Yes the picture is dollars, because it was the US Treasury Secretary, Timothy Geithner, who said the title words on Tuesday that banks must pay back bailout cash.
A proposed Financial Crisis Responsibility fee that is projected to raise $90 billion over 10 years could be extended if the cost of the bailout exceeds that amount.
"The fee can and will be extended until every penny of taxpayer assistance to the financial system has been repaid and the cost of the rescue to taxpayers is zero," Geithner said.
Now for the UK. Alistair Darling proposes a supertax on banks, which is largely a symbolic measure that only stands to raise around £3 billion.
"This was because we do not want to disadvantage the UK in an industry -banking and financial services - in which we have global leadership," Lord Myners stated. The UK preferred the 'Tobin' tax which would see a charge on every banking transaction. We've heard nothing more about this in recent weeks although banks have announced massive profits and bonuses.
In the meantime Northern Rock, which was bailed out with taxpayers' money in 2007, has confirmed it will sponsor Newcastle United FC to the tune of £10 million.
Little wonder this country's economy is in such a mess.
Posts
15 comments:
Yes and the Six Nations is about to start sponsored by RBS (ie 85% us).
The UK has bought shares in RBS and LLoyds which are currently 'under the wate'. If things improve and share prices rise, the Government will sell the shares in the market and get its (our) money back. It might even make a profit.
One worry for Scotland is if they decide to sell RBS shares to a rival and we lose another HQ.
The big financial worry is the bank assets insured by the Government. If these turn out to be poor quality (and if they're good why have the banks paid the high insurance premium?) then we lose out big time!
subrosa,
If the US system was adopted in the UK it could mean the end of lucrative directorships for retired, or even current, politicians. We can't have that, can we?
To be fair, when the shares in RBS and Lloyds are sold, the Government will make an enormous profit, dwarfing the piddly £10m sponsorship of Newcastle United.
If these companies are to survive they need to operate on a business as usual basis and that means sponsorship, it means getting your brand out there and being recognised.
Advertising is not the same as charity. Northern Rock will expect to make £10m+ business from this deal...
So fret not Subrosa, we'll get our cash back one day. I'm just worried the RBS shareholding is sold to Bank of Oman or something...!
The last couple of gilt sales haven't raised much if anything Strathturret. That points to doubt about the quality of the assets does it not?
Brownlie, the person I was talking to and who inspired this post said that too. You're in good company. :)
If they can sell them Jeff. They've not done so well trying to sell anything.
Does Northern Rock need to advertise in the NE? Isn't it well known enough?
I've yet to hear of any sponsor admit they made money from a sponsorship deal, at any level.
It was a Newcastle supporter who mentioned the sponsorship to me. Many aren't happy about it as so many lost their jobs.
The long term worry for Scotland is what happens to RBB?
Now if we had a Scottish Oil fund, we could buy a strategic stakes in companies like RBS and SSE and keep them in line.
Brown and Darling are being very quiet about RBS and Lloyds at the moment. I wonder why. Any ideas Strathturret?
Well they bought into RBS at about 50p a share I think, its now about 32p so we've made a loss. I'm pretty sure our 'investment' in Lloyds is also under the water. So I understand why they're quiet.
There are all the dodgy assets that nobody understands sitting on either the books of the banks or insured by HMG. Commercial Property values are crashing and both banks hold a lot of mortgages given in better times. eg £700M from Lloyds to Sir David Murray's empire. Gulp!
I almost said not a leg to stand on!
What we'll hear at the GE in Scotland from Brown and Darling is 'we saved the Scottish banks', all hail the Union. Scotlands too poor to have done it! You've already heard this stuff from Murphy.
Personally, I think the Scottish Government needs to be more proactive on RBS particulary. Although that's easier said than done. They just don't have either the funds or levers of power to do much. All we did during the crash of 2008 was wheel out Alex Neil on Newsnicht!
I'd like to see some financial initiatives to allow us to invest money in Scotlands infrastructure. Why can't we all invest money in the Scottish Futures Trust for example? It invests in bridges, hospitals, buys stakes in key firms and pays us a dividend.
Many thanks for that Strathturret. I'm afraid I'm a little out of touch with the two 'Scottish' banks right now as I've been involved with the Kaupthing, Singer and Friedlander IoM liquidation and that's time consuming.
Didn't the SNP mention much earlier that the hoped to sell shares in SFT? Must investigate further. Possibly Westminster said 'naw, ye cannae dae that'.
Yes the SFT could sell bonds but that would not be allowed. Councils can sell bonds but not the Scottish Government!
As I recall, 'new inproved Calman' would allow the Scottish Gov to borrow, but only if they increased taxes imediately to cover costs. Like what the UK Gov does (NOT!).
See this piece on Scottish Banks by Alf (Union Jack) Young,late of Herald.
http://www.scottishreview.net/AYoung203.html
Thanks for confirming that Strathturret. Of course it's a unionist ploy denying us the ability to buy into our country.
The unionists are terrified the Scots may go for it.
Thanks also for the link. Off to read it.
Every last cent should be paid back. Plus a fund to cover the misery and stress they directly caused customers and users. And a compensation fund for those who's businesses went down the pan during that period because the banks wouldn't support them properly. Then there would have to be a quantative easing fund to replace money devoured by inflation caused by bailing the banks out - that's savings, investments, wages etc
Pound of flesh - no half!
Hi Rosa, perhaps Jeff would like to answer why we need to cut back, if the £1.3trillion is such a good investment.
That's of course before the collateral damage of bankruptcies, redundancies, benefit costs, loss of production and profits are added in.
Plus you have to consider, what's paid in dividends or interest lessens the corporation tax due. So for a shareholding government unless it changes the tax rules, what it gains on dividends it loses in tax.
Will we get the money back? There's more chance of Blair being hung for war crime.
Speaking of which Pit Bulls, Poodles & Politics is on the blog.
Post a Comment