Comments on: UK Financial Investments Limited

By: Steven

Steven — Mon, 26 Jan 2009 09:52:24 +0000

The latest announcement suggests that UKFI does not own the shares in the banks, but merely manages them:

http://www.hm-treasury.gov.uk/press_06_09.htm

By: Steven

Steven — Mon, 05 Jan 2009 22:19:31 +0000

Thank you for the interesting blog.

Do you happen to know if UKFI will actually own the shares in RBS, LloydsTSB/HBOS, Northern Rock and Bradford and Bingley or if it will simply manage them on behalf of the government ? You state in your blog that it will own the shares, which is certainly a reasonable inference from the Treasury press release, but the press release is not clear on this point.

If UKFI will own the shares then it appears that there will be considerable complications arising from consolidated supervision at the level of UKFI in accordance with the EU Banking Consolidation Directive, as implemented by the FSA in the UK (since UKFI will probably be a parent financial holding company of each of the banks). I think the government would want to avoid these complications.

If UKFI will not own the shares (so as to avoid these complications), and will simply “manage” the government’s interest in the shares, then it will be all the more apparent that the purpose of setting up UKFI is to deflect criticism for losses in value away from the Treasury and onto the directors of UKFI.

Reply: Good points. I just assumed from the Press Release. I will ask questions.

By: mikestallard

mikestallard — Mon, 01 Dec 2008 17:03:07 +0000

The reason is, actually, that the banks support our working poor. Lots of small companies work round where I live in the Fens. So what happens when their customers do not pay up on time? Who provides the people on our estate with mortgages? We all need cars/buses to buy food, and move around the place. So, if we need pay for this who provides “magic card”?
The government, to do them justice, can actually see this.
Without banks, we all go under: this is not British Aerospace or even Arthur Scargill.
I leave aside the point about being rich. Suffice it to say that there are a LOT of extremely rich socialists and also several VERY rich socialist placemen in charge of socialist departments and qangos.

http://www.taxpayersalliance.com/files/public-sector-rich-list-2008.pdf

By: Bazman

Bazman — Sun, 30 Nov 2008 20:48:24 +0000

These ‘companies’ ie Banks. FAILED! Got that? They have now absorbed billions of cash from the taxpayer. They are ‘owned’ by the taxpayer. They are not private companies anymore except in legal terms. Why should rich people support richer people who are in turn supported by the working poor? Socialist nonsense no less. Sickening.

By: mikestallard

mikestallard — Sun, 30 Nov 2008 17:22:00 +0000

Thank you for mentioning this so very clearly and for promising to keep us informed.
I am beginning, as a country voter who is interested in my little country and its dangers, to see that I am increasingly being left out of the loop.
Perhaps that is because the loop is full of stuff which the government is either ashamed, or very worried about.

By: Mrs Smallprint

Mrs Smallprint — Sun, 30 Nov 2008 13:34:22 +0000

Good for you John, they must be held to account.

By: APL

APL — Sun, 30 Nov 2008 12:46:27 +0000

Adam: “.. wouldn’t want to be made the scapegoat if these bad investments ended up being… well… bad.”

These investments WILL turn out bad, they were made during a period of extraordinary growth in the world economy*. That growth has been arrested and is now in reverse.

Just as a rising tide floats all boats, so too does a receding tide drop the water level.

The real worry for the rest of us is to what extent the government will destroy the UK governments balance sheet to try to turn back the tide? A futile exercise.

* Growth manufactured by securitizing debt and selling the debt (dressed up as something else ) to a third party. The whole edifice will collapse.

By: tim bull

tim bull — Sun, 30 Nov 2008 11:54:15 +0000

I’m very glad to see that someone whoappreciates the enormity of this gamble (for that is what it is) is watching.
I doubt we could say the same of our media so-called ‘experts’ (Peston, Davies and Robinson) – though if they do understand the extent of this, I doubt we will hear them conveying this in their reports.

Off-thread, but I have urged my MP (Brian Binley) to consider boycotting the state opening of parliament in response to the arrest of Damian Green – with respect, I would to ask you to consider the same action.

Reply: I intend to go to kick up a fuss about what has happened.

By: Adam-

Adam- — Sun, 30 Nov 2008 11:24:53 +0000

I too thought about urging John to apply – then realised he might wouldn’t want to be made the scapegoat if these bad investments ended up being… well… bad.

They’ll almost certainly shoe-horn some Labour cronies in there anyway. Nice little sinecure for those on the verge of losing their seats. It’s doomed!

By: torydeb

torydeb — Sun, 30 Nov 2008 10:32:29 +0000

That will require very talented people, who understand the complex political and economic forces which will play on this very public leviathan, and who can see a way of balancing the need to make a profit with the requirement to lend more to people and businesses currently in distress. They are looking for people with experience of fund management, retail or wholesale banking.

It sounds liek you are eminently qualified, Mr. Redwood.
I hope you will be applying for the vacancy!