The Banking Crisis......again !
Discussion
How many of you read the article in yesterday's Evening Standard ( 27/11 )by Anthony Hilton ( City Comment).
To me it stated the blooming obvious that there must be a separation of the trading and banking divisions of our banks.
I know of no other business where reckless speculation is encouraged,profits banked,and when the s
te hits the fan the losses become the responsibility of you and me. The bankers say "not me guv" and walk away.
What is driving the lack of ability of successive governments to bring in adequate regulation and put an end to this nonsense ?
To me it stated the blooming obvious that there must be a separation of the trading and banking divisions of our banks.
I know of no other business where reckless speculation is encouraged,profits banked,and when the s
te hits the fan the losses become the responsibility of you and me. The bankers say "not me guv" and walk away.What is driving the lack of ability of successive governments to bring in adequate regulation and put an end to this nonsense ?
Mrr T said:
That's a really good idea it would have meant the UK Government would have had to rescue Barclay's as well and RBC and Lloyds.
Remember the UK banking crisis was about three things, property, property, property.
There were several reasons for the banking crisis but the tipping point may well have been the mortgage fiasco in the USA.Remember the UK banking crisis was about three things, property, property, property.
However you have not addresed the central point on how the lack of regulation and the lack of corporate and personal responsibility still exists 6 years down the line and why it is so difficult to put those effective regulations in place.
Most of us work in business or industry where the controls are there,why not for the banking industry ?
I really cannot get my head round this.
I have been in business for forty years and the buck and responsibility has always stopped with me.
If I feck up I have to take the hit.
When I started in business I had a bank manager that new me and had an understanding of my business.
That all ended about 25 years ago and has gone downhill since then.
Financial speculation appeared to be left to the Merchant Banks and it seemed to work well enough.
This might sound a tad simplistic but it bloody well did a job.
For me it's the lack of regulation and RESPONSIBILITY that sticks in my craw.
I do not care how much someone else earns,good luck to them BUT they have to take the hit when they feck up.
I have been in business for forty years and the buck and responsibility has always stopped with me.
If I feck up I have to take the hit.
When I started in business I had a bank manager that new me and had an understanding of my business.
That all ended about 25 years ago and has gone downhill since then.
Financial speculation appeared to be left to the Merchant Banks and it seemed to work well enough.
This might sound a tad simplistic but it bloody well did a job.
For me it's the lack of regulation and RESPONSIBILITY that sticks in my craw.
I do not care how much someone else earns,good luck to them BUT they have to take the hit when they feck up.
sidicks said:
In what way?
Cut their balls off.........for a start.Feck me geezer.
I write a long heartfelt rant and you want to know what I'd do with the greedy ,stupid b
ds.It rather depends on the severity of their actions,doesn't it ?
For those at the top a proportionate fine/imprisonment ,is that ok for starters ?
A few prosecutions and huge fines might just focus minds.
sidicks said:
Indeed - prosecutions in progress for those that have committed crinimal offences, plus large fines.
Job done!
I doubt very much if their is suitable legislation to deal with this.Job done!
You call it incompetence...that's the problem.
Heads of Banking presiding over an institution that rewards what I perceive as criminal negligence.
sidicks said:
crankedup said:
Over ambition on the part of bankers, public and Governments. Who benefited from it all before the crisis - bankers.
Seriously? You'd don't think that the whole of the economy benefitted from cheap credit pre-crisis?!
Governments who benefitted from increase GDP and tax income which then resulted in increased spending, benefiting the wider population.
Individuals who could borrow more money, more cheaply and acquire goods
Etc etc
crankedup said:
Retail banks will have a legislative duty in ensuring all loans fall within a set remit.
If a retail bank has to foreclose then they seize the asset the loan was granted against. Why would savers lose their savings?t
Agree about a regulatory body that knows what they are doing 100% But to be fair many investment bankers bosses didn't understand what their traders were up to. Likely didn't much care either.
Which investment bank traders caused the problems?.If a retail bank has to foreclose then they seize the asset the loan was granted against. Why would savers lose their savings?t
Agree about a regulatory body that knows what they are doing 100% But to be fair many investment bankers bosses didn't understand what their traders were up to. Likely didn't much care either.
Edited by sidicks on Friday 28th November 15:59
This is a complicated subject but too me the bottom line is that huge risks were taken by a section of the financial
community. When these risks went well huge profits were made,huge bonuses given,all was good.
