Increase in fscs protection scheme?

gadgetmind

BillJones wrote: »

Which is why Goldman was driven to the wall through 2008

Goldman only survived because they converted to a tradition bank structure so they could get TARP relief. Remember that? Do the names Lehman Brothers, Merrill Lynch, Morgan Stanley and Bear Stearns ring any bells?

Have a read of this -
http://en.wikipedia.org/wiki/Investment_banks#Financial_crisis_of_2008

Read the "Criticisms" section too.

Investment banks weren't just the victims of the financial crisis, they were pretty much the cause of it.

It's almost as though your simplistic take on the situation doesn't actually match recorded history, and your definition of "perform well" doesn't match mine either!

cloud_dog

BillJones wrote: »

It really isn't. If it was, Goldman wouldn't exist, and Lloyds would be one of the biggest players in investment banking.

As to "risky", what I do carries far, far less risk than what (for example) Northern Rock was doing in the mid-2,000s, which destroyed it.

You've chosen to ignore my (not only I know) comment but........

So, for a regulated financial organisation there isn't any sort of capital requirement, or capital ratio (which is what you are implying)? So, things like the Bank of England / PRA CET requirements are smoke and mirrors then?

2010

BillJones wrote: »

Well, the only people that banks want to pay to retain tend to be those who perform well.

If you've someone who never produces much, shows little potential, and then tries to demand a seven figure package, they'll just politely be shown the door.

As at Barclays:

Barclays is set to cut more than a quarter of the staff in its investment banking arm as part of a radical overhaul of the lender that will also lead to the closure and disposal of its entire European retail business.

About 7,000 staff employed by the old Barclays Capital division will lose their jobs, out of a current workforce of just over 26,000, that will see the bank shrink its trading operations and focus more on underwriting new issues of bonds and shares.

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10815350/Barclays-cuts-7000-investment-bank-jobs-in-overhaul.html

talexuser

Goldman was bailed out by the taxpayer, courtesy of former top employees then in government, who had been responsible for deregulating the banks to the point of greed inspired self-inflicted bankruptcy in the first place. To hold THEM up as any kind of example is just breathtaking.

gadgetmind

7000 let go, all of them capable of performing well. I'm sure they'll all be able to start their own operations given their ninja skills that are worth seven figures a year.

grey_gym_sock

gadgetmind wrote: »

7000 let go, all of them capable of performing well. I'm sure they'll all be able to start their own operations given their ninja skills that are worth seven figures a year.

it just needs somebody to give them a fair shake of the dice by providing each of them with a few million working capital to gamble with, at minimal interest rates. perhaps the "funding for lending" scheme could be adapted to help with this.

bigadaj

grey_gym_sock wrote: »

it just needs somebody to give them a fair shake of the dice by providing each of them with a few million working capital to gamble with, at minimal interest rates. perhaps the "funding for lending" scheme could be adapted to help with this.

Careful that could be adopted as a policy.

It's nice to see that the much touted humility of bankers following their fall from grace after the gfc is so much in evidence.

kidmugsy

The trouble with deposits was that people wanted to lend their money to the banks, so that they could earn interest, rather than securely stick it into a vault where they would earn no interest. Then they want Someone Else to pay when their loans to the banks turn sour.


Now that interest rates are negligible, the sensible thing for anyone troubled by the protection limit is indeed to use a vault.