Friday, October 31, 2008

Tory's finally spot the real economic crisis!

George Osborne, speaking at the LSE this morning, finally seems to have twigged the grave nature of the danger facing the country. Britain can borrow no more! As this blog has been warning the danger now is the unstoppable and relentless borrowings being incurred by the Government as they try to cope with the reckless irresponsibility of Gordon Brown's tenure as Chancellor of the Exchequer, little of which has much, if anything to do with the global credit crunch. The speech, in full here, concluded as follows:

Even a modest dose of Keynesian spending – say increasing it by an additional 1% of GDP - means that in the end taxes will have to rise by the equivalent of almost 4p on income tax.

That’s not just a tax bombshell, it’s a cruise missile aimed at the heart of a recovery.

And in extremis, it can mean you lose the confidence of the international markets.

Gordon Brown doesn’t understand that there are limits to borrowing, even after he’s abandoned his fiscal rules.

They are not his limits.

Today everyone assumes the only question is ‘how much more does the British government want to borrow from the markets?’

Talk to former Chancellors and they will tell you that at some point the question becomes ‘how much more are the markets prepared to lend?’

That’s why there are limits to borrowing – not political limits, but actual limits.

Limits to what can be lent and limits to what a country can carry into recovery.

Finally some words of sense from this woeful opposition!

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Thursday, October 30, 2008

Gordon Brown's continuing lies

Thanks to Guido Fawkes blog for this video link, please watch! While on the topic of the despicable filth at the top of the British political process and the corruption of the EU take a look at this link!

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Czech Constitutional Hearings postponed!

The two week postponement of the constitutional hearings on the Lisbon Treaty was made at the request of the Czech President Vaclav Klaus, read link here. One in the eye for Angela Merkel, presently visiting PM Brown in London, who has been pushing to bring Czech ratification forward. More on the delicate political balance in the Czech Republic is available from here.

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Gordon Brown and the IMF

Yesterday at Prime Minister's Questions the following was put to the Prime Minister: Q6. [231039] Mr. Andrew Robathan (Blaby) (Con): In 1976, the United Kingdom was humiliated when the last Labour Government had to approach the International Monetary Fund to be bailed out. Should—God forbid —this Labour Government similarly have to go to the IMF for a bail-out, would the Prime Minister resign? As a commentator to the BBC Politics Show pointed out - Prime Ministers Questions may run for half-an-hour from midday on Wednesdays but there is no scheduled time for Prime Minister's Answers - so for this question as for all the others from the opposition benches - no relevant response was forthcoming.

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Deep gloom from the USA

The Guardian reports:

U.S. consumer spending, which accounts for two-thirds of GDP - fell at an annual rate of 3.1% in the third quarter - the first decline since the economy was in recession in late 1991 and the biggest fall since the spring of 1980.

With American households affected by rising unemployment and sharp falls in share prices, personal disposable income fell at an annual rate of 8.7% - a rate not seen since quarterly records began in 1947, prompting a 14% annual decline in spending on cars. Businesses reduced investment in new plant and machinery by 1%.

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"Uncomfortable implications" - Nationwide

A 1.4 per cent drop in house prices in October takes the annual fall to 14.6 per cent for the year according to the Nationwide Building Society, read here. In the Daily Telegraph report comes this grave paragraph, indicating that even the housing lenders in Britain are finally beginning to grasp the severity of the problem. If only Parliamentarians were now to follow! "The crisis in the financial sector and the latest Government data suggesting a recession is imminent is likely to worsen the housing market slump and has “uncomfortable implications”, Nationwide said."

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Wednesday, October 29, 2008

Treasures from the threads - Number twenty-four

In response to an incredibly weak article by Shadow Chancellor George Osborne in the Telegraph this morning, linked here, came the following: My dear George... We need a (massive) ground-shift rethink on how to run Blighty, if we are going to see any turnaround from this gawd-awful mess that Neue Labour has steered us autopilot in to... (One of my favourite sayings is... “Exactly what has America done for us?”) The ‘Americanization’ of our eating standards, the dumbed down broadcast media, and our teenagers obsession with all that is so vacuously, smiley Emotocon driven that is Facebook/Playstion3... all they aspire to is to be ‘Peaches/Amy’ clubbing like...i.e. a cretinous drug and boozed taking selabrittie über alas... (oh deary me)... And what with the imminent ‘Halloween’ now a new supermarketing driven spending opportunity, slipped betwixt Xmas and Easter...just see the look of joy on the mega queue bearing consumers... then dial in the Haymarket card driven Fathers Day, Mothers Day, Errant Father’s Day, Dysfunctional Daughter’s Day... And finally congrats on Your Completed Divorce Day... and what we have is anything but the joys of happy communal spirited Brit peeps living the ‘dream’ on the McBarrett built graffiti ridden suburban streets... Dial in the never ending b#llsh#t that is the legislation of the Neue Labour nanny state, added to which we have the mandates of the EEC... and you quickly realise... that politics as we currently understand them are failing the common people on mass... and like never before. Question Time with Dimbleby proves that the masses are collectively starting to wake-up though.... and there disquiet is starting to more regularly appear. In these times of seismic change (muck like the industrial revolution of the late 18th Century).... I can assure you ‘true’ accountability, best value for money and investment in anything less than brilliantly well thought through will be punished severely come voting time... (So think on that before you fill the media void with light-weight drivel) Finance is going to be driven by what energy we can command, home grown... and geopolitically things are rapidly moving on that score fast... During 2008 we have seen two things happen. First, and probably most importantly, the resurrection of the Nation-State - shifting the global balance between the state and commercial business. Second, it’s redefined the global geopolitical system, opening the door to a resurgence of Russian power and revealing the underlying fragmentation of Europe and inherent weaknesses of NATO. (And as we all scramble to survive and compete in an increasingly asset depleted world expect the survival of the fittest attitudes to override) The most important manifestation of this is here in Europe. In the face of Russian power, there is no longer a united European position. And though on the surface during the last few weeks of financial crisis, we Europeans sorta coordinated, but as the Irish proved we no longer act as one. After the summer of 2008, it is no longer fair to talk about Europe as a single entity, about NATO as a fully functioning alliance, or about a world in which the nation-state is obsolete. The nation-state was the only institution that worked...and McBruin has always been a key architect of that... (PS: Do let Dave know General Election soonest please!!) Posted by Peter Stone on October 29, 2008 11:48 AM

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Tuesday, October 28, 2008

Hungary facing default

In a report on the financial crisis in Hungary (remember an existing EU member) the Guardian reports Prime Minister Ferenc Gyurcsany as follows:
"The goal is to provide Hungary with a protective shield, so we have access to financial resources and even in the most extreme situation we are not facing the threat of a default... We expect a final deal in the coming day or two," he added.
The European Union (EU) is preparing a financial aid plan for Hungary, the European Commission said, but it did not make clear whether its scheme would be part of a package agreed in principle between Budapest and the IMF or come on the top of it.
IMF CONDITIONS
"The IMF had two reasonable conditions. One: plan a budget in which even in the most pessimistic case, you plan spending which you have funds for. Two: in a situation like this, don't commit to reducing revenue," The IMF conditions will be of interest for the UK. Although with Prime Minister Gordon Brown's proven incompetence and idiocy, he will probably defer seeking IMF aid until after the time that their limited funds are exhausted, he should nevertheless abandon his ludicrous plans to further increase borrowing which the UK can no longer afford and follow the IMF guidelines above. At present Brown is expecting the independent Bank of England to reduce UK interest rates while the government itself plans huge new borrowings which could only be achieved with massively raised interest rates to compensate for the daily more severe sterling currency devaluation risks. In the absence of any real political opposition party it is now increasingly difficult to see any way for the UK to escape from the equivalent of an economic Armageddon. I guess that is essentially what the Bank of England was trying to state, in somewhat less alarmist terms, in its survey released this morning. Meantime, Iceland has raised interest rates to 18 per cent, see AFP report here, and requested urgent help from the US Federal Reserve and the EU"s ECB.

