Retail vs Investment Banking

I’ve no idea what long term this change will make, but was delighted to receive this notification from my UK Bank, first direct, and HSBC subsidiary.

Something we are (very) unlikely to see here in the US in the near future.

Letter from HSBC

What is says is

We wanted to let you know that in line with new regulations introduced after the global financial crisis, later this year HSBC will be changing the way it’s structured in the United Kingdom (UK).

The new rules mean all banks with deposits of UKP 25bn or more will have to keep their “retail banking” business seperate from their “wholesale and investment banking” businesses, also known as ‘ring-fencing’.

Of course, this won’t stop another global financial meltdown, but at least in principle, they won’t be gambling with our money. If it happens it will still have as dramatic impact since the stocks, shares, futures, and companies will be hit the same way and everything will lose value as it did before. When all is said and done though, this is a good move.

Your move Elizabeth Warren.

insidious greed – HSBC

If you’ve not been following along today, it’s well worth reading back through the BBC Business Live News feed on the HSBC Tax Avoidance scandal. It is indeed the perfect example of the sort of insidious greed that is destroying society today.


It’s not just the “me” culture that is all around us, but the industry and culture that is behind it. Rather than pay taxes now, there is a whole industry on tax-avoidance. It’s become an accepted practice, mostly illegal, certainly immoral and to deflect interest in their actions, just like with the bully at school, they deflect criticism and investigation away from their own failings, by making a big deal about those who can least defend themselves.

The amount of tax avoided, mostly illegally, by the HSBC 7,000 will have gone along way to dealing with many of challenges that the UK is currently facing, and the austerity measure they are taking.

Add to that the same offshore tax dodges being employed by large companies, and the industry of sleeze ball consultants, awarded for advising, aiding, and making this possibly, doing everything from advising, writing, and ultimately even joining governments to implement tax policy that facilitates this has got to stop.

It’s easier to blame welfare cheats, immigrants, in fact anyone than themselves. Here in Texas we have both past Governor Perry, and current Governor Abbott continually railing against the Federal Government. Under Governor Perry, we had the HHSC(Ed: no relation) contract scandal, with the State going with a no-bid contract, with little oversight and unclear results to again go after the “little people“. It’s much easier to make them the problem than deal with the problem of insidious greed of the wealthy and their legions of shills.

hsbc taxWatch this extract from the BBC Panorama show to get a quick summary, or read the summary here.