I was pleased to read today the Conservatives announce two policies for the BBC – disclosure of all remuneration for stars and executives earning six figure salaries, and the sale of Radio 1. That’s a start. As the Sunday Times rightly points out the BBC now also offers effectively a free on line newspaper as well on the licence fee, with implications for the private sector competition who do not enjoy the subsidy.
I was less pleased to see RBS taking full page ads to tell us it really does want to lend some money.The way to get that message across is through its daily actions with its customers, and by telling the journalists who could write it up as a story. Why waste taxpayers money on such ads?
And how true it it? What rates and charges come attached to the cash? We are in the ludicrous position where on the one hand the government orders the banks to lend more, yet with the other hand through its regulator tells them to lend less and to hold more liquidity to have a stronger balance sheet. Which is it to be? And why pay for ads when what people want is sensible loans at realistic fees and charges?
August 2, 2009
And why pray would I want credit? Or rather, why would I want more debt? I thought we are being told that we’ve got to save more, that is rebuild our balance sheets.
Hey, I’ve got a good idea. Tell RBS / LooydsHBOS that we’re a bit worried about their ablity to service their overdraft with us (us being the taxpayer) and we’d like the money back and here is the repayment plane we are requiring that you stick to. Then, once all that money is back, or whilst it’s being collected, cut taxes on income and give us all a nice fat rebate. I understand that officially it’s about £20,000 per head, (Yeah. Right. I reckon it’s nearer £40,000) that’s £120,000 for my household. I’d pay that straight into the bank as a combination of debt repayment and savings. This may not directly help the bank’s balance sheet but they can always talk to their shareholders and bondholders about a debt for equity swap. Or they could sell off all the crap and the extraneous bits – Direct Line? – of their business and shrink it to the capacity of its balance sheet.
But what I do NOT want is more debt, er credit, er debt ….. well you know what I mean.
(Actually I’d use my rebate to expand my business and replace Mrs Lola’s current X-Type with an XF – she deserves it living with me. So the money goes straight to where the bloody gummint wants it to go, into jobs and manufacturing, rather than bonuses to useless bank managers in the cartelised and out of control banking, well I was going to say system, but it’s not is it?)
August 2, 2009
Given the past record of many nationalised industries, it will not be long before RBS will be opening new branches in competition with its existing ones, and taking over disused coffee shops and other stores to lend money to, then writing off the certain losses with government bailouts. I try to keep explaining about Old Mother Riley economics, but the theory is perhaps too hard for economists to understand.
August 2, 2009
Why waste taxpayers money on such ads?
Because it’s part of The Labour machine? Also a juicy promo for Harman was in the package?
I’m with Lola except this is what should have been done last year.
August 2, 2009
…and thinking about it a bit more why the bloody Hell should I pay RBS to borrow my money from it?
August 2, 2009
The most important thing of all is for the government, now the crisis has passed, to announce that the banks are on their own and that they are no longer being guaranteed by the taxpayer.
There were some staggering figures released in the business section of the Telegraph on Saturday. We supported the banks to the tune of !.2 trillion – yes, trillion – pounds. That is double the entire expenditure of the government in one year on everything. We are still up for hundreds of billions if just one of them goes bust.
And apparently Barclays is now filling in the gap left by the American giants when they crashed. So it is entering the high risk zone once again.
Meanwhile, according to Open Europe, President Sarkosy and his ministers are building a nice little haven for our hedge funds to go to now that the City is being under stricter control.
Still there seem to be no signs either of selling off any parts of the nationalised banks.
I wonder if the government actually want to bankrupt the country?
August 2, 2009
Hey John, why dont you and I just run away to somewhere sunny and remote and just forget about all these problems in the UK? These problems are not going to go away, any more than my dodgy marriage and my teenage daughters are going to go away.
Lets just pretend none of this is happening, eh?
Our country is shot to hell after all.
Looking forward to hearing from you.