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Lord Tebbit on the future of the EU

The leading British euro-sceptic writes on the present stae of play in the Daily Telegraph this morning, read it here. The following quote contains the essence for me:

The task for the Tory leadership, the euro-sceptics, the "Better Off Out" supporters and Ukip is to crystalise the vision of Mrs Thatcher's Bruges speech into the architecture of a new European treaty, one that would constitute a framework within which sovereign states would co-operate with a European Republic formed of those nations willing to enter a complete political union of their own - what we might call their 1707 moment. And if those states are wise, they would see that the 1707 Act of Union brought mutual benefit for three centuries, although devolution has edged the UK close to the cliff edge of break-up within a decade.

In 1988, Mrs Thatcher's "guiding principles for the future" of Europe were simple.

First, that "willing and active co-operation between independent sovereign states is the best way to a successful community". Secondly, that "community policies must tackle present problems in a practical way". Thirdly, she saw a place for "policies that encourage enterprise" and, lastly, that the "most fundamental issue" was the European countries' role in defence.

Monday, October 27, 2008

20 years since Bruges

Lord Tebbit will speak tonight in commemoration of Margaret Thatcher's Bruges speech which ultimately led to her toppling by the treacherous EU infiltrators, many of whom still remain in the Tory Party. According to the Daily Telegraph, here:

Lord Tebbit urges Tory leader David Cameron to start to "think about the architecture of such a Bruges-style Europe" which he describes as "a truly European compromise", and have a referendum on it within two years of a new Conservative Government.

He says: "We cannot drift on as we have been. It is not fair either to the British people nor to the European Union.

"We need to show Thatcherite courage and determination to lead the country along that path."

Lord Tebbit's speech marks the anniversary of Lady Thatcher's speech in 1988 when she told the College of Europe in Bruges: "We have not successfully rolled back the frontiers of the state in Britain, only to see them reimposed at a European level, with a European super-state exercising a new dominance from Brussels."

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Sunday, October 26, 2008

Britain's treasury minister, Darling, exposed as knowing Icelandic dangers!

Anybody watching Channel 4 News last March or seeing countless other warning signs throughout the summer and Autumn would have been fully aware of the risk to deposits in Icelandic Banks. Such is the lalaland world Britain has become under the twisted governance and manipulated media of New Labour, that countless citizens deluded themselves into believing the lies of their leaders. The fact that these were lies is now revealed in the Iceland Review Magazine and reported in The Mail on Sunday, this morning, linked here.

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Will Mandelson cause the curtains to finally fall on the corrupt EU?

The UK press this morning are enjoying a feeding frenzy over the activities of the EU Commission's former Trade Commissioner's actions in that post. In The Independent on Sunday the headline is "A final favour" linked here, the Prince of Darkness himself, interviewed by Sky News this morning, with typical bravado, claims he is today off to Russia for a few days, we are to believe entirely in Britain's trading interests rather than to cover any tracks which otherwise might be the assumption. Brown was truly 'bonkers' bringing this man back to his Cabinet, might it not just finish New Labour but even better open the eyes to the mass of duped EU citizens to what this grotesque and evil construct of the EU is really about! More from Bruno Waterfield in Brussels from here (European Commission 'broke its own rules' over Peter Mandelson's meetings with Oleg Derpaska) ... or a surf around the UK Sunday press or browse along your newsagent's shelves.

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Saturday, October 25, 2008

Treasures from the threads - Number twenty-three

Praise indeed from the string to comment on the Tories from Charles Moore in the Daily Telegraph this morning, titled "The world has changed: David Cameron and George Osborne must change with it". (IMHO by removing themselves from national politics completely): ======================= That is the Tory dilemma. My blogs have five years of warnings! Why not they? Posted by Martin Cole on October 25, 2008 8:22 AM SPOT ON, well said. Posted by Cromwells woman , waiting on October 25, 2008 8:46 AM +++++++++++++++++++++ OK, immodest, but it is a comparatively rare event my input is so appreciated!!

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Friday, October 24, 2008

Authorities twig the truth! Its the Worst in Human History!

The Deputy Governor of the Bank of England, Charles Bean, is reported in Forbes as saying that the present financial crisis will be the worst in human history - that includes the South Sea Bubble, Dutch Tulip Bulbs, the Great Depression, the disastrous economic consequences of the Plague known as the Black Death, etc.etc. Even this blog has yet to go that far and was earlier a little concerned that it was overdoing the gloom.... Slump, however, now seems mild compared with the view of the Bank of England itself!!

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Opec cuts but crude price slips

The following is from Forex News as things get worse: - OPEC Cuts Crude Output By 1.5 Million Barrels Per Day: In an extraordinary meeting, OPEC slashed production output by 1.5 million barrels per day in an effort to slow the sharp decline in crude oil prices. "The financial crisis is already having a noticeable impact on our world economy, dampening the demand for energy, in general, and oil in particular. This slowdown in oil demand is serving to exacerbate the situation in a market which has been oversupplied for some time," according to a statement explaining the move. Nevertheless, crude continues to move lower with WTI oil down nearly 6% at $63.78 at 7 a.m. EDT.

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Treasures from the threads - Number Twenty-two

This comment from the aptly named "UK Debt Slave" at 11:08 am (I normally do not include anonymous comments but make an exception for this interesting posting) was to a rather strangely written opinion piece by Jeff Randall in the Telegraph this morning, linked here: The classic response to any and all ills in British society Let's have an enquiry! Let's spend million writing a report that will tell us NOTHING we don't already know. TO HELL WITH ENQUIRIES! Let's straighten a few things out for you Jeff. I'll save the public purse millions right now by explaining what has happened. A VERY BIG CRIME HAS BEEN COMMITTED. That's what's happened. We are supposed to believe this debacle is all just a terrible accident. All the talking heads are saying how foolish everyone has been. "Oh dear. What a mess. Let's put the kettle on." The FACTS are very different. 1. On both sides of the Atlantic, the central banking system, the Fed and the BoE have presided over the biggest credit bubble in history. by keeping base rates way too low. They knew damn well what the consequences would be. 2. The regulatory bodies charged with overseeing lending practices and regulating 'inflation' have all FAILED miserably. 3. Both the Fed and the BoE used a wholly bogus yardstick to measure inflation. They based their inflation statistics on an easily manipulated 'basket of consumer goods' called the CPI, NOT MONEY SUPPLY. Inflation is ALWAYS a function of money supply. The money supply in the UK has consistently grown by between 11-14% YOY for several years. This growth in money supply is what has funded the asset bubble in property and stocks and shares. The real rate of inflation in the UK has consistently been 8-9%. 4. House prices have tripled, not because they are intrinsicly more valueable than they were 10 years ago but because of excess liquidity and insane lending practices, none of which were held in check. 5. The media has contributed to this fiasco, poured petrol on the fire, by deluging the bovine masses with 'property porn' TV shows, encouraging people to borrow beyond their means to participate in the one way ticket of infinite house price inflation. 6. Banks and mortgage lenders have thrown caution to the wind and thrown every rule of responsible banking out of the window, lending insane income multiples or worse, lending to people who don't even have a job! To make matters worse, they immediately sold these worthless mortgages immediately to get them off their books. They have infested stock markets and pension schemes all around the world with potentially devastating consequences. Banks have ignored every basic tenet of responsibility from capital asset ratios to common sense...GONE 7. The people charged with overseeing the regulation of banking, the FSA, were obvioulsy on holiday for 10 BLOODY YEARS. 8. The people charged with overseeing inflation, the MPC, were using a Mickey Mouse method to measure inflation. It was complete nonsense to measure inflation based on just a basket of consumer goods. Nobody it seems realised the obvious. WHY? 9. The government first under the satanist Bliar and now under Stalin Brown has consistently encouraged this myth with their Orwellian DEBT IS GOOD mantra. They have consistently peddled the myth that DEBT IS WEALTH. This is O-level economics, yet the combined efforts of the BoE, MPC, FSA, Treasury and government didn't see what was coming........OR DID THEY? You see, THIS DEBACLE CANNOT HAVE HAPPENED THROUGH IGNORANCE OR NAIVETY! It had to be contrived at the higest levels. This economic collapse was planned and deliberately orchestrated well in advance. The people behind this disaster, and they are at the very highest levels of the international banking system, the political elite and freemasonry, have DELIBERATELY planned and conspired to create the biggest economic catastrophe in human history. This is NO ACCIDENT. It WAS PLANNED. It is a repeat of the Wall Street crash and the Great Depression, which was also a conspiracy, headed by Paul Wahburg and the Rothschild banking dynasty. This is the NEW WORLD ORDER folks. The asset stripping of the people has begun. Million will lose their homes, their businesses, their savings and pensions. We are to be reduced to penury. Their objective is the biggest seizure of private property in history. Millions are going to have their homes seized, their pensions and savings destroyed, their gold and silver bullion and coins confiscated. They are going to asset strip the people as surety against our humungus national debt. We are to be reduced to slaves. The time for worthless enquiries and writing reports is over. It will require revolutionary acts to bring these people to justice and return freedom and liberty to the people. There's very little time left. WAKE UP PEOPLE It all could be cock-up rather than conspiracy, I suppose, but can the West's political leaders really be that stupid, unhappily perhaps so - I doubt we will ever know!

