there are 3 main bits
1) 25bn + 25 bn in shares being brought by gov/taxpayer essentially if banks get better taxpayer gets better, if shares in the banks go down and stay down taxpayer is worse off
Gov(darling) says this is the only bit that is at risk this is nonsense as both the below is also totally at risk
2) 200bn in loans to 'boost liquidity'
These loans are only safe as long as the banks stay working. Dont tell me they are safe cos to make them safe the Gov would have to be prepared to whip back the loans when the banks look like they are about to collapse thus sealing their collapse. Do you think the Gov is likely to do that? Does anyone think they will? No
3) Guarentees of up to 250 bn for 'inter bank loans'
again fine as long as banks stay working and afloat.
If banks start to tumble again then the gov will have to back a bad loan to another bank which then will also possibly tumble.
Make no mistake this is an all or nothing scenario
its not 50bn that is at risk its 500bn that it is possible for gov/taxpayer/country to loose.
It is designed to try to save the banking system....its a big risk to take without trying to co-ordinate this with all other govs responses.
I dont understand why all govs didnt co0-ordinate and synchronise their responses, like I DID state before the Yanks did their is it on is it off (less than) a trillion bail out.
By staggering these responses across countries and allowing stock markets to stay open between these staggered gov responses, it allows stupid panicky movement of money by the market movers, it allows them, at a time when govs are saying we all have to try to shore this up, to try to scrabble and compete ((still) with where they want to try to bet where their money will majke the best return.....they are now gambling not with market forces but also partly with what they expect gov responses to be and others responses and what order they occur with, they are still trying to make a buck.
For gods sake close the exchanges and take the time to co-ordinate gov responses, then take control of the exchanges and regulate how they respond.