579,000.

Yeah, I think I’d not cry too much over losing my bonus if I could console myself with the thought that every year for the rest of my life I’d get given more money than most people make in their lifetimes.

That and more handy figures to wave at anyone who thinks you should have sympathy for these parasites came from here.

October 13, 2008

You just gave your bank £500

Filed under: bank bailout — Tags: , , , , , — stanleymilgram @ 11:52 pm
The only stocks they should let bankers near

The only stocks they should let bankers near

So according to the FT lady, governments now realise it’s not a “liquidity crisis” (the money is there just… not… quite… yet…) like has been claimed.

It’s a “solvency crisis” (yeah I could pay you the money but I promised Lou, and Tony Fingers, and the VAT man).

The bail-outs will not prevent an economic slowdown. Nor will they avert further (and necessary) deleveraging. Equity markets could stay jittery for some time as debt-laden countries and companies writhe in pain. Financial Times

I (and you) now own RBS and HBOS. Great. What does that mean? With RBS, it means taking on their share of the £360 billion of unpaid Lehman Brothers debt that came due last Friday, sparking the most recent panic. With HBOS, all those overpriced mortgages that people soon won’t be able to pay.

Is this the end? Hell no. Remember Washington Mutual (no me neither). Their unpaid debt is going to divided up on October 23rd. That will load more debt onto the banking system. Now, that debt is yours.

A bailout to the tune of ~£37 billion, that’s more than £500 for each person in the UK, on my envelope. What do I get for that?

  • the banks don’t collapse – so all our debt still exists
  • Gordon says “they won’t be micromanaging” them – No, why would you want a say in what you just bought for more than Scotland’s GDP.
  • Maintain lending levels to homeowners & small businesses for 3 years – yep, keep the charade going till after the next election. Smart, eh. “Credit got us into this mess, and credit will get us out of it!”
  • Why did we get rid of the stocks? I mean the real ones. That’s where Sir Fred and friends should be headed…
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