Thursday, 26 February 2009

RBS & LBG to the races

And so it was done. The Government has capitulated before the markets. RBS has been given another £13 billion to try and stave off full nationalisation (read bankruptcy), on quite generous terms. Darling is saying taxpayers will profit, just like Northern Rock, eh?

I can see the Government's view on wanting to keep a sliver of shares on the market, as this will let them know when to sell-out of their shareholding. Whisper it, but this is a big improvement on what has gone before. But really, RBS's end of term report today was actually worse than expected.

Massive losses, ABN acquisition not only written down but the remnants written off for sale. This is a corporate disaster worse than either Mannesman or GEC Marconi. Now that is going some.

Yet the share prices of the battered banks flew today (N.B. CU currently holds LLOY shares) and may well do tomorrow. I think the market wants good news and is not prepared to dig to view the long-term picture.

RBS, maybe LLOY, are zombiefied and we are following the Japanese plan for 10 years of economic stagnation at best. Now that the Government has put the debt of the banks on the national balance sheet, I can't see what is holding them back from full nationalisation...in the US it seems momentum is behind the push to sort out Citi and BOA.

I am still against full nationalisation in the UK; not on pure ideological grounds, on competence grounds. The government have already proved with Northern Wreck that they can blow money just as well or better than the Bank executives. Plus the other key economic test as well, If Vince Cable is all for it, it is bound to be wrong.

10 comments:

Mark Wadsworth said...

To be fair, the Northern Rock thing was going really well until a week ago, NR was repaying its loan ahead of schedule, good borrowers were leaving in droves etc, what was left was becoming ever more toxic, but at least ring fenced.

This wasn't too far from the 'New Good Bank model' that you and I and others have proposed.

In hindsight, we didn't give them enough credit for this policy, but since the volte face, they don't deserve any.

CityUnslicker said...

MW - Hmmm, you do have a fair point. But they were always going to wreck it. NR was never a good candidate for good bank / bad bank - you need a good bit after all! NR too toxic and should have been liquidated.

RBS/LLOY/BARC are much better candidates and this plan is much better. After lots of scrabbling the govt are getting there.

Sadly the huge elephant in the room is that with the economy in meltdown the banks might go bust (i.e. get nationalised now) anyway as they can't cope with 2009 being as bad as 2008 - yet so far it looks worse.

Anonymous said...

Is Barclays really a candidate for going bust this year?

Anonymous said...

With Northern Crock, the government were hit by a problem unawares. It shouldn't have been that way, but it was.

NR had 20% of the mortgage market and was heavily into 125% mortgages. Completely reckless.

The gubmint shoved in cash and told NR to reduce the size of the mortgage book, and pay the cash back, which they did. They didn't say how or what NR shouldn't do.

NR just reduced the mortgage book, happily losing good customers and repossessing bad ones.

There wasn't any intention to quarantine the bad debts, it was a reaction to the run on NR and the thinking didn't go further than that.

However, 12 months down the line, the gubmint looks and now they are facing falling property prices and repossessions and this isn't good for votes at all, so it's bung Crock some more money and tell them to hit the accelerator again.

I think the gubmint has no long term plan, no understanding of what's happening or likely to happen and they just react to the latest crisis.

It doesn't cause much faith in anything else they are doing such as QE, which surely requires fine judgment.

There's no getting away from the fact that property has been hugely overvalued and correction is going to hurt a lot of people. I don't see a soft landing, unless it's paid for by future taxation; some soft landing and it rewards the profligate.

One panic measure after another.

Wolfie said...

"we are following the Japanese plan for 10 years of economic stagnation at best."

If that happens I will breath a massive sigh of relief! Frankly the government seem completely out of their depth.

This is my synopsis.

CityUnslicker said...

SW - All banks are in it if we keep losing GDP at 1.5% per quater.

Cosmic - Yup, no strategy is the strategy!

Wolfie - comments at yours

Jock Coats said...

"I can see the Government's view on wanting to keep a sliver of shares on the market, as this will let them know when to sell-out of their shareholding. Whisper it, but this is a big improvement on what has gone before."

