Posted on 01/25/2009 6:08:38 PM PST by randita
Monday, Jan 26 2009
Revealed: Day the banks were just three hours from collapse
By Glen Owen
Britain was just three hours away from going bust last year after a secret run on the banks, one of Gordon Brown's Ministers has revealed.
City Minister Paul Myners disclosed that on Friday, October 10, the country was 'very close' to a complete banking collapse after 'major depositors' attempted to withdraw their money en masse.
The Mail on Sunday has been told that the Treasury was preparing for the banks to shut their doors to all customers, terminate electronic transfers and even block hole-in-the-wall cash withdrawals.
Only frantic behind-the-scenes efforts averted financial meltdown.
If the moves had failed, Mr Brown would have been forced to announce that the Government was nationalising the entire financial system and guaranteeing all deposits.
But 60-year-old Lord Myners was accused last night of being 'completely irresponsible' for admitting the scale of the crisis while the recession was still deepening and major institutions such as Barclays remain under intense pressure.
The build-up to 'Black Friday' started on Monday, October 6, when the FTSE 100 dropped by nearly eight per cent as bad news on the economy started to multiply.
The following day, Chancellor Alistair Darling began all-night talks ahead of an announcement on the Wednesday that billions of pounds of taxpayers' money would be used to pour liquidity into the system.
(Excerpt) Read more at dailymail.co.uk ...
Supposedly we were back in September.
This article is going to do a lot to calm the continued jittery financial nerves.
UK Market is not amused (pound taking a hit) and Dow futures are off 1% (I read this over at tickerforum.com).
I don’t think it’ll take much, and when it happens us lowly serfs won’t be warned.
The Bank of Metal Box in the Closet is starting to look like a much better option these days.
George Bailey: [yelling at Uncle Billy] Where’s that money, you silly stupid old fool? Where’s that money? Do you realize what this means? It means bankruptcy and scandal and prison. That’s what it means. One of us is going to jail - well, it’s not gonna be me
And our overlords want to make us hand in our ammunition...
Uncle Billy! Where’s that $8,000!?”
“Now Mary, how much do you really need? Can you get by with $20?”
Dark times coming, my FRiend.
GEORGE: No, but you . . . you . . . you’re thinking of this place all wrong. As if I had the money back in a safe. The money’s not here. Your money’s in Joe’s house . . .right next to yours. And in the Kennedy house, and Mrs. Macklin’s house, and a hundred others. Why, you’re lending them the money to build, and then, they’re going to pay it back to you as best they can. Now what are you going to do? Foreclose on them?
“Were?” Past tense?
Truth be known, financials in much of the world have been at the precipice many times since March of 2008, and the Lehman Bros failure in September nearly sent us all over the edge, not just Great Britain.
The Paulson freakout was melodramatic and on several levels self-serving, but he did not manufacture the threat out of whole cloth, and did not exaggerate the possible ramifications.
I don’t know, but if the banks close it’s game over.
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