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British Bank Bradford & Bingley Goes Bellyup
#2
So, today we learn that the profitable part of B&B has been sold off to Santander, and the unprofitable/troublesome part has been bought by the taxpayers. The old rubric of nationalizing costs whilst privatizing profits.

THis was always the way the Pentagon/Ministry of Defence system operated -- the taxpayer picks p the cost for weapons R&D and thereafter the companies get to lap up the on-stream profits.

I find I get highly annoyed when Alistair Darling states on the radio (today's Jeremy Vine show - Radio 2) that very "few people could have foreseen this problem ten years ago". Bollocks! I saw the leveraging catastrophe-in-waiting 10 years ago - it was that obvious - and therefore most bankers saw it that far back -- and many much further back than that.

I even phoned the Bank of England back then (circa 1995) following the collapse of Barings, to ask what measures the Old Lady was going to take to toughen up oversight and regulation in the ight of that disaster (another cover-up btw). The spokesman said that regulation was not an option as the fear was that the banks would simply relocate to another centre (say Paris or Frankfurt) if the authorities tried to impose tougher regulation on them. This was stated quite openly. Having seen similar empty threats delivered to the authorities during my time in the City I sincerely doubt the veracity of such threats.

The bottom-line is that the fraternity of bankers know - as the governments also know - that the banking system holds governments and everyone else to ransom and that a taxpayer funded rescue is accepted as the only alternative in cases of systemic risk.

There is no reason for this as central banks and governments cold easily form a cohesive body to insist on far tighter regulation to protect the interests of citizens and taxpayers alike. But that is never viewed with enthusiasm in the corridors of power and therefore, the question we need to ask ourselves is why this is?
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14
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British Bank Bradford & Bingley Goes Bellyup - by David Guyatt - 29-09-2008, 01:15 PM

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