View more on these topics

Brown is playing a risky game of snap

US President Barack Obama has a reputation as a pretty cool poker player, which may explain the massive gamble he is taking on turning the US economy around.

On the other hand, Prime Minister Gordon Brown’s preferred card game seems to be snap, which would explain his obsequiousness towards Obama during his recent visit to Washington.

The fact is that the PM’s political survival and the stability of our banking system depend to a frightening extent on whether Obama is playing a winning hand.

This dependence became apparent when the government announced it would take a majority stake in Lloyds Banking Group to insure £260bn worth of toxic assets.

Together with a similar deal with the Royal Bank of Scotland, this brought taxpayers’ exposure to toxic funds to a staggering £585bn.

One might ask – who needs Fred the Shred when we’ve got Brown the Clown? But like it or not, he is captain of the good ship Britannia and if Obama is lucky, let’s hope Gordon can shout snap.

The trouble is that this luck will have to come along sooner rather than later because nobody knows what will happen to the value of the mountain of toxic assets if the situation in the US and UK mortgage markets gets much worse.

After all, asset values depend on banks’ willingness or ability to lend and our government has yet to solve that problem.

Recommended

Look East and pray China pulls through

Will US President Barack Obama’s massive economic rescue plan lift the world out of the slump? While the UK slides into the unknown with a programme of quantitative easing, the smart eyes are not looking to the West but the East.

Job market pessimism dents housing optimism

Over half of people now believe that it is a good time to buy property, but uncertainty surrounding their personal circumstances is denting their confidence, shows the Building Societies Associations Property Tracker survey.

Guide cover

Guide: how to… communicate with your pension members

Effective communication of your pension scheme is a large part of getting auto-enrolment right. Delivering the same message to all employees is not necessarily the way to go. To assist you with the communication of your pension scheme, we have provided some key areas to think about, such as:

  • What to consider when segmenting your workforce
  • How to communicate to pension scheme members at the right time in their member lifecycle
  • What topics you should be discussing with your pension members
  • The new pension freedoms and the importance of communicating them