Hubris and Nemesis – The Fall of the Co-operative Bank…

In ancient Greek mythology, the sin of hubris – excessive self-praise and over-weaning pride – was punished by Nemesis, the goddess of indignation. It is a metaphor sometimes used to describe how the giants of the banking industry were destroyed by market forces in the great recession that began in 2008. Their inflated egos allowed banks to lose the run of themselves, investing in assets that were vastly over-valued and which the bankers often didn’t even understand. It would be …

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“When the banks stopped lending we were there for everyone” – in support of the credit unions bringing old-fashioned banking back to our high street

They have cross-party support, a wave of new members, new premises opening in our town centres and financial strength unaffected by the credit crunch. With an aim to provide a listening ear, a caring service, community spirit and practical help, it is not just a return to the best parts of banking from the past but the entire service is provided by your neighbours for your neighbours. Which is why, in comparison, the change in banking as we know it …

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Ireland’s experience of Bankers: “Focused on profit the same way a starving dog focuses on a sausage”

Brian Lucey with some advice of his own on the advice offered to Scotland by experts in banking… The bottom line is this. Exceptionally able as most of the bank economists, financial sector analysts and FX traders may be, they are not in the truthiness business. They are paid to help their companies sell product. They are not paid to ahve a moral, ethical, or social perspective except in so far as that aids in sales. That doesn’t make them …

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#IndyRef: Rejigging Scotland’s currency arrangements requires restructuring (and damage)

So yesterday three ‘boys’ from Westminster went to face the man of Scotland. As it happens all four major party leaders have been immersed in the art of politics since young, but Alex Salmond’s has twenty years on his more ‘senior’ rivals. Time and time again it shows. For much of the last three years whilst the ‘boys’ were in Westminster trying either to hold together or prize apart Her Majesty’s Government in the Palace of Westminster, there has only …

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An Independent Scotland’s banks will “continue to rely on a London-launched bail-out”

Currency would not be a problem for an independent Scotland if, one, the Eurozone had settled its difference over what a fiscal union might look like; or two, the financial sector did not account for such a large proportion of Scottish GDP. Liam Halligan outlines the problem with some precision… The combined balance sheets of the UK’s banks amounts to a massive five times annual GDP. We have the most bloated banking sector of any major economy, making our public …

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Barclays is not the problem

Barclays is a problem, no doubt. But it is not the problem. The problem is not a few cowboys, it’s the whole damn rodeo. Speaking with a friend who’s worked on nuclear anti-proliferation strategy on Saturday, I was struck by the contrast he drew between approaches to and expectations surrounding government regulation in both areas. Given nuclear technology’s tremendous potential for colossal harm it’s a no-brainer that stringent regulation, frequent spot-checks and the limitating of access to rigorously trained and …

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LIBOR – a tobacco moment for banking?

Here’s a super leader from the Economist on the LIBOR scandal…the video is pretty good also. “Since we have not more power of knowing the future than any other men, we have made many mistakes (who has not during the past five years?), but our mistakes have been errors of judgment and not of principle.” So reflected J.P. Morgan junior in 1933, in the middle of a financial crisis. Today’s bankers can draw no such comfort from their behaviour. The …

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Barclays: “Shouldn’t we hear some answers before the condemned man is whacked?”

Timely analysis from Iain Martin on a trigger happy populism that could easily get out of hand… with a language straight out of Sean O’Casey… what is slightly depressing is the sanctimonious lynch-mob mentality which currently prevails. It was there over Hester’s bonus and Sir Fred, sorry Mr Fred, Goodwin’s knighthood. So intense has been the clamour from some MPs that Diamond is in the bizarre position of having been forced out before he has had a chance to try …

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RBS bonus: Obscene or a nice piece of business?

One thing, I think, that is better, or at least more widely, understood in the Republic than in the UK is that the credit crunch is still screwing up almost every other well intentioned effort to get our economies moving again. This is because the banks still haven’t owned up to the extent of their bad debt, and they are barely lending anything to anyone. So far, the pattern seems to be that they keep the good (ie, unimpaired) investment …

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Financial reform fails

Simon Johnson pronounces the Financial Reform Bill ineffective as essentially nothing in the entire legislation will reduce the potential for massive system risk as we head into the next credit cycle As you were then. Business as usual for the bailed-out-too-big-to-fail-banks. Moral hazard and socialism for the rich, our well established, guiding principles. Ah well, maybe next time, when the big one bites, and sends us back to the dark ages, maybe then, we can start over from scratch. The …

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Ireland : Why Morgan Kelly is wrong

On Newstalk Radio this morning Professor John Fitzgerald of the ESRI explains why he thinks Morgan Kelly’s analysis of the banking crisis is overly pessimistic and replies to David McWilliams assertion that his growth estimates are ‘horseshit’. John Fitzgerald on Newstalk Radio – his interview starts about 40-41 minutes in. The reasons why he feels Kelly is overly bearish – 1. Fitzgerald argues that there are insolvency issues at Anglo Irish Bank and Irish Nationwide, but that AIB and Bank …

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