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John Lewis shows the Slump

Even our redundant and troughing Members of Parliament spending their apparently never-ending tax-payer funded allowances at John Lewis cannot now boost that stores sales sufficiently to disguise the reality of the SLUMP. Notably the Government supporting Guardian uses that very term "SLUMP" when reporting the stores 7.6% drop in weekly sales in the week to 18th October, read here. The reality cannot be much longer hidden, Alistair Darling pretending we are entering a recession (the credit crunch is 14 months on) by hanging his hat on the technical economic ' two calendar quarters of zero or negative growth' should be made to own up to the reality as defined in Collins for business activity:- "to decline suddenly; collapse" or in economics: "another name for depression" How can they not only be allowed by the media to escape blameless for years of economic mismanagement, but now be allowed to spin away as to the reality of the desperate plight they have put us in? I put the BBC at the head of the long, long list of fellow-travellers and culprits!

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Inquiry into Britain's Finances

Jeff Randall writing in the Daily Telegraph calls for a full inquiry into the state of Britain's finances. Were such to be held it would be amazing if charges of criminal negligence at the very least were not to follow. The article may be read in full from here, this being a brief quote concentrating on the Conservative's complete incompetence in diverting attention from the looming disaster:

What with the Bank of England forecasting a prolonged downturn, Mr Brown at last acknowledging recession, the imposition of a three-day week at Nissan’s factory in Sunderland and the pound suffering its sharpest fall since the aftermath of Black Wednesday in 1992, it takes a special kind fool to oust Mr Brown’s shortcomings from the headlines.

Worse still, Mr Osborne has allowed Labour the luxury of moving on from its own “dodgy donations” mess, which culminated in November last year with the Prime Minister admitting that £600,000 had been illegally accepted and promising that it would be handed back. In short, Mr Osborne has facilitated government efforts to bury bad news on an industrial scale.

And for what? Fifty grand. It’s so cheap. Meantime, in the real world, 2,500 JCB workers in Britain have accepted a fifty pound a week wage cut in a short time working package, Asian stock markets tumble again overnight, Greenspan admits to error and Renaults third quarter revenue falls 2.2 per cent.

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Thursday, October 23, 2008

Pound's plunge points to higher interest rates!

The fact that Britain has been heading towards bankruptcy for years has been one of the main and constant themes of this blog and its forerunner "Ironies" since 2003. The end result of a decade of completely incompetent governance could have had no other outcome. The constant disregard of our carefully argued warnings by all the political parties, combined with the trashing and undermining of the newly founded political party, Veritas, formed to counter the nation's descent into chaos just before the last General Election, leave this commentator with the firm conclusion that the destruction of Britain (more particularly England) has been the desired outcome. The performance of the Chief Secretary to the Treasury, Yvette Cooper, on yesterday's "The Politics Show" in trying to evade, shout down and avoid any such obvious economic truths was outrageous. If a video record appears on the web I will link it here. (Once again my thanks to the Crown Blogspot for the link) Meantime the 3 per cent interest rate rise in Hungary, reported in the Telegraph, linked here, is an obvious ominous portent for the UK, particularly following the dire warning speech by the culpable and complacent Governor of the Bank of England the evening before last. Leaders are needed with ideas to best navigate the consequences of this extensive, apparently deliberate and malicious mis-governance - it seems unlikely they will be found in Parliament.

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Wednesday, October 22, 2008

An economic team for a slump?

What should one expect?

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Sarkozy suggests National Sovereign funds to EU's MEPs

The link to the video report from Euronews is here, the following is a quote: The French President declared that Europe needs a pro-active industrial policy to promote growth. And he suggested creating sovereign wealth funds in EU countries to coordinate a response to the economic slowdown wrought by the crisis. Is this not something that might be deemed as 100 per cent contrary to the whole idea of the European Union? More on this from the IHT, here with some comment on attempt by the French President to retain Presidency of a 16 member Eurozone group throughout next year when the Czech Republic and Sweden (neither members of the doomed currency) will chair the 27 member EU, here. Update added 23/10/08 0800z from Monsters and Critics click here.

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My first quadrillion sighting

The article with a wealth of fascinating and informative links appears on UN-Debt.net and is linked from here. The quote with the quadrillion dollars mentioned is this: ======================================

More Of The Same Old Cherished Delusions

To start with, the TV broadcasts have once again done everything they could to hide a backdoor giga-bailout orchestrated by the Fed to keep the economy lubricated: the banks have borrowed a record $437.5 billion per day from Fed, Reuters attested candidly as of October 16. Let's also mention that the Fed announced a few day before that it would to provide broad access to unlimited borrowing. So what happens when one has to borrow $100 to honor $100 loan? So, you can imagine where the irresponsible actions of the monetary elites are going to lead us, can't you? But this is nothing surprising from Helicopter Bernanke who has fervently pursued Greenspan' s task aimed at eradicating the cash-strapped middle-class in favor of foreign banks holding too many dollars, and which they were about to dump if anything was done. Ellen Brown, who monitors the situation closely, sums it up like this: FMae and FMac, along with AIG had to be bailed out to prevent the 1 quadrillion dollar derivatives from detonating - temporarily.

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Collins English Dictionary defines a quadrillion in Britain, France and Germany as being one followed by twenty-four zeroes. The US and Canadian word for this is septillion. In the US and Canada a quadrillion is one followed by fifteen zeroes (presumably the amount referred to above)..... I trust that is a comfort to we Europeans!

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Czech Constitutional Court to rule on Lisbon 10th November

German pressure on the Czech Republic seems to have had some immediate results with the above announcement which is linked from here.

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Osborne must go - then Cameron

The latest twist on the Osborne foreign donation scandal is that a respected third party has been named as witness to a donation solicitation involving Leyland Daf as a front for a non-permissible donor. Read here. No criminality occurred apparently but the question mark over Osborne's judgement will remain for decades. N. Rothschild's revenge for a clear betrayal of trust is complete. Osborne must go because there is not one single solitary redeeming factor during his tenure as Shadow Chancellor which makes his retention worthwhile. One factor only would seem to merit his retention worthwhile - that being his closeness to Vapid Cameron the Party Leader - given this blog's longstanding assertion that this Leader is absolutely worthless and unelectable (let alone in the midst of a vicious economic slump) Osborne's departure will also be of longer term benefit to the country in providing a proper alternative to New Labour.

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Tuesday, October 21, 2008

Britain's debt - £76,475 per household?

