Tuesday, December 18, 2007
Taxpayers In The Crock Pit
Today, Darling has extended the taxpayers' guarantee to virtually all Northern Rock's borrowings: retail deposits, wholesale deposits, unsecured borrowing, secured borrowing where the security actually turns out to be insufficient, collateralised and uncollaterised derivatives, onshore and offshore. The whole kit and caboodle.
Which totals c £100bn.
Or £4,000 for every household in Britain.
(yes, the HMT press release excludes subordinated debt, but that's only a few bill)
So now we're formally guaranteeing a bank that remains fully owned by shareholders. It requires a breathtaking disregard for taxpayers' interests to even contemplate such a situation. Our clothead rulers are giving us the worst of both worlds- we bear all the downside but any upside goes elsewhere.
As we've said before, nationalisation without compensation is the only realistic option left. And the sooner it's done the better.
PS They reckon no alligators were harmed during the filming of that fantastic stunt in Live and Let Die. If only taxpayers could be so lucky.