The british taxpayer is to take a huge stake in the main high street banks of this country. Somewhere deep in the treasury someone is wting cheques for 37 Billion pounds to help support the banking industry. We didn’t do this for the car industry when they were in trouble we watched as the government allowed british steel go down the pan. The shipyards nearly all closed and manufacturing in all types of industry moved abroad.

We were in a new era of the service industry. We were told that it didn’t matter that the manufacturing jobs were disappearing because we were to take on the world of highly technical service industries. The financial sector was wooed to encourage them to develop over here and any critism of high pay and bonuses was, we were told, not helpful since these highly paid and very bright people would have gone elsewhere in the world.
Now some of those same people who were telling us how wonderful and beneficial the financial industry was are putting billions of pounds into that same industry to try to support it and prevent the whole uk economy from going into meltdown. As the old saying goes, we live in interesting times.

It is clear that the whole banking sector had completely lost the plot. The mind blowing bonuses were surely a sign that things were not right. The banks should surely have been aware, more than any of us, that money does not grow on trees. You cannot simply magic money up like that and build a house of cards and think that it is in any way secure as the billions and billions of pounds that are being pumped into the banking system around the world demonstrates.

It is good to hear that the prime minister is demanding changes in the way the financial system operates yet he was the man in charge of the nations finances for ten years and should certainly take some of the blame for turning his blind eye to what was going on. It is understandable that the flow of tax income recieved was very appealling as house prices soared and business boomed on a river of credit but it clearly could not continue for ever and the end, when it came, was going to be painful.

We were not behaving any differently to the rest of the world and perhaps a global crisis is the only way people would come to their senses and face up to the fact that our whole way of life is a flawed system.

The collapse of the banking industry is surely a sign that our society has become too far removed from reality. We were persuaded that the purpose of owning a house was as an investment rather than somewhere to live, we farm animals as if they were crops caring little for their welfare so long as they don’t get some disease they might pass on to us, we treat people as numbers and profit making machines.

Banks are some of the most unpopular institutions because of the way they have taken advantage of people and ripped us off at every opportunity. How the mighty have fallen. Now that we own a significant stake in these institutions the very least we should expect is fair treatment of customers and an end to the excesses of the top management.

You now own the banks. How would you like to be treated? Press One to continue to be treated as a an essential nuisance who is there only to profit the banks, or press two to be treated as a human being who is a customer and should be treated fairly.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

With all the tumoil in the stock markets I was just looking at a company that two years ago was valued at £200 million and today you could buy it for around £7 million or so. How can that make any sense whatsoever.
It seems clear that the share value of a company has little to do with it’s true value these days. I guess this is because everyone is looking for the next instant profit instead of looking long term and the fact that credit has been used to drive companies to grow to a size that was unsustainable in the long term.
There is a lot of talk about changing the way banks do business but I suspect we need a root and branch clean up of the way business has been carried on over the last 20 years.
One thing we can be sure of, business will be very different over the next 20 years. Maybe it is time for a back to basics and back to common sense approach to life, business and everything.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

It has always been the case that some small businesses that were running successfully but having cash flow problems would be effectively shut down by the banks who refused to allow additional credit even when that credit would have been a temporary support while money owed could be collected. The banks always claimed they had to be cautious about extending such credit.
So it seems a little hypocritical that now when the banks find themselves over extended and struggling for cash, the banks are looking to be supported by the taxpayer. When we remember how extravagent these banks were when they thought they could do no wrong. The salaries and more especially the bonuses were incredible and seemed impossible to justify. It would seem the proof is now in the pudding and those bonuses were completely unjustified and based on ridiculous assumptions and expectations of profit made from risky deals that were stretching common sense to limits never before seen.

Unfortunately, we are where we are and what has gone before is just history now. There are clearly huge problems with the whole system of banking. Perhaps the whole idea of lending money that you don’t have is starting to be questioned but whatever the future holds, we are all dependent on a banking system that works so the news that the taxpayer is to take a stake in the banks is perhaps not entirely surprising. Something had to be done.
We also have a 0.5 % cut in interest rates which, if it is passed on, may help us all to deal with the after effects of years of excess spending. We are all sharing the hangover and it seems unlikely we will recover for some considerable time. Let us hope that the lessons learned mean that when we say, ‘Never Again’ we really mean it this time.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)