Boring I know, now that the daylight is returning to the north and the snow has all but melted (unless you are in the Scottish mountains).

Tonight on UK TV is a documentary about the guy Dave Fishwick who tried to set up his own bank, got caught in all the rules and regs to the point that he can't have a "bank", and he now does what amounts to peer-to-peer lending.

Bank of Dave - Channel 4

About Us | Burnley Savings and Loans

According to the pre-programme blurb/publicity, the UK banking vested interests are trying to close him down while it is also said that his model for such commercial investment/banking is very similar to that used in Germany.

In the meantime, back in the "real" world of UK banks, the latest suggested initiative (from a BoE official I believe) is negative interest rates - apparently this has been tried in some Scandanavian countries, but no one I have heard has commented on how successful this was.
As far as I can tell, what it amounts to for the high street customer is that you would pay charges for storing your money in a bank account; the whole idea, as ever, is to get you to spend cash rather than save it.

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Dave

I suspect you are old enough to know, and remember, that this is how banking used to operate, back in the days before computer technology made it possible to do the things that have been highlighted in here, in earlier postings.
I have never forgotten how I was grilled by a local building society manager (a building society equates to a bank in the UK for anyone who doesn't know the term); he personally interviewed me for what seemed like for ever in order to ensure that I could repay the loan.

From the Bank of Dave website FAQs:-
"Do you credit score?
No, we manually underwrite every application. You obtain a decision from a person, not a computer."

Says it all really.

Great documentary tonight by the way; it confirmed for me the suspicion I have that the UK can't rely on what goes on within the capital; this guy Dave Fishwick (DF) took his fight to the authorities (financial services authority in this instance) who were sat on their hands and, initially, just said no to his initiative, guts and determination to succeed.
Amazingly, the FSA thinking was that Dave's bank would be more acceptable to the authorities if the loans on offer were to provide greater risk for the customer. DF underwrites all loans from his own resources with insurance cover for the small number that default - but, the main point is that the local community trust each other in assessing what risk does exist.
Go figure.

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Dave

That's right, my first mortgage, early 70s, interview with the Building Society manager.
But it was starting to go rotten even then. Huge pressure had built up to persuade borrowers to opt for those strange things called 'endowment mortgages'.
A device that had no risk for the Building Society, nor the insurance co. All the risk was on the borrower, if his/her circumstances demanded a move of home before the maturity of the insurance. Or a while later, when insurance yields were failing to pay off the mortgages during a time of falling stock markets. A huge scam that caught so many people in its trap.

Each time (over about 4 mortgages as I moved house over the years) I just did a simple set of sums for the B.S. manager - what my repayments would be on a straight re-payment mortgage. Then I'd ask the manager to do the same for the endowment set-up.
It was always the same: "Oh, what a surprise, the repayment mortgage is cheaper, your circumstances must be unusual, well done on spotting that, we'll sign you up for a straight repayment mortgage then!"
The adverts were unregulated and stressed how 'secure' the endowment mortgages were - even convinced my wife at the time - "Isn't it risky having a repayment mortgage? - they say the endowments are much more secure."
Until, that is, friends who had to move house well before the insurance term - found all their premiums swallowed up in charges while they had paid zero off of the capital borrowed over however many years the mortgage had run for.

The promised "with profits" payouts only materialised if you kept the mortgage for almost the whole 25 years. It was well known to anyone who did the research that the average length of a morgage in those days was 7 years.
If you did continue for the whole 25 years from those days, you were then at the start of the stock market depression when insurance yields, even with profits, were starting to drop below the sum owed.

Enough of that, someone's just directed me to this website.
Analysis-News

What a laugh! Have a look at the bottom of the page, commencing "Some Quotes from People Who Understood ....."
One stands out, from Sir Josiah Stamp, director of the Bank of England, 1928 onwards - "The bankers own the earth. .... if you wish to remain the slaves of bankers and pay the costs of your own salary, let them continue to create deposits."

Plus ça change ....! There'll be growth in the spring!

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TTR250 - London to Cape Town

Yep, Spring is fast approaching and the governments of Europe, in particular, continue to peddle the notion that they can wave a wand and generate growth.

I've now read that link and it makes a lot of sense; however, I have read some of the other bits of the main website and there are some "kooky" views in there - definitely a conspiracy theory repeats itself. Nevertheless, it's an interesting link.

We've had a few views expressed in this thread about what has been going wrong, especially since around 2007-08, but here is a forecast of "the next big thing":-
Private equity crash could trigger next wave of financial crisis, Bank warns | Business | The Guardian

And that article led me to:-
Home - Positive Money
Which, for once, offers some solutions to the current impasse; or so I believe - I have yet to dig into this particular webpage in any depth, but one of the links therein points to a published book that has some ideas about money supply (naturally, those who equate money with national wealth will have little interest in such alternatives).

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Dave

If banks were so good why did we have to bail them out? here the Irish economy is absolutely in tatters thanks to the actions of the bankers and their friend in Government who forced us to bail them out and keep hitting us every day for taxes. any of you ride on Irish roads lately? they would be in the same standard as Albania or Kosovo, no services no repair and huge increases in road taxes.

It's been quite a while since anyone posted in here in support of bankers/the banks, so I assume your question is rhetorical.
One potential, simplistic, answer is that they were too big to fail - recent news in the UK points towards making this a thing of the past; the UK govn aim to bring in more competition within banking including making it easier to start up new banks on the high street + all the earlier policy about splitting the "casino" aspects (or at least firewalling it) from the real world of the countries' population and its needs in banking. Also, the financial services agency (FSA) is being more or less scrapped (I'm not up to date on this but that is how it comes over to me), with the Bank of England taking a much closer regulatory role, after earlier governments cut away and adopted the laisser-faire approach of other decades.

