Beware the City merry-go-round

Of course, when you set up a system, it is always good to incorporate a structure that allows plausible deniability.

It doesn't change the fact that you are ultimately responsible for that system.

Yes, a merry-go-round: they are all drinking each other's whisky.

It promotes a damaging kind of group-think, and perpetuates stupidity.

The worst of it is that evidently it has swept up Gordon Brown, which has in turn infected the regulators.

Yesterday Brown "cut off at the knees" two of his advisors (re: Andrew Neal - BBC Politics Show). Today he says he did not know because the FSA did not tell him plus that it was KPMG who gave a clean bill of health to HBOS. This is clearly the drowning man syndrome jettisoning anyone nearby to save his own skin. If he did not know he is incompetant and if he did then he is culpable. He apparently also had a personal involvement in recommending Crosby for a knighthood using the reason as his contribution to banking. Therefore, Brown must have had detailed knowledge of Crosby's banking ability or just made it up!

Brown also needs to explain why KPMG investigation remit was narrow, and they said this in their findings, plus why they were engaged when they had a conflict of interest being the Auditors also. But do not let these KMPG questions detract from the main thrust of this blog about Browns knowledge and increasingly distancing tactics.

"Plausible deniability refers to the denial of blame in loose and informal chains of command where upper rungs quarantine the blame to the lower rungs. In the case that illegal or otherwise disreputable and unpopular activities become public, high-ranking officials may deny any awareness of such act or any connection to the agents used to carry out such act."

I would describe Gordon Brown's chain of command, in this instance, as loose and informal.

For somebody who is portrayed as such a control freak, that's a bit out of character, isn't it?

What utter cods wallop.

Who exactly is in charge in this country?

The government appears not to have been around at all key times, for all key appointments, for all key decisions ever taken.

But they were definitely there for the boom.

This government has wrought more damage in the British economy with its spending and borrowing policies than any previous government ever before but it was never there at key times over the last twelve years.

Where were they when these decisions were taken?

Not guilty of any wrong doing no doubt, in the mangled language of Blair's Britain.

The prime minister Gordon Brown is one of the most depressing individuals ever to hold office in this country. He can speak for hours on end while simultaneously claiming credit for everything and blame for nothing.

Call an election

It is only with the benefit of hindsight that we realise that the "New Labour New Danger" warnings were significant too!

Does anyone believe what Brown said about not knowing anything about anything that might stick to him?

Please excuse me if I am just a bit cynical.

29 similar reports and Brown didnt think it was significant.

Surely that is grounds for resignation for incompetance.

As for the appointment of Crosby isnt that like putting the prisoners in charge of the prison.

Nick,

I'm sorry, but the PM's 'I saw no evil, I heard no evil, I touched no evil', defence just won't wash.

He was the man who created the banking regulatory structure. He cannot now complain about short term cash bonuses - he could have regulated against them - or about a lack of communication between the FSA and the Treasury. After all, I'm sure the FSA followed his guidelines about when and when not to raise the alarm bells with GVN.

As for the FSA warning being routine and one of 29 issued at the time... Where the other 28 issued to RBS, Lloyds, Northern Rock, Bradford and Bingley, the Icelandic banks etc... strange that the PM didn't tell us who they were....

If FSA warnings to banks were "standard and routine", should that not in itself have set alarm bells ringing somewhere?

The incompetence of the government and the FSA really is staggering.

"... it was one of 29 similar reports issued at the time (2006) and did not conclude that HBOS posed a risk to the entire banking system."

Hellfire! Who were these other 28 reports issued to?

That hole in the garden is starting to look a much more inviting place to put the Digby household's rainy day fund.

Nick,

A question worth asking is how Mr Brown's claims to have changed regulation in the City from 'self-regulation' to 'independent regulation' squares with the fact that the 'independent' regulator is staffed by the very bankers who were 'self-regulating' previously, i.e. all that happened was the same job was done by the same people, with the same self-interest, only now they were paid for by the taxpayer, and the Bank of England was removed from the loop.

Quite apart from the legitimacy of this policy, it is clear that the regulator failed, and since the framework was of his own making, he must accept ultimate responsibility for that failure. A defence of "I didn't know because I wasn't told" only demonstrates that the system was wrong.

So there were 29 reports with similar importance as that a 'system' bank was growing too fast - and this does not raise concerns in any quarters such as the FSA and Treasury? This actually makes the Trasury and the FSA look even worse: 29 reports that were similar to a report about a bank about to implode

Certainly FSA workpractices were plain wrong when the most senior risk manager's warnings about risk appetite of a 'system' bank hardly cause a ripple.

Handily, the story that the FSA warned HBoS in 2002, reported in today's The Times, has also been sidestepped.

And as new level of spin: during the PM's grilling, if it deserves that description, the current chancellor announces the budget date, which is 2 days after the G20 summit.

So. we'll get sentences in that budget like:
-As the G20 noticed that this is a GLOBAL recession (I doubt the G20 will start with saying it has all been caused by the US);
-The G20 has said this is unprecedented and calls for unprecedented measures (yes, but cash out (state debt) will require cash in at some stage).

The G20 will be used as smokescreen to hide the fact the UK's public finances were deteriorating prior to 2007, as Brown ran a budget deficit of almost 3% in 2005/6.

Perhaps an election mid June when polls suggest some reprieve for Brown following his belated April foolsday agenda.

As the Who sang: "Then I'll get on my knees and pray, we don't get fooled again." Not if you don't want to.

Nick

Follow crosby's board positions.

[Unsuitable/Broken URL removed by Moderator]

shows him on board in 2004 ????

Is he on the board (FSA) at the time its reading a report on the risk issues from a whistleblower ??????


Did crosby carry out independant review of the KPMG report for FSA while he was running Halifax?

Was he the poacher and gamerkeeper.

Why is this not researched and mentioned.


Banks fail because someone missed a huge risk..... if you replace experienced risk manager with someone with less experience and all the board agree to that unanimously

then they all culpable!!!!!!!!!!!!!!

up-date 1140

Good point Nick. Too late to ask the question now but I hope you make something of it in your News pieces.

