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Peston says Uk to also protect 100% of savings

Patr100
Patr100 Posts: 2,855 Forumite
Part of the Furniture 1,000 Posts Name Dropper Photogenic
in Savings & investments
Following the German Govt decison today R Peston reports that Uk will inevitably follow suit "within 24 hrs" and announce protection of 100% of private savers.
The decision by the German federal government to guarantee all private savings in German banks is momentous.
In a globalised banking market, in which money can leak across borders like a sieve, it will be almost impossible for the UK not to follow Germany's lead.
I would be immensely surprised if Alistair Darling, the Chancellor of the Exchequer, didn't announce a similar commitment within the next 24 hours.


http://www.bbc.co.uk/blogs/thereporters/robertpeston/
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Comments

  • Lokolo
    Lokolo Posts: 20,861 Forumite
    Part of the Furniture 10,000 Posts
    I imagine they are saying that to stop people rioting when a bank is in the news for 'failing'. Like what happened with NR. Just makes things a whole lot worse.
  • KTF
    KTF Posts: 4,855 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Well they might as well because they have shown that no bank is going to be allowed to go under so the guarantee is meaningless in reality.
  • dunstonh
    dunstonh Posts: 121,292 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    I wonder who is going to fund that then?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • 1echidna
    1echidna Posts: 23,086 Forumite
    dunstonh wrote: »
    I wonder who is going to fund that then?

    Rather like Gordon Brown on ending African poverty - no one. The government would default rather like Argentina did once and people would be told that one day they would get their money - probably when inflation had destroyed a lot of its value.
  • sadabbott
    sadabbott Posts: 85 Forumite
    dunstonh wrote: »
    I wonder who is going to fund that then?
    What funding is required? Just print the money and hand it to the customers. Job done.
  • Lokolo
    Lokolo Posts: 20,861 Forumite
    Part of the Furniture 10,000 Posts
    sadabbott wrote: »
    What funding is required? Just print the money and hand it to the customers. Job done.

    You can't just do that....
  • sadabbott
    sadabbott Posts: 85 Forumite
    Lokolo wrote: »
    You can't just do that....
    Why not? Its a fiat currency
  • dunstonh
    dunstonh Posts: 121,292 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    sadabbott wrote: »
    What funding is required? Just print the money and hand it to the customers. Job done.

    The FSCS isnt funded by the Govt. It is funded by FSA authorised firms. So, if there is going to be a 100% increase, then where is the money coming from to underwrite it?

    I dont think its an issue personally as its a non-event. The B&B nationalisation has already shown the FSCS will be used to protect savers money above £35k but its more the principle of who is making the decision on this and how do they intend to pay it if worse case happens.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • sadabbott
    sadabbott Posts: 85 Forumite
    dunstonh wrote: »
    The FSCS isnt funded by the Govt. It is funded by FSA authorised firms. So, if there is going to be a 100% increase, then where is the money coming from to underwrite it?

    I dont think its an issue personally as its a non-event. The B&B nationalisation has already shown the FSCS will be used to protect savers money above £35k but its more the principle of who is making the decision on this and how do they intend to pay it if worse case happens.

    The FSCS is an independent body set up by the FSA. The FSA is government funded and so if money needed to be printed it could.
  • LucyTheDwarf
    LucyTheDwarf Posts: 880 Forumite
    sadabbott, it'd be worthless. Stop suggesting printing money in every post!
    Target Cash Net Worth: £25K by January 2012
    Progress     May-08     19.0%; May-09 40.0%; May-10 63.0%; May-11 58.4%; Jun-11 58.5%; Jul-11 58.9%; Aug-11 58.7%; Sep-11 59.0%
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