Scottish banks fall from grace

So, the Credit Crisis. The problem, as distant and invisible as it was, started in the US when the financial giants decided the way to increase growth was to sell credit [mortgages] to those with low credit ratings. Bad debt of course isn't something you want on your books, so they packaged them up along with better quality debt and sold them on as securities. This almost made sense until the investment banks, who didn't really know much about mortgages due to the fact it was historically a business exclusive to the retail banks, starting buying them, re-packaging them, and selling them on to retail and investment banks alike.

So, if my understanding is correct, we ended up with a very expensive game of musical chairs. When it started coming to light that much of these securities were in fact laden with bad debt and therefore worthless, the music stopped and the banks started to realise the sheer scale of the risk they'd taken on, and promptly stopped lending to, well, everyone. Liquidity dries up, almost overnight, and the banking giants start peering down the long dark tunnel into oblivion.

I've simplified this for my own understanding and have undoubtedly lost important concepts in the process, but in the end, the banks were naive, greedy and ultimately reckless. Perhaps it's entirely deserved that those organisations have failed, but what about the employees who've lost their jobs? (What about the employees of all the other companies who've gone bust?). What about national pride?

One of the world's oldest banks, the Bank of Scotland (HBOS), has now been sold to an English conglomerate, Lloyds TSB. One of the world's largest banks, The Royal Bank of Scotland (RBS), is now 70% nationalised. Both are disgraced and diminished. They've fallen from grace with the Scottish, and British population.

Iceland's financial sector has collapsed taking the government with it. Many British individuals and organisations, both public and private, have lost fortunes. Iceland as a whole seems to have fallen from grace with Britain.

The great technical and financial powerhouse of Japan is in recession, as is half of Asia and Europe.

And of course, where it all started, in America, some of the country's greatest and most respected financial institutions have disappeared overnight leaving not just the nation, but the whole world, in an economic meltdown.

I'd love to think that we, the human population of the world, will learn from the mistakes made but I know we won't. Those with the desire for power and the greed for money will always screw it up for themselves, and everyone else.

I understand why some people that I know really just want to grab a wind turbine, a few solar panels, and retreat to a cottage on the Isle of Lewis to live in blissful isolation of the world. But, alas, I'm a city kid, a digital kid, and I'll never convince myself to ignore the world. Like most of us, then, I'll continue harbouring a vague resentment of the world and our ways, and a frustration towards society and its flaws. I'd love to live to see the day we reach the utopian ideals of a planet working in harmony for the greater good.

Ha. I'll just stick to drinking beer and doing what I can for the communities in which I circulate. Just, someone, pat me on the head and tell me they understand. Lol.