RBS, Lloyds Get $51 Billion in Second Bank Bailout
By Jon Menon and Andrew MacAskill
Nov. 3 (Bloomberg) -- Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc will receive 31.3 billion pounds ($51 billion) in a second bailout from the U.K. taxpayer in return for putting a cap on bonuses.
The Treasury will inject 25.5 billion pounds of capital into RBS, for a total of 45.5 billion pounds, making it the costliest bailout of any bank worldwide. The government will fund about a quarter of Lloyds’s 21 billion-pound fundraising. Both banks said they won’t pay cash bonuses to workers earning more than 39,000 pounds this year.
Full article at http://www.bloomberg.com/apps/news?pid=20601087&sid=a9MBFPNg_6mY&pos=1
My comments:
Gold has currently been sold down to a little below US$1060 on this news that should really be gold positive but then again, investors conditioned by last year's GFC unthinkingly, automatically expect everything to play out the same way again.
So we see Dow futures down about 100 80 points. The euro is down nearly 1% against the US dollar in a lemming like conditioned rush to the "safety" of the US dollar.
This news of more major bank bailouts has clearly spooked those who have been looking at the financial system through rose coloured glasses.
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