Defaulting banks - where will it stop?

[Jan Klimkowski]

High-level and entirely deliberate leaks have also been made to The Times. However, displaying unusual independence of thought for MSM, their version includes the following apposite comments:

An economist who declined to be named said: “This is the biggest risk of the UK’s balance sheet ever undertaken. No-one knows the extent of the toxic assets these banks are exposed to.”

A handful of Treasury officials have grown concerned about the potential for conflicts of interest emerging between the advisers working on the bailout deal and the financial implications.

For example, Goldman Sachs, which is advising Royal Bank of Scotland, also has large financial exposures to the bank.

There have been calls within the Treasury for an independent advisory boutique like Blackstone or Greenhill to be appointed to monitor conflicts of interest, but it is understood that these calls have gone unnoticed so far.

http://business.timesonline.co.uk/tol/bu...926316.ece

Once again, the bankers are saving their own - doubtless at the expense of ordinary folk.

When Northern Rock was nationalized, Goldman Sachs advised the British govt and, lo and behold, the only decent assets Northern Rock had were left in a legal-accounting off-shore fiction called Granite, and did not pass into British govt ownership. Who owns Granite? The British taxpayer doesn't know, and we certainly do not own it.

Do Goldman Sachs know the identity of the owner? I think they should be asked. And we should be told.

Meanwhile, ex-Goldman CEO Paulson's first draft of the US bailout bill granted him total power over how to use the $700 billion, and total immunity from proescution forever and in all jurisdictions. Even if, rather astonishingly, that version did not pass.

It's still a banker's coup. Even if it's also FUBAR.