A run TO the bank ?!

Northern Rock, the UK bank that was nationalised to avoid a run on the bank, is now experiencing one of those Bizarro World reverse universe events.

Rock turns savers away after becoming too popular

Northern Rock was forced to close several of its most popular savings accounts yesterday after a rush of savers panicked by the near collapse of HBOS and Bradford & Bingley switched their deposits to the government-owned bank.

The bank, which was nationalised in February, said it had been flooded with money over the past two weeks and the inflow threatened to breach its commitment not to attract more than 1.5% of all UK deposits.

Northern Rock might have to turn away savers

Rock removed a number of savings products from the market this week to stem inflows, but experts said that this was unlikely to deter savers scrambling for havens after recent banking turmoil. If the cash inflow lasts, Rock could reach its limit in the next few days, forcing it to stop taking money from new customers.

Alex Potter, an analyst at Collins Stewart, the broker, said: “Clearly people are nervous about the banking system, so it could be just weeks or even days before we see Northern Rock close its doors to new savers.”

As the events of September have shown, Hank Paulson may have finally gotten around to take up Guambat's suggestion: It's such a good idea, why doesn't Paulson nationalize Countrywide (and all the others while he's at it). And if the pork-barrel bail out stabilization bill passes, the Northern Rock Reverse Run may point to better times ahead.

Having just seen the Veep Debates, Guambat reckons Palin didn't come off half bad, and now he's beginning to wonder if maybe he has Northern Rocks in his own head.

We are knee deep in the Chinese curse of living in interesting times.