I've been fascinated watching the meltdown of Northern Rock, Britain's fifth largest mortgage lender that's found itself in a credit squeeze that's related to the weak US housing market and financial woes of the US sub-prime market. I never in my life imagined I'd see what is essentially a depression-era run on a bank, with thousands of average Joe's and Mary's lining up at the bank's branches to withdraw their savings. And this despite assurances from the Bank of England (who've stepped in to loan Northern Rock money to meet its obligations due to their unduly risky and greedy business strategies) and politicians who're urging calm.
I've always thought there's too many dodgy and unscrupulous people working in finance especially in Wall Street and that the government, even here in the US, are not regulating the stock, commodities, investment banks etc. sufficiently. There's far too many risky investments calculated to churn huge fees cooked up by these institutions with no real meaningful regulation, especially given the wildly pro-business government currently in the US.
America sneezed during the summer and now Europe and other world markets are catching a cold. Let's hope this Northern Rock fiasco is contained and real panic doesn't set in and there's a run on some other weak institutions in the UK and it then triggers a run on banks over here. Then we'd really be in the shit. It'd be 'back to the land' for everybody--maybe not a bad thing. And let's hope the next administration regulates Wall Street so we get rid of dodgy investments that are nothing but gambling rackets at the end of the day and the besuited cowboys are made to leave town.
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