Bailing out the banks
— Propping up banks with taxpayers' money is just another sign of worse to come.”
The Benelux governments today announced a package of over 11 billion euros intended for the bailout of Fortis, the now ailing bank that just last year bought a stake in ABN Amro.
And if that wasn’t enough on a gloomy day in Europe, Fortis’ competitor Dexia will now receive aid in a deal being hammered out this evening. Both banks lost between 24 and 30% of their value in the day’s trading on the Bel-20, the net result showing an almost 8% loss for the index.

Across Europe and the United States, there can be little doubt that 2008 has been an annus horribilis for the financial sector. Northern Rock and Lehman Brothers have already imploded, whilst Freddie Mac and Fannie Mae are in freefall and today it was announced in the UK that Bradford & Bingley is to be nationalised having become dangerously overstretched on its loan business.
As ever, it takes time for the headlines to filter down to street level. Nevertheless, people are tightening their belts and fretting about mortgages and redundancies. Food and fuel prices are higher than ever. Consumer confidence has plummeted in the States.
Meanwhile the debate rages on about the merits of using taxpayers’ money to prop up banks that have openly been accused of irresponsible greed. Fortis welcomed its new “state partnership”, but the three governments are unlikely to be too forgiving. The bank has already agreed to cede its stake in ABN Amro, with boss Filip Dierckx admitting with remarkable understatement that the purchase had been made at the wrong time.
Where will it end? If that question cannot be answered with ease, what seems certain right now is that there is more to come. Something has snapped in global finance and throwing money at the problem isn’t likely to fix it.
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Who you gonna call?
Hello you, I'm Mike Padgett. I'm not the Princeton curator, the US senatorial candidate, the Kentuckian pastor or the journalist from Arizona. In fact, I work as a consultant in User Experience and Information Design.
I also enjoy travel, concerts, films and walking.
I'm originally from Yorkshire, England but nowadays I live in Brussels, Belgium. My current favourite Belgian beer is Ellezelloise Hercule.





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