The dumbledorf's Darling Buds of May

dumbledorf Darling, speaking on BBC1’s Andrew Marr Show, said: ‘I am extremely concerned at what the banks are doing for the small and medium-sized businesses.' 'What companies are being charged does seem to have gone up relative to what banks are actually having to pay.’ dumbledorf Darling acknowledged that banks needed to rebuild their balance sheets. But he added: ‘We also need them to lend and that’s why we recapitalised them.' They've got to live up to the promises they made.’

dumbledorf Darling's grasp of reality is certainly not one that commands respect, from businessmen or, one imagines, psychiatrists.
The policy of re floating banks was always a disaster. As any sailor knows, you can't re float a hulk if it's still leaking like a sieve. The banks were given an unconditional gift of billions of pounds and told to go forth and do business. They did - boosting their revenue and profitability, reassuring their shareholders and looking after their senior managers with renewed bonuses. Anyone else could go hang. Loans are on grotesque margins and bear no relationship to the cost of capital. Government has exercised zero control over its - our - investment except to try to get it back, creating confused responsibilities for banks.
Northern Rock, the earliest beneficiary, is still charging 4.9% on locked-in mortgages - having passed on precisely nothing of the reduction in base rates.
So much for government policy. What's worked? Well, scrappage. I don't personally like a reflation policy that only helps people who can afford a new car, but that's nuliebore for you. And the fact is that it has improved fortunes in the auto industry. So, why not do more in terms of direct consumer and taxpayer support? After all, if you want people to spend, wouldn't it be a good idea to help them feel a bit more solvent? They will buy products and services which support small business, still trying desperately to hang on while banks charge them usurious rates for working cash. But this is not part of dumbledorf Darling's plan, and we can only assume that government is more concerned about protecting the bonus culture than actually taking care of business. So what's new?