Rough and smooth

[peterbirks]

There are various areas in news where you really can't say what many people are thinking, because to do so appears to condone human suffering. It's all part of the "there can't be any losers" culture. Of course, there are always losers. It's just that sometimes those who are losing are very visible. Take the investors in Kaupfucked Ltd Reykjavik. They have been compensated for their greed in going for the highest available interest rate. All of those who saved with more prudent companies are penalized. How so? because other building societies in the UK are stumping up hundreds of millions to pay some of the compensation. It's not just taxpayers' money; it's savers' money as well. You can't expect building societies not to widen their profit margins when they are shunting out fifty million quid or so a year to compensated savers with an Icelandic rickshaw of a company that has spunked it all away on Hamleys.

Another example of this was highlighted when it was revealed that the Woolworth employees of Guernsey would not get UK statutory redundancy payouts. Well, er, that's because it isn't in the UK. There are a number of significant tax advantages to living in the Channel Islands. You can't expect to get the benefits of UK employment law if you don't pay UK taxes, surely?

But no-one can write this in the mainstream press, because it's hard not to feel sorry for Mrs Sauxdown of St Peter Port as she loses the job she has worked in for 30 years. She didn't get up every morning and say "ahh, lucky that I live in a low-tax regime, but beware! There could be downsides". She just went to work without thinking about it. But, once again, it comes back to that old mantra. Life isn't fair. I suffer lots of "unfairness" for living in the UK as a reasonably well-paid, fit, middle-aged childless male, but I don't moan about it, because I know that the rough comes with the smooth. I just wish that other people wouldn't assume that life should be all smooth and, when a bit of rough life comes along, they shoult "it isn't fair; the government should do something about it".

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Comments

[jiggery-pokery.livejournal.com]

I agree with that up to the point where people can make an entirely prudent-appearing investment in a perfectly conservative UK building society which is then bought by an Icelandic institution, which later goes under. When the company with whom you bank (or invest) gets taken over, I can see the sense in all the investors performing their own risk assessments all over again, but I have much more sympathy for those who invested in something that looked conservative but was later taken over than those who invested in something that didn't look conservative in the first place. We must all be risk managers now, as well as computer technicians, chefs, housemaids, drivers and so forth.

I may not actually be disagreeing with you here.

[(Anonymous)]

M&S chairman Rose today,
"People are very professional in this business. They know the score, they read the newspapers."
Sometimes you have to wonder though.

Also not sure if it was on Peston's or your blog I first saw the term "quantitative easing", but the use has sure picked up over the last few days.

hal

[peterbirks.livejournal.com]

Hi Hal:

Comment this morning from Allister Heath in the City AM leader.

"I'm increasingly suspicious of GOrdon Brown's new-found interest in quantitative easing. While this make sense to boost the economy, it was also be an exceedingly convenient solution for a government staring insolvency in the face".

Exactly. Governments need inflation to get rid of inconvenient debts just as much as individuals do. The difference is, governments can do something about it; they just print more money.

PJ