Just out of interest, were not things like BLMC/Austin Rover not kept listed? I certainly remember Austin Rover having about 7% of shares in public hands long before they were sold to BAe. Same with Rolls Royce I think, no? Am I misremembering?

Mark Wadsworth said...

CU, of course NR was not a candidate for a Good Bank, it is the ultimate Bad Bank - a closed fund that is wound down and creditors repaid as far as possible.

This is the necessary flipside of there also being Good Banks.

The same filtration process should be applied to all banks who are in trouble - the crap gets left behind and the good risk borrowers and depositors start elsewhere with a clean slate.

Either way, they've shat on this plan.

Anonymous said...

aaaa片, 免費聊天, 咆哮小老鼠影片分享區, 金瓶梅影片, av女優王國, 78論壇, 女同聊天室, 熟女貼圖, 1069壞朋友論壇gay, 淫蕩少女總部, 日本情色派, 平水相逢, 黑澀會美眉無名, 網路小說免費看, 999東洋成人, 免費視訊聊天, 情色電影分享區, 9k躺伯虎聊天室, 傑克論壇, 日本女星杉本彩寫真, 自拍電影免費下載, a片論壇, 情色短片試看, 素人自拍寫真, 免費成人影音, 彩虹自拍, 小魔女貼影片, 自拍裸體寫真, 禿頭俱樂部, 環球av影音城, 學生色情聊天室, 視訊美女, 辣妹情色圖, 性感卡通美女圖片, 影音, 情色照片 做愛, hilive tv , 忘年之交聊天室, 制服美女, 性感辣妹, ut 女同聊天室, 淫蕩自拍, 處女貼圖貼片區, 聊天ukiss tw, 亞亞成人館, 777成人, 秋瓷炫裸體寫真, 淫蕩天使貼圖, 十八禁成人影音, 禁地論壇, 洪爺淫蕩自拍, 秘書自拍圖片,

做愛的漫畫圖片, 情色電影分享區, 做愛ㄉ影片, 丁字褲美女寫真, 色美眉, 自拍俱樂部首頁, 日本偷自拍圖片, 色情做愛影片, 情色貼圖區, 八國聯軍情色網, 免費線上a片, 淫蕩女孩自拍, 美國a片, 都都成人站, 色情自拍, 本土自拍照片, 熊貓貼圖區, 色情影片, 5278影片網, 脫星寫真圖片, 粉喵聊天室, 金瓶梅18, sex888影片分享區, 1007視訊, 雙贏論壇, 爆爆爽a片免費看, 天堂私服論壇, 情色電影下載, 成人短片, 麗的線上情色小遊戲, 情色動畫免費下載, 日本女優, 小說論壇, 777成人區, showlive影音聊天網, 聊天室尋夢園, 義大利女星寫真集, 韓國a片, 熟女人妻援交, 0204成人, 性感內衣模特兒, 影片, 情色卡通, 85cc免費影城85cc, 本土自拍照片, 成人漫畫區, 18禁, 情人節阿性,

Anonymous said...

情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊美女, 視訊交友, ut聊天室, 視訊聊天, 免費視訊聊天室, a片下載, av片, A漫, av dvd, av成人網, 聊天室, 成人論壇, 本土自拍, 自拍, A片, 愛情公寓, 情色, 舊情人, 情色貼圖, 情色文學, 情色交友, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 色情遊戲, 情色視訊, 情色電影, aio交友愛情館, 色情a片, 一夜情, 辣妹視訊, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊, 視訊美女, 美女視訊, 視訊交友, 視訊聊天, 免費視訊聊天室, 情人視訊網, 影音視訊聊天室, 視訊交友90739, 成人影片, 成人交友,

免費A片, 本土自拍, AV女優, 美女視訊, 情色交友, 免費AV, 色情網站, 辣妹視訊, 美女交友, 色情影片, 成人影片, 成人網站, A片,H漫, 18成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 免費A片下載, 性愛, 成人交友, 嘟嘟成人網, 成人電影, 成人, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 情色, 情色貼圖, 情色文學, 做愛, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲, 情色視訊,