I believe they have their hearts in the right place even though they’re lacking on the old European front, but a believable opposition which looks for things which are good for the country and can agree with decent policies yet argue their case openly without so many soundbites ( ? ) is what’s needed.

http://news.bbc.co.uk/today/hi/today/newsid_7616000/7616089.stm

Stourton : They’re not going to be allowed to go bust, you say, but they have gone bust!

Vince : Well indeed but [ .. ] probably along the lines of Bear Stearns, the US Treasury will step in here.

I’m not sure this has happened … and Hank Paulson, who should know whether the US Treasury should/would/could act, rather has a different view to Vince

Paulson said the situation with Lehman was ‘very, very different’ from the one facing regulators earlier this year, when the Federal Reserve helped JP Morgan Chase (nyse: JPM – news – people ) buy Bear Stearns.

and

Paulson said he ‘never once considered that it was appropriate to put taxpayer money on the line’ for Lehman.

But it doesn’t necessarily have the intended effect. Ultimately, if an organisation was sound say, turning in vigourous earnings, it would be very difficult to successfully short the stock.

Perhaps the government loans ought to be used by the company to permit it to buy its stock off the market at the depressed price, essentially go private. That would insulate the company from hedge/shorting pressure and give it time to reorganise its affairs.

The government could recoup its ‘investment’ by recieving interest, and repayment of capital should the company successfully re-float.

In the case of Fannie & Freddie, the common shareholder was wiped out, similar has happened with AIG. Thus the government support does not raise the stock price, rather it destroys it.

Official financial support is designed to allow the bank to carry on trading without the taxpayer taking the equity – that is what Mr Cable was referring to. It lifts the stock price.

Ian dale reports Clegg has called the credit crunch “this great, big intangible thing”

and claimed he has never heard of Lehman Bros. or Bear Stearns.

As for the ludicrous Cable, after making such a fool of himself on Northern Rock, you would hope he would check the basic correctness of his assertions. We are at least spared any possibility of him getting his hands on the levers of power.

As for the banks, if they really have taken stupid speculative risks, then they should fail. Making the wider system more liquid at this time is probably sensible (along with rates cuts that I know you support), but I really can’t see any case for taxpayer support of poorly run business that took stupid risk.

Reply: The solutions I recommend are usually private sector, and of course entail poor businesses paying for their failure

We need the media to expose these people who has difficulty in understanding the difference between their rears and their elbows when it comes to such an important thing as our economy.

I see Clegg heaped praise on him too or was he just reading the autocue ?

Someone should give them both a nudge as you say or else give a sharp bang to the top of that autocue which is obviously flawed and making them both speak drivel unfortunately !

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