Since there is considerable reason to expect real house price falls in Britain the chance of some other, probaly bigger, bank going the same way must be substantial.

This would be a time to get the government to state publicly that this has been more of an 'orrible warning than a precedent to be followed & that in future banks cannot expect to be bailed out.

Northern Rock need the money to pay off the relatively short term loans they had taken. They can afford to pay the interest on the loans they had taken out (and even much more), but due to the complete and utter drought of available credit as a result of market panic regarding the subprime issue, there is simply no available credit, almost regardless of price, which they would otherwise have used to "roll-over" the loan.

You can look at it this way, lets say you took out a 30 year mortgage, with the agreement that after 10 years you would roll the mortgage over to another mortgage company. After the 10 years, all the mortgage companies deny you the right to roll over the mortgage and demand the rest of the capital back. If noone lends you the money you are screwed, and I would venture to claim that both you would agree it wasn't really your fault.

If anything, this seems to suggest something cronically wrong with the money markets. How can the bank of England say that the interest rate is 5% or whatever when you can't actually get fairly insignificant (in terms of total money supply) amounts of money at that rate ? If the real interest rate is in fact much higher, then what about the rate of inflation ?

This may well be the case, however it may well be only putting off the inevitable. Whilst it is true that, should the resuscitated NR do well we shall see some profit, but by the same token, should NR fail we still would be liable as the bonds are guaranteed by the government, having no money of their own, that means the taxpayer. The other worry is that in a few years time, we shall be the ones running the country and it could all become our problem should it follow the normal anti-Midas touch associated with Labour where everything it touches turn to pooh.

I noticed that you did not comment on my remarks about the person that blabbed to the media about NR going to the BoE, that in my view started the panic amongst depositors, does that mean you agree with me on that?

By the way, well done yesterday defending us against the traitorous policy of Labour in relation to the treaty(sic) and I really enjoyed William Hague's speech, pity he did not wait until a year or so ago to become our party's leader as he is now clearly ready for the role. He was too young and inexperienced when he was leader, he is now ready to try again and I for one would back him for the position, unless of course you stand again.

Keep fighting for the UK!!

Reply: Yes I will keep fighting for democracy and the UK.
Yes I also agree the leaking of the news about NR needing to borrow was far from helpful and it would be good to know more about who and why.

How far we have fallen. Only recently you were praising PM in the House for being a cracking programme.
I do think your criticism is a little unfair. You move from World at One, PM, and Today not interviewing you to conclude, 'BBC misreads the Rock crisis'. That's a big leap given you did do other BBC outlets.
I can't speak for Today but the only producer I can find that did speak to you for Wato does not recall saying what you say 'Editors' told you.
Your party's position changed that morning so instead of you we did Philip Hammond, the Shadow Chief Sec, on why the Conservatives would now oppose legislation to nationalise. That seems fair enough. No-one else we did that day was pro-nationalisation. We have done Vince Cable on other days but that's because he is the Lib Dem spox on these matters.
We are interested in your views on this blog and hopefully in future on our programmes too. Just this time we went with CCO's line instead.

Yours

Peter Rippon
Editor World at One, PM

Reply: I lost count of how many press releases and blog comments you ignored, and how you failed to provide an alternaitve to nationalisation as an option on the 3 flagship programmes. I think you should try to forecast what the outcome is likely to be and cover all bases.
I did not offer myself for interview as a Conservative, but as a well known financial innovator who was one of the pioneers of privatisation in this country, followed by wider ownership and debt swap, and a book on PFI/PPP. Your programme needed someone who knew how public/private finance and modern banking works.

Although the bailout is costing

And that is the longer it goes on, and the more money that is printed by the Bank of England and loaned to the Rock; the better off the "taxpayer" will be through the phenomenon of "seignorage".

If you don't believe me, Tim Congdon let the cat out of the bag two months ago in the FT, here
http://www.ft.com/cms/s/0/ddf4c35e-88e5-11dc-84c9…

The fact is that this money has never been anywhere near a taxpayer.

The solution I advocate is that this windfall, currently running at around