Posts Tagged 'alistair darling'

Night Said Fred

As Sir Fred departs the scene one can only view his career with RBS as a microcosm of our financial times. Like Icarus he flew too close to the sun, replacing a well run, austere Scottish retail bank with a laissez fair institution with global ambitions.

I am loath to praise our government for their actions because it could and should have been done at least two weeks earlier, and like congratulating the drowning man for accepting the offer of assistance, what alternative was there? Independent economists had been calling for this action for some time, and sprinkled with some political actions: no dividends, the heads of those responsible, it remains the best action that could be taken. Since this crisis began, the UK banks have consistenly lied to anyone who would listen. Minimal exposure to the US housing crisis we were told, mark to market values were still good. Yet each quarter from 2007 brought us further downgrades. It is for this reason why heads must roll and bonuses for MDs and above must be curtailed for every institution who brings its Dickensian begging bowl out.

I am somewhat annoyed with the response by the Conservatives. They were consistently slow in their response, merely adopting a ‘united front’ approach, arguing that they would work with the Government. I realise that nationalisation (and that’s what it is) is a bitter pill to swallow, but these are not ordinary times. It is vital to ensure that this does not happen at the same scale again which means, punishing the executives, through resignations, and bonus cuts, and punishing the shareholders through dilution and no dividend. The shareholder via the institutions clearly need to take a closer look at their holdings. Did Enron and WorldCom not teach us that a story too good to be true is just that?

If the Scandinavian and Japanese crises of the last century tell us anything, it’s that we’re in for a painful recesssion. The best we can hope for is that 2010 will bring us new hope, and that this, if not the end, is at least the beginning of the end.


Yes Darling

So Mr Darling has promised to do something to the economy!

Well considering that the credit crunch began some twelve months ago, one can only marvel at his inability to have a structured response by now.

There is only so much that can be borrowed in the current climate therefore taxes have to be raised yet, Darling ever the politician, just didn’t have the guts to say the obvious. This unnecessary economy with the truth is incredibly frustrating. I was happy to praise Mr Darling when he acknowledged the severity of the financial earthquakes some weeks ago, but clearly he’s been told to keep his mouth shut by Team Brown.

What we actually need is a structured attack before the contagion gripping the city hits town & country!

On a separate point, I note the call for a windfall tax is rising in the labour ranks. Now I have a big problem with windfall taxes. There is a system already in place to capture a share of excess profit. It’s called ‘taxation’.  Also, I note that it’s ‘to pay for rishing fuel bills’. Where does this taxing A, to bay for B principle stop? Will all taxation need to be earmarked for a particular related expenditure? In which case, who will we tax to pay for defence or our MPs and civil servants? Now that’s interesting…

June 2018
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