http://news.bbc.co.uk/1/hi/business/7927415.stm

Meh, that's small news compared to the fact we are trying to solve things by PRINTING MONEY. $75b of it.

Allow me to translate:

"injecting into the economy" = giving the money directly to banks, no strings attached. For example, every $100 a bank trades in they get $110 back.

"quantitative easing" = if the country has $10 total money, and the government prints another $5, then that $10 can only now buy $7.50 worth of stuff. So printing money is directly equivalent to a large, unavoidable tax on everyone, without all the outrage when you impose one usually.

"emergency action" = we don't have to seek the approval of elected representatives

"cutting interest rates" = increasing banks' profits. Cutting them from 1% to 0.5% won't have any effect on the loan interest rate at all since they're already so low, so it won't affect the credit market, but banks will be quick to cut savings rates by the full 0.5%.

^^Exactly

Oh jeez they're actually doing quantiative easing already?

I disagree that nationalizing banks isn't big.  It makes private debts the debt of the people.  Which makes the country look bad which hurts investing, which can lead to investors pulling out and further currency drops...

I mean that's one of the things that killed Iceland.

Oh, yes, everything they've done is a complete disaster, but since I have no power to stop it beyond a certain point I just stopped getting angry.

What's another hundred billion or so wasted when every country is doing it?

everything Kaz says realtes the Uk falling into the same trap as iceland.

jheeeez!!! LOL

Because it largely is?

It's unlikely that a major country goes bankrupt... but if one does you can bet dollars to donuts it'll be the UK.

For some reasons why...

http://www.thisismoney.co.uk/news/article.html?in_article_id=467930&in_page_id=2

"Consider the following terrifying facts. Our national debt officially stands at approximately £400bn - in itself a frighteningly high figure and our annual borrowing is now larger as a percentage of gross national product than in 1976, when Labour Chancellor Denis Healey was forced to call in the International Monetary Fund to rescue the economy."

"Let's take the case of just one - the RBS group, whose two principal assets are Royal Bank of Scotland and NatWest. RBS has outstanding loans and other assets amounting to an eye-watering two trillion pounds. That's five times the size of the national debt."

Why not the US? Their GNP is only about 5 times bigger but their national debt is about 20 times bigger.

Also, if we OWN all of these banks, and the banks aren't really in trouble (the only reason they're considered to be is the low confidence in the economy; if the economy was neither boom nor bust then the market value of its assets would far exceed its liabilities), when we sell the banks back to themselves we will get much more than we paid for them; enough to cover those billions in bailouts.

Unless we have some sort of deal where they never have to pay us back when we lose ownership of them. Which would be stupid.

@Soleron: Northern Rock has already paid back the majority of what the Government gave them, I don't see why any other bank would be different.