Britannia Radio

When all is said and done the whole package is a great gamble because 
Darling has still not forced the banks to disclose their toxic 
assets.  So consequently nobody has the slightest idea of how much 
money is at risk!    Until that position is clear no bank will trust 
another bank and nobody can find out yet just how indebted Darling - 
Brown expect us to be when things do start to improve.

One thing is certain and that is the astronomical indebtedness 
forecast by the Chancellor will look like chickenfeed when the truth 
is known.  And STILL none of the parties will talk of what will have 
to be done if we are once again to be an economic giant in the world 
- cutting government expenditure -drastically!

The radio quotes are particularly illuminating today!

xxxxxxxxxx cs

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BBC ONLINE   19.1.09  (timed 1134 hrs)
Eurozone economy 'to shrink 1.9%'

The eurozone economy will shrink 1.9% in 2009 and grow by only 0.4% 
in 2010, the European Commission has forecast.

The Commission said in a statement that the whole European Union was 
facing a "deep and protracted recession".

Unemployment in the the 16 countries using the euro is expected to 
exceed 10% in 2010, up from 7.5% in 2008.

The commission hopes it will be possible "to create the conditions 
for a gradual recovery in the second part of 2009" in the eurozone 
economy.

Economy Commissioner Joaquin Almunia said in a statement it would be 
achieved through "measures to stabilise the financial markets, the 
easing of monetary policy and the economic recovery plans".

The commission said annual inflation in the 16 countries using the 
euro would be 1% in 2009 and 1.8% a year later.

'Continued fall'

According to official figures, the eurozone has been in recession 
since September of last year.
"As events unfolded late last autumn, it became increasingly clear 
that the EU would not be spared a deep and protracted recession," the 
commission said.
It added that "the outlook is for a continued fall in GDP throughout 
the first half of this year".

Different vews
Analysts gave different opinions on the commission's latest forecast.
Sunil Kapadia at UBS Bank said: "On the growth figures for 2009, it's 
a pretty fair assessment".
However, Gilles Moec at Bank of America said it was more pessimistic 
than the Commission, forecasting a contraction of 2.6% in 2009.
========================
SKY NEWS   19.1.09  (timed at 1437 hrs)
Bank's Shares Nose-Dive By 70%

Shares in Royal Bank of Scotland have nose-dived more than 70% on 
news the bank could record the biggest corporate loss in British 
history.
The company saw its shares slump as the market responded to warnings 
that RBS will post full-year losses of £28bn.  That puts Vodafone's 
£15bn loss in 2006 in the shade.

The turbulence came as the Government released details of a multi-
billion pound bank bail-out package.

Lloyds Banking Group, which was formed Monday from the merger of 
Lloyds TSB and HBOS, is 34% down.
HSBC was 2% lower, while Barclays lost an earlier rise of 20% to 
stand 2% down.
Barclays issued an unprecedented after-hours statement on Friday 
saying it expected to better City expectations for pre-tax profits in 
2008.

++++++++++++++++++++++++++++++++++++++++++
If the banking system collapses, every single one of us would see the 
obvious problems. The economy would come down with it.
Chancellor Alistair Darling
++++++++++++++++++++++++++++++++++++++++++

The bank on Friday earlier lost a quarter of its market value as 
investors panicked about the prospect that it may be forced to turn 
to the State for a cash boost.

The wider London market remained in positive territory following the 
developments.
The FTSE 100 Index was up 73.2 points or 1.8% at 4220.2.

Keith Bowman, equity analyst at Hargreaves Lansdown stockbrokers, 
said considerable uncertainties remained around the banking sector.
"Whilst today's measures will be widely welcomed, significant risks 
remain," he said.

"The plan cannot compensate for the withdrawal of foreign banks from 
the UK, whilst the fear that asset prices will continue to decline 
leaves the banks looking to cherry pick the safest lending 
opportunities."
========================
Darling's Statement to the Commons

Alistair Darling has delivered a statement to the Commons on the 
additional measures being taken by the government to boost the level 
of lending in the economy.

In addition to confirming the measures announced this morning, the 
Chancellor denied that the £50bn asset purchase scheme meant that 
there would quantitive easing.

"There will be no increasing the amount of money going into the 
economy ," he said. saying that the Bank of England would take out 
the equiavalent money put into the economy through the scheme.

However he said that with this mechanism in place it could be used 
for quantitve easing should it be required in future.


George Osborne said that the announcement was "the clearest possible 
admission that the first bank bail out of the banks failed"

"The prime minister has finally been forced to confront the truth 
that he hasn't saved the world, he certainly hasn't saved the economy 
and he hasn't even saved the British banks yet," he said.

