Peston's picks a must read

I agree, Robert Peston is certainly a man who offers real insight and great analysis of many business, economic and political issues.

 

With regard to house prices it has been clear for a number of years that a collapse was inevitable.  I personally blame the banks; for years they have been lending more and more money to people with dubious financial stature without real regard to the application of sound financial analysis.  A BBC money programme some years ago highlighted the issue of self certified mortgages, essentially loans to people without any checks on their ability to pay.  The simple driving force behind this sort of behaviour was greed and the bonus system paid to many working in banking who meet sales targets. The whole system relied upon the continued rise in house prices, once that ceased the whole thing came tumbling down like a pack of cards.

 

It is ironic that the profits made by the banks in the good years were private profits whilst the losses that they are now making would appear to be public losses as the taxpayer is effectively bailing out the banking system.

 

It is clear that the banks cannot be trusted to behave prudently and I would like to see far more regulation and governance of their behaviour to ensure future balance sheets are far more sensible and prudent.  Of course that will mean money will become harder to acquire and more expensive to borrow.  On the positive side this of course will mean that products typically bought using loans will have to become more affordable, as houses and cars are becoming now.

 

Anybody struggling in the present climate has my sympathy but it pays to remember who your friends are.  The banks have responded by increasing the profit margins on many of their products at the expense of the consumer.  Can anybody justify arrangement fees for mortgages that now run into thousands of pounds?  How exactly are the banks able to get away with this blatant exploitation?

 Running a business such that the profits made are mine and any losses are borne by the taxpayer.  Hmmmm, now that is a business model that I could succeed with, even with my limited entrepreneurial skills.

Can only agree - he's revitalising how the BBC reports news in the world of business and finance.  While an objective but detached voice is good for general news reporting, Robert's keen insight and strong personal voice mean I'm checking up his blog almost as much as the BBC's main business reports these days.

Robert Preston does exciting news.  But On Northern Rock and HBOS he may have lead to panic, chaos and financial meltdown.  Great reporting if sensation is wanted.  But perhaps more care and fewer extreme adjectives about disaster would help.

I'm not sure even Robert Peston is powerful enough to bring about the downfall of a bank - but point taken. It does appear as though certain sections of the media just love bad news - but it was always thus.