Fed eyes Nordic-style nationalisation of US banks

[dkf]

The US Federal Reserve is examining the Nordic bank nationalisations of the 1990s as a possible interim solution to the US financial crisis.

A senior official at one of the Scandinavian central banks told The Daily Telegraph that Fed strategists had stepped up contacts to learn how Norway, Sweden and Finland managed their traumatic crisis from 1991 to 1993, which brought the region's economy to its knees.

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged. Two of the country's top four banks - Christiania Bank and Fokus - were seized by force majeure.

"The law was amended so that we could take 100pc control of any bank where its equity had fallen below zero. Shareholders were left with nothing. It was very controversial," he said.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/31/cnfed131.xml

[trotsky]

1. Lessons to be learned

"Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged."

Sounds like a great place to start.

[MannyGoldstein]

2. That Would Be Great

But I doubt it'll happen, unless the entire BFEE has had time to pull their investments out of bank equities.

[hobbit709]

3. The problem is that the Federal Reserve is NOT the government.

[Uben]

4. They won't do it, it makes too much sense!

For some odd reason, here in the U.S., no one has to be accountable for their actions. How many have gone to jail for the current financial crisis? None! Every institution that participated in the predatory sub-prime loans should be closed, their assets liquidated. The officials at those institutions should be jailed for fraudulent practices for at least twenty years. Any persons who qualified loan applicants by exagerating their incomes or not checking the applicants claims should lose their right to approve loans and be heavily fined or imprisoned for their actions. It will never happen, though. These scumbags will walk just like Libby did.

If I were King, the guillotine would be well greased and operating in America. You cheat, you lose....period!