Partly Responsible?

[ColinW]

The chairman of one of the world's biggest groups thinks that his industry is "partly responsible" for the economic crisis!

http://news.bbc.co.uk/1/hi/uk/7806857.stm

Doesn't that imply that there is a part they are not responsible for?

Which part would that be?

His company has just had a 35 BILLION dollar bailout, so his senior staff are "forgoing their annual bonuses". They should be putting the barrel of a gun in their mouths, never mind just postponing their annual trough gorging session!

 

Merchant Banker really is cockney rhyming slang.

[Alan Stubbs]

The chairman of one of the world's biggest groups thinks that his industry is "partly responsible" for the economic crisis!

http://news.bbc.co.uk/1/hi/uk/7806857.stm

Doesn't that imply that there is a part they are not responsible for?

Which part would that be?

His company has just had a 35 BILLION dollar bailout, so his senior staff are "forgoing their annual bonuses". They should be putting the barrel of a gun in their mouths, never mind just postponing their annual trough gorging session!

 

Merchant Banker really is cockney rhyming slang.

 

I do agree with you Colin, but Bischoff's argument would be along the lines of the regulators accepting the banks' policies and products are sound and within the criteria laid down, so the regulators failed to adequately oversee the banks allowing them to get into the mess....

 

 

No. I don't believe a word of that, either!

 

If my reading of the background to these problems is correct, the issue started with banks mortgage lending willy-nilly and even mis-selling to people with no chance of ever meeting their payments. These banks then bundled the 'dodgy loans' along with other more attractive loans and sold them on to other banks, who furhter down the line uncovered the rats' nest. They in turn had to increase their interbank borrowing and teh other banks, aware of their own liquidity inthe same situation declined to lend.

 

Closer to home, the issue was related to the American scenario with the likes of Northern Rock relying on a business modelling too heavy reliant upon inter-bank borrowing and offering lower cost loans and higher savings rates than other people - a pile-it-high, sell-it-cheap policy...which is fine if you attract enough savers. They didn't - people were too busy borrowing.

 

This was well known to be the case - even at Treasury level before the crisis happened, but did the then Chancellor of the Exchequer react? Did he hell as like - in the way the US Central Bank failed to do so. If you want to spread the blame, politicians in the higher echelons could be held to blame for burying their heads in the sand.

[watervole]

and somewhere I seem to remember reading that bill clinton ditched one of the regulatory measures .... and as usual common sense was nowhere to be seen .....

[chesters1]

I do agree with you Colin, but Bischoff's argument would be along the lines of the regulators accepting the banks' policies and products are sound and within the criteria laid down, so the regulators failed to adequately oversee the banks allowing them to get into the mess....

 

 

No. I don't believe a word of that, either!

 

If my reading of the background to these problems is correct, the issue started with banks mortgage lending willy-nilly and even mis-selling to people with no chance of ever meeting their payments. These banks then bundled the 'dodgy loans' along with other more attractive loans and sold them on to other banks, who furhter down the line uncovered the rats' nest. They in turn had to increase their interbank borrowing and teh other banks, aware of their own liquidity inthe same situation declined to lend.

 

Closer to home, the issue was related to the American scenario with the likes of Northern Rock relying on a business modelling too heavy reliant upon inter-bank borrowing and offering lower cost loans and higher savings rates than other people - a pile-it-high, sell-it-cheap policy...which is fine if you attract enough savers. They didn't - people were too busy borrowing.

 

This was well known to be the case - even at Treasury level before the crisis happened, but did the then Chancellor of the Exchequer react? Did he hell as like - in the way the US Central Bank failed to do so. If you want to spread the blame, politicians in the higher echelons could be held to blame for burying their heads in the sand.

or not wishing to spoil the change of a lucrative "exec" job on the side

[Alan Stubbs]

or not wishing to spoil the change of a lucrative "exec" job on the side

 

Hey, what's politics without forward planning (OK, an escape route!)

[chesters1]

Hey, what's politics without forward planning (OK, an escape route!)

escape! they do both at the same time my typo was change instead of chance