Taoyuan Nights

First… please enjoy this video :)

Finance has for a long time been the UK’s biggest sector, ever since we wasted all the oil we had on a gigantic social welfare system, and closed down our factories.

That ends today. Excluding HSBC which isn’t really ‘British’, there were only 7 big British banks in existance 18 months ago. Most of them have histories extending back 100-300 years. One of them, RBS, was described as ‘the biggest bank in the world’ by assets, and was top 10 rated by Forbes last year. We now have, after 3 weeks of remarkable change:

• 1 dead / bought out (Alliance and Leicester).
  
• 2 nationalised (Northern Rock, Bradford and Bingely)
  
• As of today, 3 more nationalised or part-nationalised (Royal Bank of Scotland, Halifax Bank of Scotland, and Lloyds).
  
• The last one is on the brink of nationalisation if a rights issue fails (Barclays)
  

Unbelievable. The People’s Republic of China has a banking sector with a better grasp of capitalism.

This is the UK’s biggest industry and it has just died in 3 weeks. How did it die? The government leaked information through BBC journalists, particularly a BBC reporter called Robert Peston. There’s no conspiracy theory here folks, go look at his blog - you’ll find government plans to support the banks being released outside of the UK’s official market news service. Needless to say, the consequences for the banks were dire, particularly since many of the details leaked through journalists were inaccurate (about resignations, about the necessity of a bailout, the size of a bailout)…

Consequently, the government has effectively taken over a number of highly profitable banks for next to nothing. And we now have an incompetent government running our biggest industry.

Their first move? “Let the LENDING BEGIN!”. They immediately forced the banks to return to 2007 lending levels. See the RNS statements from the UK banks for the gory details - you can’t make this kind of stuff up. This is madness. In a world that is being destroyed by debt, their solution is to steal the public’s pension and savings assets and at the same time, try to get the public deeper into debt buying overpriced piles of bricks. I suppose it’s no big coincidence that so many members of the UK’s ruling Labour party seem to own a portfolio of rented housing…

It’s OK though. The UK can become rich and prosperous again if we just keep building more houses and selling them to each other at higher and higher prices until everyone is a millionaire. Hurray! :-(