BEWARE! THE BANKS ARE OUT TO GET YOU!

[Tizer]

The US commissioner's report on HSBC was scathing and it makes you wonder why the US can be so forceful in its comments and yet the UK government always seems to be frightened of upsetting business executives by pointing out their failings. Big business in the UK is in dire straits and it's only a matter of opinion now whether we regard business execs as blatantly corrupt or not.

Did you hear the news that Rebekah Brooks, the former head of News International, was paid £10.8 million after she resigned following closure of the News of the World? This is the same Rebekah Brooks who has been charged over alleged payments to police and public officials, has appeared at the Old Bailey and is due to face trial in September next year over alleged illegal payments to public officials. LINK ....I'm speechless!! Why don't we just let Berlusconi come and run the UK?

[Stanley]

Tiz, don't on any account read this week's Private Eye, you might explode!
Do we need any more evidence that the banks are under the protection of the government because they are the paymasters? Look at the number of SPADS financed by the banks et al on secondment. Cast your mind back to the US Treasury committee in 2008 staffed largely by Goldman Sachs. As one senator said then, it was a coup controlled by the bankers. You can't help feeling that this is exactly what is happening here at the moment. It's a corrupt mess fuelled by nepotism and the infamous revolving door. PE flags up the connections week after week. One example, look at the people supposedly running HMRC to attack off-shore tax evasion, they are the people who ran the evasion business before moving into regulation. How bad a smell is that!

[Tizer]

Well said - do you remember earlier this year the fuss* over Cameron's trade minister Stephen Green who had been chairman of HSBC? I'm surprised the press haven't had more to say about him in the last week. Being also a C of E priest and having written a book on the morality of capitalism you can't help thinking him to be a hypocrite. Or was he simply unaware of what was going on in HSBC even though he was chairman?
*New Statesman, 18th July 2012: LINK

[Stanley]

Tiz, PE have been hammering away at that one for months and plenty of other examples like it. Large contracts are still being given to the major accountants even though they are the people who manufacture the tax instruments to get through the loopholes. I had a certain amount of sympathy with the CEO of one of the tax-dodgers who said that as long as the loopholes exist and he has a duty to maximise profit for shareholders he has no other choice than use the most tax-efficient strategies. He's quite right of course, the problem is with the structure itself and only the government can change that. The further problem of course is that the government can't legislate unilaterally because the structure is agreed internationally. It's a complicated mess that has built up over the years and is exploited by the people who can pay for the best brains. As far as they are concerned it's a legitimate game and they can see no profit in ethics.

[Stanley]

Liborgate rolls on. UBS are fined £700million and other cases are in the pipeline. These people are playing with our money!

[Stanley]

I see the UBS fine is up at £1billion now... Estimate is that RBS will be fined £700million. Telephone numbers and all out of the customer's pockets eventually. In RBS case, the taxpayer! Noticeable that more and more commentators are talking about fines being no protection, the only thing that will really work is criminal sanctions. This raises the question in my mind of why are there no sanctions in place now? After all if a shop assistant fiddled the till roll and stole money they would be liable to prosecution. What's the difference?

[Stanley]

I see the Banking Commission isn't impressed ny the 'ring fence'. They say it should be electrified because the banks will find a way round it. Sounds about right! Question is, doe Ossie agree with this/

[Tardis]

The issue at the heart is the requirement for a government to bail out its banks.

It is that piece that 'needs' to be ring fenced, but if you deny the banks access to that capital then you will obviously get much less growth because bank charges will be much higher.

Banks need to be able to fail. It doesn't matter how many electric fences that you put around them, and people need to borrow less to buy their houses

[Stanley]

The power to gaol bankers would do more than anything else....

[Tardis]

The power to gaol bankers would do more than anything else....

They have to break the law first

[Tizer]

The power to gaol bankers would do more than anything else....

They have to break the law first

Then it's time to change the law to ensure the bankers don't wreck the nation's (and world's) economy again. They've been deliberately fiddling the Libor rate, knowingly mi-selling various products, knowingly laundering drug money and transferring funds for terrorist organisations - how is it that they are allowed to get away with what are, in relative terms, piddling small fines and no prosecutions when if it were my small business I'd be thrown in jail and the business dissolved? At the same time as banks are getting away with blue murder several eminent Italian scientists are being sent to prison because they did their very best to predict the scale of the Aquilia earthquake but their prediction wasn't close enough (and nobody could have done it any more accurately).

[Tardis]

There is no law that says they can't fiddle the libor rate in the UK

Gordon Brown and his triumvirate refused to regulate it, despite many comments to the contrary

The banks could only 'destroy the economy' because of people's insatiable desire for lending which caused a massive unregulated bubble in asset prices because that was the policy of the government.

This was pointed out, but no one did anything about it

These people were voted in (and out) obviously, but it is far easier to "Blame the bankers" than to actually tackle the problem in our state structure?

