Can I Have An Interest Rate Cut And A Few Billion Pounds Please?
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.
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