This might be a straight forward rant, but I'm sure I'm not the only one to be losing out with the interest rate cuts in the UK. Interest rate is now 1%, and some of the best instant access savings accounts are around 2.4%, and fixed aren't much better. In fact some of the better rate accounts have now been frozen by banks as they have maxed out the total investment size they allow under each of the schemes. Basically the British government are trying to claw back from a deep financial crisis, but in a way that simply isn't working. What is worse is that the entire issues surrounding the mass collapse are simply because people got greedy and borrowed, and borrowed and borrowed, far more than they could afford..
So my rant is simply that all those that actually did the right thing, borrowed only when needed and amounts they could afford and subsequently paid off, or saved up for their wants and needs are now the ones that are getting fried by the government, just so those that didn't do the right thing can be "saved".
In fact the amount of bankruptcies and IVAs have increased significantly over the last year, and all this falls back on the honest, "do right" men and women.
This has left those that have saved to retire or those that have semi-retired, to now find it almost impossible to keep going.. Years and years of hard work, saving.. doing the right thing.. and they are better off to have splashed out and bummed their whole life, because they'll get all the government to spend the rest of the tax payers money on them instead.
So what is being learnt about the whole financial crisis... nothing at all about doing the right thing, that's for sure! Key learning is how to blame storm on a massive scale and how getting into financial problems is perfectly acceptable risk as you'll just get bailed out by someone when the going gets tough. For some reason everything is blamed on the banks.. Not saying that they were involved in the whole issue, after all they were the ones handing out impossible loans, but I strongly believe the individuals and government knew exactly what they were doing, and knew what risks it was leading up to. Now the "do right" people are the ones bailing them all out. It's not exactly an inspiring set of circumstances.. Why work hard all your life to be giving what you earn to everyone else that simply get greedy and borrow, borrow borrow.
I think the worse part of the entire affair is that businesses are really suffering. A lot of small business owners I speak to are still finding it impossible get any over draft or loan facilities. These people have perfect credit ratings, and there simply isn't any reason they shouldn't be able to get what they need. I don't want to beat a dead horse here, but billions of pounds going to banks to allow them to lend to businesses, at least that was the plan.. Now, this came up a few months ago.. what I find astonishing, is that nothing has changed still.. A lot of businesses can't survive without the credit.
I actually can't find anything positive about the decisions made yet... All talk, all blame, no lessons learnt. The economy will eventually get back on its feet again, but I actually see a strong chance that behaviour and the risks people will take will be even worse than before. Everyone is going to be saying "don't do it" and "it shouldn't be allowed", but it's more than likely its going to, especially after all this..