Rich Kids In Bright Shirts

In the wake of the Lloyds TSB takeover of HBOS (does anyone really believe that it's a merger?) there has been an outbreak of  "agreement" up here in the Scottish Parliament. 

First Minister Alex Salmond called short selling, which he blamed for the demise of HBOS, economic vandalism.  Scottish Liberal Democrat leader Tavish Scott welcomed the suspension of short selling saying  "Rich kids in bright shirts in London, New York and Tokyo are making money at our expence, Scotland loses its bank, people lose their branches and the country is worse off."  In fact all parties were in broad agreement on the the issue.

However Patrick Harvie of the Green Party took a swipe at the other parties. While he also welcomed the UK Government's action in respect of short selling, he said "Isn't the root cause of the problem the culture of deregulated buccaneer capitalism which all of these political parties have supported, celebrated and even courted?"

I have to admit that my own opinion leans toward his. We all recognise that a free society needs policing.  So why should the financial markets be different?  Perhaps if the Financial Services Authority had spent less time going after easy targets, like independent mortgage brokers, and more time on the banks and the city  things might have been different.

While everyone is rightly criticising the "spivs and speculators" in the city lets not forget that the banks have been acting like spivs for years by ripping off their own customers with their outrageous charges.

And doesn't bad management also come into the equation?

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Comments

[Terry]

Totally outrageous. Hornby is a proven failure, he has brought HBOS to its knees, and he comes out of LloydsTSB with a shed load of shares in his new employer. What price failure? Certainly no incentive to succeeed in British business if this is the unacceptable price of wrecking misery upon tens of thousands of HBOS investors, savers and mortgage holders.

[Mike Bell]

So wee Andy Hornby, having proved himself to be a crap CEO of HBOS, walks away with £2 million Lloyds TSB shares and a new job with Lloyds.

If my daughter's belief in Karma is true then his ill gotten bounty will bring him nothing but misery.

[Manolo]

You've been a bit easy on the banks Mike. The bankers, collectively & world wide, have always had one overriding ethos, greed. They have continually worked on a 'short term get rich quick' strategy, as seen by the unsavory sums of bonuses gladly shelled out to third rate 'street corner'spivy snake-oil salesmen, without any consideration of the consequences. Sell, sell, sell, hang the costs, just sell. And then another 'opportunity' came along which they, the banks, jumped onto with gusto, the American sub-prime mortgage market. Once again, they were blinded by sheer unmittigated greed, as the bankers looked forward to their enormous profit margins.They did the same in South America & west Africa years ago - lent on the basis of high returns and caught colds there too. Had they learnt their lessons? No and why not? Simply due to the way these people pay themselves with massive bonuses for perceived large profits, not on actual profitability over the long term. This comes down to that one word again, greed.
And who pays for these people's avarice? Homeowners with higher mortgage payments and even some being repossessed, pension fund members with falling fund values, savers with reducing interest rates, the man in the street, in fact everyone of us and these guys are walking away with 'golden goodbyes' of thousands .....for ruining their companies and our lives.