Of course, in the meantime, we have yet another case study of bad banking practice in Cyprus where they seemed to learn nothing from the case of Iceland.

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Dave

It's too early to say.
The recrimination continues:-
BBC News - HBOS collapse: Ex-bosses face calls for City bans
Possibly the most significant aspect of this latest news item is that the 3 guys in the spotlight:-
a. Are not qualified bankers, but "managers".
b. Have gone on to work in other high level posts - who is it who takes on such talent??

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Dave

Well well well!
One of the miscreants has resigned (and is currently making all kinds of "apologetic statements and moves" that I won't go into detail here), but -
As a poacher he was also a gamekeeper.

While running the HBOS bank that collapsed it seems that he was also on the board of the regulator:-
http://en.wikipedia.org/wiki/Financi...ices_Authority

Adair Turner - Executive Chairman
Deputy Chairman - vacant, following resignation of Sir James Crosby
Andrew Bailey - Managing Director, Prudential Business Unit
Martin Wheatley - Managing Director, Conduct Business Unit
Lesley Titcomb - Acting Chief Operating Officer, the FSA
Carolyn Fairbairn - Non-executive FSA Board member, Director of Strategy and Development at ITV plc
Peter Fisher - Non-executive FSA Board member, Managing Director of BlackRock
Brian Flanagan - Non-executive FSA Board member, formerly a Vice President of Mars Inc
Karin Forseke - Non-executive FSA Board, formerly CEO of Carnegie Investment Bank AB
Sir John Gieve - Non-executive FSA Board member, Deputy Governor, Financial Stability of the Bank of England
Professor David Miles - Non-executive FSA Board member, Managing Director and Chief UK Economist at Morgan Stanley
Michael Slack - Non-executive FSA Board, Director of the British Insurance Brokers' Association
Hugh Stevenson - Non-executive FSA Board member, Chairman of the FSA Pension Plan Trustee Ltd
Mick McAteer - Non-executive FSA Board member, Director, Financial Inclusion Centre

Almost as a side issue, there are lots of indicators that the "old boys club", mentioned earlier in this thread, still exists.

But, the knifes are out at present and they are stabbing for the bankers; those who were part of the regulation system are lined up to be next for judgement by the Parliamentary committee.

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Dave

Rothchilds continues to be named as being at the heart of the issues.


Meanwhile the discussion continues, not least on BBC which is running a 3 part series on channel 2 about the history of the past few years - the first past, tonight, covered the LIBOR scandal which was known to governments and financial regulators back in 2008 even though it blew up in the public perception only last year.
Those with access to the BBC programming can see more about this at BBC Two - Bankers and there is more discussion about the issues at:-

DEBATE: Can we trust bankers to help the national recovery? - OpenLearn - Open University

3 banks identified at the heart of the LIBOR fiddling have been Barclays, RBS and UBS. The latter of these 3 is yet to be dealt with by the regulatory authorities.
It is somewhat encouraging that criminal investigations are under way in both the US and the UK.

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Dave

The banks don't care about us, the bigger picture or the country, rather in the manner of Sebastian vettel, they'll apologise in public to try and save face, but the only thing they are interested in is satisfying their own ambition, which generally means screwing as much money as possible out of the rest of us.

Well, having received another lesson in the failure of people to read each other's post I come back to look at this tired bit of ranting and find the Masonic emblem and wisps of "the Rothschilds".

Gentlemen (!) you can't have it both ways. Either "THEY" are all powerful or . . . they are not.

Oh, never mind.

"A silly obsession is the hobgoblin of a small mind."

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Orange, it's the new black.

I see nothing tired, or ranting, about this thread.

On the contrary, those who ignore the (very recent) history of banking are destined to repeat the mistakes, which in many cases are compounded by greed, dishonesty, lack of integrity and plain old fashioned criminal behaviour.
In the case of the latter, it appears that the US regulatory authorities are ahead of the UK but it is to be hoped that the UK will catch up in the future, via the Serious Fraud Office for one instance.

A heavy emphasis in the documentary that I mentioned above was on Barclays bank, founded by Quakers.
Mr Bob Diamond, erstwhile mover and shaker of that bank and a past darling of the city of London, did not know the founding principles of Barclays which are in my title to this particular post.
That particular incident, when this was revealed, occurred nearly a year ago:-
Barclays is branded a ‘rotten, thieving bank’ by MP John Mann - Telegraph
but the scandal of the issues concerning LIBOR continue to this day.

How Barclays betrayed its own heritage | Make Wealth History

One of the commentators within the documentary summarised that it all went wrong when the banks turned to making money out of their clients rather than making money for their clients.
As I said in an earlier post in here, it is quite some time since anyone has ventured within this thread to defend the banks/banking practices of the past years.
However, I am the first to agree that we need banks - they are far too essential a human activity to be left to ......................... well, you tell me, what the solutions are!

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Dave

"However, I am the first to agree that we need banks - they are far too essential a human activity to be left to ........................."

............. It just struck me that there was a report a while ago that drew attention to some common traits among senior staff of the banks; these all pointed toward psychopathic tendencies; the report indicated that such people are not "those who are the best suited" to manage large organisations, much less other people; just a thought, based on the next in the "bankers" series (number 2 of 3 at 9pm tonight). The advance blurb says -
This will address the subject of "risk" - a topic that has been discussed in here, previously, and in other threads within the HUBB. Apparently, it will look at how the bankers were deluded into thinking that they fully understood risk, could manage it "for ever" and the attendant attitude of "boom, no more bust". But, most interestingly, most of the case studies will be drawn from examples of failure to deal with risk since the crash of the last decade. We might think that the bankers' earlier culture has not changed a great deal, but it is probably best to reserve judgement for a while?

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Dave