National Rock

Oh, how I wish I were a British taxpayer, so my government could also buy me plums like Northern Rock. The bank says it’s “business as usual”. Of course. What bank doesn’t say that? I’m sure all blue-blooded Englishmen are just rushing to open accounts and refinance their mortgages.

The UK government says “In the current market conditions we do not believe that they (the bids for the company) deliver sufficient value for money.” Effectively, Richard Branson’s bid (and that of management) condemns the plum as a lemon. He wishes the bank (fare-)well.

Nevermind wishing I were a British taxpayer (after all, my government owns lots of juicy fruit, such as Eskom, parts of Telkom, Infraco, and South African Airways). What I really wish is that I were a British banker. Imagine. Set up a bank. Take whatever risk you like. Undercut your rivals. Crush them! Be daring, be bold! Because if you win, you’ll be up to your eyeballs in fame and fortune. And if you lose, well hey, Gordon Brown’s party will take the disaster off your hands. What a steal!

I’d love to hear why the British government does not think nationalising Northern Rock introduces moral hazard throughout the British banking sector — why it doesn’t think this decision will poison the quality of risk-taking in the UK.

What a sad day for the City.