How can we save £60 billion?

[brianthedog]

I don't think Anna was refering to the cashiers and clerks when she said tax the banks and the bankers. It wouldn't be so much a tax as a repayment. With enough public pressure, it could happen. It's early days yet. I wouldn't be suprised if there was some internationally co-ordinated action against the banks once the chaos caused by the recession settles down a bit.

 

But it wouldn't be a repayment. The repayment comes when the government sells the shares at a tidy profit (unless they do "a gold" and flog them in a dip). Not to mention not all banks (as mentioned by SimpyTimpy) need to repay a penny.

[donkey]

But it wouldn't be a repayment. The repayment comes when the government sells the shares at a tidy profit (unless they do "a gold" and flog them in a dip). Not to mention not all banks (as mentioned by SimpyTimpy) need to repay a penny.

 

It was a bail out, not an investment.

[donkey]

 

 

Where the banks come into this is that they lent to home buyers, then re-packaged the 'sub-prime' debt and sold it on the market. Those banks that bought such debt did it unwisely. However, every investment has a risk and if that risk was excessive, it was the job of the regulators to manage.

 

.

 

If people at the cutting edge of buying and selling increasingly complicated and fast changing types of financial packages couldn't keep track of what was going on, then how are regulators on a fixed salary working for the government supposed to. if they understood it better than the bankers, they'd be working in the private sector. Obama has the right idea. Investment banking should be seperated in such a way that it can no longer infect the whole economy. If they gamble and loose, it's their loss, not ours. In the meantime, governments should be looking at ways to make the banks pay back what have taken off us.

 

where people spent beyond their means to live the lifestyle they couldn't realistically afford. The main part being the amount of borrowing based on property value, which was inflated due to people living beyond their means.

 

.

That is not strictly true anywhere outside of the USA. Our banking system almost collapsed because of the purchase of toxic debts from the USA, not because of widespread defaulting on loans and mortgages in the UK. In fact, given the circumstances, there have been comparitively few bankrupcies and house repossessions in this country because - despite the propaganda coming out of the banks to try and deflect the blame for what they did - it seems the average member of the public has been far more prudent with their finances than the supposed 'financial gurus.'

[Anna B]

I found this in a 6 month old newspaper cutting written by the Institute of Directors and Taxpayers' Alliance -

 

Ways to cut spending and save taxpayers' cash.

 

Scrap Sure Start - save £1.4 billion

Halt Eurofighter Programme - save £740 million

Halve Government spin budget - save £270m

Scrap NHS IT programme - save £1.1bn

Halve public sector Consultants budget - £1.3bn

Cut Civil Service - £1.2bn

Cut department for Communities - £1.1bn

Axe quangos or cut budgets - £818m

Cut dept for Culture budget - £754m

Freeze International development Budget - £862m

Freeze Home Office budget - £350m

Freeze Local government grants - £687m

Cut some non-ministerial department budgets - £1.7bn

Freeze grants to Scotland, N Ireland, Wales - £1.4bn

Freeze state pension £1.4bn

Public sector pay freeze (except armed forces in warzones) - £6.2bn

Cut highest public sector pay - £1.3bn

Increase employee pension contribution - £2.5bn

Axe Child Benefit and Child Trust Fund, alter Child tax credit to tackle child poverty - £8.4bn

Abolish free TV licences - £564m

Abolish interest subsidy on Student loans - £1.1bn

Means test free bus passes - £438m

Abolish Bus Service Operators' Grant - £451m

 

Their figures, not mine...

[SimpyTimpy]

If people at the cutting edge of buying and selling increasingly complicated and fast changing types of financial packages couldn't keep track of what was going on, then how are regulators on a fixed salary working for the government supposed to. if they understood it better than the bankers, they'd be working in the private sector. Obama has the right idea. Investment banking should be seperated in such a way that it can no longer infect the whole economy. If they gamble and loose, it's their loss, not ours. In the meantime, governments should be looking at ways to make the banks pay back what have taken off us. [/i]

 

Not sure I agree with this - when you deposit money into a bank; either from your wages or by cashing a cheque, you're investing that money with an expectation of getting a return.

 

The return for you investment is very small because the risk is just that, however, as small as that risk is, there's always a chance that you could lose your deposits.

 

The whole basis of separating investment banking from retail banking is a bit of a pipe dream. Investment banking relies upon retail banking for the capital required, and retail banking relies upon Investment Banking for generating profits. In theory however, this already exists. It's not seperating the companies on paper, they'd have to make them completely seperate identities which leads onto:

 

The cost of running a retail bank which was limited to deposits, loans and only high credit rating mortgages would limit profit if the banks were also expected to continue investments in technologies (such as Internet Banking) etc.

