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(Marketwatch)   Gobsmacked by the failings of its private financial sector, the British government will draw upon its own efficiencies and depth of fiscal expertise to create a state-backed bank   (marketwatch.com) divider line 21
    More: Interesting, Something/Anything?, business secretary, Britain  
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593 clicks; posted to Business » on 13 Sep 2012 at 10:34 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



21 Comments   (+0 »)
   
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2012-09-13 10:35:07 AM
Although experience in the industry is bound to be minimal, the government should be able to draw plenty of natural banking talent from Wandsworth.
 
2012-09-13 10:55:34 AM
heheh gobsmacked
 
2012-09-13 11:14:10 AM
This should end well.
 
2012-09-13 11:17:24 AM
Did he really need to spend the first five paragraphs talking about how the business secretary was five minutes late and some other guy was getting antsy? It seems like there was some other more relevant information to pass along.
 
2012-09-13 11:31:17 AM
This reads like a society gossip column. Next, please!
 
2012-09-13 11:32:58 AM

Cybernetic: This should end well.


It ends with him getting fired by the Prime Minister.

Can't believe he hasn't been yet.
 
2012-09-13 11:44:36 AM
What a surprise. I am shocked. SHOCKED, I tells ya!
 
2012-09-13 12:16:10 PM
At this point, aren't all banks de facto state-backed banks?
 
2012-09-13 12:28:12 PM
Just what's needed, a banking entity whose lending will be influenced by the political desires of its masters in government. This should work out about as well as Fannie and Freddie have for the US.
 
2012-09-13 12:47:00 PM
If Churchill was alive this might work.
 
2012-09-13 01:19:16 PM
i.telegraph.co.uk

Is this guy in the British Civil Service? I hope not.
 
2012-09-13 01:20:55 PM
You mean besides the Bank of England, the Grey Lady of Theadneedle street, the Mother of all Central Banks?

Every major country has a Central Bank of some sort, either totally government-controlled or semi-privatized, and many major banks have been appointed to perform many of the functions of a central bank through history, with exclusive rights, powers and privileges to allow them to control money supply, currency, etc.

If you read the Wealth of Nations you will get a certain amount of historical background and economic insights from the greatest economist of all time, regardless of what libertarians and neo-liberals might think. Another book worth reading on the subject is Money by Sir Terry Pratchett. On Discworld, the Bank of Ankh-Morpork is almost as eccentric as the Bank of England. It is owned by a small dog. There is a model of the economy in the basement that is magically linked to the real economy in much the same way that the map of Discworld on which the Gods play games is linked to the real world--being rather more than a map and more like a control panel or voodoo doll.

Governments have successfully intervened in markets before, especially money markets, and they have played a very important role in the creation of entire economies, industries and states. They have failed also, of course, but the job is immense and the chaotic nature of the world means that failure is inevitable regardless, so it's just as well that they do their best to control and understand and regulate for the greater good.

Despite all the boot-strapy propaganda of idealogues and special interests (i.e., the very rich) governments make a great contribution to the peace, order and well-being of the world, for better and for worse, for richer and for poorer, until death do them part. Husbandry is husbandry, even if it is sometimes inept.
 
2012-09-13 01:49:57 PM
So, the guys that lend the money to you also determine the value of that money, that sounds like a great idea!
 
2012-09-13 01:50:16 PM
www.pitch.com

Persons of interest? 

love, hate, sex, pain...
compound interest
 
2012-09-13 03:38:19 PM
What would work well is if the government formed some new building societies with government funds, and once they became stable and had built up enough spin them off as mutuals, getting back a chunk of the funds immediately and basically cashing out over a period of time. Prioritize towns and cities where all or nearly all the building societies demutualized, and give more people the option to choose between the two models again like they used to before Thatcher decided less customer choice and less competition was a good thing.
 
2012-09-13 04:00:48 PM

brantgoose: Governments have successfully intervened in markets before, especially money markets, and they have played a very important role in the creation of entire economies, industries and states. They have failed also, of course, but the job is immense and the chaotic nature of the world means that failure is inevitable regardless, so it's just as well that they do their best to control and understand and regulate for the greater good.


Yup, lots of great investments
Tanganyika Groundnut Scheme
Concorde
Rover
DeLorean
Bank Rescues

The idea that a bunch of bureaucrats with no personal interest can pick winners is just laughable. They'll end up backing the things they think are good/right, rather than successful businesses.
 
2012-09-13 08:47:30 PM
www.badassoftheweek.com

Would not approve of a state-backed bank.....or the British....
 
2012-09-13 09:15:12 PM

farkeruk: The idea that a bunch of bureaucrats with no personal interest can pick winners is just laughable. They'll end up backing the things they think are good/right, rather than successful businesses.


Because the bankers have proven themselves to be so good for the economy ....

At this point, there is nothing a bureaucrat can do that would be worse than a banker - up to and including, setting all the paper money on fire, shoveling the coinage into a furnace, and attaching giant magnets to every hard-drive holding financial information. Hell, actually releasing the entire nuclear arsenal of the world to rain down radioactive death upon everyone couldn't be a bigger clusterfark than what the bankers did. If you want to rail against the scary bureaucrats, you might want to point to a sector where they are not manifestly better than the alternative; to paraphrase Churchill: "The bureaucrats are the worst form of bank manger in the world, excepting all the actual bankers"
 
2012-09-14 07:42:34 AM

opiumpoopy: Cybernetic: This should end well.

It ends with him getting fired by the Prime Minister.

Can't believe he hasn't been yet.


He can't get fired by the Prime Minister. He could get fired by the Deputy Prime Minister, but that would spark a leadership contest and may well lead to the break up of the coalition. Cable is safe. He should be Chancellor, really, but that's not going to happen.
 
2012-09-14 08:06:17 AM

farkeruk: Yup, lots of great investments
Tanganyika Groundnut Scheme
Concorde
Rover
DeLorean
Bank Rescues

The idea that a bunch of bureaucrats with no personal interest can pick winners is just laughable. They'll end up backing the things they think are good/right, rather than successful businesses.


The National Grid
The internet
Airbus
Renault

Sounds like you read The Economist a bit too much. The sad fact is that banks in the UK don't want to invest in industry and help develop new ideas. They just don't give a shiat. It's boring, it's low margin, it requires people who know what they're doing. It's far more profitable to just trade derivatives. So, you need a national investment bank.
 
2012-09-14 01:11:21 PM
they should call it: The Bank of England
 
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