Has the time come for a revolution?
When the Government first bailed out the banks last year – they took Preference Shares in return for providing liquidity to the banks. Well – that was the plan. The problem with the preference shares seems to be that while they do not offer the Government voting rights in the banks, they hit them where it hurts – in their pockets by having a fixed tarrif that they must pay annually.
Well apparently that wasn’t enough to get the banks lending and the terms of the Government investment have been changed so that the Government now hold ordinary shares – in other words, the banks may have less control but they are now not obliged to pay a dividend. The upshot of this is that our Government’s investment and eventual repayment are placed further from us – the taxpayer who provided it.
This is out of control. Something has got to give.
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