Yesterday I queried what exactly was the true British debt figure. The above number is provided by a Tory MP Brooks Newmark who sits on the Treasury Select Committee as may be read on the Conservative Home blog, link here. The total is given as an astronomical £1,866 billion.

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Britain's absent opposition partly explained?

Read what I blogged on the Rothschilds, Rhodes, Stead, Milner etc on Christmas Eve 24th December 2003 at 05:49 am on Ironies from here.

The following letter from Nathaniel Rothschild in today's The Times and a statement from the Cameron controlled Conservative Party together with further links from that newspaper alongside those items, surely demonstrate the dire situation in Britain's politics. (As I posted on the Telegraph comment page,Teetering Tories Blog and the Conservative Home Tory Diary page yesterday - any honourable Conservatives remaining in the party MUST now distance themselves from the Cameron/Osborne leadership bestowed by Michael Howard).

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Monday, October 20, 2008

German sense of humour?

A report has this quote regarding the Lisbon Treaty from the German Chancellor: «This treaty will bring the European Union closer to its citizens, and we have seen in the financial crisis the importance of being able to act together,» Merkel told reporters. Don't believe me? Then click here. HAHAHAHAHOHOHOHOHAHAHAHA!

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What is Britain's debt?

PM Brown in Parliament said Britain's debt was 37.5 per cent according to IMF figures for 2008 and then quoted several other developed countries all with higher percentage figures. But per cent of what, and excluding what - all PFI one assumes. The CIA quoted on the unreliable Wikipedia has a huge total putting Britain only just behind the USA while monthly figures available today were horrendous. The Devil's Kitchen blog, here, has some other figures from the EU but they make little sense either.... so what is the true magnitude.... surely there is an authoriative internet source somewhere?????

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Battle for Britain's Banks!

Last week the Marx inspired British Government declared war on Britain's Banks. We must assume that the phony element of last week is about to come to a close as Labours propaganda platforms of the Sunday morning TV political programmes (not an opposition politician in sight) gave prominence to two of the principal plotters Lord Mandelson and Yvette Cooper to announce that the assault would be taken to the boardrooms of the dissenters led by the aforesaid Baron of Hartlepool and Foy with Alistair Darling in tow. The announcement this morning of the Dutch Government bail out of ING brought memories of earlier follies such as that of Barings with further echoes from France with the sackings of executives of Caisse Epargne for getting a 425 million sterling bet wrong on the stock market rising. But in Britain this week we must look to Barclays for clues as to the direction of the campaign for the future control of what was once Great Britain. HSBC is also holding out but as I had reason to discover when I happened to have dinner with its then Chairman in New Zealand at the time of the takeover of what I recall he described as the 'minnow' of a British High Street Bank, The Midland, that giant of international finance is in no way a British Bank, a matter of considerable pride, I recall, for that Scot of self-proclaimed humble origins. So Barclays is the one to watch - an international bank it is true, yet one that seemed to grow by clinging to the coat tails of the British establishment during its period of expansion into Empire, rather than international trading acumen. Its management always seemed lack-lustre to me but whether that will have spared it from many of the excesses of most of its competitors or made it the receptacle for the dross of their own mistakes yet remains to be seen. Lloyds and HBOS issues look set to become a side-show this week, although it is disturbing to see Legal and General recommend the merger, Lloyds shareholders should make their own calculations, large finance companies may easily be swayed by their holdings in HBOS when casting their votes a shareholders of Lloyds! The taxpayers can merely look on in horror and trust that all these deals may yet collapse before a single penny of the billions of taxpayers funds pledged, which can never be realistically raised let alone repaid, are actually legally committed let alone begun to be transferred. (Link on latest borrowing added at 11:30 am, here). David Cameron of the Tories, on Radio 4 this morning, offering 1 penny off Corporation Tax for small companies with less than four employees never fails to exceed ones worst expectations for total irrelevance - even he calculates the total effect for the proposed six month validity would only be worth six hundred pounds - hardly worth losing the opportunity to ram home to the Government that they are completely bankrupt and can now only cut commitments! Ambrose Evans-Pritchard has his own interesting views in the Telegraph again this morning, here.

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Sunday, October 19, 2008

Even the Guardian expresses Lisbon OUTRAGE

A piece from Comment is Free, linked here, concludes:

It should be a cause of outrage that Labour reneged on its promise to hold a referendum on the EU constitution that reemerged as the Lisbon Treaty. So too should news that Ireland is likely to be asked to hold a second referendum next October. The Irish rejected Lisbon in June, but this expression of a people's will was not deemed acceptable by the Eurocrats. What happens if the Irish vote no again – will they be asked to repeat the exercise until they finally come up with the correct answer?

We claim to care deeply about the maintenance and establishment of democracy in other parts of the world. How curious that we appear to be so nonchalant about its practice at home, especially when the very nature of what our home is, who rules it, and what say we will have in its governance, is changing without us, the voters, ever being consulted.

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French plot to force 2nd Lisbon referendum revealed

The Sunday Times carries the report which shows the EU in typical disgraceful deviousness, read it here or just consider these brief quotes: PLANS to isolate Ireland and force the country to hold a second referendum.... French politicians and other MEPs said that Ireland should be put in an “untenable position”... Ireland’s “intellectual mediocrity and lack of political courage” led to the rejection of the Lisbon treaty.... telling the Irish people how the other 495m Europeans are watching them and “will be really angry” if the answer is no again..... ensuring the next referendum in Ireland should involve a question to which the Irish could not say no.

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Sunday Times headlines House Price Crash

The article is linked from here, it is headlined "Negative equity to reach 2 million" and highlights the location of the real national crisis about which the Government continues to do nothing as covered by this blog, here, here and again here. The stupidity, if not now virtual criminal incompetence of this Government is evident from the headline article in the Sunday Telegraph, "Darling will spend his way out of recession" here and the growing question marks over the motives of Brown and Darling in another Telgraph article "Darling the bearded Trot who 'wanted to nationalise the Banks'." linked here. This blog has queried Brown's true motives in policies clearly designed to destroy certainly England if not Britain have been queried down the years and this year in February here, in April here and here and as recently as 27th September linked here. Throughout all this the opposition remains complicit and silent.

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Saturday, October 18, 2008

Immigration a la EU or UK

The following is from the Open Europe daily e-mail of yesterday:

Member states ratify EU Immigration and Asylum Pact; Frattini: "different rules in member states will no longer exist" Agence Europe reports that EU leaders yesterday definitively adopted the French proposed European Pact on Immigration and Asylum. At the end of the European Council, French President Nicolas Sarkozy said: "Europe now has a genuine immigration policy - it was both expected and inevitable". Italian Foreign Affairs Minister Franco Frattini said: "with this pact, different rules in the member states will no longer exist". He added that "everything the pact contains will no longer be done bilaterally but rather, at a level of European-level defined rules".

This, on the other hand is the headline and article from the electronic version of the Daily Telegraph with similar headline news on BBC Radio 4, and a debate involving Frank Field MP all blithely carried on as if Britain was entirely in control of its own non-EU immigration policy:

Immigration to UK 'will be capped'

Immigration to Britain will be capped in an attempt to ensure that rising unemployment does not spark racial tension, a minister has said.

Bizarre Britain - Who in their right mind would wish to become an immigrant there?

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Friday, October 17, 2008

Latest from Crown Blogspot on Boom & Bust

We often link to The Crown Blog, but PLEASE do not miss this VIDEO.

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Lloyds Bank raises mortgage costs

The partially nationalised bank, recipient of billions of taxpayers debt, which had the takeover code waived by the odious PM, Gordon Brown, in order for it to acquire the largest mortgage provider in the UK the former Halifax Building Society, is today following the Nationwide in raising its tracker mortgage rate. These facts are reported in the Daily Mail, linked here, which incredibly also reports many in the UK still believe their houses are rising in value, read here.

