Banks in turmoil as HBOS falters. Lloyds TSB rescue package proposed to save it’s future

The financial world has taken a series of massive beatings over the last week and it looks as though more of the chaos is coming home to roost. Lloyds TSB is in negotiations to bail out the largest UK mortgage lender HBOS.

HBOS or Halifax Bank of Scotland group have been caught napping by the backlash of the ongoing global credit meltdown and are currently negotiating a takeover and rescue package with Lloyds TSB. After seeing their share value go into freefall and fully aware that confidence is at the lowest ebb for several decades, the frantic powers that be have sought a saviour for their ailing giant.

The trouble is now that people, like lemmings are looking for the nearest cliff edge. Things are very serious, of that there can be no doubt, but fleeing in panic is not generally the best way to control a situation or limit damage! Panic breeds panic. If debt is spiralling, but at the same time getting more expensive, there needs to be long term strategic financial planning, not free for all mayhem.

The Government still seem entrenched in the ethos of live today, pay tomorrow. When are they going to realise tomorrow has already arrived… In fact… It was yesterday! Borrowing more than you can afford to pay your debts, whether secured or unsecured, credit card or loan, Government or consumer, the result is inevitably the same!

The politicians can bluster and pontificate all they like, the fact still remains that they have stripped the asset cupboard bare and burdened the country with unprecedented consumer debt whilst allowing the “Fat Cat” nouveau riche to amass Billions or even Trillions at the cost of the British economy. Capitalism in its truest sense can never work.

Checks need to be put in place to ensure this kind of devastation can never happen again. We have so called financial regulators now such as the FSA, but surely if they are asking the question, “How did this happen/” then they are not worth a damn and have no teeth! We need proper regulation of big business, a properly worked taxation system that puts the emphasis back into looking after those who most need it and storing enough wealth to tide us over in times of trouble.

I don’t know if I can make this any clearer, “Borrowing your way out of debt cannot, has not and never will work ion a Billion lifetimes!” There is a very simple rule that says if you have insufficient funds and need to borrow any amount of money; you will have to repay considerably more than the original amount. Hoping that you may one day be able to is the sole cause of this current crisis.

If people could only learn, individuals and Governments alike, if you can’t afford it; you don’t get it! It’s quite a simple rule and guarantees absolutely and categorically ensures that we could never face the same challenges again in the future. We have some tough choices to make, but the consequences of not taking them don’t bear thinking about.

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