jas0nuk said:
Sir Fragula: Nope. Brown put the UK economy in the worst possible condition to weather the recession.
You are talking absolute bollocks about things which are clearly way over your head.
Trying to frame a vote for the Tories as a matter of Economic prudence is completely baseless.
Any savings prior to 2007 would have merely been a rounding error relative to the size of the bailouts. RBS has a balance sheet greater than our GDP. Any PSNCR curtailments would have been rendered meaningless midnight September 15th 2008.
The seeds of the crisis were sown by Alan Greenspan's method of deregulating financial markets. You can trace back the spark to the meeting in which he told the CFTC chairwomen to essentially get bent when she suggested regulation of OTC derivatives, CDS in particular. Blaming the FSA for not handling this is completely ridiculous. If they didn't exist the Bank of England would have been in the exact same position, a bystander watching idly as it all went to shit.
Anyone who says they saw this coming is talking bullshit.
Very few people could connect the dots and the methods by which Goldman Sachs had essentially conned AIG. AIG was the CDS market. AIG didn't know it. The governments of Europe could not figure out that Goldman had helped Greece pass off open market operations as FX transactions FFS!
To pin the national debt increases post bailout on Labour is a clear distortion of reality. There are no facts to back up that claim what so ever when the reality is that the Tories were more supportive of financial sector deregulation than anyone else.
Deregulation is a weapon of mass destruction in Finance. When one country does it, everyone has to follow in order to maintain competitiveness. It is not by choice.
The UK/Europe had no choice but to follow after the US repealed Glass-Steagall, re-engineering the Universal Banking Model. Goldman took itself public to enjoy the new feeding frenzy that was set-up.
Jon Mack, CEO of Morgan Stanley has finally come out and said, one year after quitting his post, that they need to be controlled because they have no idea what they are doing anymore.
To claim that Brown is clueless when it comes to the economy is a CLEAR distortion of the facts.
Gordon Brown did something mid-crisis that very people give him due credit for. The decisions he took post-Lehman stopped a recession from becoming a depression. The unilateral action taken by the Treasury to purchase stakes in RBS, Lloyds/HBOS providing a government guarantee on the balance sheets of those firms (assets 3 x UK GDP) stopped capital erosion and allowed the banking system to survive. People do not realise how close we were to the edge of total total meltdown. The US Treasury was still batshit freemarketeering while the shit was hitting the fan. They did not want to take equity in their banks. Brown's decision forced their hand. Paulson was furious. But it worked. Prior to that all they were doing was lending. It wasn't going to make a difference since capital had dried up and aggressive shorting had started as writedowns spiralled. The actions of the Treasury forced their US counterparts to lock the Masters of the Universe up in a meeting room a the Fed where they were all told the government will take equity/derivative positions in their firms.
In PMQ's some weeks later Brown made a Freudian slip when he said "we saved the world" to much laughter from across the other side of the house. The reality was he wasn't far off.