What bothers me though, is that people - politicians and the media mainly - view this recession as something that needs treating. When in fact, rather than being the disease, the financial crisis is the cure.I contrast this with a comment left under the article by Sunny Hundal, in which he says...
The recession is a market correction of a hugely over-inflated housing market (it will correct, and home values will/may return to a more realistic level of appreciation). The recession is a reaction to borrowing on a massive and wholly unsustainable scale. The recession is the global economy snapping back, as rampant growth surpassed the finite resources we have available.
We should stop thinking of the recession as something we can spend our way out of, and just swallow our medicine. Governments, rather than trying to perpetuate a bankrupt economic status quo (see the reduction in V.A.T.), should be using funds to provide basic safety nets for those who fall through the cracks.
We should stop lying to ourselves. We need to be honest. We can’t afford to continue spending money we don’t have. Continuous growth is an illusion. Markets will fluctuate. That’s the way it is. We spent more than we had. We borrowed beyond our means. And now we have to suck it up.
Sorry. But we need to grow up. And our politicians need to stop bullshitting, and tell us what we don’t want to hear. The recession is the cure. Now let’s stop making matters worse, and deal with it.
By re-capitalising the banks you’re failing to take your own advice. If you want everyone to suck it up, surely the banks should be the last to be bailed out since they’re the ones who screwed up big time.
If one really wanted to be radical and punish the people wh made the mistakes, then the govt woud create new, mutualised banks, which guaranteed deposits in other banks, but other than that let them go bust. Goodbye Lloyds!!
The problem of course is that it would take half the insurance markets, and hence the world markets with them.
Does he really think Lloyds Bank and Lloyd's of London are the same thing?