UK banks, sucking on the blood of depositors

Malcolm.

I would like to add, it's not only the banks sucking the blood from depositors. The decisions of the BoE's Monetary Policy Committee has not helped either.

lemonjelly

tomterm8 wrote: »

I don't think so, personally. Recovering money from the bailouts is nice, but over the long term, changing the situation so the events of 2007 happen less frequently is much more important. Because, as we saw, Banking crises are extremely expensive in terms of lost output. The cost of the bailouts are small potatoes compared to the cost of severe recession caused by the crises. The IMF survey suggests that banking crises tend to increase government debt by between 20 and 40% of GDP. Our own crises looks to have increased government debt by something in the order of 30% of GDP, even though most of the bailout costs will have been recovered.

I agree with every word you say.

Problem is, the short-termism with which we (socially) tend to view the world means that many will want to prioritise "us" getting "our" money back.

The only thing I could add, I suppose, is that if they do return to profitability perhaps they can be sold off in parts, to achieve the ends you highlight. Whether that is done is another debate.

C_Mababejive

Banks and Government may think they are incredibly smug and clever now by shafting savers but they will both reap the whirlwind in future because all those good,wholesome values about trust ,saving for the future and looking after yourself,debt being bad etc...have all been flung out the window with the pish pot and the future will be very different. For instance,i may well have evangelised on the need for saving in the past but now i would evangelize and promote the here and now society where you get and take and have managed debt becuase someone will always bail you out and you can almost never be made homeless so get a big fat mortgage etc etc blah blah blah

michaels

It is unfortunate for all the savers who are losing out in real terms as a result of the policies needed to save the housing market and the banks.

However what would the alternative have been?

If these two markets had been left to collapse then savers would also have lost their money.

The bank compensation scheme (even for 50k) requires solvent banks to cover the losses of the insolvent - if even one big bank had gone the scheme would have been insolvent. So yes savers are taking a loss but they would have lost more if the banks were not being bailed out - sorry.