If it looks scruffy and smells fishy it is almost always very dodgy! Not to be consumed at any price!!!

I can't read any of the posts yet, but I expect them all be part of the ranting Tory faithful baying for the head of the Gorgon, oops I mean Gordon.

Apparently oblivious that their own party has been, and would have been, in the same place, equally culpable. There but for the grace of the ballot box...

No matter who you vote for, the same things will happen, because that's the way that capitalism works (greed is good!). We've had the smooth. Now we have to weather the rough.

"UPDATE 1140: I've just noticed that Gordon Brown's defence of his appointment of Sir James Crosby to the FSA related only to the period 2003/4, ie when Sir James was made a non-executive director of the FSA.

The most serious FSA warning to Crosby's bank HBOS came in 2006. The following year he was made Deputy Chairman of the FSA. By then, of course, Mr Brown had been replaced as chancellor by Alastair Darling.

Could this be a case of saying "not me, guv"?"

I thought Gordon Brown ceased to be chancellor on 27 June 2007?

Could this (finally) be a case of saying "it's a fair cop guv"?

When exactly in 2007 did James Crosby get appointed?

18 December 2003

New Non-Executive Directors to the FSA board

The Chancellor of the Exchequer, Gordon Brown, today announced that James Crosby and David Miles have been appointed Non-executive Directors of the FSA.


So hes on board from 2003, and the FSA talk to the wistleblower in 2004... when crosby is on board examining claims Halifax's risk is not up to scratch


The smoking gun starts to appear for halifax at least


Crosby has to prove he did not influence the FSA clearing of the KPMG report into his own organisation (Halifax)....

oohh its so murky

dig dig the truth is out there.

I hope that the admissiion that there had been warnings about there being too much risk in some banks will put an end to the worn out phrase that nobody could have seen the crisis coming.Good old Gordon same old excuse nobody told me doesn't he realise that no-one believes that any more.

Oops, the budget is not 2 days but 2 weeks after the G20.

Still it's plain to see the plan for the mini Brown bounce

Let's program the software now to count the frequency of the following words/phrases:
-unprecedented
-once in a life time
-global
-started in the US
-extraordinary times require extraordinary measures (but why did Brown run a budget deficit when the ecnomy was growing above trend in 2005/6 - was this extraordinary in normal times or normal in normal times?)
-fiscal stimulus
-real help for real families and real companies
-Obama
-do nothing
-conservatives have isolated position
-worse than previously anticipated
-emerge stronger from this recession (how is that possible by the way, except in a relative sense, which I doubt since the UK was a country with a zero savings rate in 2005/6)

No prizes for guessing the frequency of the phrase "no more boom and bust" in the budget. It will be zero, but the oppo might just mention it though.

PS - I'm not related to the oppo, live abroad, non-uk national, not eligible to vote for house of commons, not member of political party

Nick,

I would never work for Gordon Brown. He is what can be called a fair weather friend.

The trouble is that the cabinet also know this and that they are all going to go down in flames.

I do love an MP, for that is just what Gordon is basically, who turns around saying that he will sort out the problems by some time in the future. Bit like sorting out the school building programe by 20/20, like vision. To be blunt it may well be that Gordon will not even stand for election next time, he probably wants to do a Mandelson and come back to the House of Lords where he can run the country from the other place, not even having to go through the process of being elected.

I do love it, as you say 'what me guv'! It is always somebody else with our Gordon. Not good enough.

The trouble is that nobody seems to remember something I learnt in banking, yes there is due diligence, but there is also contingent liability.

Maybe when the PM praises the sucesses of the NHS computer system, he might like to tell us how the system will prevent another Harold Shipman. Furthermore, when exactly will this government change the rules for the signing of death certificates as will be reported on the BBC tonight. Shameful, bring on the experts.

"Could this be a case of saying "not me, guv"?" Arrogance and ineptitude in equal amounts followed by McCavity the cat syndrome.


I would call it "in office but not in control", no doubt puffed up by his high regard for himself.

https://www.hm-treasury.gov.uk/press_135_03.htm

According to the Treasury website, Gordon Brown appointed James Crosby as a Non-executive Director of the FSA on 18 December 2003.

https://www.hm-treasury.gov.uk/press_109_06.htm

He was then re-appointed on 18 December 2006 as a non-executive director. Announced by Ed Balls, this time.

https://www.hm-treasury.gov.uk/press_129_07.htm

He was then appointed as Deputy Chairman and Chairman of the Committee of Non-executive Directors on 20 November 2007. Announced by Kitty Ussher....

Do I understand this article correctly:

https://news.bbc.co.uk/2/hi/uk_news/politics/7884877.stm ?

GB seems to be saying that it was OK that he appointed Sir James to the FSA as

"the problems alleged by Mr Moore were not the reason HBOS fell: "It was because its whole business model was wrong." "

...and the man who came up with this business strategy was then the ideal man to have as an advisor and be on the FSA board????

It's a simple case of passing the buck and claiming ignorance which he has now become an expert at.
Phrases such as 'Lessons will be learned' and 'With the benefit of hindsight' are a cop out in my opinion.
When presented with a friendly questions the same well worn phrases were trotted out 'I'm pleased you asked me that' 'You're absolutely right' and 'I'm glad you gave me an opportunity to answer that'. These are the very same kind of responses he gives to friendly planted questions in PMQs. No questions at all about mistakes he may have made as Chancellor except to say that there were so many financial reports in 2002 that concerns about some of the bank's practices were lost in transit and not registered by The Treasury. Yeah right!
In essence what we saw was a Government political broadcast with no real substance to anything. We didn't learn anything new because he repeated the same old well worn answers he has learned by rote and which in many cases did nothing to address the questions put.
That false smile which he uses to try and defuse serious situations almost makes you want to attempt an action which would have serious consequences.
In brief: It's not in any way me Guv. It was The Americans, the dysfuntional bank's business models and the incompetence of some of the individuals in high positions at the major financial institutions.

Here we go again - complete incompetence from Gordon - yet the buck fails to stop anywhere near No. 10! Just how does he do it? In heavens name why didn't he know, why wasn't he told - someone somewhere is covering a lot of tracks and that's for sure.

