Politics Thread!

[zip accident]

To be honest I was a bit like that but I didn't quite understand the how much of a fucker Operation Stack is for some of the Kent locals.

I know it's small beans compared to the problems likely faced by the people trying to get here but it is does have a pretty serious negative affect on the local people and businesses.

No doubt it's a problem but doesn't excuse writing sensationalist bullshit day in day out.

There are lessons from history of the outcome of frothing up nationalism and genocidal prejudice.

For example, the Daily Mail in 1938 was full of headlines about the "flood of German Jews" invading England...

Look where Einstein ended up.

[Absolute_Zero]

Here's a maths question, maybe it should have been on that Scottish exam that was too hard for pupils.


Gideon has some shares, which the previous person in his job bought for £5 each.

Gideon decides to sell them to his friends, the hedge fund owners who donate to his party's funding, at £3.30 each.

Calculate how stupid Gideon is.

Then Carney is also "stupid" since he supports the sale.

The reality [you've heard of it] is that if we're waiting for the RBS share price to reach an in-real-terms break-even, 'never' is a real possibility. In which case, not selling represents a £46bn+ loss. That would be stupid. We borrowed that £46bn... we pay interest on that £46bn.

I recall you whining similarly about the first tranche of Lloyds shares being sold cheap. Guess what, genius, by the time that the last holding is shifted, the taxpayers look as though they will come out more-or-less ahead. This on the back of a an increasing share price... that curiously started shortly after #11 made the initial announcement. Strange that.

[gravy]

Slow hand clap.

"Well not selling now means not selling ever and losing all the monies!!!!"

It doesn't. There are advantages to a sale right now for the brokers buying via this limited initial offering. Not a lot of advantage for rest of us though.

There is something wrong here.

[pogo]

Well, yes. The alternative to not buying some of RBS in the first place was a systemic collapse of our financial system. Given that the costs would have been catastrophic, compared to any losses from the trade. I haven’t read this recently but estimates a couple of years ago would be that the govt. would make a profit overall, which could include some losses. But that was and is not the reason the government invested in the banks in the first place.

[Absolute_Zero]

Slow hand clap.

"Well not selling now means not selling ever and losing all the monies!!!!"

Reductio ad absurdum.

We won't know if it's a good time to start selling until it's nearly all sold. See Lloyds as an example.

[tufty]

Yup it is average, I knew it was around 40% but I had read that was high in proportion but it's on average with Germany etc.

Is it bollocks.

The european average is around 1.2 asylum applicants per 1000 population. That's applicants, not accepted applications. The UK is at around 0.49 per 1000, 20th position of the 28. Germany take 5 times more per head of population and six times more in terms of sheer numbers.

[VNVObit]

Here's a maths question, maybe it should have been on that Scottish exam that was too hard for pupils.


Gideon has some shares, which the previous person in his job bought for £5 each.

Gideon decides to sell them to his friends, the hedge fund owners who donate to his party's funding, at £3.30 each.

Calculate how stupid Gideon is.

Then Carney is also "stupid" since he supports the sale.

The reality [you've heard of it] is that if we're waiting for the RBS share price to reach an in-real-terms break-even, 'never' is a real possibility. In which case, not selling represents a £46bn+ loss. That would be stupid. We borrowed that £46bn... we pay interest on that £46bn.

I recall you whining similarly about the first tranche of Lloyds shares being sold cheap. Guess what, genius, by the time that the last holding is shifted, the taxpayers look as though they will come out more-or-less ahead. This on the back of a an increasing share price... that curiously started shortly after #11 made the initial announcement. Strange that.

Mark to Market we're running at a £15.6bn the loss at present (i.e. valuing the shares at 330p) and we've just crystallised £1bn in losses

regardless of the value we still pay interest on the £46bn it cost to bail out RBS. I can't see us ever breaking even on the sale of the shares as factoring in the interest cost (aka holding cost) of the shares the value would need to be closer to 615pps (assuming 3% p.a.) to recover all of the money

[Baggypants]

Slow hand clap.

"Well not selling now means not selling ever and losing all the monies!!!!"

It doesn't. There are advantages to a sale right now for the brokers buying via this limited initial offering. Not a lot of advantage for rest of us though.

There is something wrong here.

They're all being sold to George Osbournes mum.

[pogo]

regardless of the value we still pay interest on the £46bn it cost to bail out RBS. I can't see us ever breaking even on the sale of the shares as factoring in the interest cost (aka holding cost) of the shares the value would need to be closer to 615pps (assuming 3% p.a.) to recover all of the money

You can do the sums pretty much any way you want and come to all sorts of conclusions. I think it’s important to remember two things. First as I noted the reason for doing this was not to make money; any profit or loss is secondary to the main goal of stopping the banking system collapsing totally.

But second the government is not a normal investor. A normal investor looks for profits, from capital appreciation and from dividends, as they invest e.g. for their pension. The government mostly has costs, quite hight borrowing costs. Also the government being a large share owner is highly distortionary and a severe conflict of interest. This second reason mandates the government sell as soon as is reasonable, not hold out for a better price which may never arrive. That they are able to sell, that there is still a market for the shares, means the bailout can be counted as a success. Arguably we have one of the strongest banking sectors in Europe now as most other countries, or at least almost all of the eurozone, have yet to go through a similar process.

