Northern Rock nationalised

Former Member

Story.

Watch out tomorrow the pound will drop and mortgage rates will go up, this doesn't set a good precedent.

Thanks GB you da man.

Former Member

sufficient value for money to the taxpayer",

rofl

rolling heads pls

Former Member

I never really agreed NR should be nationalised, but at the moment I think its the best option, albeit 6 months too late.

The government need to get a savvy team in there to sort the NR business model out, then as soon as the financial markets settle look to put NR back into the private sector.

Former Member

Right, when does our cut of the profits get put in our bank account then?

Former Member

Calvin wrote: »

The government need to get a savvy team in there to sort the NR business model out, then as soon as the financial markets settle look to put NR back into the private sector.

But that just gives the message risky behaviour will always turn out to be ok in the end. They should have let NR collapse to send a clear message that overly risky actions can have condequences. Its' their fault for buying debt derived from an irresponsible US policy action. Mervyn King was spot on when he talked about the Moral Hazard problem.

Former Member

calvin - financial markets aren't about to settle anytime soon so it's me and you footing the bill, who's next alliance and leicester, bradford and bingley are we gonna bail everyone out?

iws - privatise profits socialise losses, you know how it goes...

i just wish they could have waited til after my holiday next week, bastards.

Former Member

Aspartame wrote: »

Yep.

:wave: you're here!!

Former Member

minimi38,

Its' their fault for buying debt derived from an irresponsible US policy action. QUOTE]

US policy action? What does that mean? The fed set low interest ratesand mortgage lenders exploited this to lend to the sub-prime market, selling their debts to investment banks who packaged them as CDO's, selling them to the wider market- all private institutions and nothing to do with 'policy.' Trading in futures is inherently risky, (see our friends Leeson and Kerviel) but it isn't something that should be discouraged or punished. That's not to say I think Northern Rock's business model should escape the condemnation it deserves, but it just shows as with pets.com's IPO and the dot-com crash, that the market can get it wrong.

As for the future it's clear that there needs to be stricter regulation of the rating agencies to give a clearer picture of the risks that are being traded.

senor miguel,

who's next alliance and leicester, bradford and bingley are we gonna bail everyone out?

I feel you're scaremongering somewhat here- you know B&B and Alliance and Leicester aren't in the same situation as Northern Rock...

Former Member

minimi38 wrote: »

But that just gives the message risky behaviour will always turn out to be ok in the end. They should have let NR collapse to send a clear message that overly risky actions can have condequences. Its' their fault for buying debt derived from an irresponsible US policy action. Mervyn King was spot on when he talked about the Moral Hazard problem.

:yes:

Former Member

promethean wrote: »

senor miguel,

I feel you're scaremongering somewhat here- you know B&B and Alliance and Leicester aren't in the same situation as Northern Rock...

no i don't know actually, their share prices look quite similar to NR just before they croaked, your stock doesn't fall 24% in a day if there's nothing wrong.....i'm not saying they'll fail outright but they're definitely in trouble, i suppose it's ok though we've got a few hundred billion spare kicking about in the kitty right?

Former Member

I never said the financial markets will settle soon, we all as tax payers will be propping up NR for years.

I would have been quite happy to let NR fold at the beginning, but 6 months down the line the government has decided to protect the company. We either sell NR to a private company. (i.e Virgin) and let them take the risk for what could turn out to be a very good reward or we take it on as the tax payer.

Things could have been handled a lot better 6 months ago, but you cant turn back time.

Former Member

If you're implying that I'm in favour of the nationalisation, you're mistaken. Although B&B's pre-tax profits were almost halved I don't think they're expected to make any more large-write downs in the coming few months and it would take more to bring Alliance and Leicester down.

Former Member

promethean wrote: »

If you're implying that I'm in favour of the nationalisation, you're mistaken. Although B&B's pre-tax profits were almost halved I don't think they're expected to make any more large-write downs in the coming few months and it would take more to bring Alliance and Leicester down.

lol that's the funny thing with big writedowns, they're not generally expected because the banks aren't being transparent about their true exposure, i guess we'll see soon enough.

Former Member

who'd of thought they'd be idiots in the treasury, well actually, runnign the treasury

Former Member

I have posted on the 21% thread the truth of what is happening.

The UK banking system and the UK State are both bankrupt and about to fail a la argentina/weimar/zimbabwe.

Either the banks collapse or we use wheelbarrows to go shopping.

These are the options.

The government has chosen hyperinflation.

Good luck to you all.

Former Member

If Labour believes it's acceptable to nationalise failing companies it's a shame more important companies like Rover were ignored and left to disintegrate... Months ago the LibDems and many commentators called for the nationalisation of NR - and the govt rejected the idea.

Richard Branson isn't an idiot, he knew Labour is afraid of nationalising because of the associations of it - he was trying to exploit that and get NR on the cheap for a rock bottom price.

Former Member

dispatches on c4 now, well worth a watch i hope....

Former Member

I wished they'd nationalise the trains and buses again :yes:

Former Member

BlackArab wrote: »

I wished they'd nationalise the trains and buses again :yes:

Considering how terrible British Rail was I hope they don't

JsT

Flashman's Ghost wrote: »

Considering how terrible British Rail was I hope they don't

Oh god yeah. I wouldn't complain about buses being renationalised - least the railways are attempting to improve things...