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Prospects for the Lisbon Treaty

After this week's EU Council meeting President Sarkozy of France is proposing that French experts will "help" the Irish to finsd a way forward before the end of the French Presidency in December. A further grotesque dance of the grave of democracy. One report is here: “We will define the elements of a solution in December and I shall have the opportunity to make proposals,” France's President Nicolas Sarkozy told journalists late on Wednesday. Declan Ganley, who led the No Campaign during the Irish Referendum Campaign is warning the EU of the consequences of any attempt to circumvent the vote, read here. The EU is now having other worries over political uncertainties in the Czech Republic, read here, which assumes the EU Presidency next January and will hold it throughout the election campaign for the EU Parliament due in June, which sensibly should now be canceled in view of the present uncertainties and the economic plight of the entire EU. Another good reason why the ghastly Lisbon Treaty must never enter into force may be seen on the Euractiv website today, an item on sport, here, of which this is a quote:

Future EU programmes providing financial support for sports organisations and sports-related projects "will be a key tool to promote the social values of sport," said Nicolas Gyss, the secretary general of Sport et Citoyenneté external , a European association aiming to stimulate study and debate of sport's societal role.

The programme could be launched if and when the Lisbon Treaty enters into force, establishing shared EU competence in the sector.

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Thursday, October 16, 2008

Markets conflicting signals.

The always entertaining Guido Fawkes blog is this morning querying whether perhaps London is starting to see Capital Flight, something much to be feared with the present dishonest Government and lack of opposition. The pretext for such doubts are presumed the bizarre use of anti-terrorism legislation against Iceland. For more queries along these lines consider the questions raised by the blogs - Anglo-Saxon Chronicles, PJC Journal and The Devil's Kitchen. The same post on Guido's blog queries the fate of the Euro currency in light of Italy's difficulties, read it all from here. (Note also from the Comments to that post is an FT link exposing the fact that UK Audit Commission had 10 million in an Icelandic bank!!). On a slightly more hopeful note today's Libor rates continue to decline, read Bloomberg, here. Oil also continues to fall as Germany drops its growth forecast by a full percentage point.

Brown and Bretton Woods

Well, well, well, the talk at the EU is of a new Bretton Woods, type "Bretton Woods" in the Search facility at the top of this blog and you will be able to read what I suggested on that topic last August - all too late now I am afraid. Read a report here. Gordon Brown who befouls and besmirches everything with which he comes into contact is presently being hailed as the architect of a 'brilliant' global banking rescue plan - the markets last evening and today are already correctly deciding that Brown's plan is no such thing. As this blog pointed out over the past several days, in the UK the plan by the duo of Scottish schemers involved nothing more sophisticated than a huge transfer of English taxpayer funds across the border to prop up two failed Scottish institutions (with an added pinch of confusion involving Lloyds to allow the BBC and other tame media to misreport the operation). Why the rest of the world wishes to throw their own billions at the failed banks beggars belief. As I posted yesterday at least in Australia the money is being targeted where it might be of some help and also have some positive effect. On the BBC Radio 4 Today programme this morning one of the lame-brained presenters , incapable of rational or logical reasoning after years of propagating New Labour's lies and spin, was trying to get his sorry apology for a brain around the reason why governments having thrown billions at the banks the latter still would not lend to one another at reasonable rates, the reason of course is clear - the bankers, being more savvy than politicians, are fully aware that such money does not exist, it is entirely a figment of Brown and other leaders imaginations, albeit lying within their power to make their fantasies seem real by the use of printing presses. If you did not already visit my post of last August on restoring real value to money "Needed - a new Bretton Woods" you can do so by clicking here, its accompanying post "How Heath betrayed Britain and Nixon the USA in 1971" of two days before is here. This section where I suggested an end October deadline for the process seems particularly IRONIC today, so I quote it here: "Either or both Presidential candidates could endorse the consensus concept of this Economic Conclave, which should be compulsorily achieved by an end October deadline. Congress would then have the utmost legitimacy for implementation early next year."

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Wednesday, October 15, 2008

Money for First Home Buyers in Oz

At least there is somewhere in the world where governments throw money in the right direction. Unhappily only in Oz! Linked here!

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Another EU summit meeting

The press is full of speculation about both the UK unemployment figures due in less than an hour and this weeks EU meeting of National Leaders. The latter should be guided by the former. Talk (see the Irish Times here) is of the possibility of EU member states being able to pay the Third World for their carbon offsets - once more glaring evidence that they have yet to realise the depth of their economic plight. To be classed as even remotely realistic or slightly a success the EU should suspend its parliament for the remainder of this session and cancel MEP salaries and expenses or if that is contractually impossible then it MUST cancel next June's parliamentary elections should be cancelled so the useless body can never again meet and waste billions more of Europe's dwindling wealth. The Lisbon Treaty should be officially and once and for all abandoned and the remaining time spent considering realistic means to ease the coming economic hurricane.

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Tuesday, October 14, 2008

House price falls gather pace

The following is the latest report from the Press Association, linked here. It begins:

House prices dived by 2.7% during August, figures showed.

The average cost of a home dropped to £211,410 during the month, driven down by a 5.1% fall in the value of flats and a 3% slide in the cost of terrace houses, according to Communities and Local Government.

Meantime Sky News has its own report, linked here. The broadcaster has the fall in prices estimated as much as 40 per cent. If anything like this reduction is indeed being experienced then mortgage lenders will be about to experience a huge fall in mortgage payments as this blog has now been warning for almost a month. There is certain to be a critical level of price falls where the average family either through general price inflation, unemployment or sheer inability to cope will deem it unrealistic to continue payments against a mortgage on a property upon which they are never again likely to enjoy any equity. The squeeze as so far experienced by lenders will seem as nothing if a real house price drop of 40 per cent is ever experienced. Mortgage repayments will fall to a trickle! This blogger berated David Cameron for suggesting a holiday on the 75th birthday obligation to purchase pension annuities would be an idea worth considering, as if there was any short term prospect for a 75 year old to ever see an improvement in the country's economic dire straits. Yesterday we had the Government dreaming that the nationalised banks could quickly return to the lending levels of the past two years for mortgages - like targeting water to flow uphill and supreme market ignorance opined an expert before the Commons Treasury Committee today - precisely, none in the Government nor the Opposition seem to have the first clue of the depths of the economic hole they have all created. Mass misery for millions is now on the menu, the plight of a few wealthy bankers is as nothing to the desperate need for massive sums of aid now required for the ordinary house-buying citizen.

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Where will they find the money?

Some say a begging bowl is being held out towards Russia, if true that just shows the desperation. After the weekend spending spree on Scottish Banks with credit cards payable by English taxpayers, Brown and Darling must be feeling like a couple returning from a lost weekend knowing the bills are on their way but with senses too deadened from their excesses to fully grasp the enormity of what they have done! 5.2 per cent inflation, the escalator to be used for various state benefits for next year should further spoil the after-glow from their Marxist wet dreams! The Debt Management Office has announced Gilt Sales to begin to cover these excesses from 20th October, hang on tight, will we see the nationalised banks paying 12 per cent coupons on the Preference Shares of the Government now using their scalped shareholder's remaining funds to provide the investments that will permit the loans on which such shares were purchased? Farce indeed!

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House prices back in focus!

