Astonishing news: Bank of England changes the rules
September 17th, 2007I just heard this news an hour ago and frankly was astounded. The Bank of England will ,if necessary, guarantee all deposits held with Northern Rock. This a major change to the current depositors insurance scheme.
Wow! In a stroke they have just removed any risk from the banking system. They have in effect nationalised Northern Rock without actually doing so.
Actually this is a good thing since it further exposes the myth behind our banking system. Mind you they didn’t rush to bail out the depositors of BCCIÂ when that failed.
So where to from here? Well that’s anyones guess but this wont finish here even with the blank cheque provided the the Old Lady.
Max Hastings writes a lovely piece here. Finally as the party comes to an end and the hangover kicks in, will there be some reason?
I hope so. It is a great opportunity to look closely at the money system we currently have. Do not look to our central bankers to provide the lead or even our politicians. We the people will have to provide ideas, answers and solutions on how to proceed. The monetary reform movement has been growing by the day and now it is time to stand up and be heard.
Tags: bank of england, banking, central banks, credit, credit crunch, debt, economics, federal reserve, finance companies, financial crisis, interest free banking, intervention, markets, money, money reform, money supply, mortgage, northern rock, politics
September 17th, 2007 at 8:37 pm
As a Joe public moron,I and others of my dubious brain power,totally rely on the expertise,honesty and years of street cred of bankers to look after our cash.
On a recent £11,000 loan I had from Northern Rock,I found them totally professional in their dealings with me and my loan was repaid when I downsized moving house in June 07.
Us minions don’t have time to scrutinise the whys and wherefores of big banks-wer’e too busy trying to run our own lives.
In parallel with Northern Rock,again,Joe Public has absolutely no idea how the Bank of England operates.
It is therefore paramount that a) The Government knows what is going on
and b)us punters are fed information on a regular basis (post/email/adverts etc) of the Ethos of the particular bank or banks we have accounts with-ie total transperancy.
September 17th, 2007 at 9:02 pm
Joe Public is usually totally reliant on the expertise ,honesty and accumulated financial accumen of our bankers to look after our money.
As a recent loan customer of Northern Rock,I found them to be totally professional and cautious when loaning me £11,000.I have recently repaid this on a downsizing house move this June(07).
Our faith in the big banks is paramount as we are generally busy running our own lives.Consequently,the percentage of persons knowing the “ins and outs” of the Bank of England and all of the big banks,would be well in the minority.
To this end,we must have confidence in the Government of the day,to have in place,experts over and above the B of E employees,who can act as moral and pragmatic overseers to that Institution AND those Banks that come under its Financial Umbrella.In short,to safe guard our whole society,a “Belt and Braces” format may be necessary.
The Ethos of each and every bank located on the UK soil,should be transmitted to all of its customers by non jargon methods before a new account is opened to give the potential customer the chance to “weigh up” the contract he/she is entering with the bank.
September 18th, 2007 at 1:21 pm
Trevor,
You are absolutely right in that the public relies on the honesty, expertise and ultimately integrity of our bankers and the system they operate within.
I wouldn’t judge the bankers themselves although it is clear some institutions are better run than others. It is the system itself which is the problem. The people that run banks barely understand the system themselves. If they looked at their balance sheets they would all see how close to insolvency they really are.
It is hard for the public to understand this. You wont learn it at school and you wont learn it at University. I hope this blog and others like it can help in enlightening people on how the system operates and why we, as citizens, need to call upon our representatives in Parliament to account for and understand how our money is created and managed.
I will now put a piece up now on how banks are structured and why confidence is so necessary. Please keep reading, commenting and get others to do the same.
Regards
Raf
September 19th, 2007 at 8:31 pm
[...] bankers and finance ministers will have been wired into each other this past month and since the Northern Rock meltdown probably on 24 hour [...]
November 18th, 2007 at 7:13 pm
[...] after death. The real concern though is the financial responsibility assumed by the taxpayer. As previously reported the taxpayer has underwritten Northern Rock and by inference the entire banking [...]
December 6th, 2007 at 3:54 am
[...] the Fed joins the Bank of England in changing the rules. The word is that certain sub prime mortgages will have their rates frozen [...]
December 29th, 2007 at 2:20 pm
Of course the gov is covering the bank. Who wants a bank run or public confidence to droop? Then again, there is the fact that all of the money is purely invented anyway. Just print some more. What is inflation? Besides, the English pound is strong and will easily cover the loss. Just like the U.S., the gov will just cover up the loss with the hard work of the people or in the case of the Bank of England, the subjects of the kingdom.