When did Gordon Brown "arrange" the Lloyds-HBOS deal? At a drinks party on Monday night.
The prime minister promised that the deal would not be investigated by competition authorities -- if the enlarged bank continued to provide funds to would-be homeowners. Note the lack of conditions over job cuts and losses at the newly merged banks. In July 2001, Patricia Hewitt (remember her?), as the DTI secretary, vetoed a merger of Lloyds and Abbey National, on the grounds it would have cost at least 9000 jobs, as well as the closure of branches across the country. With Lloyds-HBOS, up to 40 000 jobs could go.
A few things to read:
Dave Osler asks if the Left has any answers to the financial crisis.
Molly, at Gaian Economics, argues that "we should not allow control of the most fundamental structures in our economy to be in the hands of privateers."
Nic Clarke of Charles Stanley (quoted in the Guardian) said Lloyds is making it riskier to hold its shares:
"Not only has Lloyds TSB tripled its exposure to UK mortgages in a period when the UK economy is about to go into recession but more importantly in the short term it has significantly increased Lloyds TSB exposure to potential short term funding problems. HBOS's loan to asset ratio is markedly higher than Lloyds TSB's and it has significant funding requirements in the near term. This was precisely why the short sellers had targeted HBOS for such harsh treatment early yesterday."The BBC's website has a handy Q&A, along with a video of Paul Lewis (Radio 4's Moneybox) being interviewed on News 24.
Obsolete asks how it will affect football.
Finally, Robert Peston has an ominous blog post about a new world banking order:
"It's a world in which the Chinese state, if it co-ordinated the investments of its cash-rich institutions, could end up owning more-or-less the entire financial system of the US and the UK."