The UK Is Preparing To Return To "Glass-Steagall"

[Trajan]

my my my......would our politicos go along with same here, or maybe the question is; how much campaign *cough, bribe* money would it take to stop it?



In a very surprising move, the AP reports that the UK finance minister George Osborne has announced a major overhaul of British banks, the key provision of which will be the separation of bank retail and investment business "in order to help avoid another financial crisis" - an act which is in essence a reintroduction of Glass-Steagall. What is stunning about this development is that the banking cartel has allowed the UK to get so far as to effectively repeal Gramm-Leach-Bliley, the act that ended Glass Steagall and allowed unprecedented deregulation to convert formerly safe banks into the mastodon, 50x levered, TBTF hedge funds they are now. And if this is happening in the UK, how long before Europe adopts the same overhaul in order to placate its austerity-ired population, and deflect populist anger where it belongs: the banking oligarchy which continues to defy nature, and the simple laws of bankruptcy, and demands that there is never even the smallest impairment of senior claims. All this may very soon be changing.

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The UK Is Preparing To Return To "Glass-Steagall" | zero hedge

AP-

Yahoo! Finance

 

[California Girl]

They're also tackling their massive public sector by taking an ax to it. Fun times in the UK. Yet, the British are not rioting daily like they are in Greece. Why? Because, generally speaking, the Brits are far more intelligent and know that this is the hard road they must walk to make up for 13 years of incompetence from their Labor Party.

 

[Epsilon Delta]

Agree wholeheartedly with your analysis of the situation, Trajan. The repeal of Glass-Steagall is the definitive event in the background history of the recession that continues today. A return to Glass-Steagall or rather an updated version of it is such an obviously needed measure that it simple boggles the mind that it cannot gain any traction in Congress - until one remembers that every member of congress [or potential member of congress] needs money in order to stay there [or get there], and that the financial sector is the one sector with the most money to throw around. This makes them totally untouchable.

But of course, the free, unregulated, unchained financial markets willed it so - it willed the finance and financiers would be rich enough to be untouchable by virtue of their hard work or whatever. So this must be the best of all possible worlds. Anything to contain them would be intrusive government regulation telling people how to live their lives and spend their money!!

They're also tackling their massive public sector by taking an ax to it. Fun times in the UK. Yet, the British are not rioting daily like they are in Greece. Why? Because, generally speaking, the Brits are far more intelligent and know that this is the hard road they must walk to make up for 13 years of incompetence from their Labor Party.

Disagree wholeheartedly with your analysis of the situation, CG. For starters, there have been huge riots in Britain over public spending cuts; the Tory-Lib Dem poll ratings have completely plummeted. Labor is actually LEADING in polls now (http://today.yougov.co.uk/sites/today.yougov.co.uk/files/yg-archives-pol-sun-results-150611.pdf - the latest poll, Labour pulling +8 over the Conservatives). The government's making U-turns on major policy initiatives every week. So much for the "smarter Britons" argument or it's implication that they are more likely to acquiesce to fiscal conservative austerity.

The real reasons behind the difference is that Britain's starting position is not nearly as bad as Greece's: first, Britain does not face the same kind of crisis of confidence Greece does (obviously, investors are much more confident that Britain can actually repay its debts than Greece, regardless). Second and most importantly is the fact that Britain retains control of it's monetary policy through the Bank of England and the pound, an avenue that's simply not available for Greece as part of the eurozone. Hence, the pound underwent a heavy devaluation in 2008 and a crisis like Greece was averted for the moment without the need for the massive cuts expected of the latter.

 

[Trajan]

They're also tackling their massive public sector by taking an ax to it. Fun times in the UK. Yet, the British are not rioting daily like they are in Greece. Why? Because, generally speaking, the Brits are far more intelligent and know that this is the hard road they must walk to make up for 13 years of incompetence from their Labor Party.

yes, but are we?