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Friday, January 18, 2008

The Rotting Corpse of Northern Wreck

As I suggested two days ago, it seems that Brown is holding back on nationalising the corpse of Norther Wreck so that the price will fall further.

That at least is what the Telegraph reports today:

"A Treasury minister appeared to suggest yesterday that the Government may wait for Northern Rock's share price to fall further before taking the company into public ownership.

Andy Burnham, the Chief Secretary to the Treasury, said the Government was watching 'market conditions' to see how to get the best value for taxpayers from any nationalisation of the stricken bank
".

In the event that the bank is nationalised, as is more and more likely each day, Brown's self styled reputation for prudence will be fatally holed below the water line. The nationalisation will add billions of pounds of Northern Rock debts to the public finances, which will breach Treasury rules limiting borrowing.

A shambles by anyone's measure.

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