Has the FSA gone too far regarding bank stress tests?
As we covered in one of our earlier articles, the Financial Services Authority (FSA) has issued a new set of guidelines regarding bank stress tests which will effectively force each and every financial institution in the UK to identify its own potential weaknesses. This is a rather bizarre way in which to protect the UK economy because all the regulators are doing is highlighting weak companies and making them susceptible to potential takeovers, mergers or limited financial backing.
If a company is forced identify a potential weakness in its own business model, then what is there to stop a predator approaching the company's shareholders and claiming that they could run the company better than its current board of directors. There are no industries in the world which force companies to do the homework of their potential predators and competitors and weaken their own reputation and financial strength in the eyes of investors. So why has the FSA decided to act now?
Even though the idea of "reverse stress tests" does appear to have some merit in the current economic climate it is absolutely crazy to ask a company to research its own weaknesses and then publish these for public consumption.
ECB chief can't rule out further special monetary measures
The head of the European Central Bank has refused to rule out the introduction of further exceptional monetary measures as the Eurozone heads south towards a severe recession and possible depression. As we have seen in countries such as the UK, the interest rate tool which many have favoured over the years appears to have lost its impact and only substantial investment into the economies of the Eu...Read More
Employment protest in Wales could be the first of many
Around 100 unemployed construction workers are today protesting outside the Uskmouth power station in South Wales where there is a dispute about the number of local staff working on the project. Siemens, which is in charge of the project, claims that a promise to employ a minimum of 80% of the workforce from the local community has been upheld with 81.5% either British or Irish. However, this com...Read More
UK GDP Contracts, as Triple-Dip Threatens
The UK economy shrank by 0.3pc in the last four months of 2012, making the possibility of entering into recession for the third time since 2007 all the more likely. The Office for National Statistics (ONS) said that the fall in GDP was most likely down to a reduced output from the North Sea and manufacturers. This comes as a massive blow to the coalition government, who just three months ago we...Read More
28% of over 55’s cannot afford to retire
01/11/2014 28% of over 55’s do not believe they will ever be able to afford to retire, research from Key Retirement, the independent retirement specialists, shows. The nationwide study showed that more than one in four over 55’s who are currently working fear running out of money in retirement, and believe they will never fully be able to give up work. 19% of people are planning to work...Read More
UK mortgage lending edges higher
While UK mortgage lending is now at its highest for over 18 months it is still significantly short of the average for the last three or four years. Figures from the British Bankers Association showed that just over 42,000 mortgages were approved in September against around 40,800 the previous month. Net mortgage lending also increased from £3 billion to £3.1 billion which is an impressive 4.6% r...Read More