Northern Rock - The City knew on 27th June what a crock of shit NR was - but not the FSA / BOE or the Treasury
In the wake of the HOC Select Committee report Lord Patel mused on the small item of the Directors of Northern Rock deciding to raise the divvy by 30.3% see post on Saturday and how this was possible as the capital requirments ad been adjusted as the FSA approved a waiver under Basel II regulations.
The arguments, whilst they can be followed with care were explained explained on p 14/15 of the Interim results. Impenetrable to many, but not to all ... just look at the enormous leap in dealings in NR shares and the share price drop as soon as the results were produced.....
Mr Adam Applegarth said the "world changed on August 9th" ... no,no,no it changed when the greedy Directors decided to whop up the Divvy ... and the City took noticed and unloaded.
Here was a company selling 20% of the mortgages raised on domestic property in the UK, raising the divvy by a third and the market .... didn't rush for a share of such wonderful action , they dropped them like a hot cake.
There were plenty of people in the City who knew what a steaming pile of crap was hidden on that Interim (and of course unaudited) Balance Sheet.
The Fucking Stupid Authority and Sir John Gieve (famous in house liar for Home Secretary Blunkett who left the Home Office wih accounts that the Official Auditor would not pass) at the BOE just sat and watched.