The UK bailout plan doesn't appear to be working any better than ours
and they are tyring changes. See Bloomberg here yesterday:
Prime Minister Gordon Brown said the U.K. is working on the "second stage" of a bank rescue ...banks remain reluctant to lend even after tapping into a 50 billion-pound ($74 billion) government program to bolster their capital. Chancellor of the Exchequer Alistair Darling is considering credit guarantees for households and companies to encourage loans, a person familiar with the plan said this week...
Also this Bloomberg piece for more detall and The Wall Street Journal today "U.K. Weighs Revamp of Bailout", if you have a subscription.
Meanwhile there was interesting Germany v. U.K bickering:
....EU's 27 nations approved on Friday a coordinated call for fiscal-stimulus packages of around 1.5% of the bloc's gross-domestic product, or about €200 billion ($267 billion). The language they used, however, was vague enough to permit countries to do more or less.
Germany has proposed a stimulus package that would pump around €4 billion ($5.3 billion) into the economy over the next year. Meanwhile the U.K. plans about £20 billion ($30 billion) in stimulus by 2010, including short-term tax cuts.
"All this will do is raise Britain's debt to a level that will take a whole generation to work off," German Finance Minister Peer Steinbrück said in an interview with Newsweek. U.K. Prime Minister Gordon Brown dismissed the comments, saying they reflected internal German politics.
Friday's EU agreement won't force Germany to expand its stimulus package....
Ecuador: President Orders Debt Default, December 12, 2008
Interesting that he's an American-educated economist. Basically just decided he needed a bailout too, might as well be now?
December 13, 2008 3:58 PM | Reply | Permalink
Thanks for the links AA. I swear, this seems like just such an impossible game right now. If it'd "only" been a financial crisis, and the economy had been steady or surging, errrrrm, maybe we pull it out. But to come now, when the real economy was on edge, and had some pretty poor stuff underlying it, and now... is tailspinning down... man, I donno how this is gonna work.
I mean, I've been waiting for the unemployment to start tumbling through the system, and the thing is, the wider negative consequences, right now, of that, are just soooo ugly. Including for Finance. Consumer debt default, and Corporate profits down? Shit, that's gonna blow back into the financial side, hard. I think it was Dimon from JPMorgan talking about this the other day.
And the mood, amongst people I know and read, is now shifting. This thing feels more personal to them now. Not just Wall St or DC bullshit. which again feeds the downturn.
And out of that, we're gonna try and make the banks lend? Plus, as your links note, we're tying our own hands in sorting this shit out. 12% fees sound great if you want to make your money back, but if it's to help restart the engine? As opposed to just stave off collapse? Not so sure that's smart. Ahhhhh well. :-?
December 13, 2008 5:04 PM | Reply | Permalink
At least the UK plan gave Brown-and the UK taxpayers-a sufficient claim on equity that there's a discernable path by which the Government can take control if it ceases to be true that " a nod is as good as a wink".
December 13, 2008 8:57 PM | Reply | Permalink
Here's a link that won't necessarily put a smile on our faces but LB's work is worth a read:
http://londonbanker.blogspot.com/search?q=
December 14, 2008 12:08 AM | Reply | Permalink
I do not like Friedman who likes to state the obvious and then smirk as if he discovered something. I swear the idiot thinks he is in line for a Nobel or something. Franken is from the same neighborhood. Who'd figure? But Friedman's discussion of the flat earth or inter-linked economy points out the problem here. Instead of workers of the world uniting, the capitalists united and, to coin a phrase, FUCKED IT ALL UP.
December 14, 2008 8:41 AM | Reply | Permalink
From
As the U.S. Buys Less, Germany Suffers, New York Times, December 30
December 30, 2008 12:36 PM | Reply | Permalink
See also
Gazprom, Once Mighty, Is Reeling; Gazprom Seeks Bailout, and Russia Reels
and
Mexico’s Fiscal Prudence Fails to Avert a Slowdown
December 30, 2008 12:39 PM | Reply | Permalink