A moment of reality returned yesterday evening to UK politics - No, not the justifiably huge defeat for the Government in the House of Lords with the rejection of the extended pre-trial detention period - I mean the moment when that common bimbo Yvette Cooper (Chief Secretary to the Treasury and mistress of Ed Balls, the moronic Schools Secretary) had her true aims for the nationalisation of banks exposed for all to see on Channel 4 News. Why? She was asked, would the government possibly want the nationalised banks to resume mortgage lending at the levels of 2006 and 2007? Answer came there none, but to all with any brains it is perfectly obvious. For these types of despicable filth who make up much of the Government and their back benches it is the accumulated wealth locked up in their tax payer funded homes and second houses that they are scared witless of losing. Hence the dream that if mortgage lending can be restored to previous levels, the previous dizzying and absurd valuations can be restored and the gains of their 11 years of mis-governance safely stashed away. Remind yourself of some of the background of this obnoxious couple here, here and here. How will the nationalised banks meet this requirement to resume such excessive lending, the very cause of the nation's present plight? Only by sucking in ill-informed first time buyers even more ignorant than Labour MPs, a task I feel sure Ed Balls is setting about with every diligence in his post of supposedly guiding the education of England's youth. This morning, however, banks have been nudged out of the headlines with the real state of the housing market getting even Britain's state-controlled media's attention. Read the summary of the Chartered Surveyor's report in Bloomberg here, read the plight of Estate Agents as reported in the Daily Telegraph here (AAAAAGH). Just in are the latest UK inflation figures at 5.2 per cent. A sum for Ed Balls and Yvette Cooper: House price falls of 13.8 with inflation at 5.2 equals a real price house drop of --.-?

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Monday, October 13, 2008

Incredibly Lloyds HBOS deal continues!

Of course one cannot really say that a deal is continuing when the price has been re-negotiated downwards by 27 per cent but the join-up of the banks seems to be continuing condemning LLoyds not only to nationalisation but almost certain death! The report from Sky News is linked here with the following comments provided at 1455 London Time:
  • It seems I am of exactly the same opinion as many other people at the moment - why is Lloyds taking public money and still making this acquisition? Surely that can't be legal, let alone ethical?
    Posted By :Mike Report This
  • as a shareholder of Lloyds this deal looks worse and worse---is this yet another example of atrocious management decisions? Lloyds were regarded as the best capitalised bank with the most prudent board only a few months ago--perhaps the mayhem of the past weeks has affected their collective judgement.
    Posted By :Stephen cole Report This
  • If Lloyds TSB also requires government funding, can someone please explain how they can afford to buy HBOS, please? changing the law to allow the purchase in the first place was bad enough but for the tax payer to have to fund it for Lloyds as well?!?!?!
    Posted By :Di Report This
Good question from Mike, can any of this be legal and in accordance with Company Law and the Takeover Code? Things just get stranger and stranger - Where is the Parliamentary Opposition?

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Solely a Scottish Shareholder Salvage

Well I have read the press, watched the excruciatingly overlong Downing Street press conference and have concluded that all the 37 billion presently being discussed is entirely to be devoted to rescuing the Labour Party North of the English border. I can remember banks coming and going throughout my lifetime, others too may remember these names: Martins Bank National Provincial Bank Midland Bank They have all gone in one way or another - WHY NOT the Halifax Bank of Scotland and the Royal Bank of Scotland. The only other bank presently involved seems to be Lloyds TSB which was perfectly viable before they became entwined in the machinations of the demented Gordon Brown - now presumably the Lloyds shareholders are to be punished/sacrificed for having doubts on the originally hastily cobbled together deal. British taxpayers can neither afford nor pay for this deal which does not direct a single penny towards the source of the problem - the exploded house price bubble. A MOTION OF NO CONFIDENCE IN THE GOVERNMENT SHOULD TODAY BE TABLED IN PARLIAMENT AND ANY ENGLISH CONSTITUENCY MP NOT VOTING AGAINST THE GOVERNMENT SHOULD BE MADE AWARE OF THE CERTAIN CONSEQUENCE! Has the 37 billion helped the liquidity crisis? Well consider this, the Three Month Interbank Sterling Interest Rate has dropped point one tenth of one per cent from6.28 to 6.27 per cent - DISASTER!

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The evil EU?

There is a very detailed and interesting critique of the EU which was published on the web yesterday and is linked here. It concludes: The European Union is not about cooperation for protecting the best interests of Europeans; it is about turning the entire continent into a Multicultural theme park while the natives get culturally deconstructed and demographically crushed. The EU is a large-scale social experiment conducted on hundreds of millions of people. It is not about economics of scale, it is about stupidity of scale. The EU system corrupts virtually everybody who comes close to it. It cannot be reformed, it can only be dismantled.

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New Labour called to Account -

Labour has been the greatest financial disaster ever to be inflicted upon Great Britain by its own electorate. The cost this morning of Monday 13th October 2008, according to the propaganda of the subjugated and biased media is in the tens of billions of pounds up another 37 billion just today! Read here, here and here. This is not the end. Any who have studied the erratic and dangerous behaviour traits of Gordon Brown down the years, as has this blog, can be in no doubt that ever more dangerous waters lie ahead.

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Sunday, October 12, 2008

HBOS Deal Collapses

Sky News is reporting, as repeatedly foretold by this blog from the day of its announcement, the Lloyds TSB takeover of HBOS will not proceed. Links to be provided when available. This Guardian report indicates the reports have substance but do not provide confirmation. Elsewhere Eurozone members are reported to be about to guarantee interbank lending, if only these wasted billions could be directed to the aid of those with negative home equity - almost at a stroke the banks would then be able to resume normal activities! Tomorrow looks like being another hectic start to the week, as I blogged here seven days ago, I will report things as they appear to me on the morrow. G'night!

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Why Lisbon is dead - Sunday Times

The link is here. Some quotes: "The civil servants who haunt the corridors of the Berlaymont will not rest until they have succeeded in riding roughshod over the democratic wishes of Irish voters.......... "An elaborate show — comprising reports, committees and other time-wasting measures — is being devised with only one outcome in mind: a second Irish referendum...." " Part of the new strategy also involves a campaign to do down Declan Ganley....." The article concludes that Lisbon is dead, but can we really be so sure - this blog has its doubts!

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"HOUSE PRICE" not "Banking" Crisis

Across the world this weekend national leaders and heads of international organisations are meeting to come up with new sticking plaster cures for a banking crisis they state has caused a stock market collapse. Unless they address the real crisis their cures are doomed to failure - for this is a financial crisis caused by the house price bubble. It started in the US with its roots in the Democratic Party inspired reckless lend by Fannie Mae, itself a creation of the supposed cure for the Great Depression. The publicly underwritten mortgage debts together with those of its sister organisation Freddie Mac were never carried as public debt. These organisations lent to low income people incapable of responsible mortgage and lifestyle management. Similar crazed lending policies were adopted in the UK under the New Labour Government and Chancellorship of Gordon Brown. Unless the artificially high house prices in these two countries are addressed the banks cannot be the source of salvation. Other countries may well have similar but not necessarily identical problems. If taxpayers money is to be liberally thrown away, aiming it to reduce house prices in the US and UK would certainly make more sense.

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Saturday, October 11, 2008

Australia highlights the next danger - Spain

I personally believe that it may well be insurance companies where the next big crisis point develops but in Australia in The Age they today point the watcher towards Spain and particularly Banco Santander, the article is linked here, of which this is a quote: Spanish banks are the ones to watch now. Their banks are virtual property developers, an accident waiting to happen.

Their mortgage default reporting is slow. Whereas most countries jump on a default in 90 days and it is reported, they don't reveal it in Spain for about six months, which means the figures should start to come through at the end of the calendar year.

If Banco Santander hits the skids, which is entirely possible as it is trying to bed down the ABN Amro acquisition - which has destroyed its

co-acquirers Fortis and RBS - then the prospect of the Bradford & Bingley rescue unravelling comes into play.

Banco Santander is a big one. On the Dow Jones 30 Banks Titan list it is weighted about 5%. To give perspective, Bank of America is about 7% and Commonwealth Bank about 1.5%. If Santander cracks, it is full-blown crisis time in Spain, too.

There are 450 million people in Europe. France is in recession, Ireland, Spain and Britain are heading there. Germany, the biggest economy in the euro zone and one of the world's largest exporters, is not far off. All this was in train even before the credit crisis.

If this prediction proves correct and with the HBOS rescue still the subject of much doubt, Brown and Darling will really not be able to continue to get by with not looking the complete and utter buffoons they surely are!

