One of the most curious aspects of the Northern Rock debacle is the government’s insistence that the bank’s loan book is fundamentally solid and that market conditions will soon improve. How can they be so very sure?
Yesterday, Alistair Darling continued to say that: “The Financial Services Authority continue to assure me the bank is solvent. It believes that Northern Rock‘s mortgage book is of good quality.” Just now, at the monthly 10 Downing Street press conference, Darling repeated his claim that “these are good assets”. Read more