Prudent savers being punished - reply from governor boe office

bowlhead99

steampowered wrote: »

"Stashed away"?

Perhaps the money is hidden in bankers' mattresses? In a Canary Wharf basement perhaps?

Yes, perhaps it got trousered by the dirty banksters as the lazy tabloid journalists would have us believe. Or perhaps it is in use within the banks, providing funds to support their lending business while allowing them to meet the enhanced capital adequacy and liquidity requirements implemented subsequent to the financial crisis.

Probably the people selling the tabloids expect to sell more papers if they point out that the average banking professional gets paid more that the average tabloid reader and so is probably inherently evil, while by contrast they expect to sell fewer papers if they devote significant column-inches to explaining Basel III and other financial regulations, or teaching a postgraduate-level course in macroeconomics.

Unfortunately, as the media likes to whip up an easily-led baying mob into a frenzy, some ordinary people get suckered in to wasting their time writing letters to the head of the Bank of England in a misguided attempt to directly affect policy - and blogging about it.

HUMBUG

JohnRo wrote: »

This implies, quite clearly, that they absolutely do not understand the risks, unless they're astronomically wealthy.

So you knew that the banks were about to go bust even after Martin Lewis said that the risk was virtually nil? Wow, can I have a peek at your crystal ball.

HUMBUG

eskbanker wrote: »

And you feel that cutting and pasting emotive and naive claptrap from a Daily Mail-sponsored single-issue pressure group will achieve this?

Bless.

Better than acting like a sheep being silently led to slaughter.

HUMBUG

bowlhead99 wrote: »

Yes, perhaps it got trousered by the dirty banksters as the lazy tabloid journalists would have us believe. Or perhaps it is in use within the banks, providing funds to support their lending business while allowing them to meet the enhanced capital adequacy and liquidity requirements implemented subsequent to the financial crisis.

Probably the people selling the tabloids expect to sell more papers if they point out that the average banking professional gets paid more that the average tabloid reader and so is probably inherently evil, while by contrast they expect to sell fewer papers if they devote significant column-inches to explaining Basel III and other financial regulations, or teaching a postgraduate-level course in macroeconomics.

Unfortunately, as the media likes to whip up an easily-led baying mob into a frenzy, some ordinary people get suckered in to wasting their time writing letters to the head of the Bank of England in a misguided attempt to directly affect policy - and blogging about it.

You sound very much like a banker. Fair play to you for speaking up for them . A lot of people detest them and they really haven't been doing themselves justice with the PPI , Libor and Lloyd bank £245m fraud scandals (as a small example of their utmost integrity).

whattochoose

Maybe Doolittle had the right idea.....

https://www.youtube.com/watch?v=chZjiVs7boQ

As they say, the things we own end up owning us.:beer:

steampowered

It was a comic way of making a serious point. The suggestion that banks are "stashing money away" instead of lending it is a bit of a silly one.

Banks have no incentive to let money sit there doing nothing rather than using it to make money by lending.

Of course, many of the banks have been forced to hold on to more capital as a result of regulations passed following the financial crisis - after all lending too much money was one of the key causes of the financial crisis - but you can't blame them for that.

JohnRo

steampowered wrote: »

It was a comic way of making a serious point. The suggestion that banks are "stashing money away" instead of lending it is a bit of a silly one.

Banks have no incentive to let money sit there doing nothing rather than using it to make money by lending.

Of course, many of the banks have been forced to hold on to more capital as a result of regulations passed following the financial crisis - after all lending too much money was one of the key causes of the financial crisis - but you can't blame them for that.

Perhaps bank bashing of this sort is getting a bit long in the tooth or people just prefer to choose to forget what really happened.

The TBTF banks certainly had huge incentives to park their gargantuan handouts with the FED. Risk free return..

Do you know anything about the financial crisis?

jimjames

HUMBUG wrote: »

So you knew that the banks were about to go bust even after Martin Lewis said that the risk was virtually nil? Wow, can I have a peek at your crystal ball.

No idea what your parents knew about risk but it's abundantly clear that you don't understand it. The risk isn't that a bank might go bust but holding all your investments in a single company. It might be useful if you can provide a link where Martin said that, I'm not aware of him claiming any such thing. Any company could go bust that's exactly the risk having a portfolio with only one share in it. On the other hand if your parents had invested in a balanced fund they'd probably have more than doubled their money by now

jimjames

HUMBUG wrote: »

You sound very much like a banker. Fair play to you for speaking up for them . A lot of people detest them and they really haven't been doing themselves justice with the PPI , Libor and Lloyd bank £245m fraud scandals (as a small example of their utmost integrity).

You sound a lot like some of the comments on the Daily Mail who shout with joy every time a bank says it's leaving London. I don't think they'll be cheering as much when the banks pack up and tax revenues dwindle so services are cut or taxes rise for everyone else.

Malthusian

jimjames wrote: »

It might be useful if you can provide a link where Martin said that, I'm not aware of him claiming any such thing.

I expect what you're going to get is a link from Martin saying that depositors who had money in the banks were at virtually nil risk, which was true.

Obviously, you'd have to be a complete idiot to think that whether a company's customers are safe has anything to do with its shares. By this logic, I should be 100% safe if I invest in a company making an 100% safe product like child car seats, bubble wrap, or nappies; conversely the highest volatility shares in the world would be those of Lockheed and BAE Systems and if you invested in Dignitas you would go immediately bankrupt.

steampowered wrote:

It was a comic way of making a serious point. The suggestion that banks are "stashing money away" instead of lending it is a bit of a silly one.

Old as the hills though. We all know how much "bankers" like sitting on their piles of gold, rubbing it in their hands, holding it up to the light so it glints off their long hooked noses, carrying it in a little black bag when they go outside. Same millennia-old crap.