Post Tagged with: "Britain"
The Last King of Scotland
In Scotland, one of the UK’s most venerated names, the Royal Bank of Scotland, a bank that prints its own bank notes as legal tender, has been eviscerated by the over-leveraging and risk-taking of its CEO Sir Fred Goodwin. Sir Fred, an accountant by training, started his career at Touche Ross, a precursor to the
Nationwide: example of how UK recap scheme matters
If you don’t think that the recapitalisation scheme by Gordon Brown doesn’t matter, then take a look no further than Nationwide Building Society. The mutual company is not under pressure in the equity markets like RBS, HBOS or Barclays. Yet, it too is going to take full advantage of the capital strengthening that the UK
The Swedish roots of the UK bailout plan
Gillian Tett makes a good point in today’s FT about the clear benefits of a systemic solution to crisis. Where the UK policy makers were bumbling along until today, they have taken the problem firmly in hand, finally recognizing the systemic risk. Tett sees this sensible policy as one hearkening back to the Swedish solution last decade. The U.S. would do well to take notice
Another look at my 2008 predictions
In July, I made my ten predictions for the markets and global economy for the rest of the year. Some of my predictions were pretty pedestrians, and some were fairly bold. Let’s take a look and see how I’m doing. Here’s what I originally said: Oil prices will dip below $100 before year-end. Let’s face
The Fed leads a global rate cut by central banks
The Federal Reserve, the Bank of England and the European Central Bank led a coordinated rate cut effort as the official response to the biggest financial crisis since the Great Depression gathers steam. The official response in Europe and the U.S. has really stepped up. The U.S. central bank intervening in the Commercial paper market
Recapitalising Britain
Prime Minister Gordon Brown has finally pulled the trigger. In the most momentous move yet in the credit crisis, the UK government is effectively partially nationalising the UK banking system. For months, I have maintained that the financial system needed to be recapitalised in the UK and elsewhere. If any country is to work its
German deposit guarantee sets up a German-British row
The Guardian is reporting that Gordon Brown and his Labour Government are increasingly on the defensive as the number of governments in Europe guaranteeing deposits increases. The first problem for the Prime Minister was that Building societies started complaining that Irish banks were advertising their government guarantees to British savers in a way that engendered
UK: House prices are going to rise substantially
If you want a good laugh, take a look at what Graham Norwood reports in today’s Guardian. House prices in Britain are going to rise — a lot! Apparently, he forgot that house prices are falling at double digit rates and we are in the worst banking crisis since the Great Depression. The last tme
Europe is in for a rude awakening
The Europeans have no idea what is about to hit them. Their banking system is collapsing and European politicians are fighting amongst themselves. At French President Nicolas Sarkozy’s crisis summit, the politicians were unable to craft a comprehensive or wide-reaching response to deal with the banking crisis. Meanwhile, the carnage in European banking is increasing.
UK house prices fell another 1.7%, now down 12.4% annually
Nationwide released its monthly survey of U.K. house prices and the results are not promising. In September 2008, the month-to-month of 1.7% matched last month’s decline, but the annual change in Nationwide’s index fell 12.4%, the largest fall since at least 1991. Nationwide’s Chef Economist Fionnuala Earley, always looking for a silver lining, had this
Bradford & Bingley is being shopped by the FSA
Just in case you thought the crisis was over, I have to remind you that there are still firms out there that are very concerned about their futures. Principal among them is the UK buy-to-let specialist Bradford & Bingley. The word on the street is that the FSA, the UK banking regulator, is shopping the
Definition of the day: the law of unintended consequences
Given the fact that the regulatory authorities in the U.S. and the UK have taken the unusually manipulative step of banning all short sales of financial institutions outright, it bears remembering that all actions have consequences, both intended and unintended