Saturday, January 03, 2009


Where has all the money gone?

We’ve re-capitalised several banks, saving them from bankruptcy, with the explicit understanding that they start lending immediately to get the economy going. Instead the money has been either hoarded or gambled away, with the result being repossessions, job losses and depression.

In effect we are giving the banks our money so that they should lend it back to us, and with interest. This is such a ridiculous situation anyway that any one with any sense would stop it immediately, take the banks into bankruptcy and create accountable government controlled banks whose responsibility would be to finance a stable and growing economy for the benefit of society as a whole, not speculation for a quick buck for the few.

But what is really happening is that the banks are upgrading their computer systems to continue the derivative speculation with financial mathematics that got us into this mess in the first place, so the problem is not being solved. Instead the next and even bigger problem is being financed…AND WITH OUR MONEY.

Darling and Brown are members of the House of Commons, elected by their constituents to serve them, not to serve the banks with their constituents’ money to speculate with.

The banks have shown themselves unworthy of the power we have given them.

Take the banks into bankruptcy.

Create government controlled banks run by elected and accountable officials whose responsibility it is to create a stable and growing economy for the benefit of society as a whole.

And perhaps most important of all, hold a public inquiry into the current financial crisis so criminal bankers go to jail and the ordinary British taxpayer is never screwed by this or any other similar crime again (and yes it is a crime due to the Fraud Act 2006 Section 4).



From The Times
January 3, 2009
Chancellor Alistair Darling on brink of second bailout for banks
Billions may be needed as lending squeeze tightens
Francis Elliott, Deputy Political Editor, and Gary Duncan, Economics Editor

Alistair Darling has been forced to consider a second bailout for banks as the lending drought worsens.

The Chancellor will decide within weeks whether to pump billions more into the economy as evidence mounts that the £37 billion part-nationalisation last year has failed to keep credit flowing. Options include cash injections, offering banks cheaper state guarantees to raise money privately or buying up “toxic assets”, The Times has learnt.

The Bank of England revealed yesterday that, despite intense pressure, the banks curbed lending in the final quarter of last year and plan even tighter restrictions in the coming months. Its findings will alarm the Treasury.

The Bank is expected to take yet more aggressive action this week by cutting the base rate from its current level of 2 per cent. Doing so would reduce the cost of borrowing but have little effect on the availability of loans.

Whitehall sources said that ministers planned to “keep the banks on the boil” but accepted that they need more help to restore lending levels. Formally, the Treasury plans to focus on state-backed gurantees to encourage private finance, but a number of interventions are on the table, including further injections of taxpayers’ cash.

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