Mugged again

crazyguy

caveat_emptor wrote: »

What a strange way to look at the public finances. You pay your tax but don't give damn how it's spent because it's no longer yours.
The Government needs more people like you.

Not quite I am just in the real world and dont !!!!! about such trivial issues that I can neither change nor affect me in any way shape or form.

Ifts

crazyguy wrote: »

Not quite I am just in the real world

And there I was thinking you were in In La La Land

Chadsman

Its Virgin on the ridiculous.

pqrdef

caveat_emptor wrote: »

Cost to us to bail out Northern Rock 1.4 billion.Cost to Virgin Money to buy 750 million. Good old taxpayer is always there to pick up the tab.

The £1.4bn is a totally arbitrary figure. Keeping Northern Rock afloat cost the Treasury £27bn in loans, and how much of that it will never get back remains to be seen.

Or rather, it remains to be obfuscated, because they'd rather we never get to put a figure on it.

£1.4bn is merely the slice of the £27bn that they've written off so far, by taking the opportunity for a bit of creative accountancy to convert it to equity in the "good bank" (increasing their shareholding from, er, 100% to 100%).

It's £1.4bn because that was what they optimistically once thought they might get to sell the "good bank" for. A different figure would have been the same financially, but £1.4bn had the optimal spin value.

So, just think, every £100m taxpayers have lost on the good bank is £100m less that they will eventually lose on the bad bank.

hollieinbloom

If we were told everything that the tax payer contributes for then we'd all be crying. I say contribute as we also pay for the good things like schools, roadworks and keeping the place tidy with bin disposal. So if you pay say £250-£300 a month on a basic wage, you're prob only contributing towards David Camerons dinner. x

pqrdef

caveat_emptor wrote: »

Now I'm angry. Just heard Ron Sandler who I think was responsible for selling NR saying that this is a good deal for the taxpayer but didn't say why. Does anyone else know?

Well we've just got £750m for something loss-making, worthless and near-unsaleable. Sounds like a good reason for a party.

I wonder if Surichard would be interested in an aircraft carrier, a large Georgian palace in central London, a soon-to-be-ex Olympic stadium, or any other white elephants the nation has lying around.

opinions4u

The profitability of NRAM is an intriguing issue.

Charge your borrowers 4.99% interest on money that you simply printed.

Brilliant!

Apparently income is exceeding write offs. So it looks like the taxpayer will get their money back and some. Over a very long time.

antrobus

caveat_emptor wrote: »

Cost to us to bail out Northern Rock 1.4 billion.Cost to Virgin Money to buy 750 million. Good old taxpayer is always there to pick up the tab.

Yes, but as the previous poster has alluded to, Virgin is buying Northern Rock (good bank) leaving us with Northern Rock (bad bank) aka NRAM. Oddly enough the former is currently loss making and may well struggle to make any real money, whilst the latter appears to be coining it. Making a 'loss' of £400m on the sale of the former may well be neither here nor there, so long as NRAM can make annual profits i the region of the the £400m that it managed in 2010.

pqrdef wrote: »

The £1.4bn is a totally arbitrary figure. ..
£1.4bn is merely the slice of the £27bn that they've written off so far, by taking the opportunity for a bit of creative accountancy to convert it to equity in the "good bank" (increasing their shareholding from, er, 100% to 100%).....

Well no actually. The £1.4bn was a very real number that represented an actual cash transfer. And as far as the £27bn of loans is concerned, £6bn has already been repaid, and the balance owing is with NRAM and thus has nothing to do with the Northern Rock business that is being sold. Not a penny of the £27bn has been written off by anyone.

IronWolf

What we "bought" it for is irrelevant in determining if we got a good deal. We didn't buy it as an investment, we bailed it out.

Virgin are essentially buying the net assets and customers, as the business as a whole is loss making. £700m sounds like a reasonable figure to me for something not making any money.

talexuser

Well, we can argue about figures and balance sheets, but the most galling thing is people coming on the tv and telling us it is a good deal for the taxpayer.

A good deal for the taxpayer is extra services for no extra tax or tax cuts, it is not bailing out the banks. A good deal for the taxpayer is spinning the bailout as if it were some form of investment opportunity!!