Northern Rock Crisis Article Discussion

dippy

MSE_Martin wrote: »

I've just added the following update to the article

Update Note 6.36pm 17 Sept. Chancellor announces 'savings guaranteed'

The Chancellor has just announced that "I want to put the matter beyond doubt. In the current market circumstances, and because of the importance I place on maintaining a stable banking system and public confidence in it, I can announce today that following discussions with the Governor and the Chairman of the FSA, should it be necessary, we, with the Bank of England, would put in place arrangements that would guarantee all the existing deposits in Northern Rock during the current instability in the financial markets.

"This means that people can continue to take their money out of Northern Rock. But if they choose to leave their money in Northern Rock, it will be guaranteed safe and secure."

Sadly there are no more specifics than this, yet it should lay to rest many fears. This commitment means that not just the £35,000 is safe, but all money in Northern Rock is safe. It is likely the number crunchers have worked out the liability a bank like Northern Rock could leave and have provisioned to cover it. Good news... if only it'd be said last Friday.

Hi Martin,

Could you possibly comment on the use of "should it be necessary" and "we would put in place" as bolded above? Is this politician speak? Could you give us the thumbs up if/when they have actually put in place these arrangements?

MarkyMarkD

Those arrangements are not required to be in place until a bank fails.

That isn't really going to happen, so there's no need for the government to waste time setting up the arrangements.

They are still saying that the guarantee's in place and that should be sufficient.

deary65

When you see it in writing with the crown seal on it, then you might begin to believe it. In other words it's more spin!

[Deleted User]

I am very glad I left money in NR as it is now as safe as having money in the bank of England. The panic should stop now and there will be a lot of people who are regretting drawing their money out

I even bought NR shares yesterday afternoon at under £3. Then came the announcement in the evening. Excellent news

bristolleedsfan

kittie wrote: »

I am very glad I left money in NR as it is now as safe as having money in the bank of England. The panic should stop now and there will be a lot of people who are regretting drawing their money out

I even bought NR shares yesterday afternoon at under £3. Then came the announcement in the evening. Excellent news

in theory yes, unless the share speculators do what the currency speculators did to the lamont/major government on black wednesday and stick 2 fingers up to mr darling and continue to send NR/A+L shares into freefall with a message to mr darling saying what are you going to do now. :eek:

all will be revealed in a few hrs. i got visions of no queues at NR branches first thing, NR shares falling 30% in early trading and NR savers putting their coats on and queues reforming. :rotfl:

hansi

Our local evening paper ran a story about NR and the people queuing outside their office. Apparently, one person had been told that he would have to travel to an English branch to withdraw his money as he he had an online account and they couldn't deal with that in a Welsh branch. Absolute nonsense! No branch will let you withdraw from an online account. You obviousy have to do it online!! I immediately emailed the paper telling them to check their facts before publishing misleading articles.

mean_momma

If the worst happens and the government has to step in, what hope for getting your money out quickly? Judging from the annual delays in obtaining a routine tax rebate, claimed in April but not paid out till September, I wonder which department would find the time to handle this job?

bristolleedsfan

kittie wrote: »

I am very glad I left money in NR as it is now as safe as having money in the bank of England. The panic should stop now and there will be a lot of people who are regretting drawing their money out

I even bought NR shares yesterday afternoon at under £3. Then came the announcement in the evening. Excellent news

7am .....70 in queue at a london branch been their since 1.30am :eek: most saying they dont trust government promises, none in queue at a newcastle branch obviously hoping their native bank will be saved. _pale_

NR shares up 65.8 at start of trading. :j

tristan727

kittie wrote: »

I am very glad I left money in NR as it is now as safe as having money in the bank of England.

I even bought NR shares yesterday afternoon at under £3. Then came the announcement in the evening. Excellent news

Great - first my wife's & my taxes are paying to titanium-wrap your investment in a bank with a narrow asset-base, & now emboldened you're making money out of shares.:rolleyes: How exactly do they decide to set aside £21 Billion anyways. Do they simply change the classification of £21 billion ear-marked for the NHS from 'guaranteed' to 'quite probable'? Or has Gordon actually managed to find some assets reserved, he hasn't sold off yet for a knockdown price?

harryhound

It is probably cheaper to prop up the City of London than have it crash.

The Government HAS NO MONEY OF ITS OWN it must tax or print.

If all the spivs in the square mile stop having to pay tax, because they have no job anymore, your contribution won't go far.