Is Mervyn right, or is George right?
George says that the economic mess is the fault of Labour; Mervyn King says it is largely the fault of the bankers... so who is to blame? That may, of course, be in some way connected to the fact that the Conservative Party gets 52% of its funding from the financial sector.
George says that the economic mess is the fault of Labour; Mervyn King says it is largely the fault of the bankers... so who is to blame? That may, of course, be in some way connected to the fact that the Conservative Party gets 52% of its funding from the financial sector.
The fact that the governor of the Bank of “England”, who is about to assume far greater responsibility for the financial conduct of the financial sector, and who agreed Georgie’s deficit reduction policy (making him a financial god in the chancellor’s eyes) has disagreed with Osborne on such a fundamental point must be embarrassing for the government.
It matters, of course, because unless you know what caused the problem, you are unlikely to be able to stop it happening again. If Osborne thinks that it was Gordon Brown, and his policies that caused the crisis, then he may be rather complacent about the City. Get rid of the problem (Labour) and everything will get better. But if the governor is right, then, having got rid of the wrong thing, are we likely to be heading for another crisis soon? If Mr king is to be believed (and he has just that little more experience than Mr Osborne), the answer is, yes.
When he was asked whether there could be a repeat of the financial crisis King replied in the affirmative. "The problem is still there. The search for yields goes on. Imbalances are beginning to grow again."
And once again Mr King brought up the subject of the size of banks, a problem for which I have seen little in the way of a solution from the London government. He pointed out quite clearly that banks paid these bonuses because they could: "Why do banks in general want to pay bonuses?" he asked. “It's because they live in a 'too big to fail' world in which the state will bail them out on the downside."
With such a fundamental difference between them, it’s hard to see how they are going to rub along together from now on. Maybe one of them will have to go?
It matters, of course, because unless you know what caused the problem, you are unlikely to be able to stop it happening again. If Osborne thinks that it was Gordon Brown, and his policies that caused the crisis, then he may be rather complacent about the City. Get rid of the problem (Labour) and everything will get better. But if the governor is right, then, having got rid of the wrong thing, are we likely to be heading for another crisis soon? If Mr king is to be believed (and he has just that little more experience than Mr Osborne), the answer is, yes.
When he was asked whether there could be a repeat of the financial crisis King replied in the affirmative. "The problem is still there. The search for yields goes on. Imbalances are beginning to grow again."
And once again Mr King brought up the subject of the size of banks, a problem for which I have seen little in the way of a solution from the London government. He pointed out quite clearly that banks paid these bonuses because they could: "Why do banks in general want to pay bonuses?" he asked. “It's because they live in a 'too big to fail' world in which the state will bail them out on the downside."
With such a fundamental difference between them, it’s hard to see how they are going to rub along together from now on. Maybe one of them will have to go?
Anywho... you'll laugh at this:
A banker, a Daily Mail reader and a benefit claimant are sitting
at a table sharing 12 biscuits.The banker takes 11 and says to the Daily Mail reader:
"Watch out for the benefit claimant: he wants your biscuit".
Ha ha ha.
Pics: Top: I was wondering if that was Nadine’s knee at the back there. You’d think that her new boyfriend would buy her a pair of tights. That’s knobbly!!! Left: Mervyn King... poor man. He’s not had an easy life. Gordon Brown, Alistair Campbell and now G G Osborne. (Bet he was called “horsey” at prep school!... G G ... horsey, get it?) Right: A random Daily Mail reader disapproving of something, somewhere...anything, anywhere.
I'm very disappointed Tris. You promised you'd keep that photo of me completely confidential.
ReplyDeleteI have no confidence in any of them (the current Westminster executive that is) all their high falutin talk has come to nothing. No new politics, no respect agenda, no we are all in this together, fiascos and U-turns the order of the day and a shambles of a foreign policy. No wonder that Osborne with all his encyclopaedic knowledge of wallpaper and soft furnishings will no doubt make an even bigger guddle of the economy than we already have. And with the Tories in financial thrall to financial sector (and Mr Murdoch) lets just see how like the old way of doing things the new one will be.
ReplyDeleteDon't be silly Subrosa. It was the OTHER photograph of you I promised was between the two of us....
ReplyDeleteThey all promise us something new Munguin, and all we ever get is the same old worn out rubbish.
ReplyDeleteMr Cameron has already found out that the only way to keep them in line is to employ a string of Alistair Campbells.
I rather think Tris, that both views are equally valid. Both incompetent Labour and attrociously managed mega-banks are responsible (alongside other factors).
ReplyDeleteLabour is major-guilty. It was their incompetent system of financial regulation which failed. It was their New Liebore regime which encouraged everyone to max out th credit (after all, they abolished 'boom or bust').
Equally, the Fred the Shreds of the banking world are also criminally guilty. Let us not excuse either of those rotten baskets: Liebore and th mega-banks are responsible.
That is why the Tory-led coalition is taxing th city at higher rates, and has not reversed the 50% income tax rate on them. They need to pay their share, and we Conservatives are better placed to ensure that. After all, when trying to ensure recovery, jobs, we hardly need leftie confrontation politics.
Consensus, honesty, and everyone paying their full share. That is what the Tories are all about.
p.s. Subrosa, thats a charming picture, I don't know why on earth you'd want to hide it away! :)
ReplyDeleteActually most of it was Labour. The collapse of the banks has only cost the country around £200 billion of the £4.8 trillion debt that has bankrupted the country. The Tories are also to blame for their share of that £4.6 trillion before the banking crisis - just ask Nigel Lawson, but the bulk of it was still Labour who tried to bully the IMF into hiding the real state of the countries finances BEFORE the banking collapse, even going to the extent of supplying them with doctored figures in order to hide the shambles they had created. Of course the debt is now worst than this possibly double so everything that the government tries to bring it down is only chipping away at the interest.
ReplyDeleteThings can only get better eh!