{"id":22792,"date":"2007-11-20T08:57:00","date_gmt":"2007-11-20T08:57:00","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/blog\/?p=563"},"modified":"2007-11-20T08:57:00","modified_gmt":"2007-11-20T08:57:00","slug":"northern-rock-y-la-incompetencia-de-la-comision-europea","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/northern-rock-y-la-incompetencia-de-la-comision-europea\/","title":{"rendered":"Northern Rock and the European Commission\u2019s incompetence."},"content":{"rendered":"
The \u00a325 billion injections made by the Bank of England<\/a> (Bank of England) to the popularised Northern Rock<\/a> have been and remain a source of contention amongst Britain\u2019s political and financial elite, as well as within the EU. The funds lent to ensure the bank\u2019s solvency in the face of capital flight to other institutions are guaranteed by the Treasury. It could not have been otherwise; either solvency was guaranteed, or the domino effect could have put the entire British banking system \u2013 and by extension the European one too \u2013 in serious trouble. The consequences of this would be incalculable, and the banking sector in the US and the rest of the world is not exactly in the best of health, shall we say. \"\"<\/a>Consequently, the actions of the FSA<\/a>, from the Bank of England or the Ministry of Economy, was flawless and succeeded in containing the crisis perfectly; it will be fully resolved when the scavenger on duty<\/a> do its job and take advantage of this situation, to the benefit of us all. For the time being, the vultures circling Northern Rock\u2019s dying body are Olivant<\/a>, Cerberus<\/a> or Virgin itself, among others. I recommend this excellent article<\/a> by Enrique Gallego, who understands the situation at this bank better than almost anyone else. Although, in the end, an even more powerful and professional vulture will probably step in, recycling the spoils with the approval of the Chancellor of the Exchequer (Darling) and returning the cheque to the forced lender, much to everyone\u2019s relief. Faced with a crisis such as that of this bank or any other, and I would go so far as to say in general:<\/p>\n

A loan is infinitely healthier than a grant, but an investment is even better<\/span>.<\/p><\/blockquote>\n

But what is truly scandalous is that the European Commission<\/a> is seeking to boycott this welcome rescue operation launched by the Bank of England, which has averted a crisis of confidence with potentially global consequences. Officials (some call them politicians or pseudo-bureaucrats) at the Commission are threatening to scrutinise these loans to ensure the integrity of free competition. The funds lent by the Bank of England are guaranteed by the British Treasury and could therefore be regarded by these officials as intolerable state aid. Unbelievable.<\/p>\n

\"\"<\/a>It should not occur to any rational mind\u2014be it civil servants, politicians or bureaucrats\u2014that Northern Rock\u2019s competitors feel they are being treated unfairly because of the cash injections received to quell the crisis of confidence in the banking sector. But the European Commission\u2019s inability to grasp the global credit landscape is made clear by its threats to launch an investigation. Ladies and gentlemen<\/a>, no British bank \u2013 nor, for that matter, any bank in the world \u2013 has been treated unfairly because of the \u00abpreferential treatment\u00bb accorded to Northern Rock through the capital injections provided by its central bank. Quite the opposite<\/span>, had these injections not been administered, the problem would have spread like wildfire. The explosion could have reached the ECB<\/a>, the EDF<\/a> and, of course, into the pockets of the European Commission itself. The potential for a devastating shockwave was effectively nipped in the bud from the outset by the guarantee of funds from the UK Treasury. The process will soon be perfected with the acquisition of the bank\u2019s remains by the vulture of the moment, thus completing the cycle of the global financial food chain.<\/p>\n

\"\"<\/a>These are fundamental principles of the global financial and business markets, but they appear to pose a threat to the integrity of free competition in the eyes of certain European pseudo-bureaucrats, who could do with some basic lessons in common sense, the responsibilities of their positions, and a grasp of reality.<\/p>\n

Pure incompetence, even if it\u2019s disguised as overzealousness.<\/div>","protected":false},"excerpt":{"rendered":"

Las inyecciones de 25.000 millones de libras realizadas por parte del Bank of England (Banco Central del Reino Unido) al popularizado Northern Rock han sido y son motivo de discordia entre la clase pol\u00edtica y financiera de Gran Breta\u00f1a y tambi\u00e9n de la UE. Los fondos prestados para garantizar la solvencia del banco ante la […]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":["post-22792","post","type-post","status-publish","format-standard","hentry","category-sin-categorizar"],"_links":{"self":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/22792","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/comments?post=22792"}],"version-history":[{"count":0,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/22792\/revisions"}],"wp:attachment":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/media?parent=22792"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/categories?post=22792"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/tags?post=22792"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}