Could people REALLY lose all their savings?

jamesd

Yes, housing was involved but that part has been around for a long time. It was the changes in the other things - notably securitisation and elimination of the rules splitting investment and retail banking in the US - that caused the problem.

GeorgeHowell

If the government could not pay the <=£85,000 in compensation then we would have anarchy.

What would therefore actually happen in the event of a very widespread collapse of the banking system would be the government adopting emergency powers, putting us on almost a wartime footing. They would have absolute control over the financial sector, including the supply of money and credit, interest rates, prices and incomes, withdrawal limits, share trading etc, whatever it took to stabilise things. It would not be pretty, but it would be preferable to anarchy.

longleggedhair

This threaD is beginning to sound more like a TV drama than reality. Remember, the schools are still open, the bins are being emptied, Hospitals are open, the world is just ticking on as normal, working its way through the problems it has, as it has done though every other recession/depression over the past millenia, shall we all carry on with our lives now?

oldtoolie

They haven't collected my bin. Is this the beginning of the end?

GeorgeHowell

longleggedhair wrote: »

This threat is beginning to sound more like a TV drama than reality. Remember, the schools are still open, the bins are being emptied, jospitals are open, the world is just ticking on as normal, working its way through the problems it has, as it has dont though every other recession/depression over the past millenia, shall we all carry on with our lives now?

True. But if the political pygmies (*) who call the shots in the EU are unable to prevent the Euro collapsing uncontrolled, then it would be a different scenario from anything that has been experienced over the past millenia. I think it's always preferable to hope for the best but prepare for the worst, and that is what we are led to believe HMG is doing.


(*) Figure of speech -- no discriminatory slur intended

jimjames

GeorgeHowell wrote: »

True. But if the political pygmies (*) who call the shots in the EU are unable to prevent the Euro collapsing uncontrolled, then it would be a different scenario from anything that has been experienced over the past millenia. I think it's always preferable to hope for the best but prepare for the worst, and that is what we are led to believe HMG is doing.


(*) Figure of speech -- no discriminatory slur intended

Not strictly true. Look up what happened with the gold standard and the similarities with the euro so it has happened in the past.

GeorgeHowell

jimjames wrote: »

Not strictly true. Look up what happened with the gold standard and the similarities with the euro so it has happened in the past.

The gold standard was a currency union (cf the ERM) not a common currency, so not quite the same thing. In addition the world we live in now is far more complex, globalised, more major players, computerised, instant communications etc. I don't believe that a sudden Euro break up has any comparable past precedent that could give us confidence that we would not be facing a catastrophe.

longleggedhair

I am just relieved we dont have a labour government signing blank cheques to our european "allies".

ESKIMO

http://www.fsa.gov.uk/Pages/consumerinformation/compensation/index.shtml

http://www.fsa.gov.uk/Pages/consumerinformation/compensation/limits/index.shtml

ESKIMO

The FSCS is nothing more than a 'paper promise' tbh. - But an important one no less that inspires confidence in the financial sector. Without it - there would be nothing to 'guarantee' your savings deposits.

Unfortunately part of the problem is the current financial system - which in a nutshell is a victim of its own success. Used and abused.