It's not just incompetent politicians, it's incompetent bankers and incompetent regulators (The Treasury and the FSA) too!

Will this never end?

"Yes we caused it and we are ever so sorry but it wasn't our fault, honest. At the time we just didn't think because we were either too greedy for wealth or too hungry for power. Now it's in the open we have apologised, surely you don't want us to go do you? After all we are paying ourselves very well and we are best positioned to see the UK out of this mess and we are leading the world as well as having saved it too!"

The mind boggles - does this lot of no good, no use idiots actually think we believe them?

Come the revolution (that's Election Day or Annual Shareholders Meetings) let us hope that - metophorically - you are all lined up against a wall and shot (push out, sacked, dismissed) - oh and lose your pension rights too - some hope!!

Has there been any example in the past of a Government being forced to call an election by the electorate?

If so, can we do it again please?

Of course it a case of saying 'not me guv'! It is all he ever says.

Why can't some journalist get him to admit any culpability for anything - have you seen Frost/Nixon?

As an aside, if Gordon has not been responsible for ANY of the current problems, or the appointment of Crosby, or anything OTHER than the 'prudent' consecutive quarters of growth... that began long before he was in charge and were prolonged by an explosion of debt and unsustainable house prices... then what exactly do we need him for?

#26:

Oh and I forgot a few more important phrases which he used on several occasions. In answer to why on a number of fronts measures he had promised to put into place to address problems in various sectors hadn't happened the answers we got were predicated by the words:
'We have got to ..........................................................

or:
'We will certainly look at it ...................................

"Could this be a case of saying "not me, guv"?"

Brown appointed Darling even if it was Darling that promoted Crosby who do you think advised him, obviously Brown.
The trail of slug slime still ends with Brown.

Lets face it Captain Smith wasnt on the Bridge when the Titanic hit the Berg but it was his responsibility.

Tony Blair appointed Gordon Brown as Chancellor

Gordon Brown appointed Treasury officials

Gordon Brown appointed Regulators

Gordon Brown appointed Mr King in the Bank of England

The Bankers have resigned or been sacked,

The Regulators have been replaced or resigned

What now for

a) the Treasury officials?

b) the Bank of England?

c) Gordon Brown and the man who appointed him, Tony Blair?

If Dr David Kelly can be brought before a Select Committee of MP's for telling what turned out to be the truth in Iraq, Gordon Brown and especially Tony Blair should be brought to account for NOT telling the truth.

It is incredible, there were 29 similar reports and that did not alert anyone that there might be a problem?
These people were asleep at the wheel that drove us on through until the crash. The MPs and the authorities have not been doing their jobs and this is widespread.
Our MPs have no right to lecture anyone on morality when they have a system that is not ccountable and we even have a bonus system where civil servants get bonuses. I clearly remember the bonuses to the enviornment dept last year after failings had been brought to light directly pointing the finger at their lack of duty, and people were living in terrible circimstances due to the flooding.

The public are fed up with the lack of accountability in Westminster as well as in the city. You talk of the merry-go-round, it is all too interlinked, what about all the quangos that every government promises to sort out? It is all so wrong .

To claim that it is within the rules although it is clearly not moral is unbelievable. All MPs should live by the same rules the rest of have to live by, and there should be no exceptions. The public are well and truely sick of it. It is now a real gravy train, and MPs then go on to work in business areas where they were ministers, YES WE ARE SICK OF ALL OF THEM.

Re Mr Robinson's 11:40 update,

That would make today's real new news story, that the FSA warned HBoS in 2002, all the more pertinent, or doesn't it?

Perhaps I'm just not clever enough to comprehend this.

Maybe someone on the blog can enlighten me - don't worry making me look stupid, I'll take it on the chin, virtually!

The following is no joke though: there have been private equity email conversations going like this: which bank can help us on this deal? Well, we can always call HBoS. No joke.

PS I'm not short Lloyds shares

Just seen you addition, the fact that they even think it is incredible. None of it is joined up, and tath is why we are in this mess, they are the KNOW NOTHING PARTY.

It takes so long for comments to be moderated on here it makes it virtually impossible to have any meaningful dialogue. Never mind, obviously the moderation crunch started in America and then devastated the moderation of boards in the UK. If we all work together we can develop effective moderation which will get us back on track.

It's a shame that the country's alleged public service broadcaster has two economic correspondents blogging here yet no political correspondent.

Leave the bankers to Peston, Nick, and concentrate on dealing with what you're supposed to be doing? Holding our politicians to account?

We've got a Home Secretary openly committing expenses fraud being neatly shoved under the carpet whilst everyone's chuntering on about this smokescreen of nonsense with the bankers. We've got a Prime Minister who's taken the country up the creek without a canoe, let alone a paddle, who refuses to answer questions and refuses to acknowledge his own hideously bad judgement regarding anything.

It's blindingly obvious that the bankers have done wrong, it's blindingly obvious that there have been "failings", and it's blindingly obvious that with hindsight, perhaps it might have happened a bit differently. That's not political analysis, it's not really economic analysis, that's just common sense.

What's also common sense is resigning when your position has become untenable, as Crosby did. Gordon Brown could learn something from that.

Call an election.

Collective – non culpability (aka ‘pass the parcel’)


The one person who has got away with all this is that multimillionaire capitalist, Tony Blair, who was architect of this sorry mess along with his poodle, Brown who was the architect of the current regulatory system. One of its 4 statutory objectives is to ‘Maintain confidence in the financial system’ Well that’s another Labour success story but will he own up to that one…the collective says ‘ Not me, not us, not them but we inherited blah blah blah’…

The people who will suffer most are our children who have been unashamedly used as the collateral for future payment of this country’s massive, massive, debt burden.

Until the culture is changed, nothing will change.

Isn’t it about time these people in office for once took responsibility?

Let’s hope Labour keep going for a while longer until the next planned election so they can sort out this mess (yeh right) and then the electorate will give them what they rightly deserve…

If Alistair Darling is going to take the fall, it'd explain why the 2009/2010 Budget is not being given until two and a half weeks into the new financial year, on April 22nd....

