Friday 27 February 2009

Not sure what to make of this, either

"Lord" Davies, head of Standard Chartered Bank and architect of the first bank bailout (that didn't work) was grabbed up by the Gorgon, ennobled and appointed as Trade Minister.

Standard Chartered was portrayed as being immune to the credit crunch, but it turns out that they were in the sub-prime market heavily as well, via a "special interest vehicle" or SIV called Whistlejacket. When other banks got hit by the credit crunch, they did "the honourable thing" by pulling their own SIV's onto their balance sheets, completely fucking themselves (and kind of undoing the point of the SIV's, I would have thought!) Davies just said "fuck you" to Whistlejacket's creditors and left them, er, whistling for their money.

Could it be that he did what everyone should have done? If the other banks hadn't pulled all their SIV's onto their balance sheets, would the whole crisis have been of a much smaller magnitude? Sure, the creditors would have been spanked, but would the whole world have been in such a turmoil?

When I started writing this post, I was all for having a serious go at Davies, but the more I think about it, the more I wonder what the situation would be now if the banks had all let their SIV's go to the wall ...

3 comments:

Unknown said...

I've been youtubing Peter Schiff and Ron Paul. Both of them have said the same thing. Let the failed banks and businesses fail and let's start again from the ground up.

Unknown said...

OT, but apparently women caused the credit crunch.

http://tiny.cc/0EK7Z

Oldrightie said...

I've said since Northern Crock, save the depositors up to £500,000 and pull the plug. As for the subsequent failures, the public should have had debt reduced via mortgage and credit cards, mutuals and new local banks formed. Interest rates should have gone to around 9% so savers and pensions would be protected. All about the public and not Bankers and Cabinet interests.