The bankers only did what they were allowed and the state bank rolled them to do it. Far too easy to blame someone who exploits an opportunity when they did provide rather a lot of money for the Treasury

[Tardis]

It does look like the banking commission is going to force GO into some draconian regulation though, but if the rest of the world doesn't also take them up then our financial sector will mostly offshore, leaving another hole in the public finances

[Tizer]

It's no good forever talking, someone's got to make the the first move. Same problem with climate change, someone's got to be the pioneer, taking the risks to make this a better world.

[Stanley]

Quite right Tiz and the first step is to break the incestuous relationship between the worlds of finance and government. The next is to frame criminal laws that can be applied, after that they must be enforced. Fear will be a better weapon than interminable 'talks' and negotiations. The bald fact is that under modern capitalism, whoever controls the money holds the power. That lesson was learned as long ago as Charles I, his death was a result of the fact that he lost control of taxation and Parliament refused him the money. As the world changed and the money makers became the burgeoning industrialists they got the power and our modern equivalent is the large pension and insurance funds and the mega banks. This was allowed to happen because they retrained themselves and supported the government. Once they realised they could manufacture unlimited wealth by using computers and fancy algorithms the rest followed. As for personal debt, ask yourselves who made it easy for people to borrow and get themselves into the clutches of the banks. Ask yourself who has grown fat off the interest.

[Tardis]

It's no good forever talking, someone's got to make the the first move. Same problem with climate change, someone's got to be the pioneer, taking the risks to make this a better world.

Yes, a good ethos, but one almost always guaranteed to hurt the poor the most.

[Tardis]

No, I do not buy this "they got rich on the backs of everyone else"

Simple errant nonsense. If they hadn't done it, the tally man would have done exactly the same.

Charles I situation was far more more complex than taxation, but it was possibly the only way that a parliament could rebel against his rule

In a global market you can not control within small boundaries without actually locking out access for the wider economy.

Once you do that, your unintended consequences will be about either increasing taxes or reducing the cash spent within the public sector, and these people are those in the mid income stream. Well paid bankers (over £30k) are few and far between.

But hey, lets not let facts get in the way of your unjustified rant.

The politicians are the ones who will "change" and it is very difficult when the regulations were so relaxed under Gordon Brown to bring them back again

...and of course we now have two lost decades of "growth" because of those financial decisions

[Stanley]

" lets not let facts get in the way of your unjustified rant." Charming! And of course you are always right.....

Good crystal ball gazing session on the Money Programme yesterday. Some well qualified people giving straight answers and believable predictions. Best summary of what they said is don't hold your breath if you are looking for any improvement.

[Tizer]

Paul Lewis's `Money Box' programme on Radio 4, to which you refer, is excellent and should be obligatory listening for everyone in today's world where you are more likely to be scammed by your bank than by some bloke in Nigeria or Russia. It's one of Mrs Tiz's favourite programmes, but then she likes working out how to save money and protect it (luckily for me!). I think it comes from her upbringing - her Dad made her account for all spending, especially when she took her younger sister on YHA holidays and had some money to spend and a pocketbook to record it which dad would inspect on return. One of our friends was Company Secretary for a well-known British company and previously with Jardine Matheson in HK and he put down his accountancy skills to having been made to keep a pocketbook as a child. I wonder how many parents do that these days? Just think, a simple thing like that could make your child a success!

[Stanley]

Tiz, from your mouth to God's ear! The only way Vera and I survived and bought Hey Farm on a wage of about £30 a month was that we accounted for every penny. Vera got to the stage where she did it herself, I gave her my wage packet and she gave me enough money for about 5 cigarettes a day. We never got into debt and the kids were always well-fed and clothed. Amazingly she secretly saved money and I can still remember her having to persuade the owner of a café near Chester that a £20 note was legal tender! They'd never seen one before. I was talking to Susan (daughter) about this on Xmas Day and reckoning on my average wage then and what prices are now it was two week's wages and so would be the equivalent of a £500 note today. Amazing isn't it....

[Stanley]

Changeover day for my IPS approaches. I have had conflicting advice on just who exactly can cancel direct debits. The bank tells me that only the beneficiary can cancel but I don't believe this. I shall be watching my accounts very closely in the months after the changeover! I'm sure the banks are wrong but why should they do this?

[EileenDavid]

Whose money is it anyway? Until the beneficiary claims the money i.e. direct debit the money is still ours isn't it? I do internet banking and I can cancel the direct debit at anytime myself not that I have had cause to do so. You are not telling me that if there was a shortage of money in your account they would still pay the direct debit on the beneficiaries presentation when you have instructed against it. Is this why the banks are in such dire straight with uneducated employees. Eileen

[Pluggy]

I can cancel direct debits on my account as well, but its the Nationwide Building Society, not strictly a bank I suppose.

A page from my on-line banking :



I'd be telling 'em where to get off Stanley.......

[Tripps]

Perhaps you're thinking of a "Continuous Payment Authority" rather than a Direct Debit. It used to be that only the beneficiary could cancel a CPA, but I think it has changed fairly recently. Seem to remember Paul Lewis mentioned it?

[Tardis]

Latest investigations into the banks shows that much of the liquidity pumped into the economy via quantitative easing has ended up in mortgages for property, propping up the moribund housing market and doing little for the wider economy