 

Plus the most crucial thing of all - in a global economy, if we make it tough for banks here, they'll move to other countries. As simple as that, we need to be competitive on the global market, and without global action on the financial market, it would be a disaster for us to go solo on this.

[brianthedog]

It was a bail out, not an investment.

 

It was a bail out which took the form of an investment. Hence, my comment still stands.

[carosio]

A good thread started.

 

I'd like to see the implementation of something similar to the Liberals Mansion Tax only starting much earlier and that would be a one-off tax to those who have seen their property value rocket under Labour.

 

I'd also like to see taxes rise for anyone earning over £100,00.

 

I'd also like to see Motorways being charged with the money raised going to the treasury.

 

Would any of these tax rises that you advocate affect you personally, Titanic?

[donkey]

It was a bail out which took the form of an investment. Hence, my comment still stands.

 

The UK bank bailout came in at a mere £850 billion. http://www.independent.co.uk/news/uk/politics/163850bn-official-cost-of-the-bank-bailout-1833830.html

You surely don't believe that this will ever be recuperated? Especially in view of the fact that taxpayers money was used only to pay for toxic assets, whilst the profitable areas of the banks which got into trouble were sold into the private sector. It might suit people who stand to profit from the perpetuation of this situation to pretend otherwise, but the truth is this is the greatest con of all time.

 

Meanwhile the natioonal defecit stands at £170 billion and rising. The connection between this and the bailout are obvious. The people who actally do something productive for a living have to pay for this through increased taxes, wage freezes and cuts in services for how ever many years to come, but meanwhile the tossers who got us into this hole have had their slates wiped clean and are exonerating themselves of any responsibility whilst at the same tiime preparing for another round of making quick fortunes on the backs of the rest of us. It makes me sick.

[SimpyTimpy]

The UK bank bailout came in at a mere £850 billion. http://www.independent.co.uk/news/uk/politics/163850bn-official-cost-of-the-bank-bailout-1833830.html

You surely don't believe that this will ever be recuperated? Especially in view of the fact that taxpayers money was used only to pay for toxic assets, whilst the profitable areas of the banks which got into trouble were sold into the private sector. It might suit people who stand to profit from the perpetuation of this situation to pretend otherwise, but the truth is this is the greatest con of all time.

 

Meanwhile the natioonal defecit stands at £170 billion and rising. The connection between this and the bailout are obvious. The people who actally do something productive for a living have to pay for this through increased taxes, wage freezes and cuts in services for how ever many years to come, but meanwhile the tossers who got us into this hole have had their slates wiped clean and are exonerating themselves of any responsibility whilst at the same tiime preparing for another round of making quick fortunes on the backs of the rest of us. It makes me sick.

 

Much of this is theoretical debt that hasn't been realised.

 

£76bn To purchase shares in RBS and Lloyds Banking Group

 

£200bn Indemnify Bank of England against losses incurred in providing over £200bn of liquidity support

 

£250bn Guarantee wholesale borrowing by banks to strengthen liquidity in the banking system

 

£40bn Provide loans and other funding to Bradford & Bingley and the Financial Services compensation Scheme

 

£280bn Agree in principle to provide insurance for selection of bank assets

 

£671bn Total Government spending in the financial year 2009-2010

 

I count £730bn as 'theoretical money' they could be called on if required, and as far as I'm aware, this hasn't been touched.

 

£76bn was an actual cost, and this should be returned with a nice profit when we sell the shares at a later date.

 

The cost to the government would have been far greater if the banks were allowed to fail as the government backed insurance for deposits would have been a real cost, not a theoretical one.

[donkey]

Much of this is theoretical debt that hasn't been realised.

 

 

 

I count £730bn as 'theoretical money' they could be called on if required, and as far as I'm aware, this hasn't been touched.

 

£76bn was an actual cost, and this should be returned with a nice profit when we sell the shares at a later date.

 

The cost to the government would have been far greater if the banks were allowed to fail as the government backed insurance for deposits would have been a real cost, not a theoretical one.

 

 

We are going to be struggling for years to come because of the mess the banks got us into. Thousands of people are loosing their jobs as we speak. Services are being slashed, incomes are - in real terms - going down, and taxes are going up. This is set to continue for some time. The real cost is far far in excerss of £76 billion. There is no way on Earth we are going to come out of this better off than before!