Confused? They are!

They here refers to the Saviour of the World and also the Council for Mortgage Lenders, although it is the confusion of the first which has caused confusion for the latter.

I quote the Director-General of the Council of Lenders:
"Current policy objectives are conflicting and incoherent. The Government needs to decide on its key priority."

You would think, from all the jumping up and down by the government that its central priority is to encourage greater lending to house owners/buyers and to business.

The Director-General explains. "To different degrees lenders are facing conflicting pressures to recapitalise against possible future losses, service government shareholdings at 12%, pay a premium to access the Bank of England Special Liquidity Scheme, show forbearance to borrowers in arrears, follow base rates down to help their existing customers, keep savings rates high in support of existing savers, and provide competitive rates to new borrowers and savers to maintain economic activity in a recession."

As if this were not enough, the D-G continues, "And they are supposed to ensure their long term financial stability to help the UK economy rebuild itself when we are out of the recession. "

The conclusion is, "The tug of war with lenders being pulled in every direction at once needs to end."

The complaint echoes the words of Angela Knight, the spokesperson for the Bankers, whom I referred to a week or two ago,

The government is desperate, having encouraged and created the mountain of private and public debt, dithered over Nothern Rock the fist apparent casualty, its failure stands ready to be revealed. Perhaps the plunge of sterling is a sign that foreigners recognize what the government cannot or will not admit.

In any event it is no good brow-beating the lenders for not lending enough, when they are already lending as much as they did in 2007, or cheaply enough after base rate cuts, when they have increased the banks costs.

The banks, if they are to avoid becoming illiquid again, must build up reserves, pay extortionately to service debts to the government and also repay the debts, and all this at a time when private deposits are inadequate to cover lending and interbank lending is still hesitant through fear of more off-balance sheet rubbish assets. The shareholders, including pension funds, who are innocent and in many cases rely on dividend income, must suffer and wait. There is no government sympathy for them.

Superman must decide what he wants the banks to do. He has made the mess by throwing confusion into the regulatory system and running up great debts in prosperous times. Making the lenders jump through conflicting hoops really does not help very much.

Unless his objective is to pass the buck and claim that someone else is really the guilty party?