In the same week as the US government bailed out its two main mortgage suppliers Fannie Mae and Freddie Mac, Bank of England governor Mervyn King warned Prime Minister Gordon Brown against a similar move for fear it might undermine the banks.
Heaven forbid the government or BoE should interfere in the running of the banks, the firms they are supposed to be monitoring that got us into this mess in the first place. All our hopes hang on the findings from Sir James Crosby’s review of mortgage finance.
Brown and co came up with a mortgage rescue plan of sorts at the beginning of the month, but as we show in this week’s cover story, it has been put in the shade by US plans.
Even if the suggestions put forward by Sir James are enough to save the market, will chancellor Alistair Darling and Brown have the guts to follow them through?
The UK has always adopted a follow-the-leader approach when it comes to the US and many a bad decision has been made because of it.
We’ve blindly followed the Yanks into war, adopted their fast food culture and even embraced David Hasselhoff. So why, when it comes to bailing out lenders – one of the US’ better ideas – do we suddenly choose to go our own way?
The US may have got us into this mess but at least it has a plan. What do we have – the not-so dynamic duo of Brown and Darling waiting on the conclusions of a report that may or may not recommend a solution. And the government wonders why we have lost faith in it.