As for Northern Rock, the Government should accept one of the private offers on the table for the sake of every tax payer in the country rather than dragging out this farce longer than neccessary.

Former Member

If we all open an account, we all get our tax money back a lot quicker. They got any good deals at the moment?

Former Member

Flashman's Ghost wrote: »

Considering how terrible British Rail was I hope they don't

In comparison to the parasitic First organization who run the buses and trains in my area, they couldn't be worse. Nationalisation doesn't have to mean returning to the bad old days of the 1970s.

Former Member

BlackArab wrote: »

In comparison to the parasitic First organization who run the buses and trains in my area, they couldn't be worse. Nationalisation doesn't have to mean returning to the bad old days of the 1970s.

I find the rail service really good and London's nationalised bus and tubes rob me blind for a poor service.

I travel a lot and found that the quality of the service, its punctuality and comfort have massively improved. Perhaps it's because they run the trains for the customers convinience rather than that of the staff (management and unions)

Former Member

Hmm... I wonder whether the Government would have treated every single bank in the same way as Northern Rock. Imagine that Coutts, the self-styled "top people's bank", had to go to the Bank of England to ask for emergency loans. Do you really think that Gordon Brown would let them have it? No, he'd just turn round and say "fucking greedy Tory bastards, serves them right". No, the only reason Labour saved Northern Rock is to save their own bacon.

And that's the only reason they're nationalising the bank now. There are thousands of jobs at stake in the Labour heartlands. Were these people to lose their jobs, Labour MPs would soon lose theirs. The Government couldn't give a shit about Northern Rock, only about itself. I've said this before, and I'll say it again. This will be the ultimate test for Gordon Brown. For years, he has boasted about how brilliant he was. We'll see whether his record stands up to the test now. If Northern Rock fails, then Macavity should go down with it.

Former Member

stargalaxy wrote: »

Hmm... I wonder whether the Government would have treated every single bank in the same way as Northern Rock. Imagine that Coutts, the self-styled "top people's bank", had to go to the Bank of England to ask for emergency loans. Do you really think that Gordon Brown would let them have it? No, he'd just turn round and say "fucking greedy Tory bastards, serves them right". No, the only reason Labour saved Northern Rock is to save their own bacon.

And that's the only reason they're nationalising the bank now. There are thousands of jobs at stake in the Labour heartlands. Were these people to lose their jobs, Labour MPs would soon lose theirs. The Government couldn't give a shit about Northern Rock, only about itself. I've said this before, and I'll say it again. This will be the ultimate test for Gordon Brown. For years, he has boasted about how brilliant he was. We'll see whether his record stands up to the test now. If Northern Rock fails, then Macavity should go down with it.

Northern Rock has far, far more savers, investors and shareholders than it has employees. So this is certainly not about votes.

Former Member

Aladdin wrote: »

Northern Rock has far, far more savers, investors and shareholders than it has employees. So this is certainly not about votes.

The point still stands. Had a bank such as Coutts run into similar troubles, they wouldn't stand a cat in hell's chance. The Government wouldn't bail them out, no chance.

Former Member

stargalaxy wrote: »

The point still stands. Had a bank such as Coutts run into similar troubles, they wouldn't stand a cat in hell's chance. The Government wouldn't bail them out, no chance.

Coutts is owned by RBS. If RBS which also owns NatWest got into trouble the government would have helped them out.

Former Member

To be fair to Brown he's fucked whatever he does, and like many political fall-outs, it's not really his fault. Option 1) He let's bank collapse - result end of Labour's reputation for managing a stable economy 2) He nationalises it - he opens the taxpayer to pretty much an unlimited liability.

the real criticism of Labour is not that they nationalised (though I think that's the wrong decision personally), but that they dithered and never seemed in control, letting a bad situation spiral.

Former Member

Well the decision was not bad on principle- try to find someone to take over. It just happened that none of proposals were good enough.

Former Member

Flashman's Ghost wrote: »

To be fair to Brown he's fucked whatever he does, and like many political fall-outs, it's not really his fault. Option 1) He let's bank collapse - result end of Labour's reputation for managing a stable economy 2) He nationalises it - he opens the taxpayer to pretty much an unlimited liability.

the real criticism of Labour is not that they nationalised (though I think that's the wrong decision personally), but that they dithered and never seemed in control, letting a bad situation spiral.

between the treasury, FSA and the BoE noone had a clue who was supposed to do what, the crap setup and lack of regulation and oversight is most def brown's fault because he invented it.

the real criticism of labour is that they have spent all our taxes and borrowed so far into the future with nothing to show for it except a bloated public sector and insolvent banks that the private sector won't touch with a bargepole. thank god we freed those poor iraqis at least.

Former Member

Flashman's Ghost wrote: »

I find the rail service really good and London's nationalised bus and tubes rob me blind for a poor service.

I travel a lot and found that the quality of the service, its punctuality and comfort have massively improved. Perhaps it's because they run the trains for the customers convinience rather than that of the staff (management and unions)

The experiences of rail and bus users here are unfortunately not that positive. We've had protests, fare strikes etc and its possibly one of the most regular topics in the local press and letters pages.

http://www.ft.com/cms/s/0/b57e3d12-cdf8-11dc-9e4e-000077b07658.html

http://www.thisisbath.co.uk/displayNode.jsp?nodeId=163491&command=displayContent&sourceNode=163155&contentPK=19691903&folderPk=89096&pNodeId=163082 (with comments)