Nick
Yes it is a case of saying "not me, gov" and it won't work. With great power comes great responsibility, for your subordinates actions as well as your own. I seem to remember Michael Howard saying he was only responsible for giving orders, and had no responsibility for checking how or if they were carried out. It didn't work for him, either.

If things are as Gordon Brown says, then one can only ask who is in charge?

If nobody is in charge, as seems to be the case, then why is this government-thing so ludicrously expensive?

Nick, as you say the question which needs asking is whether Brown was involved in Crosby's appointment as deputy Chair. And why was he appointed after it had already become clear that he was responsible for HBOS heading into collapse.

#26:

Picked up by a correspondent on Sky News:

Gordon Brown's differing answers to the same question as to whether The Treasury knew about the concerns regarding HBOS practices in 2002:

NO 1: It is unllikely that The Treasury knew about these concerns'. (The excuse being that there were 25-30 similar reports and no time to digest them all).

NO 2: 'The Treasury were not informed of these concerns'.

It beggars the question can we believe the voracity of either of these responses the standard practice being apparently that The Treasury is in regular contact with FSA.

Is it possible that some of the posters here are in agreement with the third part of Jeremy Clarkson's description of our beloved PM? Perish the thought.

How pathetic of the PM to hide behind the investigation of Mr Moore which found his allegations lacked substance whilst the FSA now confirm that in fact it did have substance - the substance is that the banks were taking too many risks and they ignored the warnings. You only had to look at Mr Moore, the PM and Mr Crosby scurrying for the shadows yesterday to know who was telling the truth.

The time for this sort of political double speak and spin is over - we need the confident leadership of men with good judgement, integrity and vision. The PM, Mr Darling and their advisers do not give the slightest impression that they have any of these attributes.

This comment was removed because the moderators found it broke the house rules. Explain.

Browns goose is cooked.

If he didnt know he should resign because he should have known.
If he did know he should resign because he knew.

either arguement same result RESIGN!

#30:

Having said all of this is Gordon Brown really expecting us to believe that between 2002 and 2006 The FSA was not at any stage in contact with The Treasury regarding continuing concerns about their practices. If The Treasury knew then so did The Chancellor and The PM.

Nick,

Could you tell the serial Crosby excusers that

Financial Warnings are FORESIGHT not HINDSIGHT

Ignoring Financial Warnings is NEGLIGENCE

( anyway, well done in recognising that we are all sick to the stomach of all the negligent boards and board members )

"The prime minister's essential message was that it is only with the benefit of hindsight that the warnings to HBOS look significant. The FSA warning to the bank that grew too fast was, he said, "standard and routine"; it was one of 29 similar reports issued at the time"

So, warnings that the bank was growing too fast were normal and routine. So much so that they were routinely ignored.... and they guy that ignored them got promoted and the chancellor then PM thinks that it is only with the benefit of hindsight that the warnings should have been acted upon?

What galaxy is this man from?

Sorry, he was far too busy taking credit for what he described as a robust and growing economy that was based on sound principles...

When all along many people were warning him that it was a massive house of cards built on an unsustainable level of private and business and state debt and he was warned that the longer this was allowed to continue, without a carefully controlled and slow deflation of the housing market, the bigger, and more uncontrollable the crash would be when it inevitably came.

He did NOTHING to prevent the dire situation we are now in and in fact he did a lot to guarantee we all ended up right in it.

There are those that would state that this is part one of a deliberate and globally coordinated agenda for creating a global single currency as part of a new world order.

Well what does the future hold?

What are we SURE of?

Massive and increasing bail-outs, quantitative easing, pumping Trillions of dollars, pounds, Euros etc...into the GLOBAL economy by the nation states concerned... leading to global collapse in currencies in a couple or three years time and the rise of rampant hyper-inflation... What is the solution? Scrap the failed currencies and create a new one? An electronic one, one that can be implanted?

Now that is purely speculation based on conspiracy theories based on the actual written and reported words of global leaders going back about 100 years and may all be complete nonesense, BUT if it is true.... By the time it happens, it will be too late to stop the tyranny that the electronic ID/Money RFID chips allow.



Election now please...

Leaders, particularly Prime Ministers, should have outstanding foresight.

We all have the benefit of hindsight.

Does anyone think that Brown is a man of judgment anymore?
Come on Labour supporters.

The world is crashing round his ears and has not seen any of it coming.

He did not do anything wrong.

He is completely deluded and it some strange state of mental denial.

Is there no one who can rid us of this fool he is driving us to destruction with an ever widening manic grin.

29 king

We don't need him.

The reason why Brown gets away with his "not me gov" is that, like the government itself, they always take great pains to put other organisations/people between themselves and the blame. It is the others who either take the blame or resign.

Brown can do this for another year or so but then our time will come. I hope the wrath of the public is immense and that Brown is totally humiliated at the next General Election. From where I stand he totally deserves it.

Is this Irony

Brown calls the Conservatives a "Do nothing" party.
Having commissioned a report into Exstasy rating as a class A drug then goes on to ignore the advice, that he has payed millions of tax payers money for, and leaves Extasy as a class A

Now I dont personally advocate changing its clasification but whats the point in wasting our money on a report that you are going to ignore if you dont like the advice it gives.

In circumstances like this I would much rather the government had done nothing in the first place instead of doing nothing after the report.

Hypocrite is the hat Brown should be wearing.

Lets just add to that the report on the BBC website today that says, despite close to 1Billion spent, truancy has gone up by a third since Labour set the target to reduce it by a third.
The figures are so embarrassing that Labour now prefer to use a diferent measure to measure truancy.
Well they would wouldnt they.

When will this failure of a government do the one thing the majority of people in this country want and call an election

Did anyone watch Hustle on BBC1 last week? The dodgy MP summed up my opinion of Brown and his cronies.

Good BBC programme. Based on fact???

FWIW, even though these are very dark days indeed for the NL Government, I believe that if the Tories had been in power over this past decade, that we would now be in the same situation.

The venal, nasty, grasping 'greed-is-good' party might possibly have made an even worse mess.

However, ho, ho, a battered public now looks to the Tories for salvation, now that 'Dave' has come along and provided a glossy, respectable veneer.

