The UK MPs were pathetic, like a bunch of prefects who could no longer employ the stocks or flog the miscreants.
The second week in February saw the UK’s Treasury Select Committee grill the failed banking chiefs, while on Capitol Hill the Senators did the same with Fed Chairman Bernanke, before hearing out Treasury Secretary Geithner’s stimulus package: the US Representatives of the People won hands down.
The UK MPs were pathetic, like a bunch of prefects who could no longer employ the stocks or flog the miscreants, as these splendid devices of punishment have now unfortunately long been banned.
So they resorted to the old British notion that a fulsome public apology, relayed to a baying nation by TV, was their main task. The Fib Four delivered their apologies: the Chairman and MD of HBOS – acronym for ‘House Built On Sand’ – bowed their heads as low as they could as they tried to dip their apologetic features below the camera lens.
Then Sir Shredded Fred of RBS said it all happened so quickly he still couldn’t believe it, while his Chairman Sir Tom McCodswallop moved his facial muscles like the tectonic plates of a Galapagossian turtle to express his deep sorrow that he had ever heard those three worse letters of the Dutch alphabet ABN – Another Basket-case of Nonsense.
It reminded viewers of that wonderful scene from ‘A Fish Called Wanda’, when Kevin Kline dangles John Cleese by his ankles from a fourth floor window:
‘Apologise! Apol-o-gise! APOLOGISE!’
Then the Committee Chairman John McFall faced the cameras on College Green and expressed his view that the apologies had started off quite well, then weren’t quite as sincere after an hour or so, while at the end there definitely wasn’t enough grovel left to satisfy his Wee Free Presbyterian sensibilities.
This apology, designed to make the miscreants keep up the grovel and humble pie routine for three and a halfhours, had defeated them. They had failed the Kevin Kline test, but were released anyway. It was all a complete waste of yet more public money, and no one was any the wiser.
It was different on Capitol Hill, where they dealt with the present, not the past, with today’s crisis rather than yesterday’s mistakes. Ben Bernanke kept a pretty straight face, but the questions were searching. Helicopter Ben of the Unreformed School of Keynesian Largesse said: ‘It’s cheaper for us now on a national scale if we do more now,’ which solicited a question as to where all this largesse will eventually lead.
Bernanke’s answer was impeccable: ‘Inflation.’ When it was pointed out that the Fed’s balance sheet had swelled from $800 billion to $2 trillion in just three months, Bernanke smiled – ‘That’s only the beginning’ – but laughed outright at the idea it could grow to $10 trillion.
When Geithner had sat down too, after delivering his Financial Stability Plan with all the important bits left blank, the Dow Jones had already reacted by sinking by 347.90 points, or 4.21 per cent, while he was still speaking.
The old adage of ‘Buy on the rumour, sell on the news’ was replaced by a new mantra: ‘Sell on the non-news.’ Somewhat disturbingly, the middle line of breaking news at the bottom of Bloomberg’s screen kept running the line: ‘J&J gets EU approval for first Premature Ejaculation Pill’.
There was a distinct smell that had been revealed: no one knew what had to be done exactly, it was all taking too long anyway, the crisis was far worse than the incoming administration had believed, their plans were not formulated at all by Inauguration Day, the crisis was moving and deepening at an accelerating rate, the economic stimulus of $787 billion was a drop in a bucket that wouldn’t affect the big picture any time soon, more was required – but of what? – and there was a deep unease amongst the Senators that all was not well in the State of America and that the Central Bankers and Government were no longer in control.