so, this bail out in Cyprus, is actually theft of the savings of so called "rich"

The_Green_Man_2

GhIFA wrote: »

You don't seem to understand that there is a whole world of difference between the failure of Woolworths and the failure of two banks holding the accounts of millions of customers and businesses.

Why don't you enlighten me?

CLAPTON

The_Green_Man wrote: »

Do you support the idea of letting any business fail or do we as tax payers prop them all up? Didn't we try that in the 70's and we ended up with wildly inefficient businesses that cost more to produce products that they made by selling them?

If we don't support a large, inefficient company with a failing business model, such as as Woolworth's then...

So their staff would not be paid.
Their suppliers would not be paid.
Their customers would be reluctant to do business with them.
Their staff would start defaulting on their own debts; mortgages, utilitie bills etc etc.

Do you believe that a government would be any better at running a bank than they were running British Leyland? Is that the model of state intervention you want to go with?

Indeed so, I do indeed think that a normal company that has a bad business model should go out of business without government intervention.

However banking is different.
In combination RBS and HBOS and LLoyds probably were the bankers of 30-40 % of UK businesses.

To suddenly have 30-40 % of UK businesses stop trading and have 30-40% of UK people suddently unemployed and the government suddenly loses 30-40% of tax revenues and the government suddenly has to find benefits for 30-40 % of the UK population requires some considerable thought.


A normal business going down does take out 'innocent' suppliers but a large bank going down can take out very large numbers of otherwise solvent successful businesses and bankrupt the whole country.

StevieJ

Too big to fail

GhIFA

The_Green_Man wrote: »

Why don't you enlighten me?

It's already been mentioned in this thread. In theory, I don't necessarily disagree with you. But it doesn't take any enlightenment - If you believe that letting two of the countries major banks fail wouldn't have had a horrendous, maybe even cataclysmic, impact on the UK economy, then that's up to you, but comparing the results to the failure of one retail chain is nowhere near a direct comparison.

The_Green_Man_2

CLAPTON wrote: »

Indeed so, I do indeed think that a normal company that has a bad business model should go out of business without government intervention.

However banking is different.
In combination RBS and HBOS and LLoyds probably were the bankers of 30-40 % of UK businesses.

You keep trying to bolster your argument by mentioning Lloyds, even though we have established that if HBOS was allowed to fail, then Lloyds would not have been put into the financial dire straights by buying it.

Please try again without the misdirection.

The_Green_Man_2

GhIFA wrote: »

It's already been mentioned in this thread. In theory, I don't necessarily disagree with you. But it doesn't take any enlightenment - If you believe that letting two of the countries major banks fail wouldn't have had a horrendous, maybe even cataclysmic, impact on the UK economy, then that's up to you, but comparing the results to the failure of one retail chain is nowhere near a direct comparison.

Two major banks? Which ones?

CLAPTON

StevieJ wrote: »

Too big to fail

yes, if we want to treat banks like 'normal' businesses then they must be broken up into sufficiently small unit that a few can fail without bringing down the whole economy.

at the moment we simply have a factuous mantra of firewalls between casino banking and normal banking.
This clearly does nothing to address the problem of the size of the banks and the impact should they fail.

CLAPTON

The_Green_Man wrote: »

You keep trying to bolster your argument by mentioning Lloyds, even though we have established that if HBOS was allowed to fail, then Lloyds would not have been put into the financial dire straights by buying it.

Please try again without the misdirection.

I am out.................

The_Green_Man_2

CLAPTON wrote: »

yes, if we want to treat banks like 'normal' businesses then they must be broken up into sufficiently small unit that a few can fail without bringing down the whole economy.

at the moment we simply have a factuous mantra of firewalls between casino banking and normal banking.
This clearly does nothing to address the problem of the size of the banks and the impact should they fail.

Northern Rock was a small business. So was B&B and the Icelandic banks had nothing to do with the UK apart from them being in the FSA scheme and having a small proportion of UK depositors.

Oh dear, I've just noticed that "you're out", the internet debating form of 'taking your ball home'. That's a shame but I guess without your continual 'double accounting' as another poster commented, then your argument starts to crumble.

spacey2012

What the face doing is pushing the country in to Nationalism.
They liquidate and buy as much gold or Silver as they can get their hands on and start a standard backed currency where 1 hour of Labour = 1 unit of currency.

Sooner or later the bankers are going to burst the dam, they are not going to stop until they do.