PAU (politics as usual).

Is the House of Commons fit for purpose or is it's cognisance based entirely upon tax revenues and not the mechanics of wealth creation?

After 'Teflon Tony', have we now got 'Greased Gordon'?

Who's to blame?

" Macavity's a Mystery Cat: he's called the Hidden Paw -
For he's the master criminal who can defy the Law.
He's the bafflement of Scotland Yard, the Flying Squad's despair:
For when they reach the scene of crime - Macavity's not there!

37 djl

I tend to think that only the general public have any common sense - sometimes. That is because we live in the real world unlike politicians and political journalists.

We know what is important - food, home, heating - all of which depend on jobs/savings/pensions.

Our politicians have a different view - its all about keeping their jobs as career politicians and staying in power - the general public don't matter to the majority of them.

As I have commented before my definition of an MP as a "self-serving professional liar." Sadly our PM fis the bill - exactly.

"6. At 11:29am on 12 Feb 2009, Mark_WE wrote:

It is only with the benefit of hindsight that we realise that the "New Labour New Danger" warnings were significant too!"
---------------------------

No, in my case that is not hindsight as I thought that at the time too. I am so disappointed that labour failed to prove me wrong.

#43:

Here's another one:

'You do yourself an injustice asking a question like that'. If someone said that to me I wouldn't be responsible for my consequent actions.

@ 7. "At 11:31am on 12 Feb 2009, mikepko wrote:

Does anyone believe what Brown said about not knowing anything about anything that might stick to him?"

{sarcasm} Oh come on mikepo, This was the man praised, no, indeed worshipped, as the most intellectually brilliant chancellor this century. A man whose grasp of the intricate and complex workings of the financial markets were beyond compare. Certainly this was the much repeated view of labour MPs and much of the mainstream media commentators, especially the BBC, throughout his Chancellery and through into his premiership.

How could he POSSIBLY have known what was going on in any way that he could be held responsible for? for shame.{/sarcasm}

Of course your cynicism is well founded and repeated the length of the kingdom.


Election now please.

I think we have finally reached the stage when the game is up for the PM.

No matter what he says we longer believe a word he says and who is to blame for that? - only himself.

Gordon Brown has been in denial ever since the collapse of Northern Rock. With the constant drip, drip of evidence connecting this Govt, either directly or indirectly, with the failure of the banking sector the PM`s, "protestations," are contributing to his own demise.

It is interesting to note that none of the usual suspects within the labour party are rushing to the tv studios to defend the PM. It appears that they are distancing themselves from him in case they become tainted with the, "story." Or is it a case of being impossible to defend the indefenceable and the best word to say at the moment is sorry - which Lord Mandleson will not allow under any circumstances.

I had earlier thought that the PM would have taken the opportunity today to make some sort of apology; but he is continuing with his usual defence,"nothing to do with me gov." Just how much longer he can continue ploughing this lone furrow I don`t know - because I would suggest he is the only person left in this country who believes a word he is saying any more.

I understand the budget has now been set for 22nd April. A bit late if there are measures to be introduced to benefit the economy. Seems more likely that there will be measures we won`t like and which the PM does not want to be embarassed about at the forthcoming G20 meeting.

So, not only is Crash in denial about his part in this r... depression, he is blaming everyone else for our current travails.

And now to top it all off he is passing the buck onto poor Alistair Darling for this whole unsavoury 'Jobs for the boys' episode.

Is our PM's moral compass made of cork and needles?

I would laugh if it wasn't so tragic!

If there were 29 other warnings then something very serious was already going on. THE QUESTION IS WHY DIDN'T 29 WARNINGS ALERT THE REGULATORS AND GOVERNMENT THAT THERE WAS A PROBLEM????!!!!!

Is this just a case of the blind leading the blind? As they have so much in common, both have lead their respective organisations into the depths of depression! Both will go down in history as being possibly the worst leaders both institutions have ever known. Having managed to grasp defeat out of the jaws of prosperity having squandered the vast riches of the BOOM years!!!!!

"Why can't some journalist get him to admit any culpability for anything - have you seen Frost/Nixon?"

Yes, and that is why the political reincarnation of Nixon (Brown) will never ever submit to being interviewed by anyone remotely as clever as Frost.

The fact that GB can sit there and spout all this pathetic eyewash proves to me, once again, that he and his fellow incompetents are so far out of touch with the electorate that they think they are fooling someone- politicians are apparently still lacking the moral fibre to actually stand up and say "yes, I cocked it up and am prepared to make way for a better man, with principles"

The really worrying thing is that by the time we can get rid of the incompetents and nest-featherers they will have "turned a drama into a crisis" and then dissapear into the sunset with something like a nice cushy Middle East Envoy position; a touch of deja vu here?

GET REAL GORDON!!

Right to get these 29 reports into perspective in 2002 HBOS had an ARROW inspection, during this inspection their internal controls were found to deficient for the size of the organisation. These finding and the recommendations formed part of the report made (1 of 29, suggesting that there were at least 29 ARROW inspections made that year – actually there would have been many many more). The ARROW inspections are the FSAs standard review of a financial institution, every institution has them, their frequency is dependant on how large and/or the risky the institution is.

Following this inspection a follow up report was made saying that many of the recommendations had been met, but that there was still work to be done, including the risk department.

When a new risk director was appointed HBOS reviewed the risk department and the former head of risk (Mr Moore) was removed. Mr Moore went to the FSA to claim that the new risk director was not fit for his position, all people holding significant functions have to be approved by the FSA (they normally do this within 6 months of being advised an appointment is being made). This approval was placed on hold while KPMG did a review of the appointment, they did not find anything to suggest Mr Moore was correct. The FSA checked the KPMG findings and came to the same conclusion.

In 2006 the FSA did an interim ARROW inspection where they found that there were still flaws with the internal controls including risk.

The FSA did not review whether Mr Moore was sacked because he claimed the risks being taken on by HBOS were too great, nor did KPMG because that was not the claim levelled by Mr Moore. The FSA did find flaws in the risk management of HBOS, which for at least one of these reports was the responsibility of Mr Moore. It could be after being told by the FSA that Mr Moore’s department did not cut the mustard (twice) they decided to get someone in to do the job who could.