BUT when "balls fell ",as it was bound to happen, the bankers walked away and all of us have had to bail them out.
To me this is very clear,a simple explanation.
I would like to know what you think went wrong,where the "blame"lies and why you think that nobody should be put in the dock ?
K
2. Thousands of bankers lost their jobs
3. The bailout costs are low in comparison to the increased revenue that was generated during the period when the previous government encouraged the era of cheap credit...
I understand that the climate of cheap credit encouraged borrowing and spending.
What I do not understand is why that was taken as a signal by the Heads of Banks to indulge in taking on bad risks.
Surely if due diligence was paid the danger of taking on those risks would have been recognised .
Either way such risks were ignored because of ignorance or greed ?
I do believe that some bankers argued against this climate of reckless risk taking but were either silenced or sidelined.
sidicks said:
avinalarf said:
I do not wish too get into a slanging match but you appear to have all the answers and suggest others do not have a grasp of the subject.
It's quite obvious that many people do not have a grasp of the subject, as evidenced by the numerous threads on here on this or related subjects.avinalarf said:
This is a complicated subject but too me the bottom line is that huge risks were taken by a section of the financial
community. When these risks went well huge profits were made,huge bonuses given,all was good.
BUT when "balls fell ",as it was bound to happen, the bankers walked away and all of us have had to bail them out.
1. Given that a significant portion of those bonuses were in company shares, when the economy collapsed so did much of the banker's earningscommunity. When these risks went well huge profits were made,huge bonuses given,all was good.
BUT when "balls fell ",as it was bound to happen, the bankers walked away and all of us have had to bail them out.
2. Thousands of bankers lost their jobs
3. The bailout costs are low in comparison to the increased revenue that was generated during the period when the previous government encouraged the era of cheap credit...
avinalarf said:
To me this is very clear,a simple explanation.
Indeed. Clear and simple but not accurate.avinalarf said:
I would like to know what you think went wrong,where the "blame"lies and why you think that nobody should be put in the dock ?
See above (and numerous other similar threads)...What I do not understand is why that was taken as a signal by the Heads of Banks to indulge in taking on bad risks.
Surely if due diligence was paid the danger of taking on those risks would have been recognised .
Either way such risks were ignored because of ignorance or greed ?
I do believe that some bankers argued against this climate of reckless risk taking but were either silenced or sidelined.
ATG said:
avinalarf said:
For me it's the lack of regulation and RESPONSIBILITY that sticks in my craw.
I do not care how much someone else earns,good luck to them BUT they have to take the hit when they feck up.
The leadership got sacked and the shareholders lost their stake. In what sense was responsibly not taken? Do you think there should be criminal liability for taking misguided commercial decisions? Perhaps you can point to another industry where that applies? Indeed Finance is the only sector I've heard of where there are criminal sanctions handed out where the burden of proof is only a balance of probabilities. I do not care how much someone else earns,good luck to them BUT they have to take the hit when they feck up.
I really think that some of you have not grasped what a feck up we have been left in.
Yes of course the government were at fault, but that does not absolve those at the head of the banks from their responsibilities.
It was their greed and recklessness or sheer stupidity that lead to this debacle,it was one or other.
They knew that the banks were to big to fail and therefore took this "get out of jail free card " to feather their nests.
Yes thousands of shop floor bank staff lost their jobs,they should not have ,they did not have the position to make those bad judgement calls,you don't see the likes of Fred Goodwin impoverished.
The banks were acting like a casino,only thing was heads we win,tails we win cos the suckers will have to foot the bill.
The decisions I make in my business are built on experience and good practice AND there is nobody going to bail me out AND if I place fast and loose I'd be banged up.
These top bankers were paid huge salaries they had a responsibility to their Banks to act prudently,they shirked that responsibility for short term greed and personal gain.
Where there is a culture of greed it infects all around it.
In any business the buck should stop at the top.
These top men were extremely well paid to do a job,they failed,big time.
This is not just a case of a few deals going sour,the whole kaboodle was rotten at the core.
Either it was known what was going on,in which case they were culpable or they didn't in which case they were stupid.
I know what's going on in my business and I'm professional enough to smell a rat.
If I choose to ignore the smell because I'm making money that doesn't make it right or me less culpable.
The bad practises of the financial industry are the unacceptable face of Capitalism.
It is poisonous and destructive and should not be defended.
I accept of course that there are many other bad practices in other industries however that's not this topic.
Edited by avinalarf on Saturday 29th November 21:39
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