DURING stock market trading last Friday more than £12.8bn was wiped off the value of the UK’s bank stocks as the rumours of ‘bad American loans’ swept through the stock markets, along with predictions of an economic and political disaster.
The FTSE 100 plunged by more than 1.7% in London, while HSBC, the second most valuable company on the FT, and rivals Lloyds Bank and NatWest plummeted by 2.5% each.
Global stocks were hit the hardest overnight, with Wall Street’s so-called ‘fear league’ climbing to its highest level since Trump launched his ‘liberation day’ tariffs in April.
The Chicago Board’s Options Exchange Volatility Index jumped by 14.5%, delivering a heavy blow to banking shares.
Bitcoin also plunged, dropping by as much as 5.3% to $103,550 just one week after it hit a record high above $126,000.
In fact, the network of loans handed out by US banks amount to an exposure of $4.5trillion in loans from financial institutions outside the banking sector.
Last week, the head of the IMF Kristalina Georgieva admitted that the so-called shadow banking sector kept her awake at night!
Joacim Klement, an analyst at stockbrokers Panmure Liberum, said that it was impossible to assess the scale, of exposure to major losses in the private credit market. He added that: ‘Given the lack of transparency it is currently impossible to assess how big is the exposure of individual funds and banks.’
The world capitalist system is heading for its biggest ever crash and a huge crisis, that is the ‘death agony’ of capitalism. There is only one way out of this desperate crisis of an out-of-date system that is incapable of further development and which needs to be consigned into the dustbin of history.
War was seen as the way out of the crisis, yet already almost £7bn has been wiped off Britain’s biggest arms manufacturers after the US president unveiled plans for new peace talks over Ukraine.
Yesterday, Defence and Aerospace giants BAE and Rolls Royce were struck by a £6.7bn sell-off in London with both slumping by 3.9%.
British capitalism is at the centre of the world crisis of the capitalist system that is now facing a massive collapse and is looking for a way out through new wars, collapses and a massive slump that is already developing.
In this situation of growing world capitalist crisis, the working class and its trade unions must insist that there must be no sackings and that there must be a sliding scale of hours and wages so that the working class does not lose out in the crash that is developing and be forced to pay the price for the capitalist crisis through savage mass sackings and wage cuts.
In the face of this developing crisis, there must be an emergency meeting of the TUC General Council to defend the jobs and wages of the working class by organising a general strike to nationalise the banks and all of the major industries in the UK.
In fact, the TUC must be made to call a general strike to bring down the Starmer government and bring in a workers government that will fight for a worldwide planned socialist economy.
The TUC must now be made to call an Emergency Congress to mobilise the working class for a general strike to bring down the Starmer government and bring in a workers government and socialism.
The TUC must also reach out to the working classes of Europe, the USA and the Americas.
The workers of the world must be mobilised to carry out the world socialist revolution, to consign capitalism to the dustbin of history and bring in a worldwide planned socialist economy.
This will dump backward capitalism into the dustbin of history and bring in a world socialist economy whose motto will be: ‘From each according to their ability, to each according to their need!’