It is a risk manager job to highlight potential risks, so his memo was inline with his job spec and it would seem unusual to sack someone for doing their job (though you might if the regulator thought they were doing a poor job). Mr Moore did not raise with the FSA his concerns until he was replaced, which raises the spectre of sour grapes on his part.

It seems unlikely that either KPMG or the FSA did a white wash, since their investigation into Mr Moore’s claims revolved around Mr Moore’s claims, which did not involve him being sacked for whistle blowing (I not that Mr Moore has not yet claimed that either organisation was involved in any such white wash).

I see three reasons why Mr Moore may have been given the push: 1) he was sacked for raising concerns, which was part of his job. 2) there was a clash of personalities, quite possible in any work place. 3) HBOS after getting its wrists slapped decided to get a new head of risk.

Mr Moore is not the complete victim that some here believe him to, his former position carries very specific responsibilities and regulatory consequences for not meeting them. The 2002 ARROW report and its subsequent follow would suggest that he was not meeting them.

GB admits that he messed up!!

https://www.timesonline.co.uk/tol/news/politics/article5716524.ece

but.........

If "I didn't know because I wasn't told" is true... then was he too stupid not to ask?

16 pete

you must be a clairvoyant.

Funnily enough, if the Tories had been in power, although the economic situation might well have been the same, the public's reaction might have been much more angry.

Even though many feel very resentful towards GB, if the Tories were in power and all their chums in the City [just about every one above a certain income] had wrecked the economy, there would doubtless have been riots etc.

At least we can all see that Sirs Crosby, Goodwin, McKillop, and that Hornby guy are all free-market Tories by economic philosophy, even if they don't carry the card, and even if they were prepared to write Govt. reports for large fees.

Bankers are Tories, the Govt. are Labour, both share the blame in most of the public's view, thankfully. If the electorate at large had any kind of respect for the Libs, we might get a 3 party system back in this country.

Nick,

It all comes back to Blair/Brown. Follow the money.

New Labour were elected on the back of a Third Way (i.e. neither Old Labour nor Tory) that was long on rhetoric and short on detailed policy (and in the end promised much but delivered little).

Blair knew he couldn't fund massive welfare state liabilites without significantly increased tax revenue, but also knew he couldn't simply increase taxes if he wanted a second term. Unlike Thatcher, he didn't have the luxury of massive oil revenues.

So New Labour's new friends in the City whispered in Brown's ear, "You scratch our back, and we'll scratch yours."

How do you raise more tax without increasing the tax rate?

Simple, you increase the gross revenue. Let the City loose and we'll make so much profit, you won't know how to spend the taxes (unless you go to war, of course).

But what happens when the music stops?

Well then you bail us out and we start again.

So, appointing Sir "Shames" was ok, because he was advised do to it?

Politicians are paid to have JUDGEMENT. I don't care what the advisors said. Appointing a poacher to the gamekeeper's panel causes a CONFLICT OF INTEREST.

Jaqui Smith - as Home Secretary responsible for the moral conduct of the nation. It seems she can't see the difference between the spirit and letter of regulations. Her housing arrangements SEEM like a scam to ordinary people.

What are MP's expenses for? They are there to help them do their job without dipping into their salaries. They are NOT there to provide extra income streams for the family. Remember: she employs her own husband as a £40,000 a year parliamentary assistant too. Was this job advertised?

The rules may not have been broken - so much worse for the rules. Again, the most important issue here is JUDGEMENT.

This comment was removed because the moderators found it broke the house rules. Explain.

Well, one thing is for sure Gordon is leading 'New' Labour to the biggest ever defeat buy a party at the next general election. And he will be leaving Number 10 with more unemployed in the Uk than when they came to power.

"Does anyone think that Brown is a man of judgment anymore?
Come on Labour supporters."

It seems to me that the only defence for them lefties left is "well the tories would have done the same!!!!"

Hmmm, well, whilst that is possibly true, they also may not have and that is not really the issue anyway. That is merely childish ya-boo-sucks arguments without any provable validity and therefore is totally irrelevant.

The REAL issue is the guy behind the wheel of the wreck who was driving with a blindfold on!!!

Or would labour voters really believe that criminals should be let off with crimes under the argument that "well, if I did not do it, someone else would have?" which is the logical implication of that defence.

All this means that they cannot defend their party of this heinous and gross negligence.

(that is IF it is through sheer incompetence and negligence instead of deliberate malfeasance as part of said earlier conspiracy to instigate a single global currency, but I digress)

56 jconstable

On what basis do you say it would have been worse with the Conservatives.

As I remember it Ken Clarke was the Chancellor who got the country out of the 1992 recession and handed NL a 'golden economy'. Its this legacy that Brown has wasted.

If I am reading the update correctly Gordon brown is blaming Alistair Darling for this.

Perhaps the Chancellor should be brought to the Treasury Select Committee for his thoughts on the matter?

In view of the Prime Ministers actions over the last week are the BBC going to withdraw the apology re Jeremy Clarkson's comment as they do mockingly in Private Eye?

Oh for the late lamended Paul Foot to still be around for some serious investigative journalism.

So, rather like Pontius Pilate, the Golem washes his hands.
If he had any decency, integrity and honesty he'd humbly accept that the buck stopped with him.

This comment was removed because the moderators found it broke the house rules. Explain.

I am sorry but this makes no sense at all. If the FSA thought it had to raise issues with any bank of this nature, it should have acted on it. That is the job of the regulator, so in effect they gave warnings and then sat on them, is that what we are being told.

It is the duty of the regulator to inform the Government and the treasury of any bank which is potentially over stretching its balance sheet. There used to be monthly reports sent to the Government on the health of the banks, this was stopped by Brown, could this be one of the problems.

It sounds to me as though everybody including the Government was making so much money out of this, that they ignored the warning signs. What on earth was this Crosby doing being made Deputy Chairman of the FSA anyway, when they knew he had a bad track record. Something is seriously wrong here, what is this 'jobs for the boys.'

Give the powers back to the Bank of England that is the only way forward.

