On the ‘free banking myth’

May 24th, 2012 § 0 comments § permalink

Free banking. There is no such thing. It’s more akin to the NHS – free at the point of use.


Free banking is “a dangerous myth”, according a top Bank of England official.

The comments come from Andrew Bailey, who is due to become the chief regulator of the financial services industry in July.

He says customers may think their account is free, but the true costs are actually hidden.

Those hidden costs would include the extremely low interest rate that many banks offer on current accounts.

Due to the nature of a current account, it should be free. A current account is not for saving, it’s not an investment, it isn’t money for taking risks with. It is an account for doing daily business with.

So much of our daily financial transactions are electronic that without a current account you’re practically outside society without one. It is one of those things that, without one, so many things are shut off.

Businesses and banks, for decades have been pushing people to get accounts. How many people get paid in cash, in an envelope at the end of the week or month? Not a part jobs, in pubs or whatever, but proper 40 hour a week jobs? I couldn’t get paid in cash even if I wanted to, and practically nobody else could either. So if I’m not allowed to be paid in cash, why should I have to pay a bank to be able to receive my wages?

If I overdraw, fair enough, I should have to pay a penalty. The cost should be may seem high, £25 for a computer generated letter telling me I have no money may feel rather insulting, but then I can do several things: Sort myself out so I don’t overdraw; get an agreed overdraft which would cost a lot less or; move to a bank that charges less for a letter. To be charged for being able to access and manage my money when I have no choice, that is the real insult.

“In short, I think that the reform of retail banking in this country cannot move ahead unless we tackle the issue of free in-credit banking, and have a much better sense of what we are paying for and how we are paying,” Mr Bailey said in a speech.

You want me to have the account. As long as I’m only using my money, you take the cost of it.

He said the situation also made it difficult for banks to understand the cost of the services they provide, which may have contributed to the mis-selling of financial products.

Between them, Barclays, Lloyds, Royal Bank of Scotland and HSBC are currently paying about £9bn in compensation for mis-selling loan insurance.

“I worry also that this unclear picture may have encouraged the mis-selling of products that is now causing so much trouble,” Mr Bailey said.

It’s difficult for the provider of a virtually madatory service to understand it’s cost? Aw, diddums. Is there anything these fucking wankers do understand? Most of them cunts in The City don’t understand half of the products they trade. Selling debt and other stuff in ways that are so fucking difficult to understand they didn’t realise how fucked the whole system is until it all came crashing down on top of them, and us.

If you don’t understand what you’re doing, you’re doing it wrong.

And it may have contributed to mis-selling? I don’t buy that for a fucking second. The mis-selling happened because they wanted to make money and to tell everyone they needed loan insurance was the easiest and quickest way they could make money. If they did it deliberately, they thought they could get away with it. If they didn’t do it deliberately, they obviously didn’t know what they were doing and shouldn’t have been doing it. Either way they were being cuntish. Fuck ’em.

However, Mr Bailey says it is a difficult situation for banks because the first one to start charging for accounts could lose significant amounts of business.

Speaking on the BBC’s Today programme, BBC Business Editor Robert Peston said: “He’s saying you can’t leave it to the banks to clean-up their act in this way.”

We’ve learnt over the last few years that the banks can’t be left alone to do pretty much anything.

“That’s why he is saying – which I think is really pretty significant because this chap is replacing Hector Sands as the senior regulator in the City of London – that either the regulators or the government actually have to intervene to end the myth of free banking.”

Charge me for having a savings account, ISA’s, being overdrawn or whatever, but start charging for current accounts, the banks can get to fuck.

Big Society Bank

April 5th, 2012 § 0 comments § permalink

Something about this Big Society Capital or Bank (or what ever it’s called) doesn’t sit quite right with me. It’s not so much the idea itself, more of where the money is coming from.

The money to pay for all these social enterprises is going to come from dormant bank accounts. Accounts that have been seen no activity for 15 years. That’s the bit that feels a little wrong. Raiding bank accounts, albeit ones that haven’t been touched for a while.

It just feels, well, dirty.

