Through the prism of the BBC, the Banks are the bad guys, solely responsible for our financial woes. The role of Labour in bringing about the financial crisis is being sanitised and in fact the Labour Government is
If the banks obtain funds at low rates the whole economy benefits, businesses can borrow from the banks at lower rates and mortgages are lower….more jobs, more houses, higher GDP. The government’s stance now, not to guarantee the banks, is compounded by the government’s insistence on the banks having large capital reserves themselves…meaning less money available to lend to business…and what is lent is lent at higher cost. A report from UBS confirms this….and the damage being done to the economy by the government now refusing to guarantee the banking sector finances.
‘Banks being made riskier and Brits poorer, warns UBS’
‘Comparing the BoE’s policy to that of the European Central Bank, UBS analysts warned the lack of an emergency scheme to support the UK banking system in the event of a new crisis already led to rapidly rising funding costs for lenders. Barclays and Lloyds Banking Group had to pay a very high price to access the debt markets. The impact of this on the economy has been profound. UBS says five-sixths of British private sector workers are employed by companies with no access to the bond market, while bank lending to the UK economy continues to decline. Noting recent Bank of England figures showing a decline in Britain’s foreign trade deficit, UBS said the authorities were ignoring “the lost GDP from inappropriately high cost of debt”. ‘