Britalian

Well, I knew it would be the case but I expected that my post of yesterday would take at least 24 hours before proving to be correct!

Reuters is now reporting on a high level meeting in Italy where UniCredit has asked for a cash injection from the government.

So why would Alessandro Profumo profess the Italian banking sector to be in such good shape?

Ridiculous but unfortunately, very Italian.

The Bank Of England has lowered UK interest rates by 0.5% to 4.5%.

The real test for UK banks comes now.

Can they resist holding out on mortgage rate reductions for a few weeks or will they do the decent thing and not see it as an opportunity to make some hay while they cast misctrustful glances at each other?

In the same way that petrol companies increase pump prices daily as the price of oil goes up but do not drop them when the oil price goes down.

By the way, the same rings true of airlines. Shameful.

We need to see immediate reductions in mortgage payments otherwise this rate reduction benefits nobody other than the bank bosses who did so much to create this turmoil.

In the kind of statement that turns to folly days later, the CEO of Italy’s UniCredit has stated that “The Italian banking system is absolutely solid”.

So far Italy’s state within the current financial meltdown is unclear (as you might expect) but when a bank CEO comes out with such a statament, it raises more questions than it answers but I suppose we will see in a few days….

German Chancellor Angela Merkel came under fire over the weekend for telling German citizens that the government would secure their deposits.

She has now been forced into an embarrassing clarification and has stated that she did not mean the government would actually guarantee deposits but that the government had a political commitment to protecting investors.

So when a German bank goes under, how exactly does one go about claiming their money bank under a political commitment? It is typical of the bland statements being thrown about by politicians the world over.

In the UK, Alastair Darling said he would do everything possible to resolve the situation. That doesn’t actually mean anything. Now Merkel has to admit that she did not mean what she said.

What people need now is a trust in their leaders that at the very least, this situation will not be allowed to happen again. It is no good bleating about how much the wasters in the City get paid for pressing buttons when nothing was done at the time about some suspect financial instruments.

Instead what we have now is leaders who are selling their citizens down the river, saddling us with debt for decades to come.