Northern Rock gets Nationalised!!!

[rynnor]

BBC NEWS | Business | Northern Rock to be nationalised

Amazing stuff - it would have been better to let it sink than to do this tho - it will cost the taxpayer tons to no good purpose.

 

[ECA]

Disagree, if they sold it would be retooled and sold for 5x in a few years and the govt would look like the incompetant idiots they are.

 

[Draylor]

it would have been better to let it sink than to do this tho

Ah cluelessness: isnt FH great?

 

[Sharma]

Well I guess this shows that Gordon Brown is obviously too much of a fucking idiot to handle it himself so he passes the buck.

Great.

 

[Kryten]

Shame they can't just "dissapear" really, I owe them a fair few thousand

 

[inactionman]

Did anyone notice the fact that the legislation will allow them to take over ANY financial institution! Woah!

 

[ECA]

Did anyone notice the fact that the legislation will allow them to take over ANY financial institution! Woah!

Better hire some security guards for your piggy bank.

 

[Raven]

Shame they couldn't do anything for the people who lost money when farepak collapsed

 

[ECA]

Shame they couldn't do anything for the people who lost money when farepak collapsed

Ah yes but that was poor people who vote labour anyway, with this they can influence the middle class.

 

[Furr]

Wonder how many more companies will be bailed out and embraced by the government as the economic situation continues on its weakening. Anyway how could the government let the predominantly Labour voting customers of Northern Rock suffer, that wouldn't be on now would it....
Inadequate response and now an inadequate temporary solution. Going to do wonders for the governments PR when they will be the ones responsible for foreclosing on peoples houses. They aren't going to be able to offload the bank for years to come due to the slowdown, maybe they will be able to strip it eventually and sell it off piece by piece or offload it when the situation improves if they're lucky, buts its going to be a tainted brand. Anyway the Tax payer is now lumbered with the burden of a white elephant at least until we've seen the end of the rebalancing/recession. We're already in Stagflation after all, the next company to look out for is Bradford & Bingley who are having a hard time.

But if you have some divine faith in the future of Northern Rock then buying the shares is going be to dirt cheap.

 

[Gumbo]

But if you have some divine faith in the future of Northern Rock then buying the shares is going be to dirt cheap.

Except that trading in them will be suspended first thing tomorrow, and shareholders will be forced, albeit with a right to challenge the price through a government run panel, to sell their shares to the government.

This one will run and run.

 

[cHodAX]

Ah yes but that was poor people who vote labour anyway, with this they can influence the middle class.

You have a very valid point there bud.

 

[rynnor]

Ah cluelessness: isnt FH great?

Letting it sink would have caused short term harm on the markets but we got most of that anyway - individual investors would have been mostly protected or the govt could have baled them out but instead we now have thousands more civil servants in a banking capacity.

Nationalisation is synonomous with in-effeciency and drains on the taxpayer - I still remember it vaguely from the 70's and it was a crap idea then a worse one now

 

[Tom]

As much as I can't stand NL I can't really see how this is anybody's fault but the Northern Rock bank itself.

I'm still not quite sure why the bank wasn't sold privately, unless the potential buyers were refusing to repay any government loans.

 

[ford prefect]

Shame they can't just "dissapear" really, I owe them a fair few thousand

Same here, have a mortgage with them

Still I agree with Rynnor, seems like a complete waste of tax payers money to me. The government should have floated it to the tune of a full refund for it's customers, balanced out by its debts being sold on to other banks / building societies, and then let it slip away.

It annoys me that the government (old and new) will bend over backwards for a financial institution, but has happily turned up it's nose at any forum of manufacturing industries for over 30 years, in essence making a nation of pen pushers.

 

[Chilly]

What exactly is wrong with nationalising it? We get the profits it makes (yes, its a profitable business, but going through a tough patch like *every* other bank). If it had collapsed the loans is was managing would have been sold off to shitty companies who would have immediately jacked up your rates and the rest of it. Be glad that after sinking £50bn into it, we get to keep it for a while.

 

[ford prefect]

What exactly is wrong with nationalising it? We get the profits it makes (yes, its a profitable business, but going through a tough patch like *every* other bank).

OK, this is small scale nationalisation of a single financial institution, but errrm, the governments previous nationalisation experiments didn't work particularly well did they?

As for profits, the tax payer certainly won't see any, why would we? The only way we would see any benefit from this is a very small tax decrease, and well Labour have been big on promises, short on results over the past 14 years.

 

[Draylor]

Letting it sink would have caused short term harm on the markets but we got most of that anyway

Nope. Not even close.

individual investors would have been mostly protected or the govt could have baled them out

Not 100%. Stories of folks losing even a tiny percentage of their savings would have caused the chaos seen at Northern Rock to spread to other banks.

but instead we now have thousands more civil servants in a banking capacity.

Wrong again.

