Bank of England governor can still move markets.

A speech in Leeds last night proved that Mervyn King can still move markets. Today,
sterling was down 4 per cent against the dollar. This was in response to the Bank of England governor saying that the UK economy was entering recession. If I was the governor I would try and talk things up since it might make things better. There is no point in trying to wish for a deep recession.
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Most IFAs be wondering if they have the client base to survive. Mortgage brokers have been badly hit as property transactions have come down. They have been in recession for quite a long time. Apparently, the recovery will come in 2010.
In Newmarket, Suffolk, Frank C Barker offers advice in areas such as lump sum investments and income protection. I wish I had a lump sum to invest, although the traditional arena of the stock market looks very risky. However, the world does not stop completely and people have sums on deposit where they are looking for a better return.

I like Brian Tora article on financial crisis.

I like the moneymarketing.co.uk article by Brian Tora on the current financial crisis by looking at the past. For instance, in the early 1970s there was a three day week in the UK and hyperinflation. Tora says this crisis is all about overborrowing with too much money being lent to the wrong people. However, he is confident that we will get through the crisis, which may be once in a lifetime event but is not unique.
Meanwhile, in Brighton the financial firm Antrams has been offering advice for over twenty years. It can handle complex financial planning issues.
In his regular investment article for moneymarketing.co.uk Tora says he is convinced "central banks and governments will find a way out of the situation created out of easy money and greed". However, I think he might have to exclude the bankers Trichet and King, who seem intent on fighting imaginary inflationary battles. It may be that inflation is used to attack the debt mountain in various countries. However, Trichet and King must be more pragmatic and cut interest rates now. Oil and food prices have come down, although the Bank of England governor must be worried about the level of sterling.

It is interesting BOE widening range of collateral.

The UK central bank Bank of England is widening the range of collateral it takes from banks in the provision of their funding needs. The central bank is to take paper, which is not AAA rated such as U.S student loans. The Bank of England governor Mervyn King is probably pondering how to get the banks off this funding tap.
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Apparently, the Governor is being more pragmatic and is less concerned at making the banks pay for their mess.

Bank of England governor - No pain, no gain.

The Bank of England governor, Mervyn King, has not said the phrase "no pain, no gain" but he is pretty adamant in his opposition to any plans by the UK government to prop up the mortgage market. I read in moneymarketing.co.uk one description of Mr King, which said the Aston Villa fan
was a purist and was not a pragmatic economist.
Some parts of the mortgage market continues to operate. If you are creditworthy, then you will still receive credit. However, it looks like there are real problems at the first-time buyer level, which obviously hits chains.
In recent memory building societies ran a cartel while rationing housing loans. Such things were dismantled in the Thatcherite revolution but remarkably banks and building socities can still move together in the United Kingdom. They all seemed to raise their required deposits at the same time and at the same level. Or was that my mistaken impression?
If the Bank of England governor has his way, there will probably be a slow recovery.
UK Chancellor Alistair Darling wants any recovery to be quicker and it will be interesting to see how far he ignores Mr King.
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Will Alistair Darling rescue the mortgage market?

Will British Chancellor Alistair Darling rescue the mortgage market? The Bank of England governor Mervyn King wants the market to recover naturally and does not want any form of state guarantee or help for borrowers. Mr King is insisting that the lenders should still retain the risk of their mortgage loans.
Some observers consider that the Bank of England governor is being too much of a purist and should be more pragmatic.
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Postscript: with me writing in September 2009 Darling is still Chancellor, which seems a minor miracle, since he is more or less ignoring the instructions of Prime Minister Gordon Brown. Darling wants to be a bit more upfront on forthcoming spending cuts from 2010. However, he could help the mortgage market, which has shown signs of recovery, if he reduce stamp duty rates.

Mervyn King is still Governor of the Bank of England, which is another source of wonderment. He must be surprised that the UK banks seem to be making efforts not to
repossess at the first possible moment. I think the banks should be congratulated for these efforts to keep down residential repossessions.

Is Bank of England governor defending UK financial markets?

Is the Bank of England governor Mervyn King defending UK financial markets? Obviously, he would not like to be lectured by overpaid bankers over the need to hose
the markets with cheap cash. However, this might be necessary to get things going
again. I assume the governor is very aware of the dangers of importing inflation
with the depreciation of sterling. This should help exporters but this has never
been the priority of the Bank of England.
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Mr King must be as mystified as the rest of us that the banks have not cut dividends
and raised capital. This would be allied with management changes. How many
Barclays SIVs can go bust before the management does the decent thing.
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Briault walks the plank at Financial Services Authority.

Managing director Clive Briault has walked the plank at the UK regulatory body
Financial Services Authority (FSA) following the Northern Rock debacle according
to Money Marketing. However, Mr Briault was the prime mover of the retail distribution review, which has yet to be finished. He leaves with a contractual
£380,000.

Elsewhere, I read that the actual FSA staff supervising the UK mortgage bank were insurance rather than banking experts. The organisation's internal report has pointed to failings in the supervision of Northern Rock but I think the main structural flaw was the tripartite responsibility of the FSA, the Bank of England and the Treasury.

Bank of England governor Mervyn King still seems to want to punish banks for their mistakes but he lost the opportunity to do that some time ago. In a perfect world
the banks' shareholders would lose their shirts for their poor lending decisions
but this would be too damaging for all concerned.