Is the Government about to start selling off Royal Bank of Scotland shares.

[Uptowngirl]

It is rumoured that the government is in talks with the government of Abu Dhabi over the sale of a significant amount of shares in RBS. With RBS share rice running well below the price that Gordon Brown paid for them, the taxpayers are likely to see a loss of around 50% of their investment.

[Mecky]

Saw it on the BBC website

[green]

They need to sell the assets rather than shares which they will get a pittance for.

 

See a similar blog on this by Will Hutton http://www.guardian.co.uk/commentisfree/2012/mar/24/george-osborne-budget-disgrace-will-hutton?INTCMP=SRCH

 

in particularly these paras...

 

Instead of irrelevant wheezes and this hotchpotch of tax measures as the IFS described it, the chancellor should have confronted head on the causes of our ongoing slump. (Output is still below peak 2008 levels and is projected to recover only in 2014.) Bank assets are five times our national output and need to be reduced; and banks want to contract their balance sheets rather than grow them. As a result, British small and medium-sized businesses are facing a potential funding gap of £190bn by the middle of the decade, according to the government-commissioned Breedon report.

 

The response, to establish the £20bn national loan guarantee scheme, is besides the point. It does not guarantee new lending, but rather old deposits – and is so irrelevant that the banks had to be arm-twisted into joining. One finance director told me that it might even raise funding costs because of administration expense – all for an exercise his bank did not need. What he, and other banks, need is the capacity to bundle up new loans into new aggregated investment vehicles that the Treasury can indemnify, and which can then be bought by investors or by the Bank of England's quantitative easing programme.

 

I have argued for this. So has the Breedon report. It is the only secure way to ensure bank lending rises over the years ahead. But it means using the public balance sheet creatively, innovatively merging fiscal, financial and monetary policy. Not a runner from today's complacent chancellor betting all on deficit reduction.

[gnvqsos]

It is rumoured that the government is in talks with the government of Abu Dhabi over the sale of a significant amount of shares in RBS. With RBS share rice running well below the price that Gordon Brown paid for them, the taxpayers are likely to see a loss of around 50% of their investment.

 

We sold off our assets in the 1980s and 90s to fund tax cuts etc. and the nation is still paying the price with high energy prices,water shortages due to leaks,and a run down public sector and pit closures.Happy days.

[I1L2T3]

We sold off our assets in the 1980s and 90s to fund tax cuts etc. and the nation is still paying the price with high energy prices,water shortages due to leaks,and a run down public sector and pit closures.Happy days.

 

Or put another way the governments of the day sold off most of the infrastructure built with and maintained by taxes paid by generations of UK citzens then piddled it all up the wall in a couple of decades in the pursuit of votes. And the latest lot want to piddle away what little infrastructure is left.

 

Disgusting. I've little time for any of the main parties any more.

[Tony]

I'd guess that this is more about putting a floor under the share price rather than turning a buck today. The sovereign funds can hold long term, which provides more stability than having shares in the hands of day traders. It's a good strategy and should help to yield better value in future years.

[Uptowngirl]

I suppose it's no bad thing to sell them ASAP as the share price keeps dropping. The government bought them too dear and they aren't ever going to recover to the price Gordy paid for them.

Where was Gordon Brown when we wanted someone to pay over the odds for our gold reserves?

[Stan Tamudo]

I'd guess that this is more about putting a floor under the share price rather than turning a buck today. The sovereign funds can hold long term, which provides more stability than having shares in the hands of day traders. It's a good strategy and should help to yield better value in future years.

 

What the bloody hell does that mean?

[Anarchon]

I suppose it's no bad thing to sell them ASAP as the share price keeps dropping. The government bought them too dear and they aren't ever going to recover to the price Gordy paid for them.

Where was Gordon Brown when we wanted someone to pay over the odds for our gold reserves?

 

My bold.

 

I don't think the government had any choice about re-capitalising HBOS and RBS in 2008. Both banks were within hours of becoming insolvent if the government hadn't stepped in at the right time. If both banks had been allowed to go bankrupt, the consequences would have been catastrophic to the whole British banking sector and other banks may have suffered the same fate. Asking whether Gordon Brown paid the right price at the time is completely missing the bigger picture of having to act to prevent the entire financial collapse of the British banking sector.

 

Article here

[Uptowngirl]

My bold.

 

I don't think the government had any choice about re-capitalising HBOS and RBS in 2008. Both banks were within hours of becoming insolvent if the government hadn't stepped in at the right time. If both banks had been allowed to go bankrupt, the consequences would have been catastrophic to the whole British banking sector and other banks may have suffered the same fate. Asking whether Gordon Brown paid the right price at the time is completely missing the bigger picture of having to act to prevent the entire financial collapse of the British banking sector.

 

Article here

 

They had every choice. In Iceland the government had a far starker choice, but handed stock to account holders rather than buying it themselves. As for the price paid it is very relevant. It was the difference between the taxpayer picking up at £25 billion bill or RBS's shareholders doing so. Perhaps you need to stop pretending you live in Baghdad and try inhabiting the real world.