"As the Prime Minister and the chancellor ask the British people to 
put more of their money on the line surely the time has come for them 
to stop blaming everyone else and start accepting their own 
responsibility for the boom that turned to bust. When will they 
accept the buck ultimately stops with them?" he said.
========================
ECONOMIC 'Shorts'   19.1.09
TELEGRAPH
=Recession could re-ignite racism
Poor Britons could lose out to better qualified immigrants in the 
battle for scarce jobs, the equality watchdog warns.
=RBS has a bad day but it could get a whole lot worse
=Irish bank shares plunge on nationalisation fears
Ireland's entire banking system may have to be nationalised after the 
country's six-member financial index fell the most since 1993
=Jaguar halts production at XF sports car factory

TIMES
=Economy even worse than Brown thinks
European experts suggest Britain's manufacturing base is too small to 
take advantage of weak pound - and unemployment is set to spiral
=Art market collapse hits Christie's
Britain's oldest auction house is to let up to a quarter of its 800 
London-based staff go as part of a restructuring programme
=Don't overdose the patient, Dr Brown   per Simon Wolfson
There is a risk that the Government in its rush for an overnight cure 
for the recession will overmedicate the economy
=HSBC snubs Government bank rescue scheme
Brtain's largest bank rules out tapping Government funding, joining 
Barclays in resisting state control of the lenders

FINANCIAL TIMES
=RBS plunges as FTSE turns red
=Sterling falls as UK launches latest bank rescue
=Spain loses triple A rating  -S&P downgrades long-term debt
    'What if' becomes the default question - Spain is third eurozone 
country warned over finances

=========================
POLITICS HOME    19.1 09
COMMENTS
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Today, Radio 4 at 07:35
Osborne: Today is the day when the bill for a decade of 
irresponsibility is to be paid

George Osborne, Shadow Chancellor

Mr Osborne called for an independent audit to be conducted focussing 
on the government's plans to fiscally stimulate the banking system.

"We need to know exactly what the government wants to spend on behalf 
of the taxpayer - an independent audit is required.
"It is clear that the taxpayer is a huge stakeholder in the banks - 
clearly today is the day when the bill for a decade of 
irresponsibility is to be paid.
"The next Conservative government will have to pick up the pieces and 
find an exit strategy."

The shadow Chancellor spoke of Kenneth Clarke's return to the 
Conservative front bench, saying "it was a welcome addition to the 
business team". He added that he did not feel insecure in his 
position within the shadow cabinet.
"You move a shadow Chancellor when they make big decisions that are 
wrong - our economic decisions have been right, we now want to bring 
in someone with good experience and excellent expertise.
"I totally reject the suggestion that the Conservative shadow 
government has not made an economic impact - the Conservative team is 
united and strong, I was in fact the first person who spoke to (Mr 
Clarke) about becoming more involved."

12:03 Sky News
Later, Mr Osborne reiterated his call for a full independent audit of 
banks' balance sheets to clarify the extent of taxpayer liability in 
government support for the banking sector.

"The government has got no option but to try a second bank rescue as 
the first bank rescue has clearly not worked but this time we need to 
know what the taxpayer is in for," he said.

"What we need is a full independent audit of what these banks have 
got on their balance sheets," he said, "So we don't rely on the words 
of bank chiefs and we don't rely on the word of the Prime Minister 
and the taxpayer is told the truth in an independent and 
authoritative way"
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
Sky News at 08:03
Cameron: Clarke part of what will be the best economic team in Britain

David Cameron, Conservative leader

Mr Cameron said he was delighted that Ken Clarke had agreed to become 
shadow Business secretary, and added that he would bring great 
experience.

"I'm delighted Ken is joining in the shadow Cabinet. He has a huge 
amount of experience to bring to bear.

"He's a big figure, he brings great experience and he was a great 
Chancellor. He will be part of what will be the best economic team in 
Britain. It's great that he's joining the shadow Cabinet."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
Sky News at 08:15
Cable: Clarke's return will cause problems for the Conservative party

Vince Cable, Liberal Democrat Treasury spokesman

Mr Cable said that he feared that the government was giving the banks 
a blank cheque, questioned why more wasn't being made of the 
government's majority control of RBS and added that the return of Ken 
Clarke was a risk for the Conservatives.

He said he feared the government were effectively giving a blank 
cheque to the banks and added, "if vast amounts of taxpayer money is 
going to the banks it has to be managed and controlled."
He added that bank nationalisation was effectively already under way, 
saying "RBS is majority controlled. Why is the government not using 
its de facto nationalisation to serve the needs of the British 
economy? Rushing ahead now to underwrite the bad debts is not the 
first thing to do. It may well be that there's more need for money, 
but the top priority is that new money flows."

Asked whether some banks should be allowed to go under he said, "if 
individual banks do go down.you then spread panic. The government has 
done something to reassure depositors."

