Northern Rock gets Nationalised!!!

ECA

I am a FH squatter
Joined
Dec 23, 2003
Messages
9,466
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.
 

Sharma

Can't get enough of FH
Joined
Dec 22, 2003
Messages
4,678
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

Old Cow.
Moderator
Joined
Dec 22, 2003
Messages
3,352
Shame they can't just "dissapear" really, I owe them a fair few thousand :D
 

inactionman

Can't get enough of FH
Joined
Dec 23, 2003
Messages
1,864
Did anyone notice the fact that the legislation will allow them to take over ANY financial institution! Woah!
 

Raven

I am a FH squatter
FH Subscriber
Joined
Dec 27, 2003
Messages
45,749
Shame they couldn't do anything for the people who lost money when farepak collapsed
 

ECA

I am a FH squatter
Joined
Dec 23, 2003
Messages
9,466
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

Can't get enough of FH
Joined
Dec 22, 2003
Messages
1,067
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

FH is my second home
Joined
Dec 22, 2003
Messages
2,362
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.
 

rynnor

Rockhound
Moderator
Joined
Dec 26, 2003
Messages
9,353
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 :p
 

Tom

I am a FH squatter
Joined
Dec 22, 2003
Messages
17,657
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

Can't get enough of FH
Joined
Aug 27, 2006
Messages
1,386
Shame they can't just "dissapear" really, I owe them a fair few thousand :D

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

Balls of steel
Joined
Dec 22, 2003
Messages
9,047
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

Can't get enough of FH
Joined
Aug 27, 2006
Messages
1,386
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

Part of the furniture
Joined
Dec 23, 2003
Messages
2,591
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 :p
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.
 

DaGaffer

Down With That Sorta Thing
Joined
Dec 22, 2003
Messages
18,935
I was under the impression that EU law forbade this kind of thing?
 

bob269

Fledgling Freddie
Joined
May 4, 2004
Messages
556

rynnor

Rockhound
Moderator
Joined
Dec 26, 2003
Messages
9,353
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 :p

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 :p
 

Hawkwind

FH is my second home
Joined
Jul 5, 2004
Messages
7,541
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

J Peasemould Gruntfuttock
Joined
Dec 22, 2003
Messages
6,869
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

Balls of steel
Joined
Dec 22, 2003
Messages
9,047
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

I am a FH squatter
Joined
Dec 22, 2003
Messages
17,657
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

I aer teh win!!
Joined
Dec 22, 2003
Messages
27,318
Dispatches covered this tonight, was quite an interesting look into how this all came about and where we could end up next.
 

Furr

Can't get enough of FH
Joined
Dec 22, 2003
Messages
1,067
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

Down With That Sorta Thing
Joined
Dec 22, 2003
Messages
18,935
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...
 

Users who are viewing this thread

Top Bottom