RBS reveals biggest loss in UK history

Following the loss, RBS management has agreed to reduce (not eliminate, God forbids) their performance bonuses, and instead increase their base salary, claiming they will not be able to attract talent otherwise.

Indeed, if it’s talent that was needed to lose such sums, wouldn’t it be a prudent business decision to attract the less talented?

And let’s get serious. Bankers are not as hot as they once were. Do we really feel that if we didn’t increase their salaries they will resign, and take, for instance, teaching jobs instead? If banks don’t understand the current economic reality of supply and demand they are in the wrong job, and we’d better get rid of them altogether.

On the other hand, if we give them, why shouldn’t they take? After all, this is one of the only things they do understand.

Brown vs. Titian by ranfuchs @ 21/02/2010 – 15:17:54

Brown: "'Titian reached the age of 90, finished the last of his 100 great paintings, and said: ‘I’m finally learning how to paint.’ That is where we are’"

And to this all I can say is that I have not yet seen Mr. Brown's 99 masterpieces. So why doesn’t he go home and leave us alone until he's 90?

Change

It is disappointing that Obama, whose election motto was CHANGE, is taking economic advice from the very same economists whose policies led us here.

CHANGE Mr. Obama, starts with getting rid of that which has been proven not to work. So why don’t you get rid of those who until less than six month ago refused to see where their policies were leading, and employ those few and far between who understood. As for the rest of the economist, let them join the ever growing unemployment cycle. They may learn something.

Brown vs. Einstein

Gordon Brown said, in a meeting of self-proclaimed world leaders, that unless the trend was reversed there was a risk that it would imperil the process of globalisation, damaging prosperity around the world for years to come.

Einstein said that we can't solve problems by using the same kind of thinking we used when we created them.

Is it just possible that globalisation is the problem?

Pittance

RBS, rescued with £20 billion of UK tax payer’s money, throws £1 million Christmas party – a modest amount according to his CEO Stephen Hester.

I am glad that for Mr. Hester £1 million is pittance. However, this is enough to feed 3,000 African children for one year, provide half a million vaccination for malaria – the greatest killer of all diseases, or build schools in 50 villages.

But why go far? Many of ours schools here would be delighted to get only a few thousands dollars each to help with maintenance and acquire basic equipment so desperately needed.

So Mr Hester, as small as £1m might seem to you, it’s not your money that you’re spending this time. It is my money. And it’s me and a few thousands of my neighbours that pay your £1.2m a year salary (before bonuses).

If it were up to me, I would have saved few thousand children and not the bank. It wasn’t my choice. The money was taken from me by the sword of the taxman. So don’t tell me it’s a small amount. If it is, I want it back.

Profiteering

“Shame of the Banks that are profiteering from the rate cut by axing their best deals.” said a newspaper headline.

And I say, shame on those who while using our money to bail banks out, did not take the opportunity to force banks to become socially responsible organisations.

Because, until someone changes the rules of the game, banks will play the only game they know --  profiteering is the name of their game.

Gallant Brown saves the day (and lives happily ever after)

Mr. Brown came with a rescue plan – good; because he did not have a choice.

Mr. Brown executed the first step of his plan – good; because this the first time I see Mr. Brown doing anything difficult.

Mr. Brown, arrogantly, told the world that he saved the world’s economy, and that the rest of the world should follow his example – can’t get much worse.

Mr. Brown, you, who helped put us in this mess in the first place, probably did the only things that may give us a chance to escape a total disaster. That what you did, gave us a chance. Your action, although necessary, is dangerous, and can backfire badly. No one knows how it will turn up.

To use an analogy Mr. Brown, when you are forced into a war, you stay humble. You should have learnt it from your mate Mr. Bush, who not only helped you put us where we are today, but also won the Iraqi war long ago – just before it turned messy. If you have not read history, just remember that Nixon won the Vietnam War, Bush won the Iraq war, that is, before they lost them.

So please, Mr. Brown do what you can to and get us out of the mess you put us in, but keep your arrogance aside, to after you have won this war. That is, when the troops come safely home. Because when you send troops out, you never know how nasty things can get.

Mr. Brown, I never really liked you as a prime minister, but I like you as a person less and less. BTW, kissing your wife on the stage to improve your public image is a cheap stunt. Few are blind enough not to think otherwise.

A Letter to Mr Brown

Dear Mr. Brown,

For a man who started his PM role as a self-proclaimed financial prodigy, you seem to have little understanding of financial matters. And by this I am not referring to the financial turmoil itself. It was not your fault.

