RBS to be Sold at a £13bn loss

wotsthat

Generali wrote: »

I hope you feel that bailing out all those rich savers was worth it.

The irony is the people bailed out are probably the most vocal in complaining about the low interest they receive on their savings. Ingrates.

I had far too large a chunk of my net worth in Lloyds shares (a bet that there would be a credit crunch but it would be overblown ) and was sweating a tad when they needed a bailout. I'd just like to thank all those less well off than me who contributed to protecting my wealth. I'm still underwater in Lloyds but the recession has been so great the sums of money now seem like small change and I've just received my first dividend in years - thanks.

wotsthat

Generali wrote: »

Yes, a £14bn profit if you ignore the cost of borrowing the £107bn and with no risk adjustment.

Even if you just use the Government cost of borrowing over the 7 years at about 4% compound it but then recognise that due to QE a third of that interest is going to the BoE and thus on to the Government you get an interest charge of £90bn so a loss after carrying costs of about £75bn or 'how bloody much?' as we economists call it.

I don't see why the government aren't more upfront about this.

The banks needed bailing out (maybe some of them) because they were in trouble and sensible people should realise there's a cost associated with this. Yes, the bailouts were sold as being potentially profitable but in the event they weren't so the cost of maintaining the systemically important bank RBS is £75bn and counting.

Maybe even the Tories have reached a crossroads where they don't just blame Gordon Brown in the first instance although that would be better than pretending it's really great to have failing banks because they're so brilliant for the taxpayer.

purch

Ultimately, leaving aside whatever your feelings are about the initial bailout, it is 2015 now.

The UK has a holding of RBS stock worth £X.

If the Treasury can take £X and use it to get a better result than they would by continuing with their holding in RBS then it must be the best decision.

Any sensible and succesful investor or trader will know that you don't worry too much about what you paid, it's what you can currently do with what you have, to achieve the best result that matters.

kabayiri

purch wrote: »

...
Any sensible and succesful investor or trader will know that you don't worry too much about what you paid, it's what you can currently do with what you have, to achieve the best result that matters.

Indeed.

I'd take the £X cash raised if I were the government and spend it all on HS2. I'd even appease the Scots by putting on a fairly rapid coach service for those few wanting to carry on up to the frozen North.

purch

I was thinking more along the lines of rebuilding Hadrians Wall to a height of 25 feet with razor wire on the top.

Generali

kabayiri wrote: »

We often forget the societal costs as well.

Whenever the benefit classes are challenged on tv about their apparently soft life style ; sky tv and fags and booze ; the retort coming back is "well the bankers can do what they want. So can we!"

We talk about limiting bankers' bonuses, how about limiting benefit takers to Skye TV?

kabayiri

Generali wrote: »

We talk about limiting bankers' bonuses, how about limiting benefit takers to Skye TV?

I still do not understand why benefits do not fluctuate with the wider health of the economy.

This is a surefire way of disenfranchising the claimant classes from trying to make the nation wealthier.

Graham_Devon

Generali wrote: »

I'm sure that a poster on here, in the face of much criticism, predicted that any sale would be at a colossal loss. If anyone could help me remember who that was I'd like to go back and congratulate them on their perspicacity.

It wasn't me, so I'm not claiming that credit, but I started a thread on it in 2012 talking of the losses we'd have to face. It was in response to an article.

Full thread is here

Certainly wasn't a popular view at the time!

Your poster may be chewmylegoff...

Thrugelmir

Generali wrote: »

I hope you feel that bailing out all those rich savers was worth it.

As the largest bank in the world at the time. What would have been the real cost to the UK economy if it had been allowed to fail?

wotsthat

Graham_Devon wrote: »

It wasn't me, so I'm not claiming that credit, but I started a thread on it in 2012 talking of the losses we'd have to face. It was in response to an article.

Full thread is here

Certainly wasn't a popular view at the time!

Your poster may be chewmylegoff...

I think Generali was subtly trying to be modest...

https://forums.moneysavingexpert.com/discussion/3811413