Thursday, March 20, 2008
Bailing out the Banks
The banks seem to think that it is up to the Bank of England to bail them out of their credit problems. Prior to their meeting today with Mervyn King, they say that he needs to do more.
Why? Their gaul is incredible. This is a problem of the banks own making. They've lent out more money than they can cover, to people who can't afford to pay the money back.
It would be exactly the same principle if you or I were to take out a large mortgage, then lose our job, and so go to the the Bank of England asking it to lend us some more money until we get another job.
We would expect to be laughed out the door, but for some reason, the banks seem to think that they have the right to expect special treatment - and all at the taxpayers expense!
Why? Their gaul is incredible. This is a problem of the banks own making. They've lent out more money than they can cover, to people who can't afford to pay the money back.
It would be exactly the same principle if you or I were to take out a large mortgage, then lose our job, and so go to the the Bank of England asking it to lend us some more money until we get another job.
We would expect to be laughed out the door, but for some reason, the banks seem to think that they have the right to expect special treatment - and all at the taxpayers expense!