50 dogz

I'll leave out the first part of your post, 'done to death' doesn't even come close.

In your words, 'What are we sure of'?

Well, capitalism has not collapsed, yet.
[It would have, had Governments not acted in the autumn to shore up banks- surely if the NWO were waiting in the wings, that was the time to invent a new currency?]

Pumping money into the system will lead to inflation at some stage, but this could be of the 5% variety, rather than the 5000%.

Obviously, if China and other surplus countries decide to spend their savings on commodities all at once, we'll all suffer a very nasty dose of what we had last summer- ten times worse.

If they were to do that, there's little doubt that the US's response would be to begin protectionist measures- devaluation being just one.

The point is, while countries like China refuse to spend their vast surpluses, there cannot be inflation in the G7 [without borrowing, which is over for a while].

The best solution for all would be if the Chinese etc would reinvest some of their savings in G7 countries. They may be simply waiting for deflation to take hold before doing this.

We've just got to get used to the fact that we westerners are not that important to the world any more. Not worse as human beings, but just not as important as we once were.

In the Obama Age, these things are at last unacceptable: spin, factual evasion, and being unable to admit responsibility for your mistakes. Gordon Brown has been an insult to our intelligence since before Tony Blair was exposed as a George Bush lackey. And still, in 2009, GB is forced to continue suffering because of a GB.

It all makes so much sense now. Remember 2002? Stock market crashes after 9/11, compounded by the end of the Dotcom boom? Remember the Transatlantic pact to keep economies alive at all costs, as a means of proving that the "West" could not be bullied by Terrorism? Push money, keep interest rates low, do whatever is necessary to produce measurable "growth".

Well those of us who were appalled by the wasteful and indulgent consumer boom years that took off after 2002 have been waiting for the history to become clear.

So this is what happened....

The reins were loosened by the Chancellor on the FSA's regulation of lending growth? James Crosby, CEO of the largest mortgage lender in Britain, gets a nod and a pat on the back, and a "you know what you have to do".

Most people were distracted from all of this by the Iraq war: I wasn't, because I'm more interested in economics than international politics. So it got worse, and the economists kept coming up with positive statistics, and the investment bankers found ways to exploit the whole financial system before the whole illusion exploded.

Remember everyone calling for Gordon Brown to be the ideal replacement for Tony Blair, because he was doing "SUCH A GOOD JOB FOR THE ECONOMY"? I was calling for Gordon Brown to be examined by some financially intelligent people back then, but who was bothering to challenge him, when the notion of Sustainable Economics was equated with sandal-wearing asceticism?

Economic warnings from the likes of Anthony Hilton fell on ears deafened with bigotry and hearts sclerosed with the glut of material wealth all purchased on Credit.

But now, at last, we can see the whole incestous mess... James Crosby, HBOS, Gordon Brown, the FSA, and the fawning adoration of all those Journalists who gave us Gordon Brown as our obvious replacement for Tony Blair.

In 2009, we are still paying for 2002. And what is worse, it will probably be 2012 before we have gotten around to paying for 2003. When will we get around to paying for 2004, 2005, 2006, 2007, and 2008? Please, tell us, o wise political pundits?

It's the old pals act again.

You protect me and I'll protect you.

How can a control freak such as Gordon Brown not know everything that is going on?

But that's why he is nicknamed McCafferty. Whenever there is trouble he always seems to have the knack of knowing nothing about it.

He knows alright and it suited his purpose to ignore it because the money kept rolling in.

What a price he is making us all pay for his delusions.

It is only a matter of time before someone tells us the real truth about him.

Who will that be? He who dares wins.

Nick said:

"The prime minister's essential message was that it is only with the benefit of hindsight that the warnings to HBOS look significant. The FSA warning to the bank that grew too fast was, he said, "standard and routine"; it was one of 29 similar reports issued at the time (2006) and did not conclude that HBOS posed a risk to the entire banking system. That is why the Treasury were not told."

===

If only the warnings had been leaked to a Tory MP, then the Treasury, Home Office, Prime Minister and the Met would undoubtedly have been made aware and acted swiftly!!

#73

"....if the Tories were in power and all their chums in the City [just about every one above a certain income] had wrecked the economy, there would doubtless have been riots etc."

Now I get it. It was all a Tory conspiracy. Them and their "chums in the City". They've engineered this to discredit New Labour. Of course. It makes perfect sense. The City chums were just pretending to be New Labour's best friends. It was them who launched the 'prawn cocktail offensive', not New Labour.

Thank goodness for that. I was worried there for a while.

DavidRMurrell @ 70 raises some interesting points about 'whistleblowing', albeit in the context of a specific case.

In my view, even though their is an official 'whistle-blowers' charter, it ill behoves anybody to tread that path.

Some may recall the lowly Sheffield immigration whistle-blower, which produced a ministerial scalp. That whistle-blower got the chop too soon after and is probably still on the rock-and-roll all these years later.

There have been a number of others, both in the private and public sectors, most of whom seem to have been adversely affected by their whistle-blowing.

My own 'career' in the military was abruptly terminated in the early 1990's when I complained about aspects of a communications system which were grossly sub-standard.

However, with the benefit of hindsight, I can see now that being technically correct about something is only part of the story.

It is also necessary to play a political game at the same time, something that engineers are usually notoriously poor at, and I was no exception.

If I was in the same situation today, then would have developed a political argument alongside the technical issue, to obtain the desired result.

In these situations, unless you are exceptionally bright, which I am not, then you usually have to experience it to learn the lesson.

82 grandantidote

Here we go again.

So changing Titian's age on wikipedia is equivalent helping destroy the UK banking system.

Hmmm. Glad to see your sense of political balance is still there!!!

Glen Moreno about to be fired too:

https://news.sky.com/skynews/Home/Politics/Second-Government-Adviser-Acting-Chairman-Of-UK-Financial-Investment-Ltd-Glen-Moreno-Could-Lose-Job/Article/200902215221868?lpos=Politics_First_Poilitics_Article_Teaser_Regi_0&lid=ARTICLE_15221868_Second_Government_Adviser%2C_Acting_Chairman_Of_UK_Financial_Investment_Ltd_Glen_Moreno_Could_Lose_Job

Talk about losing the narrative.

