A Fond Hope

Both the nuclear energy industry and the tidal energy industry are prepared to build new generating capacity but only if the taxpayer guarantees the return of their investment. This is a new kind of capitalism – one which will only take risk if every conceivable risk is covered. The risk reward ratio for these projects, if implemented with a taxpayer guarantee would be virtually 1:100,000. Continue reading

The True Worth of a Government Guarantee about your Bank Deposits

The European Union has 27 member states. Virtually all of them have had economic problems. In virtually all the economies, the economic problems were caused by over spending. Nations in effect bribed the voters with gifts of large pensions and large social security payments which the nations could not afford. Those gifts would be paid for by future generations unless the future amounts of the bribes were curtailed, and thus “austerity” became the solution for most of the economies.

But not all of the economies got into economic difficulty by making large bribes. Certainly Italy, France, Greece, Spain and Portugal did, but certainly Cyprus did not. It got into difficulties by investing its depositors money in Greece and in particular the Cypriot banks lent money to the Greek banks that proceeded to lose the money lent. Continue reading