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.
Are first-time buyers dipping their toes into the market?
While there are differing opinions as to the current state of the UK property market, figures from the Council of Mortgage Lenders (CML) seem to indicate that the bank of mum and dad is being used more and more to fund the purchase of property for children. Interestingly, the last CML report on this subject back in 2007 highlighted the fact that 37% of first-time buyers under the age of 30 depende...Read More
MPs gather round to slate UK business leaders
Yet again we have seen significant spin and suggestions pouring out of the Houses of Parliament as the UK government looks to deflect any criticism with regards to the performance of the UK economy. On one hand the government is adamant that the situation was American-born and is the fault of the US government while on the other, former key members of the UK banking sector such as Sir Fred Goodwin...Read More
Sellafield joins the wildcat strikes
As predicted, a number of new wildcat strikes have emerged today in response to the government's firm approach to the problem of foreign workers in the UK. Gordon Brown and Lord Mandelson stand accused of a heavy-handed approach to the problem at the weekend when they gave no hope or support to the reunions or employees of the UK. There are concerns that the thousands of UK workers now on picket l...Read More
Will we ever see the $1.1 trillion rescue package?
To a fanfare of trumpets and applause Gordon Brown was able to announce a $1.1 trillion rescue package funded by G20 members yesterday. However, just 24 hours after the decision was announced we have the Russian government backing down and refusing to contribute amid suggestions that some of the money within the $1.1 trillion package is a rehash of earlier promises. Is the worldwide population yet...Read More
Darling says the UK will make it through the other side
Alistair Darling has come out with one of the most bland statements ever seen from a UK Chancellor when he confirmed that he believes that the UK economy will get through a 'difficult period'. Of course the UK will make it through to the other side, of course it will bounce back in due course but what wreckage will it leave in its wake as the slowdown crushes all before it.