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Gordon Brown, Sanity, Iceland and National Sovereignty

This was how AFP began its report on Brown's extraordianary turade against the independent sovereign nation of Iceland: ++++++++++++++++++++++++++++++++++++++

Brown piles pressure on Iceland over frozen bank deposits

LONDON (AFP) — Gordon Brown stepped up pressure on Iceland as Britain tried to establish how many hundreds of millions of pounds of local government cash had been in frozen Icelandic banks.

"What happened in Iceland is completely unacceptable," he told BBC television on Thursday. "I've been in touch with the Icelandic prime minister, I've said that this is effectively illegal action that they've taken."

He added: "We will take further action against the Icelandic authorities wherever that is necessary to recover the money."

Brown told Sky News television Britain had "taken action to seize the assets of Icelandic banks", in reference to Wednesday's announcement that it would freeze the assets of Icelandic bank Landsbanki using anti-terrorism laws.

+++++++++++++++++++++++++++++++++++++

Too many years in the rarefied atmosphere of the EU has destroyed any concept of what governance of a sovereign nation should involve. It could not be any clearer - this man is a menace to the entire world. See the latest comments from the Icelandic leader in the press this morning, linked here, a quote:

At a press conference in Reykjavik, Mr Haarde said Mr Brown’s outspoken public threat to seize the assets of Icelandic companies was “illegal.”

He said that the British Government’s assessment of Iceland’s prospects had fuelled the collapse of the country’s currency.

Iceland’s banking collapse is threatening its entire economy, and the country is widely expected to seek financial aid from the International Monetary Fund in the coming days.

Still uncertain, then view the video posted below from the BBC Politics Show

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EU to push Ireland for 2nd Referendum on Lisbon next March

The always authoritative Bruno Waterfield of the Daily Telegraph has the full details linked here.

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Friday, October 10, 2008

BBC Politics Show confirms Brown is Bonkers

Thanks to Guido Fawkes Blog for the video clip link. Self-mutilating behaviour indeed - its what he is doing to the rest of us that scares the hell out of me!

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Repossessions still the greater and growing threat

Jeff Randall has a good column in the Daily Telegraph this morning titled "Debris from the City and Wall Street will destroy innocent lives" linked here, my own comment Number 63 is this:

Comments: 63

I saw the same couple on Channel 4 News referred to by D. Rumsfeld at 05:28 AM. It was indeed gut-wrenching! I have been stressing, here and elsewhere, for some time, that home repossessions are an area of the present panic most open to governmental influence where the penalty for the present policy inaction is most likely to lead to the direst consequences for society as a whole. The latest international stock market collapse hugely increases the masses facing negative equity thus swelling the numbers considering walking away from their loan commitments and payments. Local government and charity cash losses in Iceland will be as nothing if large sections of Britain's working population feel justified in turning their backs on their homes and obligations.

Martin Cole
on October 10, 2008
at 09:06 AM

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Thursday, October 09, 2008

Rescuing Lisbon

An article in the Fanatically Twisted pro-EU FT by the MEP Andrew DUFF (very aptly named if this is any guide) may be read here, linked more to record the present lack of debate or useful comment than anything else I fear. A quote: "European solidarity matters in these uncertain times." NOT!!!

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Treasures from the Threads - Number Twenty-one

This comment is to a typically weak article from the monumentally useless 'so-called' "Leader" of the Opposition David Cameron in today's Daily Telegraph, linked here: "it is ... critical that we stand up for the interests of taxpayers" You've got your work cut out for you, Sir. What will be the effect of the Brown-Darling rescue plan? Let's look at one example. When the Lloyds TSB deal to take over HBOS was put together in mid-September, Lloyds (280p) were offering 0.83 shares per HBOS share (232p). Yesterday, Lloyds closed at 210p. 0.83 of that is 174p. But HBOS closed at 117p. Lloyds cannot sensibly stick to the original price. They would be paying 49% too much for HBOS. So Lloyds will have to re-negotiate the price. Not easy at the best of times. But now there is an added complication, thanks to the government's rescue plan. HBOS have confirmed that they want to take up the government's offer of re-capitalisation. How much coupon would the combined bank have to pay the government? It doesn't matter. However much it is, Lloyds can pay for it by reducing the price it pays for HBOS. How much is the government's promise to waive the competition laws worth to Lloyds? A lot. But how much do they have to pay for it? Not a lot – the government have no alternative. How important is it that Lloyds keep HBOS branches open and staffed? Very. Very important to the staff. And very important to the government. Lloyds can pay for that by reducing the price it pays for HBOS. Can Lloyds afford to walk away from the deal? Yes. Can the government afford for Lloyds to walk away from the deal? No. You say that: "we back, in broad terms, what the Government has done" Is that wise? Let's test it by trying to guess the price Lloyds will actually pay for HBOS. 0.83 Lloyds shares per HBOS share? No. Too high. Why should Lloyds flush its billions away? 0.56? No. Too low. Or is it? Is there any such thing, now, as too low, when we know that there is at least £50bn to be flushed away? Now multiply that by all the other transactions that need to be completed before the problem is solved. It doesn't work. Not for the first time, the government's plan is not a solution to the problem it faces. Posted by David Moss on October 9, 2008 12:58 AM

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Wednesday, October 08, 2008

Government debt to exceed 60 per cent of GDP

The following analysis is a small part of a very detailed report from The Market Oracle, linked here: ==============================================================

Government Emergency Action, Bank of England Loss of Control

The government, Bank of England and Regulator are in emergency talks aimed towards rescuing the British banking system from collapse. The expectation is that the banks will provide capital injections totaling of as much as £50 billion, that would mean inflating the countries national debt by 10% busting through the 40% debt to GDP rule. This IS an emergency move to prevent an imminent collapse of the UK banking system. This highly inflationary in monetary terms, but deflationary in economic terms i.e. .your money buys less but at the same time you have less money to spend! This is in addition to the estimated losses as a consequence of nationalisation of Northern Rock and Bradford and Bingley of £40 billion, therefore the UK debt has been inflated by £90 billion, with another £150 billion loaned out to the banks with perhaps a default rate of 20% implying another loss of £30 billion. That is a total cost to the UK tax payer to date of some £120 billion with the potential to explode yet higher towards £200 billion plus. The £200 billion figure is not born out of hindsight for in the analysis of 22nd April 2008, I specifically warned that the costs of bailing out the banks by means of nationalisation and exchange of cash for illiquid mortgage back securities would explode to over £200 billion this year . In the analysis of April 08, I voiced the concern that the governments debt ceiling of 40% would soon be busted through onward sand upwards to 60% of GDP by late 2009. Recent events put Britain directly on this path to exceed 60% of GDP with all of the consequences in terms of currency devaluation.

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HBOS deal under renegotiation - Brown's resignation to follow?

The Daily Telegraph has an initial report, linked here.

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The Gathering Tempest

I can do no better than link this report with links to world press coverage on the growing economic crisis from Abu Dhabi titled "Credit crisis turns into Global Meltdown" linked here. The full implications of the mass nationalisation of British Banks cannot become clear until further details become known. The basis seems clear, however, a group of grossly incompetent and untrustworthy lying politicians are about to borrow more vast sums to save the skins of a number of Boards of devious and unscrupulous Banks who are in debt due to their own greed and incompetence. At the Downing Street press conference just concluded Brown and Darling point blank refused to accept the fact of their own complicity. Great Britain's credit rating and the foreign exchange markets will be the obvious arbiters of these doubtful deals. Heaven help all of us with any dependence on the UK Government.

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Tuesday, October 07, 2008

Ecofin Press Conference

One early report is here, disappointingly it does not mention an interesting reference by French Finance Minister Christine Lagarde to an instruction to the EU Commission to change the requirements on "mark to market" to bring EU rules into line with the US for differences in reporting for the trading and banking arms of banks. The aim is apparently to get this into effect for third quarter financial reporting. I will post a better link here when found. Otherwise the linked press release sums up another sorry meeting. In the UK bank stocks are today taking a hammering with Royal Bank of Scotland the worst with HBOS not far behind. Lloyds and Barclays are suffering too, perhaps Gordon Brown is mindful to force one of the latter to absorb the RBS!