The government can take money from dormant accounts after 15 years, but as banks can deem accounts dormant as soon as one year with no activity, how long is this 15 year threshold going to stay at that length?

Instead of dormant bank accounts what about Bona Vacantia?

“Bona Vacantia” literally means vacant goods and is the legal name for ownerless property that passes to the Crown. We administer the estates of persons who die intestate without known kin and collect the assets of dissolved companies and failed trusts.

The person leaving the assets is definately dead. There is a proliferation of companies tracking down possible inheritors (ata a price, obviously) and so the realistic timescale for putting those ownerless assets to good use could be dropped to ten years for a start.

Using unclaimed inheritence doesn’t feel like such a grab at private money. It seems a more civilised way to use money that has nowhere else to go.

What a waste of money…

October 30th, 2009 § 3 comments § permalink

This link, courtesy of Luna17, takes you to the billion-dollar-gram on the information is beautiful website, check it out:


Some highlights:

The OPEC climate change fund is only 0.06% of total OPEC earnings

The value  of the Internet Porn Industry is almost as large as the amount of foreign aid given by the World’s Major Nations

The US defence budget is nearly large enough to feed and educate every child on earth for 5 years

The amount of money that the UK government spent on bailing out the banks would have more than covered the entire debt owed by African Nations to the West…..

Part of me, unfortunately, is not very surprised at the sheer scale of waste and inequality.  What is clear is that the necessary resources exist for us to transform the world – we don’t need huge leaps in technology, or to rely on developing countries to grow their economies for the next 50 years  -we need permanent  Redistribution…

On banking, business & government. Sort of…

March 30th, 2009 § 1 comment § permalink

The Dunfermline Building Society has been bought by Nationwide, the UKs’ biggest building society.

Well, I say it’s bought Dunfermline…

But Nationwide will not be taking on the bits of Dunfermline that are seriously loss-making.

These are commercial property loans and portfolios of buy-to-let and self-cert mortgages – with a gross value of £1bn.

It’s actually bought only the good bits. And where are the bad bits going? Yup, to the treasury. Who’d have thought that would happen, eh?

Being a building society rather than a bank, there aren’t any short-termist-greedy shareholders to blame, probably just plain boring mismanagement.But once again, a private entity shifting it’s crap on to us, the taxpayer.

I realise there is not a lot that can be done about the shit currently hitting the fan, but for the future, companies/business, especially big business, need to be regulated to within an inch of their lives or kept small enough not to fuck everything else up if an entity goes belly up.

Capitalism and neoliberalism is trumpeted to be the the fairest business systems there is etc, but it doesn’t really seem fair to me that a company can take risks and reap the rewards, but then not have to take the consequences when the risks don’t go the way they expected/hoped.

Obviously, the old addage of the private sector doing a better, more effient job than the public sector is a load of old toss, and I reckon has come about because, right the way through from way before PFI to these latest bailouts, the public sector has taken the hit, and the private sector the profits.

Oh and don’t forget, If you fuck everything up big enough, you’ll be asked to advise the government on how to put it back together.

Even recently, when the government made a u-turn with the decision to put a service out to tender (I can’t remember which one) and then because of the uproar decided just to let the Post Office keep providing the service, the minister in charge on Radio 4s’ PM programme refused to answer the question of how much compensation the government had to pay the companies who have submitted tenders, citing commercial sensitivity.
What the fuck is that all about? Paying people because you don’t want them to do the job? You get a few builders round your house to quote for an extension. You suddenly decide that you’re going to move house rather than extend, you don’t pay the builders for loss of work or the time they took to quote, do you?
And commercial confidentiality? When the government aren’t actually getting anything in return? It could be argued for if the government was actually getting something for it’s (our!) money, but when it’s just a fucking payoff? Someone deserves a kick in the face for that.
Try it next time you go for a job and don’t get it. Send the company an invoice for time and travel and preparation of CV, maybe a new suit, see what the response is, because that is what these ‘Captains of Industry’ do when they applied for government contracts.

Nice work, if you can get it.

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