But in the same way, it was neither the fault of those you blame: the greedy bankers, the immoral short-sellers and the Icelandic government. It’s the blaming and threatening like a simple bully that makes me doubt your financial credentials. Prove me wrong!

Let me tell you why those you blame are not at fault. For decades now, governments all over the world encouraged greed. They loved quick earnings and the spiralling property value. It gave them the spending power they wanted.

In our culture, quick money has become the measure of success; insurance has become a way to make money rather than a way to protect those who suffered damages; fines have been used as a source of income for governments and councils rather than a way to deter crime and anti-social behaviours. So how can you blame us for greed? This is the way the government, you, and most of us, wanted it, choosing to ignore a basic universal principle – things do change.

Some call it Yin and Yang, and you don’t have to be religious to appreciate the wisdom behind the biblical story of Joseph who become second to king Pharaoh because he’d realised that bad years come after good ones, and that they needed to save resources during the good years to be used when things turned bad. In financial terms it’s called reduction of volatility. It’s also called the economic cycle. But if we kept increasing our debt – private and national – during the best of times, what did we think would happen when things turned bad? Did we really think it would never happen? My grandmother knew better, you should have learnt from her, and she wasn’t a financial genius.

You see Mr. Brown, there is no one to blame. You, together with us, preferred to ride the wave of mediocrity and the path of least resistance. Now we are reaping what we sowed.

One more question if you don’t mind Mr. PM; how did you reach the £500 billion bailout figure in only a couple of days? It can only be a very rough estimated, and if it is, I have some suggestions for you:

First, why don’t you use only £460B for the bailout, and keep the extra 40 to fix the education, and legal systems. After all, it was only money that stopped you from doing that earlier, and now you seem to have resolved the problem of raising money.

Second, can you please stop blaming the poor Icelandic government? Professionals at the government and councils put the money there because they got better rates. As professionals they must have known that higher rates meant higher risk. Did you really believe that a 300,000 fishermen country could guarantee UK savings? And besides, if you already raise £500B, why don’t you simply raise 501B and leave the poor Icelandic people alone. Neither you nor anyone else would even notice the difference. On the other hand, if you abuse terror laws, we will all notice.

And one last suggestion Mr. Brown, we all know that now, when we have less money, you are going to increase the taxes to pay for the bailout. I well understand that you have no other viable choice. But why don’t you start immediately by raising the tax on alcohol and tobacco instead of blaming supermarkets for selling it so cheap, and hence encouraging anti-social behaviour. Price of alcohol is not their moral responsibility, it’s yours, and you are given the opportunity to kill two pigs in one bullet.

Remember, it’s just too easy to find scapegoats. But they may only work in the short term. In the long term you reap what you have sown. The challenges you are facing are greater than any post-war prime minister had to face. So please stop finding blame, stop making empty phrases and gestures, and stop being hypocrite. Show us what a prodigy can do. This is your chance. There is nothing more anyone can ask of you.

Our beloved chancellor

In reference to the American multi-Billion dollar bank bailout, Mr. Darling reassured us that we will learn from the American mistakes as: “Nothing is worse than coming forward with a plan that isn’t sufficiently developed.” Words of wisdom Mr. Chancellor, but can you please explain why only last week, you had begged the Americans to pass this bailout?

He continued and said that “when WE take action, we take it quickly. Then it works.” I don't follow. Are you saying that the American action was not quick enough? Or else, how are you going to develop a plan sufficiently if you were to do it quickly. Or do you mean that if and when you decide to take an action, you will take as much time as you want and then do it quickly?

BTW, just in case you have not been following the markets; a day after this statement, the UK came up with a nearly identical bailout plan. So far, it has had the same degree of success – none at all.

My dear cucumber

One good thing that came out of the hike in food prices is that the EU has agreed to ditch the law controlling the curvature of cucumbers. If you were not aware, until now it was illegal to sell bent cucumbers.

My xxx imagination is working overtime. How did such a law come into being? Who suggested the law in the first place, and what was going through his or her mind? So the good news is that now we can all choose our cucumbers the shape we like them.

Let’s not let the EU take away our most fundamental liberties. Well done Irish voters.

I am a bank owner!!!

Can anyone tell me what it means that Northern Rock will be bought into ‘public ownership’? Am I, as part of the public, an owner? Can I get dividend when the bank starts making money again? Can I  sell my shares, my part of the ownership?

What a misnomer; what a spin!

All it really means is that they will use my money to buy something I cannot use or enjoy. And some would claim that the capitalist democratic world is what we should impose on everyone.

God help them all.