I’ve lost count of the number of times “how’s business” has been said to me recently. Who do they think I am Warren Buffet? Well for all of you who have not had the advantage of travelling in my cab. Supporters of these Master of the Universe in banking say that their international telephone number salaries are to attract the Brightest and the Best, well if what has happened this year is from the Brightest and Best, give me Useless and Stupid any day.
[M]argaret Thatcher once proclaimed “you cannot buck the markets” and a light touch regulation was all that was required.
In reality, the governments on both sides of the Atlantic have now had no alternative but to bail out these banks run by the Masters of the Universe, because in an ironic twist of the Keynesian maxim that if you owe the bank £10,000 you’re in trouble, but if you owe them £10 million they’re in trouble. So if these banks are not supported the likely outcome will be not a recession but a full blown depression not seen since the 1930s.
The ramifications of this financial meltdown will be felt by every person in this country for generations. In bailing out these morons the immediate effect is that the government will have to look for savings elsewhere, that that means fewer schools, hospitals, roads, and a cut in real terms in benefits. With large scale redundancies in banking we cabbies will soon feel the pinch.
CabbieBlog takes the view that the government should not succumb to a knee-jerks reaction, maybe a few banks should have been allowed to go to the wall. A full investigation should be launched and radical changes made to the financial sector, the most important being that it should never again be allowed to self-regulate. What the City and hedge fund managers have been doing is the equivalent of going down the bookies and putting £1 to win using our pensions for the stake money and giving themselves enormous bonuses in return. Lehman Brothers for example owed $35 for every $1 it made. You don’t have to be a financial genius to realise that sooner or later the game would be up, even your average Cabbie would have told them, if only they had asked, but they never do.