Did you know under Labour's Watch...

TDiddy / Claig - Tim Harford was talking about the cost of the bank bailout (and it's contribution to the national debt) last week on radio 4 (I heard it on the More or Less Podcast). And yes, even at current share prices the investment is almost back to what we the taxpayer paid out (with either a small loss or small profit predicted in the medium term). Obviously, the investment has to be realised (by selling the shares).

The main impact on national debt was caused by the recession (which was caused by the credit crunch and banking crisis) twinned with record levels of public spending.

I recommend the More or Less podcast to anyone really interested in the numbers behind the news stories.

TDiddy - the article you quoted makes an interesting point, which I mentioned earlier, why aren't they shouting about it from the rooftops?

"The City wonders why the government is not shouting about the rise in the bank shares, given that Labour is trailing in the polls. One analyst, who declined to be named, said: "I'm surprised that Gordon Brown is not making more of the bank shares."

If they tried to realise their paper profit by selling in the market, the price would soon drop and they wouldn't get their £9bn. So it looks like they will eventually try to sell it to Sid, the inexperienced private investor, rather than the professionals. You'll be told that the shares are a bargain, then you can join Sid and snap the shares up.

But I think you should keep a close eye on the news and try to see what may lie around the corner. What may happen if Spain and Portugal follow Greece, how this will affect French and German banks, and what might happen to banks in other countries. But to you it's simple, you're an optimist, you believe the forecasts. As you say, I am more sceptical. I just think it's better to be safe than sorry.

has everyone on MN just start election partying already and they're completely rat-arsed?

or on drugs?

"So when your child and everyone elses child is 18 they will be able to join the very few elite that we call 'Trustafarians', you know, the ones that don't work for a living?"

The salient point from this thread, is that by saving £250 a year each for the DCs (I have to do the saving because they are too old for CTFs) will ensure that they never have to work again.

Tell me, OP, do you work for the Financial Services Industry? Because I think you might have sold me an endowment scheme in 1992.

Claig - it's simple, the Govt bought the shares 9BN cheaper than the level at which they are trading. Madoff scepticism is irrelevant, I think.

TDiddy, I'm saying that I don't believe the figures that financial pundits quote. These are the same pundits who couldn't see the disaster coming and who recommended Madoff. If they tell me that RBS is a great investment, I take it with a pinch of salt.
RBS made business decisions that caused it to have the biggest corporate losses in British history. If you think that it could never happen again and that the garden is now rosy, then you should invest in them along with the government. I'm a little more conservative, I'll stick to Tesco.

you don't have to believe me. I just googled and found that RBS?Lloyds even at these levels are showing 9BN profit for the tax payer. And then RBS has to pay the govt a few BN under the asset protection scheme. Not a bad trade for the taxpayer after all!!

I prefer a fact based discussion when we start talking on this subject. There was a lot of bad financial journalism before and during the crisis.

Claig - if you really have this view on RBS shares then you could "short" the shares at the click of the mouse. here

claig - didn't say that it would be all sorted. I DID say that the Govt is on course to make handsome profits from RBS and LLoyds. I don't think that I am entirely original in that thinking. And err, just have a look at how much they paid for the sharees and recent share prices. Nothing imaginary about that....

..And your argument?...you say that RBS is just another Mardoff...

TDiddy,
Two years and it will all be sorted, you reckon, boom profits you say. I will leave you to continue believing in the man in the moon.

This thread is hilarious. I feel like Grisgy has given us all a pat on the head. Arf.

claig - i will leave you to belive that it is all made up....no point in arguing if you want us to all revert to your version of fiction

This thread is making me feel very very peculiar.

I'm sure I've met Grigsy and felt very very peculiar then.

I don't have as much faith in the facts and figures that you hold so much store by. I bet Bernie Madoff's figures looked hunky dory before it all collapsed around his ears and he was led to his jail cell.

I don't think every child should be given £250. That is why we are so damn broke as a country.

TDiddy, no they don't tell us that in the Daily Mail. If it was as simple as that, I reckon the politicians wouldn't stop telling us about it, they'd be screaming it from the rooftops.

A 32p rise in the share price is a more than 50% rise from now. RBS profits were £10bn in 2007, followed by a loss of £24bn in 2008. Most financial pundits didn't see it coming. I don't have a lot of faith in what the financial pundits say, tomorrow they may discover some more black holes if certain sovereign countries have to renegotiate their debts

claig - i apologise if that sounded patronising but I am frustrated by the lack of facts in your arguments and the fact that your arguments don't seem substantiated.

1BN for every 1p increase in share price is what we the taxpayer benefits, to my knowledge!!! They don't tell you this in the Daily mail do they?

claig - I think it would take about 32p rise in the RBS share price to cover your 34BN loss. I will check but that was the figure that I was given a few weeks ago. So I really don't think you have looked at this properly. Check how much RBS share price has risen recently and how much "head room" there is.

TDiddy, RBS made a loss of about £28bn in 2008, and £3.6bn in 2009. I can't remember the exact figure of the total bank bailout, but it is in the hundreds of billions. At that rate it might take a century of profits to pay us back. That's without the danger of any of these high finance high-wire trapeze artists pulling off some more stunts that generate even more losses.

"the quickest way for us to repay the national debt would be for RBS and Lloyds share price to continue to rise. Give it a couple of years!"

I think you've been swallowing the bankers line and partaking of their champagne, which we kindly pay for. I think a couple of years is a bit optimistic, it may be more like a couple of centuries.

claig - let's see what DC and Boy George Osbourne do next bonus round at RBS when they are in power.

You keep avoiding the bigger subject of how much profit the next Govt will make when they sell RBS and Lloyds. By the way, the quickest way for us to repay the national debt would be for RBS and Lloyds share price to continue to rise. Give it a couple of years!

probably

can I join you in the sand? though you know that this won't be over on friday don't you?