Liz x
August 3, 2009
As a fellow punter, allow me to say that teenage daughters usually cure themselves with age. Mine both have.
I am really sorry about your “dodgy” marriage. That is really sad.
What, however, we are trying to do is to stop the divorce (to pursue the parallel).
And the maddening thing is that we all think we can!
August 2, 2009
Lola is right on the point about repairing our balance sheets. This decade we have enjoyed the lowest period of interest rates since the war, at a time when borrowing is easier than it ever was. The result was two-fold
1) a long consumer boom financed by increasing debt.
2) An decreased return on pensions.
Collectively we need to reduce our debts, which will be helped by the low interest rates. Then we need higher real interest rates to encourage saving and increase the returns on savings. This will again make pensions affordable.
August 2, 2009
This country seems to be entirely governed by the “Law of Unintended Consequences”.
Tell the banks to strengthen their balance sheets – Result, less lending.
Instruct banks to lower interest rates to borrowers – Result; no loans available because no one will invest with them at the even lower interest rate.
Tax the higher earners more – Result, less income because they move off shore.
Tax businesses on foreign earnings – Businesses move abroad.
Discourage “gas-guzzlers” with higher road tax – Result: sales fall and the government has to bail out car manufacturers.
Make Tamiflu easily available – Result; Tamiflu available for sale at local car boot sale.
The list is endless; we seem to be governed by idiots who seem quite unable to visualise the likely effect of their actions.
August 3, 2009
We are governed by idiots!
August 6, 2009
If they were only Idiots, it wouldnt be so bad, sadly, those at the helm know exactly what they are doing, Britain, because of its unique character has to be destroyed if the EU is to succeed.
August 2, 2009
You’ve picked the 2 items that we all picked out for our regular convivial Sunday morning political review!
What navel-gazing nonsense for RBS to run those expensive full page ads at any time, let alone when they are still being propped up with OUR money.
Has this campaign been sanctioned by the chief executive who is set to earn that grotesque bonus? If so we wouldn’t employ him as a brand manager let alone a chief exec given his obvious failure to grasp the realities of the real business world.
Perhaps with this spin initiative Mr Hester is hoping to nudge the RBS share price towards that totally inadequate 70p level rather than looking at his bottom line. What a…what’s that word that DC let slip on-air the other day?
We’ve long beeen unable to understand what Radio 1 does that the commercial stations don’t. The answer – unlike with Radios 2,3 & 4 is, of course, nothing. And surely a very expensive nothing it is with outlandish salaries being paid to the likes of Ross, Brand & Moyle. This is a good Conservative plan although not it seems policy yet.
Under the guidance of Messrs Thompson and Lyons the BBC have lost much of the the public support and trust so evident at the time of the Hutton enquiry. New senior management is needed so the BBC comes to realise that it is in the communications business and not showbiz!
Reply Mr Hester CEO signed the ads
August 3, 2009
A neat illustration of one of the problems of a nationalised industry, they spend less time actually running the company and more time jumping through political hoops with propaganda
(by the way, is it me or does anyone else find those “people’s post office” ads really Stalinist/chilling?)
August 6, 2009
Not seen one yet but these TV screens in town centres are putting out some weird stuff too.
No doubt there is some mass manipulation going on.
August 3, 2009
Ah the RBS letter in the Telegraph. Classic
August 3, 2009
Re: Disclosure of salaries:
You may remember some years ago that company accounts used to contain a table showing the pay of all directors, and the numbers of employees with earnings over £30,000 split into bands of £5,000. This was applied to the private sector: now there is every reason to apply this to the public sector and quangocracy, including the BBC. The BBC has no defence of a right to privacy here: disclosure was required of the private sector in the past.
August 3, 2009
If this is the standard of radical policy we can expect from the Tories then we really are in trouble. Better to pick on the easy non problems to appease the press rather than trying to tackle the tough problems that will generate months of tough to swallow headlines. No change there then.