This government is utterly incompetent. It hires stool pidgeons for important jobs and guess what? It's running out of people to do its dirty work.

Call an election

grandy @ 82:

Cameron apologised for this incident on LBC Radio this morning saying that the individual in question had already been disciplined. Would that Gordon Brown could bring himself to apologise for some of the much more important mistakes he has made.
N.B. The information on Titian incidentally which was changed was confirmed as correct by The Louvre Museum in Paris.

16 Pete - how right you were.

Cameron said this in 2007 at the Conference :

"And I know that business wants to hear from the Conservative Party how we will reduce regulation and reduce taxation to give them more freedom in this new world… and we heard from Alan Duncan how we will introduce regulatory budgets to cut that regulation…”

So less regulation of big business - no surprises there. Except now he says "Not less regulation but right regulation" (Will Smith letters).

Next week it will be more regulation.


"The word that sums up the Cameron Tories is vacancy - a great sky-blue-pink gap where the government's adversary ought to be, an emptiness deliberately created so as to offend nobody but the thoughtful and independent of mind."

Peter Hitchens - a columnist for the Mail on Sunday

What has become apparent is that the incumbent Prime Minister and his government along with the the FSA are out of their depth in their respective roles.

President Truman famously had a sign on his desk stating "the buck stops here".
How right he was.

The country is in danger of an economic crisis and we need a coalition government with all the most relevant people to get us through this period.

82#

Why hasnt someone done it? Er... because the spectacular amount of own goals that Brown is scoring and the effects they are having on us all is a bit more important to your average Joe than Wikipedia entries!

Brown doesnt need any help being discredited, he's doing perfectly well by himself!!

mikepko @ 79

Yes, after posting that, I did think that somebody was bound to bring up Ken Clarke, who ST Business section readers recently voted the best Chancellor since 1945 (Brown was ranked nowhere and now would probably be less than nowhere).

Just because I have a low opinion of the Conservative Party as a whole, that, of course, does not mean that they are entirely devoid of talented individuals, such as Mr. Clarke.

However, it is unlikely, in my opinion, that Mr. Clarke would have remained as Chancellor during this past decade if the Tories had stayed in power. He would probably have been shifted due to his unpopular (in the Tory Party) views on Europe.

There is always limited mileage in discussing these historical what-ifs, although they often make good novels.

We are now where we are and most likely 'Dave' and the rest of his priviledged elite will be back in power, as of course, is their true destiny (he says doffing metaphorical cap).

I just thought that for once, we English could try breaking out this tired old political duopoly.

82. At 2:37pm on 12 Feb 2009, grandantidote wrote:
"Nick why hasn't sombody picked up on the Cameron dirty tricks campaign to discredit Gordon Brown He's even got his lackeys changing the facts on wikipedia so that he can score points against GB ie Titian and this is not the first time they've pulled this stroke, to pull such a juvenile stroke of this kind it makes you wonder what sort of people they are."

Is that the best NL supporters can come up with? Where is the robust defence of Brown and governmental actions and policies? Could it because there are none?

A Story about Culpability Brown

An 18th Century agriculturist was instrumental in forever changing the landscape and gardens of the fabulously wealthy and was thereafter better known by his alternative nickname rather than his christian name. He was immeasurably proud of his achievements, and rightly so, and the whole population were enriched with the beauty and spledour of his works for centuries afterwards.

In the late 20th century and early years of the 21st a Government Minster was also accused of having something to do with changing the landscape of the monied classes irrevocably, this time the financial one, and he was also proud of his runaway success until the seemingly endless flow of praise came to a very sudden and shudderingly unpleasant halt.

The similarities between the former and latter end there.

"Capabilty" Brown's achievements are still admired and vaunted to this day whereas his latterday namesake will be a byword for mismanagement and malaise of a runaway economy over which he presided, as Chancellor of the Exchequer, which holds ultimate responsibility for the management of the Financial Regulatory Bodies, the Bank of England and to Parliament.

It is true that it could be said that we are all, in part, to blame as who in their right minds could really believe it to be sensible that an unemployed person, with no savings and living in rented accomodation, could stroll down a high steet, any high street in the country, and take out enough credit in the form of store and credit cards to be able to stock a smallish warehouse if they so wished. The cards could be maxed out in a matter of days, or certainly weeks, and all would be honoured by grateful stores backed up by grateful credit card companies. What fools - We all were to expect that sort of behaviour to be remotely sustainable!.

Those rather more cautious Citizens who thought they could see a flaw in this Utopian dream and decided to reduce their debt as much as possible and actually Save some money are now being hammered by the punitive reduction in interest rates which is designed to re-instate the status quo and get people borrowing beyond their means once again. I really don't know why I bothered as it seems holding out the begging bowl is a far more honourable activity than being Prudent.

Oh dear that was a word which was formerly attributed to the Govenment Minister referred to above in his previous incarnation as "Prudence" but who will now forever be known in my mind, as well as many others, as Chancellor, Gordon "Culpability" Brown.

The end

vsl @86 wrote:
How can a control freak such as Gordon Brown not know everything that is going on?
But that's why he is nicknamed McCafferty. Whenever there is trouble he always seems to have the knack of knowing nothing about it.
He knows alright and it suited his purpose to ignore it because the money kept rolling in.
What a price he is making us all pay for his delusions.'

I tend to agree. I don't believe he was unaware of the warnings. If he was then perhaps we should begin referring to him as the 'knew nothing' man.
I see the chairman of The UKFI is not now expected to reapply for his position. Yet another lack of judgement on the part of GB and AD.

We are certainly on a merry-go-round, a carousel of madness. Freedom Party MP Geert Wilders who was invited here, has been banned admission because he would prersent a danger. A danger to whom? The little lady at the WI exchanging jam recipes with a cash-strapped pensioner? The recently sacked worker, father of a family, who can find nothing at the JobCentre? Or is Wilders a danger to all those who trusted the banks to manage their pensions? The terms fascism and intolerance are bandied about, but the real totalitarianism which is taking over here from local council regularions to orders given to Buckingham Palace is at play here.