Wednesday, 8 July 2009

Saving the world: a reality check

Quelle surprise, really:

Six months after the U.K. government scrambled to launch new bailout measures for Britain's foundering banks and economy, several of those efforts are languishing with few takers.

No? Really? So what you're saying is that "things are getting better" and "markets are stabilising" ( (c) Gordon McTwat Broon, 2009 ) without recourse to all those eye-catching, world-saving initiatives that the towering intellectual genius of our times foisted on us?

Say it isn't so!

The flop is among several misfires by the U.K. government in recent months among programs that haven't drawn interest from the banks and businesses they were intended to help.

Really? The government's wild floundering lunatic ideas aren't even getting those mad greedy bankers excited? They must be supremely shit, then.

To address the credit crunch, the government launched two schemes to guarantee as much as 75% of bank loans to small and midsize companies.

Small companies, though, have complained that the guarantee was in fact not a guarantee at all, given that the business owner still had to put personal assets on the line as collateral.

Completely ignoring the fact that in the real world, small business owners are already often hocked up to the eyeballs and so have no assets left to put on the line. But of course, in Labour's La-La Land Ivory Towers, MP's only put other people's assets on the line, so how the fuck would they know?


Meanwhile, a £5 billion trade-insurance program -- in which the government provides supplementary insurance to U.K. manufacturers and suppliers in case their clients don't pay -- had seen only 13 firms participate as of June 9. As a result, the government backdated it to cover contracts made last fall.

But businesses point to further drawbacks. For one thing, the minimum amount of cover available under the program is £20,000, which is too high to be useful for many small firms, according to a spokesman for the Federation of Small Businesses. It also doesn't help with coverage that has been dropped altogether.

You can just see the thought processes, can't you? "20 grand? Well, I wouldn't get out of bed for less, so let's use that as a baseline."

There are also questions about the effectiveness of another cornerstone of the U.K.'s January package: an ambitious plan to insure banks' bad assets in order to keep a lid on future losses without forcing the government to acquire the bad assets outright.

The plan is going ahead, and both RBS and Lloyds have insured a total of about £500 billion in problematic loans. But people close to the banks say it has been taking several months more than expected to sort through the loans and set up the program.

In addition, the insurance is expensive. For example, Lloyds must first absorb £25 billion in losses before the insurance kicks in.

£25 billion? Jesus ... how much fucking worse could it get?

Gordon McSnot-Gobbler-Twat: no grasp of business, no place for his stupidity in running a country.

Fuck off and die, you useless cunt.

1 comment:

Nick von Mises said...

Okay, so the government are hypocritical headline-grabbing fuckwits but everything else in this story is good news.

Basic question: Do you want ZanuLabour to SUCCEED in whatever their plans are?

The very last thing taxpayers need is to have even more of their money thrown into the black sucking pit of deflation. Much better that the guarantees don't actually trigger.

Second, the very last thing the economy needs is for all the marginal businesses to be propped up by tax money extracted from the good businesses. We have overcapacity in eveything everywhere. That's what credit booms are good at - misallocating capital. Fighting the clean-out is what turns recessions into depressions.

So, cunts though they are, be thankful that in this case their incompetence led to impotence rather than catastrophe.