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Australia slashes interest rates

One of the last remaining properly functioning democracies and independent sovereign states in the Western world today led the way with a full one percentage point interest rate cut, its stock market immediately rebounded. The cowed, corrupted and dithering ex-democracies of the EU with their robotic, incompetent and collegiate leaders all day did nothing as their stock markets (drivers of their economies and thus their citizens life-support systems) went into a nose dive. All reports indicate they today plan to again sit frozen behind their desks as the world suffers a repeat performance of yesterday's disastrous falls. The Bloomberg report on the Australian rate cut is here.

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Monday, October 06, 2008

German guarantees are political not legal.

Bloomberg has the report linked here. It will be interesting to watch how much faith German savers place in the "promises" of their politicians! Markets tumble - Darling, Osborne and Cable waffle, oil falls as recession looms, and Sky News describes HBOS as isolated, on its own with its trousers round its knees which puts Gordon Brown just where? About to nationalise to salvage his pride perhaps?

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The Euro and the ECB have done for us all?

As the unflappable Warren Buffett puts it, the credit freeze is “sucking blood” out of the economy. “In my adult lifetime, I don’t think I’ve ever seen people as fearful,” he said.

We are fast approaching the point of no return. The only way out of this calamitous descent is “shock and awe” on a global scale, and even that may not be enough.

Drastic rate cuts would be a good start. Central bankers still paralysed by a misplaced fear of inflation – whether in Europe, Britain, or the US – have become a public menace and should be held to severe account by our democracies. The imminent and massive danger is now self-feeding debt deflation.

The lesson of the 1930s is that any country trying to reflate in isolation will be punished. The crisis will ricochet from one economy to another until every one is crippled. We are seeing it play again in this drama as our leaders fail to rise above their narrow, parochial agendas.

The European Central Bank – which raised rates into the teeth of the crisis in July – has played a shockingly destructive role in this enveloping slump. Its growth predictions this year have been, and still are, delusional. Neglecting its global role, it has vastly complicated the fire-fighting efforts of Washington.

It could have offered “cover” to the US Federal Reserve this spring when Ben Bernanke was forced by events to slash rates to 2pc. It could at least have signalled an end to monetary tightening. That is how an ally ought to behave.

Instead, it stuck maniacally to its Gothic script, with equally unhappy consequences for both sides of the Atlantic, as well as for China, Japan, and India. The euro rocketed yet further, which it turn set off an oil shock as crude metamorphosed into an anti-dollar with leverage.

Read the whole article by Ambrose Evans-Pritchard in today's Daily Telegraph, from here.

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Sunday, October 05, 2008

Germany guarantees deposits

The past few Monday mornings Europe has awoken to crisis news from across the Atlantic. Tomorrow it appears all our fears will be home grown! Read here.

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Germany's 35 billion Euro rescue of Hypo Real Estate falls

The report is from AFP linked here. Afternoon Update - A news conference by Angela Merkel on Sunday afternoon was reported here, and here. CNN are reporting even more alarming Hypo debt figures for both this year and next but this blog will not repeat those unless they are verified elsewhere.

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Saturday, October 04, 2008

Germany's Merkel suggests Bankers repay to solve crisis!

The following is not being circulated by some spoof website, but rather the State Broadcaster of Germany:

Merkel calls for accountability

At the start of the summit Saturday, Merkel said that those responsible for provoking the financial crisis must be held accountable for it.

"We believe that politicians must naturally assume their responsibility in such a difficult situation. But we also believe that those who caused this damage must also make their contribution," Merkel said.

Well if you do not believe me click here!

So when our credit runs out and our mortgages are refused we can all find a friendly capitalist passing in his Ferrari and ask for some help?

Gordon Brown on the other hand, exiting the same meeting, proclaims the solution as "A College of Regulators" heavens preserve us all!

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More warnings for Lloyds Shareholders

The Independent backs my concerns today with this report opening as follows:

Words of caution from Société Générale had little effect on Lloyds TSB, which advanced to 290.25p, up 10.78 per cent, or 28.25p, as the London market awaited a crucial vote on America's $700bn bailout package.

The broker advised investors to "sell" Lloyds, arguing that the proposed acquisition of HBOS, which was up 17.87 per cent, or 30.4p, at 200.5p, will materially stretch the bank's capital ratios.

"We remove the capital benefit of the insurance subsidiaries from our core Tier 1 [capital estimate] and believe that there could be a further £2bn post-tax impairment on HBOS treasury assets. This would result in a core Tier 1 ratio of 4.7 per cent for the combined entity, which implies a £6bn capital shortfall," the broker said. "If we were to assume that this shortfall was addressed through a 45 per cent discounted rights issue, this would equate to an additional 3,910 million shares being issued."

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Paris economic crisis summit

According to Bloomberg there is little agreement on anything amongst those gathering in Paris, read the full article here and weep - it begins: Oct. 4 (Bloomberg) -- As European leaders convene today on the global financial crisis, they have so far agreed on only one thing: Europe likely won't emulate the response of the U.S., where Congress gave final approval to a $700 billion rescue yesterday........ The real world is better reflected in two items I have picked almost at random from other normal Saturday reading: The Economist, 'World on the edge' linked here: By some measures, many European banks look more vulnerable than their American counterparts do—and that is saying quite something, given the past week’s forced sale of Washington Mutual, America’s biggest thrift, and Wachovia, its fourth-biggest commercial bank. In America, outside Wall Street, the banks have lent 96 cents for each $1 of deposits. Continental European banks have lent roughly €1.40 for each €1 of deposits. They have to borrow the rest from money-market investors, who are not especially confident just now. Some Europeans, including the British, Irish and Spanish banks, have housing busts of their own. And they must contend with the toxic American securities they bought by the billion, as well as their own slowing economies. The Buy to Let Market is in serious danger according to a report in Financial Advice, linked here: Saturday 4th October 2008 While the fall and fall of the Bradford and Bingley is a true reflection of troubles in the buy to let market it seems as though the situation has got much worse over the last couple of days. Buy to let products on the market had fallen from the heady heights of 3,662 at the peak of the market to just 456 in July but had recently shown improvement to 700 last week. However, concerns that money markets were again about to freeze over has seen 80% of the buy to let offers on the market pulled over the last few days. This has come at a time when those offers left on the market have seen headlines rates jump by almost one percentage point in some cases. In affect landlords are being robbed of the chance to remortgage their properties or indeed expand their portfolios in these troubled times. When you also add in the inevitable increase in rental defaults it seems as though the ill wind of change is blowing through the market. After a decade of huge growth it seems as though the buy to let market is most definitely holed below the water line and in serious trouble. Could this be the next sector to collapse? Everywhere it seems, people are about to feel the squeeze, inaction at the Paruis summit this weekend or EU business as usual is unacceptable.

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News from India

The following is from the web site "Top News", linked here: "The Executives of the Halifax Bank of Scotland (HBOS) are in Bangalore for a week to Halifax Bank Of Scotland To Out-Source 2000 IT Jobs To Indiameet possible partners for doing their IT work. This step of out-sourcing has been taken by the HBOS to cut-down on its expenditure. However, a leading newspaper reveals that the trip of 11 Executives has cost the company 45,000 pounds. " Wonderful that Britain's spooky Prime Minister waived the competition rules to save these creeps. Separately there are many reports that this same Halifax has today raised its mortgage rates for the second time in a week, read here. Poor old Lloyds Bank shareholders, soon to be brought low to keep a Building Society with such spendthrift executives afloat for a mere few extra weeks or months and salvage Gordon Brown's pride for even less time I would guess.

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Friday, October 03, 2008

EU has no future - Mandelson quits!

One of the slimiest, shrewdest, slickest political operatives has today left his lucrative post as EU Trade Commissioner (one of the only real jobs within the Commission). Does that not tell you Euro-fanatics something?????