On the return to the front bench of Ken Clarke he said, "he's a very 
impressive guy, and very likeable. I think the Tories are taking a 
risk on two levels.
"He should obviously be shadow Chancellor - so there will be tensions 
there, also he has clear views on Europe and there will be problems 
there."

13:15 The World at One
Mr Cable later added if the plans for this mornings announcement are 
not very carefuly structured it shows signs of a scheme that was 
potentially "not very well thought through".

"We are in a falling asset enviorment, there are potentially enormous 
losses coming through," he said.

When asked if Northern Rock could be seen as a lender he said it made 
sense to have a look at Northern Rock's lending mandate.
He said, "It clearly does need to have a fresh mandate which is 
perhaps to return to normal lending, I think the key here is how we 
get new lending going."

He added: "I was alarmed to see the Prime Minister saying that £3bn 
will be properly monitored and supervised, why on earth wasn't this 
done 3 months ago - banks are being given contradictry messages."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
BBC News at 10:16
Clarke: I won't seek to change the Conservative policy on Europe

Ken Clarke, shadow Business secretary

Mr Clarke denied claims that he supported the government's VAT cut, 
and said he would not seek to change the Conservative policy on Europe.

"Today rather underlines the fact that there's a big economic 
crisis.    [most media would rather talk about somethiong else! -cs] 
It's about time I joined the team and made a contribution."

Asked about the Conservative economic team he said, "I think they 
have an extremely strong economic team, but they think I can add 
value to that and I intend to do that. It's time to stop enjoying 
myself on the backbenches, and prepare for government really."

Asked about being pitted against Lord Mandelson he said, "I know 
Peter Mandelson quite well, and get on with him quite well 
personally. I don't think Peter has made any real difference to the 
wandering aimlessness of Labour's policy."

He said claims that he approved of the government's VAT cut were a 
piece of spin, adding, "I voted against the VAT cut. I did say to The 
Times if you can afford fiscal stimulus a VAT cut is a good way.but 
we couldn't afford it. They will regret having spent so much money 
already on things that haven't worked."

"Asked about the difference in views on Europe between him and his 
party he said, "I do accept the party has a settled policy, and I 
won't seek to change that policy. David Cameron and I have never had 
any problems at all on any other issue."

15:20 Sky News

Speaking later Mr Clarke said his instincts on the economy were 
similar to those of George Osborne and added that there was "no 
basis" for Britain to join the Euro at present.

Asked about the claim from the government that he supported their VAT 
cut he said, "the Prime Minister doesn't quote people with great 
accuracy. If you can afford fiscal stimulus, VAT cut is the best we 
could have, but it was obvious we couldn't afford it. I voted against 
the VAT cut.

"I have had many conversations with George Osborne as this has 
unfolded. On economic policy I think my instincts are similar to 
George Osborne. I admire the way he puts policy together. The drift 
of where we're going is right."

Asked whether the fall in Sterling should lead to Britain joining the 
Euro he said, "I don't think joining the Euro is viable politics or 
viable economics. There is no basis at which you could join the Euro 
at the moment. I don't think there is anyone at the moment who thinks 
it's real politics to join the Euro.

"The issue is the economy, it is business, there are no  great 
European issues which are going to cause problems for us.

"I've not been gagged. The idea that I constantly produce gaffes is 
not my recollection of my time of office. I'm not going to go round 
like a bull in china shop."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
BBC News at 10:31
Clarke's return "very sensible", says Michael Howard

Michael Howard, former Conservative Leader

Mr Howard welcomed the return of Ken Clarke to the Conservative front 
bench as a "very sensible thing to do".

"He brings a wealth not only of ability - he's an immensely talent 
politician - but of experience," he said.

He said that the move indicated David Cameron's confidence rather 
than highlighting any weaknesses in the shadow cabinet.

"We do already have strong economic team but I think he will 
reinforce it and strengthen it ever further," he said.

He added: "It's a indication of the confidence David Cameron has in 
the strength of his position and I think it's perfectly sensible in 
what is a very grave economic crisis facing the nation that it's all 
hands to the mast," he said.
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
The World at One, Radio 4 at 13:15
Redwood: I warned the government of rushing to buy RBS shares

John Redwood, Conservative MP

Mr Redwood said the number of toxic assets cannot be accounted for 
yet as the government was unsure of both how many assets it can cover 
or how much insurance cost, warning it is "an extremely difficult 
thing they're trying to do."

"These are colossal banks with massive obligations worldwide. One of 
the problems the government has is they rushed in to buy RBS shares 
when I warned them not to - they are having to start again.

"We need to address the underlying problem that companies and people 
don't have enough money. It is difficult to get out of a debt crisis 
by lending more money - at least they are moving in the right 
direction with these things," he said