Putin's Russia gets more gangster-like every day. And his Chechen satrapy is even worse.
While UK banks collapse, things are looking even scarier across the water. Bank shares in the Free State dropped 48% yesterday. The Irish government took the lead in guaranteeing deposits, but the nightmare, Icelandic scenario is if the banks' liabilities are greater than the Irish treasury's purse. The UK is in the same boat, but we can always inflate (i.e. collapse) the currency.
Can anyone suggest a safe-ish currency for my savings ?
Spain's in the doo-doo. I wonder how Santander, only a few months back a safe haven for Alliance and Leicester, Abbey National and B&B, is faring, given the Spanish property slump ?
Spain also has demographic collapse plus mass immigration.
Alice Cook is a woman after my own pessimistic heart :
Today was an historic moment. The RBS and its barely comprehensible loss signaled the end of an era. The days when finance was the engine of the UK economy are definitively over. The UK banking sector has become the 21st century equivalent of coal mining; over-staffed, over-paid, and profoundly unproductive ...
So what happens next? The government will continue to prop the banking system with liquidity. Whatever Brown and Darling might say in public, they now have the minimalist objective of preventing total collapse. It is simply inconceivable that lending could return to the 2007 levels. The heady days of near limitless credit growth have gone. The government would be doing well if it simply avoids another financial sector meltdown ...
What about the real economy? This too will adjust, and it will be painful. The bulk of the adjustment will be in financial services, which has just begun to shake out all that value-reducing labour that created this appalling banking crisis. Currently, the sector employs about 6 million people. Don't be surprised if that number falls by half.
I said 2009 was going to be interesting !