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Toxic assets set to move to taxpayers balance sheet

It has been revealed by sources close to the Treasury that UK taxpayers will be forced, by the government, to underwrite £200 billion of bad debt in the UK banking system. These so-called toxic assets consist of traditional bad debt as well as bad debts carried over from the initial credit crunch which have yet to be addressed. Initially the US government had hoped to install a plan to acquire all toxic assets across the board, hold them for some time, and then sell them on for a profit. This would appear to be the same scheme which the UK government has in mind.

Yet again taxpayers look to be in line for another serious "fleecing" with a so-called Bad Bank to be set up. The so-called Bad Bank would be used to acquire and be home to an array of toxic assets which have the potential to bring down the UK banking system. In many ways the UK government, UK taxpayers and the banking sector have no alternative but to bringing the authorities in and attempt to head off any potential problems in the future.

Quite how Gordon Brown will explain his latest plan to the UK taxpayer remains to be seen but it is now getting very serious!

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