My full 18-minute interview with Gillian Tett for Reuters TV, talking about Gillian’s new book, is now up:
I definitely make a better blogger than TV presenter, but there’s some good stuff in here all the same, I think.
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I thought that went well. I was surprised the ratings agencies and the ease with which they signed off on AAA standing didn’t come up — perhaps that is something that is now just understood to be so much a part of the back story that it doesn’t need mentioning, but I think it’s too soon to stop reminding listeners/readers/folks of their role in the storm that gathered.
Gillian, Gillian! Tell us more about the covert government support for banks please!
I’m still puzzled by the logic. We use investment X because it falls outside the range of laws about capital requirements. No one forced us to do this, although we will someday claim that incentives are akin to uncontrollable urges. So, X has less collateral, etc.
Now, unless I’m mistaken, the capital requirements have to do with risk. In fact, even X has a capital requirement, so it must accepted that this requirement has something to do with risk. Lower capital requirements are riskier. The higher requirements lessen risk.
But wait, if X has a lower capital rate than the other regulated investments, that must mean it’s safer. Musn’t it? That seems to be the logic here. It’s like investing with Penn and Teller. Please explain to me how riskier investments become less risky. That’s all that I’m asking.
I did not realise until now that you were a Brit – not that it matters :-) but one would not guess it from your writing style
P.S. The anti-spam word is impossible to decipher, and difficult to hear