Nationalisation is synonomous with in-effeciency and drains on the taxpayer - I still remember it vaguely from the 70's and it was a crap idea then a worse one now

Zzzzzzzzzzzzzz.

If you want to blame the government its quite easy, if you do it properly. The rules were intended to allow the Bank of England to lend NR money quietly when this first started, avoiding all the hassles and publicity. Too much meddling by clueless politicians meant they couldnt.

Nationalisation might not be ideal, but its better than the alternative of selling it to Branson for a fiver and letting him make a few hundred million from it risk free: since the government (ie the tax payer) would still have to guarantee the huge loans for the immediate future.

 

[Poag]

As a tid bit. Northern Rock shares closed at 90pence each on Friday. Froma year high of 1230pence...........stock holders gonna get reemed.

BBC NEWS | Business | Market Data | Shares | London | Northern Rock

 

[DaGaffer]

I was under the impression that EU law forbade this kind of thing?

 

[Sharma]

I was under the impression that EU law forbade this kind of thing?

What? You mean you didn't know that labour were a law unto themselves?

 

[bob269]

As a tid bit. Northern Rock shares closed at 90pence each on Friday. Froma year high of 1230pence...........stock holders gonna get reemed.

BBC NEWS | Business | Market Data | Shares | London | Northern Rock

The year high is not this year but a 52wk high, the shares plummeted months ago once the shit first hit the fan.

NORTHERN ROCK Share Price Chart | NRK.L | GB0001452795 | Yahoo! Finance UK

Around about Sept.

 

[rynnor]

Nope. Not even close.

Prove it! Unless you can see into alternative realities then your guessing as much as I am so your tone of authority is misplaced

Not 100%. Stories of folks losing even a tiny percentage of their savings would have caused the chaos seen at Northern Rock to spread to other banks..

Did i say 100% - no - I am aware of the compensation schemes limits but even if the government did step in to underwrite the rest it would still have been a fraction of the costs it did incur.

Wrong again.

Pedant - these people are now employed by the government.

If you want to blame the government its quite easy, if you do it properly. The rules were intended to allow the Bank of England to lend NR money quietly when this first started, avoiding all the hassles and publicity. Too much meddling by clueless politicians meant they couldnt.

Wrong - there were no rules to lend quietly - thats why they have since brought in legislation to do just that for future cases.

The Governments new plan has doubled its exposure to 110 billion pounds - you still think its a great idea

 

[Hawkwind]

My crystal ball says, the taxpayers will pay off most of the debt. Then Brown will sell it to Branson for an undisclosed amount (1 GBP). Who in turn will make millions then sell it for a billion.

The deal was done weeks ago on a private plane in China.

 

[Mabs]

personally, id like them to round up all the upper echolon of N Rock and clean em out. sell their houses, cars, children, etc. they get the 6 figure bonuses when it goes well, they can damn well pay for screwing it up, but its "not fair" to do that sadly

 

[Chilly]

Yes the liability may be 110bn, but we also now own a very large bank with a lot of active debts being repaid.

It's really not all that bad, I wish a lot more companies would get swallowed. I cant think of justification for a monopoly company to be in private ownership.

 

[Tom]

What exactly is wrong with nationalising it? We get the profits it makes (yes, its a profitable business, but going through a tough patch like *every* other bank). If it had collapsed the loans is was managing would have been sold off to shitty companies who would have immediately jacked up your rates and the rest of it. Be glad that after sinking £50bn into it, we get to keep it for a while.

Twofold - one is that public companies have no incentive to offer a good service, and two is that public companies have an unfair advantage over private companies, in that they have access to extremely cheap loans.

 

[Ch3tan]

Dispatches covered this tonight, was quite an interesting look into how this all came about and where we could end up next.

 

[Furr]

Dispatches covered this tonight, was quite an interesting look into how this all came about and where we could end up next.

Was also about to comment on Dispatches, was a bit disconcerting. The programme says how there is quite serious problem with the whole sector, and how NR is just the first casualty of what is likely to be many more casualties.
Gordon Brown is responsible in a large part for break up and creation of too many establishments who are meant to regulate the market basically being unfit for purpose, the banks are guilty of being criminally greedy for wanting to make a lot of money very fast on a model that had a high chance of failing and its all tied in to such a degree that its going to badly effect many other sectors, with so many major banks in countries all over the world involved the current "rebalancing" over the next couple years has the first good chance to tip the world over into a serious recession.
Of course he said that it might not happen and NR could be the only casualty but he thought it to be unlikely, also that this problem has been seen by many people for quite a while but the Bank of England, FSA and Treasury are just broken and didn't want to listen.

 

[DaGaffer]

Yes the liability may be 110bn, but we also now own a very large bank with a lot of active debts being repaid.

It's really not all that bad, I wish a lot more companies would get swallowed. I cant think of justification for a monopoly company to be in private ownership.

How the hell is Northern Rock a monopoly company? Last time I looked there were rather a lot of banks...