The President of the Bank of England Mervyn King hit out once again at UK bankers (who were bailed out by taxpayers) for taking advantage of customers. He calls for restructuring of the banks, and said the problem of too big to fail still needs to be fixed. Many taxpayers are upset that the recession which was caused by the bankers, have affected them by the austerity measures which George Osborne and the coalition has unleashed.
While hundreds of billions of taxpayer funds were given to the banks, schools, libraries, and hospital wards are being closed to cover deficit that was largely due to the bailouts. The BOE President also criticized the bonus culture and short term profits made with depositors money,and stated that manufacturing is a more moral way of making profits.
Earlier in the week Mervyn King admitted that the cuts which the coalition has unleashed on the UK public was brought about by the bail out of bankers. Yesterday he testified before the House of Commons Treasury Select Comittee. The hundreds of billions in tax dollars, kept the UK banks alive such as RBS which is 83% owned by the taxpayer. While libraries are being closed, nurses and even doctors in NHS are being fired, the bankers are enjoying their bonus bonanza.
There was more bad news for the UK this week in addition to last quarter growth being more negative than predicted,UK services sector have declined after an initial recovery following the December snow which the Chancellor of the Exchequer blamed for the negative growth in the fourth quarter of 2010.
Manufacturing and construction are the sources of growth in the economy. The decline in services sector will ease pressure on Mervyn King from raising interest rates which some in the city of London have called for. While US economy has grown by 3.2% in last quarter of 2010, and unemployment rate has dropped this week, the UK unemployment and economic data are much worse. So far stimulus has proven to be thr right medicine and not the austerity of George Osborne.
Continue reading on Examiner.com: UK service sector decline - National European Finance | Examiner.com http://www.examiner.com/european-finance-in-national/uk-service-sector-decline#ixzz1FjxtBOww
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