The FTSE dropped more than 5% today following fears of USA recession.

I wrote a blog entry last week, http://www.trumpo.com/blog/business/what-next-from-the-uk-plc-mad-house/ and one week on my comments unfortunately are starting to ring like frantic alarm bells.

I can see big falls over the coming weeks as the UK banks struggle to make the books balance following the introduction of “BASEL II” the new framework for which UK banks now manage their balance sheets and capital positions.

Standard and Poor, the rating agency, have stated that UK Banks are among the most thinly-capitalised in the developed world.

In the UK we have a worrying situation in that UK banks are estimated to generate £12.8 BN in free cash flow, but are committed to paying out £14.6 BN in dividends? So UK banks are already looking at the year ahead being asked to increase capital reserves while shareholder expected expenditure is potentially higher than income ?- It doesnt add up; hence the battering of UK’s Bank’s share prices…..

Watch out UK consumers; the europeans are coming to a street near you soon - maybe Newcastle United’s form will change with a new shirt sponsor , maybe the big Swedish Bank  such as “Handelsbanken” the Huge Dutch savings Bank “ING” or the Icelandic Bank “ICESAVE”

Lock up your wives and kids savings - the Vikings are coming…

Watch this space!

Hey ho..

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