"Startled rabbits in the headlights of an uncertain future"

I’m not alone. Given the chance, wouldn’t we all like to predict the future. And in the last issue of the Score, it would appear that is exactly what I did. I suggested that the worst all results would be a hung Parliament.

So am I trying so say there’s no political solution to the mire we are all wading through? I suppose I am. Do I think the radical policies of the current administration will achieve the projections? I honestly don’t know.

What I do know is that we’ve been digging this hole for going on 20 years, working on the basis that as long as profit exceeded default and property prices continued their upward spiral, we could sustain lending levels and remain in the comfort zone we’ve built for ourselves in that period.

Due diligence, fiscal proberty, responsible borrowing and lending ... all phrases we associate with the halcyon days of banking before the brakes were taken off in the late eighties and the throttle opened up fully when Gordon Brown’s first act in office was to give the Bank of England self governance, including interest rates.

Unfortunately, gone are the generations that fully understand the meaning of such phrases. They are now being trotted out as soundbites for a public desperate to believe that the solution to all our woes lies with a Government that is full of good intentions and populist policies.

Government can only legislate. In other words, put the brakes back on, which appears to be exactly what the Budget and subsequent announcements presage. Was the FSA the sacrificial lamb, or the author of it’s own demise?

That debate will run and run.What is certain is that the banks are as startled rabbits in the headlights of an uncertain future.

To all intents and purposes they’ve stalled.Despite all the guarantees, they are still nervous. Alistair Darling’s attempt to fuel recovery have by and large come to nought. Loan to Value rates remain fixed, businesses in particular are finding access to credit scant to say the least,and even the banks themselves seem reluctant to instruct collection and investigation agencies to the extent they once did.

Like many of their customer base, they too are adopting the ostrich stance. They don’t want to look into their portfolios because they already know that they will very definitely not like what they’ll see.

Perhaps the most unacceptable outcome of the last two years is that it was greed that engendered the recession, and it will probably be greed that starts any recovery.

However when that will be is anyone’s guess.That fabled double dip is now making its presence felt - the black dog on the end of the bed, as Winston Churchill described his depression.

by Godfrey Lancashire