The Great Debate UK

from The Great Debate:

Too many hopes pinned on EU bank

paul-taylor-- Paul Taylor is a Reuters columnist. The opinions expressed are his own --

It works more like a sprinkler than a power hose, but the European Investment Bank has a role to play in preventing a financial inferno from sweeping across central and eastern Europe.

The trouble is that politicians have overloaded the European Union's long-term lending arm with exaggerated expectations, calling on it like a fire brigade in every emergency, from saving credit-starved small firms to greening the car industry, combating the energy crisis and fighting climate change.

The need to serve many masters and focus on many priorities limits its impact, but the EIB now has more resources to back economic stimulus programs in the 27-nation bloc.

Philippe Maystadt, president of the Luxembourg-based bank, has received so many pleas for billions since the credit crisis struck that he starts by listing what the EIB cannot do.

from The Great Debate:

Geithner’s hair of the dog plan for banks

jimsaftcolumn-- James Saft is a Reuters columnist. The opinions expressed are his own. --

U.S. plans for a public-private fund to buy up toxic assets are likely to amount to a fig leaf with which to hide subsidies to failing banks.

It is also, inevitably, an entirely new subsidy to outside investors, who by definition will only participate if they get better terms than now available in what we formerly thought of as the free market.

from UK News:

Bankers offer act of contrition

In the Middle Ages the four ousted British bankers who brought the Royal Bank of Scotland and HBOS to the brink of collapse would have probably had to endure the public humiliation of sitting in the stocks. 

On Tuesday the likes of former RBS chairman Tom McKillop and  former RBS chief executive Fred Goodwin had to undergo a more civilised form of public humiliation - a grilling by Parliament's Treasury committee.

from The Great Debate:

Play by the rules, close failing banks

James Saft Great Debate -- James Saft is a Reuters columnist. The opinions expressed are his own --

Why not just play by the existing rules and rescue the economy, rather than the banks and their foolish shareholders and counterparties?

The choice for the Obama administration comes down to this: pay a subsidy to weak banks and reward failure and self-dealing or shut them down and start over again.

from The Great Debate:

Credit control will be much more intrusive in future

John Kemp Great Debate-- John Kemp is a Reuters columnist. The views expressed are his own --

The international system of bank regulation, epitomised by the Basle II process and the light-touch principles-based regulation of Britain's Financial Services Authority (FSA) has comprehensively failed.

In too many instances, light-touch principles-based regulation with an emphasis on banks' internal risk controls turned out to be no effective regulation at all.

from The Great Debate:

First 100 Days: Fix the banks

morici-- Peter Morici is a professor at the University of Maryland School of Business and former Chief Economist at the U.S. International Trade Commission. The views expressed are his own. --

For every new president, campaign promises and inaugural idealism must give way to the hard choices that measure the mettle of their leadership.

from UK News:

Easing the pain for small businesses

The government has unveiled a plan to guarantee up to 20 billion pounds of loans to help small businesses survive the credit crunch.

But there are concerns that will not be enough to get the banks lending sufficient funds to help businesses get access to cash.

from The Great Debate:

UK suffers from banks’ Darwinian hibernation

James Saft Great Debate -- James Saft is a Reuters columnist. The opinions expressed are his own --

Britain's banks are fulfilling their Darwinian role, to survive, rather than their economic one, to lend, and there is no easy or painless way out.

A glance at the latest Bank of England Credit Conditions Survey makes grim reading, with yet another marked tightening of lending conditions to households and businesses. Loans are harder to get and more expensive where available, which is hardly surprising given rising defaults and a hardening view that the UK will suffer a long and deep recession.

from Reuters Editors:

And the band played on: covering the economic crisis

dean-150I recently visited one of the most frightening sites on the Web—the place where I look at my shrinking retirement account.

As I calculated the investment loss since the steep decline in the markets began, and particularly since the collapse of Lehman Brothers in mid-September, some questions arose (in addition to: Will I ever be able to retire?).

from The Great Debate:

Banking spins destruction myth: Hoocoodanode?

James Saft Great Debate -- James Saft is a Reuters columnist. The opinions expressed are his own --

Just as every society has a creation myth, banking is now busily writing a destruction myth that seeks to explain and soothe in a world torn to its foundations.

The myth, as expounded by regulators, bankers and their various service providers, is that we were hit by a perfect storm, a 1,000-year flood so unpredictable that we can't possibly be held accountable for it. An act of god, rather than the folly of man.

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