What the Banks really mean
It is about time that the taxpayer was told exactly.what the banks have done with the money that they have been handed by the Government.
Vague statements such as “plugging holes in the balance sheet” mean nothing to most people (including politicians). “Restoring confidence” in inter-bank lending is also a meaningless phrase as is “toxic assets”.
Alistair Darling has just asked the banks to “tidy up” their Balance Sheets. Does that mean that the banks were handed taxpayers money without having tidied up? A company’s accounts consist of two sets of figures: The Balance Sheet – what they own and what they owe. The other bit is the Revenue and Appropriation Account. Maybe its time to re-label it to the Revenue and Mis-appropriation Account because it would seem that is where the trouble lies.
Where’s the money? Have they got it yet?
When banks do deign to lend, the terms make it nigh-on impossible for the average borrower to take advantage of their generosity. Politicans continue to throw everything that they can at the bankers, yet the bankers are sitting back, calculating how to circumnavigate their sudden bonus loss and scratching round for the next non-exec directorship. Many know that they may still be pushed out of the airplane with only a small parachute.
Most pundits are secretly thinking that we will end up with a fully nationalised banking system and are merely observing a game of “Who will blink first” between the Government and the banks.
Here in the UK, Gordon Brown is beginning to sound monotonous (!) and yesterday, even Barack Obama’s “cut-and -paste” rhetoric was sounding jaded.
This terrible state of affairs has had a profound effect on the political and economic pundits. “Punditis” is rife.
Financial experts are running out of metaphors and their predictions show all the conviction (and accuracy) of a pier-end astrologer. Other experts are delving deeper and deeper into a morass of incomprehensible technical detail which may be interesting to other financial anoraks but is adding nothing to the debate.
There was a time when Television and Radio reported the opinions of politicians and financial experts. Now, they report the opinions of Robert Peston.
Time to take a deep breath folks.