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.
Who Will Be The Next BoE Deputy Governor?
As the Treasury and the Bank of England stumble from one difficult situation to the next, they will need to find a Deputy Governor as quickly as possible to take the place of Rachel Lomax. Despite a concerted effort to persuade Miss Lomax to take on the role for a second 5 year stint, she has remained true to her word that she would leave after her initial period was up and parts company in just...Read More
Are our MPs being treated differently from taxpayers?
As news emerges that 27 MPs are under investigation by the tax authorities, with one MP potentially under investigation by the police, there are concerns that UK MPs are being treated differently from everyday taxpayers. A number of cases of alleged fraudulent activity have already been clarified and the very fact that Parliament has asked a number of MPs to repay significant amounts of money is a...Read More
European Central Bank Facing A Difficult Situation
While the Bank of England has faced the dilemma of how much funding assistance to give to the UK markets without allowing backs to benefit directly, this situation is now being replicated in Europe where the European Central Bank (ECB) is faced with the same situation. So what is going on?
It is a little known fact that the ECB has very different collateral rules to those used in t...
Down on his luck and down in the polls, Gordon Brown attacks the city
Gordon Brown has today joined the attack, yet again, on the UK banking sector and threatened to cap future bonuses in the industry. The move, which many believe is purely and simply a way to divert attention away from other issues in the UK ahead of the next Labour Party conference, appeared to indicate that bonuses will be capped in the future, but this has not been clarified with any real founda...Read More
Power generation firms given £1bn pay out from Government
19/12/2014 Power generation firms have received a close to £1 billion pay out from the government to ensure their plants stay open and to reduce the treat of power cuts in the coming years. The pay out will also go towards building a large independent gas plant at Trafford, the Department of energy has said. The amount paid will add around £11 to each average household energy bill, bu...Read More