Tim Worstall

There’s good bits in his analysis: he makes the same point I’ve been making for years (thus it is obviously a good bit agreeing with my prejudices as it does) that the debt dynamics are entirely different in a country that prints its own money and in one that does not. Sadly he seems to [...]

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Dear God these people are stupid. Labour also criticised the government’s bank levy, a tax on banks’ balance sheets, which it said had raised nearly 2 billion pounds less than intended since its introduction in 2011. The levy was expected to bring in 2.5 billion a year but has failed to do so because banks [...]

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The International Capital Market Association says it would devastate the repo market, a vast pawn shop that allows banks to raise funds quickly and easily by pledging assets. It expects transactions to plunge by two-thirds overnight. Even that may be optimistic. Gabriele Frediani from the electronic market MTS said trades would collapse by 99pc. “The [...]

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This does look like something of a problem really: Although the Big Four accounting firm was not criticised by the Parliamentary Commission on Banking Standards, the damning report revealed HBOS was carrying £47bn of losses when rescued by the taxpayer despite getting a clean bill of health from KPMG. In HBOS’s corporate arm alone, KPMG [...]

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Plans from Brussels put the onus on bank depositors, rather than the taxpayer, to bear the costs of bank failures. “Cyprus was a special case … but the upcoming directive assumes that investor and depositor liability will be carried out in case of a bank restructuring or a wind-down,” Mr Rehn, the European Economic and [...]

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“This was a traditional bank failure pure and simple. It was a case of a bank pursuing traditional banking activities and pursuing them badly.” Quite.

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In a damning report into the downfall of HBOS, the Parliamentary Commission on Banking Standards lays the blame squarely at the door of the trio that led the bank from its creation in 2001, via the merger of Halifax and Bank of Scotland, until its collapse in 2008. “The HBOS story is one of catastrophic [...]

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Under the arrangement, depositors in Bank of Cyprus will receive shares in the lender worth 37.5pc of any savings over €100,000, while the rest may never be paid back, according to a statement from the Cypriot central bank. Of the 62.5pc of uninsured deposits not converted to bank shares, about 40pc will continue to accrue [...]

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Couldn’t happen to us, could it? After all, Britain is nothing like Cyprus. Cyprus is a small island, far from the “action”, with contented natives who prefer not to notice as more and more of their wealth is bought up by oligarchically rich foreigners. Our banks don’t cripple themselves with out-of-control lending to those natives, [...]

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The Cyprus bailout continues to send shockwaves through the financial world, though we confess: We’re a little shocked at how shocked some people seem to be. The front page of Tuesday’s Financial Times was splashed with alarmist prose under this headline: “Eurozone shifts burden of risk from taxpayers to investors.” There’s still no greater taboo [...]

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But it’s savers, not bankers or shareholders, who are taking the 40% hit. Err, no laddie. Shareholders have taken a 100% hit. Bankers are losing their jobs all over. The problem was that this wasn’t enough, the two banks were too broke for this to be enough. Thus the non-insured depositors being bailed in. The [...]

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The euro fell on global markets after Jeroen Dijsselbloem, the Dutch chairman of the eurozone, announced that the heavy losses inflicted on depositors in Cyprus would be the template for future banking crises across Europe. “If there is a risk in a bank, our first question should be ‘Okay, what are you in the bank [...]

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However, despite the excesses of his flamboyant lifestyle, Levene was left with nothing and filed for bankruptcy in 2009. “Because” suits better.

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Because, y’know, we need and economic revolution n’all. And what this collection of dimbulb lefty economists don’t realise is that their “revolution” describes the system we already fucking have. but calls for something else: an international law on bankruptcy. Like the emphasis on employment, it’s radical but obvious. “I think that bankruptcy is one of [...]

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Panicos Demetriades, the governor of the central bank of Cyprus, pressed for “urgent” legislation “relating to the reorganisation and recovery of the Cypriot banking system” in a crisis that threatened to spark a run on banks and to wipe out £1.7bn in savings held by Britons. “This consolidation process will prevent the risk of bank [...]

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The European Parliament’s economic and monetary affairs committee today voted to revise draft EU legislation on investment funds (the UCITS directive), with a total sector value of almost EUR 6.3 trillion in funds. The vote on the legislation, which is being shepherded through the European Parliament by Green draftsperson/rapporteur Sven Giegold, also includes provisions on [...]

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The finance ministry announced that the country’s banks would remain closed until Tuesday as it proposed measures to impose capital controls, limiting the amount of money depositors could remove. Are they actually allowed to do this? I’m sure they’re allowed to limit extractions from the banks. But are they allowed to restrict the movement of [...]

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The bail-out should have been a legal bail-in whereby equity is wiped out, and all bank debt is written down. Then unsecured (uninsured) depositors ie above €100,000 should have taken a double digit hit. By doing this EU finance ministers and lawmakers would have been respecting the creditor hierarchy while adhering and honouring the rule [...]

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There are several principles at stake in the row over Cyprus and its bailout. But one we should ignore is the hysterical reaction to a tax on bank deposits. It is a wealth tax – and about time too. The objection to this particular wealth tax is not that it is a wealth tax. It’s [...]

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They’ve just reneged on the government deposit insurance. That’s going to make dealing with the next bank run interesting, isn’t it? Facepalm.

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