[VNVObit]

regardless of the value we still pay interest on the £46bn it cost to bail out RBS. I can't see us ever breaking even on the sale of the shares as factoring in the interest cost (aka holding cost) of the shares the value would need to be closer to 615pps (assuming 3% p.a.) to recover all of the money

You can do the sums pretty much any way you want and come to all sorts of conclusions. I think it’s important to remember two things. First as I noted the reason for doing this was not to make money; any profit or loss is secondary to the main goal of stopping the banking system collapsing totally.

But second the government is not a normal investor. A normal investor looks for profits, from capital appreciation and from dividends, as they invest e.g. for their pension. The government mostly has costs, quite hight borrowing costs. Also the government being a large share owner is highly distortionary and a severe conflict of interest. This second reason mandates the government sell as soon as is reasonable, not hold out for a better price which may never arrive. That they are able to sell, that there is still a market for the shares, means the bailout can be counted as a success. Arguably we have one of the strongest banking sectors in Europe now as most other countries, or at least almost all of the eurozone, have yet to go through a similar process.

I never said they were in it to make a profit just they were unlikely recover all of their costs

Investors are supposed to be indifferent as to whether or not they get their return from capital appreciation or dividends

Government borrowing costs are considerably cheaper than the private sector reflecting the likelihood of default so not sure where you're getting very high borrowing costs (at least not in terms of the rate)

[pogo]

High as it was and is quite a lot of money. Government borrowing costs are low now but the money was needed at a time when the finances were very stretched, with our deficit (excluding the bank bailout) very high. And unlike normal government borrowing the bailout was quite risky: there was (and still is) no certainty the government will get it all back.

As it was the crisis was brought under control. The banks were saved, at much less cost then letting them fail. The deficit was brought under control. Other countries in the EU got into far more trouble, scaring investors. The UK eventually became something of a safe haven for investors, and yes borrowing is as cheap as it’s been for a long time. But it’s easy to imagine scenarios with much worse and more expensive outcomes.

Even now with interest rates set to rise soon borrowing will get more expensive, rising to normal levels hopefully in the near future. So the longer the government holds on to the shares the more expensive it will get, in borrowing costs.

[gravy]

You're defending the bail out pogo but no one's attacking it.

This is more about the Osborne's judgement in of choosing now to start selling. There's a dissonance; the cons plan has the economy growing strongly over the next five years, it'd be hard for RBS value not to increase but the sale starts today while shares are at a low.

He knows this is hard to defend, currently refusing to take any interviews. It's his gold reserve sale moment

[Absolute_Zero]

Really. With the most expensive fines yet to be imposed from the residential mortgage-backed securities sold in the US before the 2008 crisis... sans an investment arm that made the big profits in the good old days. Under an increasingly wobbly world-outlook, RBS will surely roar ahead as a traditional high-street deposit holder... making Osborne and Balls-approved Carney look like fools. Oh well, his profits from Lloyds [likely] + Bradford & Bingley + Northern Rock > than if he sold the full holding at the price of the first tranche.

[Muttley]

http://ec.europa.eu/eurostat/statistics-explained/index.php/File:First_instance_decisions_on_(non-EU)_asylum_applications,_2014_(number,_rounded_figures)_YB15_IV.png

(sorry you need to select all of that and copy and paste it, as phpbb mangles URLs with non-ASCII chars in them. It's from here)

The UK is about average, other countries are much more generous. The other reasons you give are not valid ones; their personal preferences do not override EU and international law. Certainly wanting to work illegally here is not a valid reason.

Just stick it within url tags and it'll work just fine.

http://ec.europa.eu/eurostat/statistics ... B15_IV.png

[gravy]

Really. With the most expensive fines yet to be imposed from the residential mortgage-backed securities sold in the US before the 2008 crisis... sans an investment arm that made the big profits in the good old days. Under an increasingly wobbly world-outlook, RBS will surely roar ahead as a traditional high-street deposit holder... making Osborne and Balls-approved Carney look like fools. Oh well, his profits from Lloyds [likely] + Bradford & Bingley + Northern Rock > than if he sold the full holding at the price of the first tranche.

Pack in that false dichotomy bullshit. I'm not saying RBS will ever reach the heady heights they once traded at. I am saying selling now is poor timing and doesn't gel with Osbournes claims for the economic outlook of the country. It still has a strong balance sheet even post 'cleansing' which even the most pessimistic fine forecasts would make fuck all of a difference to and I -think- once out of public ownership they'd be precluded from going back into investment banking.

Worth noting the that this sale was over subscribed by a factor of two and that also one of the criticisms leveled on the timing is this was done before the fines were leveled, the hit taken and the dust let to settle.

The implication of what you're saying is the the chancellor is a super genius while the slow witted investment bankers have been sold a pup. I think they've been given a gift.

I'd be more convinced if the treasury could give some solid reasons for the timing rather than trotting out plattitudes.