Alistair Darling (of the City)'s Second Bank Bail Out

It's like deja vu and so very predictable. Having concealed the true extent of their gambling losses in the hope that there would be a resurgence in confidence the major banks have now, with results due to be published and the previously incompetent regulator taking a close interest, been forced to admit the real depth of the shit they are in and come to government (me and you) for more money.

This looks more and more like more than just incompetence and it is really time that the Serious Fraud (Farce) Office took a much greater interest, but that would damage confidence and confidence tricksters like New Labour and their big business cronies depend on confidence.

Capitalism is crumbling due largely to its own values of greed and inequality.

I've posted a link to The Red Banker in the Sidebar for a socialist analysis.

Financial Institutions and Toothless Regulators

It looks as if they might just about stopped the financial world from unravelling but recent events make my previous comments (12th September) look strangely prophetic. The banks with the most money are gobbling up the lesser banks and we all know the consequences of that for the workers in the financial services industry. The corridors of the Parliament (both in Westminster and Edinburgh) are awash with crocodile tears as the Capitalist system creaks under the strain of unfettered greed. Apparently 'Greed is good' doesn't apply any more.

Meanwhile the regulator issues a toothless ban on short selling of the shares of banks and insurance until the end of the year. The whole system of share trading has turned into a giant casino where no-one really knows the rules, because there are no effective rules. Big Gordy and Smirky Salmond might try to scapegoat the short sellers, but they were acting completely within the law, and it is Governments which still make the law. The fact that there are too many financial institutions in the USA and the UK which have grown so large that if they are allowed to go down they take the country with them is a national disgrace. It means that they can indulge in massively risky behaviours in the knowledge that the taxpayer will cover the losses should they fail.

The real answer is to break them up, and sooner rather than later and preferably put them into public ownership so that the workers who generate the profits share in the success of the enterprise, rather than the present situation where the greed generates massive losses, the workers lose their jobs, the bosses walk away with all the remaining assets, and the taxpayer bears the loss.

This crisis was avoidable, and had the regulators real powers to stop abuse then the people would have been better protected.