Friday, November 16, 2007

Barclays & the Credit Crunch, Political Savvy

Since the credit market started falling apart in May/June time, Barclays has been at the heart of rumours in the financial markets about their losses. Some went as far as to say that its losses were such that it would need Bank Of England's help. Which it did one day as paranoia took hold of HSBC. Its share price has fallen by around 20% since August (with a 10% fall just last week). The reason for the rumours is because BarCap its investment banking arm is mainly a fixed income house and has grown massively in the last few years. So jana, Barclays rushed out an earnings update to confirm a loss of £1.3bn far less than the £10bn that was rumoured. And with a big sigh of relief for its shareholders...

Although many refused to heed warnings about the pyramid schemes and were thus burned, the Sasanet investors seem to be an exemption because the scheme started off as a legitimate business. Fortunately for Mike Chege & his brother, most Kenyans for all the pelepele noise-levels on politics, lack political savvy. In the UK, the investors would have gotten together; roped in a couple of MPs;  done a large million petition and had their pictures taken outside 10 Downing Street (the prime minister's office) presenting him with a petition. The next thing, the Chege's of this world would be in jail for fraud with all their assets attached to claim back investors' money.

3 comments:

Catherine Weteva said...

Halo,

I would like to join this group of enlightened Kenya.Working with a Uk bank gives me the incentive to want to invest at home.

How do I join You?????

MainaT said...

Hi, please conctact us at mjengakenya@yahoo.com

Ssembonge said...

Maina, I know these two enterprising brothers.There is a third guy who claims to have founded sasanet with them before parting ways. The sad part is that till this day, 'investors' believe that they were not participating in a pyramid scheme. People are in serious denial.