Carpetbagging, anyone?

grey_gym_sock

gadgetmind wrote: »

My experience is that they are very happy to lend if you go to them with a sound proposition. They ask the right questions, and if you have a solid business plan, then they give the right answer.

they are lending a bit, but are they lending any more than they would if the government wasn't pumping money into them? most of the money is going to marginally reduce their own excessive gearing. that's why "funding for lending" has led interest rates to drop suddenly. if they were lending all the extra money out, that wouldn't have happened.

i'm not criticizing the bank for not lending more. given their own precarious position, it doesn't make sense for them to lend more.

i'm criticizing the pretense that pumping money into the banks is a good way to get it lent out.

gadgetmind

grey_gym_sock wrote: »

they are lending a bit, but are they lending any more than they would if the government wasn't pumping money into them?

Maybe a little, but those I speak to in banking say that the problem is they don't want to lend just to keep zombie companies stumbling along, and that's the vast majority of what they're being asked to do.

When the bottom fell out of the banks' capital base, they weren't even lending against solid propositions, and that's no longer the case IME.

grey_gym_sock

Glen_Clark wrote: »

The most pressing problem is that the power struggle between Blair and Brown led to both of them throwing public money around to buy support. So the unproductive part of the public sector has been allowed to grow to the point where its unaffordable.

yes, running a big public sector deficit when the economy was booming was foolish.

the problem with doing something about that now is that most things you can do will add to already high unemployment, and the private sector is not currently in a position to create jobs to compensate. so i think we need to (a) go slowly on cuts and (b) concentrate cuts on spending that isn't doing much to stimulate the wider economy, while actually increasing spending that will help the wider economy.

the government is, despite the noise made about it, going slowly in the total size of cuts. but they aren't concentrating cuts (or spending) in the right areas.

abolishing EMA is perhaps the most obvious example of them cutting the wrong thing.

gadgetmind

grey_gym_sock wrote: »

while actually increasing spending that will help the wider economy.

I own shares in half a dozen companies that will do well from infrastructure investing, so I wish they'd get a shift on!

Linton

Glen_Clark wrote: »

You make some very good points. But once inflation takes off its Unstoppable. Then its game over for the economy.
The most pressing problem is that the power struggle between Blair and Brown led to both of them throwing public money around to buy support. So the unproductive part of the public sector has been allowed to grow to the point where its unaffordable.

Disagree....
Firstly on inflation: in the past 40 years we have had serious periods of inflation eg 15%. They were corrected in a small number of years. Inflation is a pain, but it's not terminal.

Public sector debt as a % of GDP did not increase or decrease significantly during the Blair-Brown years until the global credit crunch crash in 2007/2008. It has of course being rising and continues to rise massively since then. During the Blair-Brown years it was in general lower than in 1979-1996.

Source: http://www.parliament.uk/briefing-papers/SN05745.pdf

Glen_Clark

Linton wrote: »

Disagree....
Firstly on inflation: in the past 40 years we have had serious periods of inflation eg 15%. They were corrected in a small number of years. Inflation is a pain, but it's not terminal.

Public sector debt as a % of GDP did not increase or decrease significantly during the Blair-Brown years until the global credit crunch crash in 2007/2008. It has of course being rising and continues to rise massively since then. During the Blair-Brown years it was in general lower than in 1979-1996.

Source: http://www.parliament.uk/briefing-papers/SN05745.pdf

Couple of points
1) Most of the public sector debt created by Brown & Blair is off balance sheet eg. PFI & other privatisations, gold plated pensions liability for the huge increase in highly paid civil servants.
2) Yes we've had high inflation before, but we also had comparably high interest rates - link: http://swanlowpark.co.uk/bank0604.jsp

talexuser

Back to mutuals, Nationwide has just announced a halving in profits to 124 million - but an ADDITIONAL 45 million put aside for a total of 173 million to cover claims for PPI mis-selling. Some mutual!

grey_gym_sock

not different enough.

steady__eddie

Another one bites the dust.

http://www.theshepshed.co.uk/about/corporate-information/press-release/

gadgetmind

Damp squib.

"No bonuses will be payable to members of either society arising from the merger."